With the holiday season quickly approaching, many employers are increasing their employee count to manage increased customer traffic. When hiring and re-hiring seasonal help always remember one of the basics –New Hire Reporting. Since 1997 companies have been required to report information regarding newly hired and rehired employees to state agencies.
The definition of a newly hired employee includes an employee who was previously employed by the employer but has been separated from that prior employment for at least 60 consecutive days.
All states have laws mandating new hire reporting and setting out the procedures to be followed. (Click here: State New Hire Reporting and Contacts and Program Info). New Hire Reporting info is used to uncover fraud and abuse in: the collection of child support, unemployment compensation, workers comp and public assistance benefit programs.
Many companies utilize payroll or payroll tax providers – businesses often times offload the responsibility of new hire reporting to their payroll/payroll tax partner. Regardless of who is reporting new hires, the following information must be provided:
- Employer’s name, address, phone number and federal employer identification number
- The state to which the employer will report new hires and the date on which multi-state reporting will begin
- Other state in which the employer has employees
- Employer contact information (name, title, phone number, email address, fax number)
- FEIN, name, state and zip code of any subsidiary of the employer with a different FEIN for which the employer will be reporting new hires
Generally employers must report newly hired employees within 20 calendar days of the date of hire. States can establish their own time frames for reporting new hires, but they can be no longer than the federal requirements. An employee’s date of hire is considered to be the first day services are performed for wages by the employee, and employees who work for as little as one day must be reported. If you’re using a temp agency that pays wages to the employees, the temp agency is responsible for reporting them as new hires.
Non-compliance or failure to report new hires can become costly and add up quick. States have the option to set a civil penalty of up to $25 for a failure to comply with reporting requirements, with a $500 maximum if the failure is the result of a conspiracy between the employer and the employee. The state where you operate a business can provide complete instructions as necessary, regarding all aspects of its New Hire program and your responsibilities as an employer.