Kansas unemployment tax rates will be determined with one of 13 tax rate schedules created to maintain the balance of the state unemployment trust fund, under a measure signed April 26, 2021 by Governor Laura Kelly.
The measure ( H.B. 2196 ), effective with tax rates determined for 2022, states that tax rates may be determined using a standard rate schedule, one of six solvency rate schedules, or one of six credit schedules. The schedule in effect is to continue to be determined by the state’s average high cost multiple, an estimate of the number of years that the trust fund could support unemployment benefit payments without the state needing to raise additional revenue or borrow additional funds.
When a solvency rate schedule is in effect, unemployment tax rates are to increase relative to the standard rate schedule, and when a credit schedule is in effect, tax rates are to decrease relative to the standard rate schedule.
The standard rate schedule is to be in effect when neither a solvency adjustment nor credit adjustment is in effect. Under the standard schedule, tax rates range from 0.20% to 5.40% for positive-rated employers and from 5.60% to 7.60% for negative-rated employers.
The measure also expands employee eligibility for participation in the state shared-work program. Employers may reduce the weekly hours and wages of participating employees by 10% to 50% of their normal work hours, whereas employers previously were required to reduce hours and wages by 20% to 40%.
Additionally, negative-rated employers will now be able to participate in the shared-work program when the employer’s most recently calculated reserve ratio has improved from the previous year’s reserve ratio. Prior to this measure, negative-rated employers were not allowed to take part in the shared-work program.
As always, we will continue to monitor this situation and provide updates as they become available. If there are any questions please do not hesitate to contact us or visit our website for the latest news and updates.