Kansas Unemployment Tax Presented to Wichita SHRM

SB-154 Maximum weekly benefit will now be based on 55% of the average weekly wage. Currently is at 60%. Will not be less than $ Minimum weekly benefit remains at 25% of Maximum weekly benefit. For 2016 and subsequent years the contribution rates to be determined by the “Fund Control Table” and the “Rate Schedule Table”.

How rates are figured Contributions Paid less Benefits Charged = Account Balance Divided by Annual Taxable Payroll for 3 prior years Determines Reserve Ratio and Rate Group

CONTRIBUTION RATES EFFECTIVE FOR CALENDAR YEAR 2015 FOR EMPLOYERS WITH A POSITIVE ACCOUNT BALANCE Rate Upper & Lower 2015 Rate Rate Upper & Lower 2015 Rate Group Reserve Ratio (in percent) (in percent) (in percent) UpperLower UpperLower

SURCHARGE ON NEGATIVE ACCOUNTS K.S.A a provides that negative balance employers shall pay contributions at the assigned rate of 5.40% and in addition shall pay a surcharge based on the size of the employer's negative reserve ratio. The schedule shown below provides the amount of surcharge that will be added to the assigned rate for calendar year Upper & Lower Assigned Rate 2015 Rate Surcharge to Negative Reserve Ratio (in percent) (in percent) Trust Fund (in percent) (in percent) UpperLower

New Rate Schedule SB to???? Standard RateSchedule Rate Group Lower Reserve Ratio Level Upper Reserve Ratio Level Standard Rate % % % % % % % % % % % % % % % % % % % % % % % % % % %

New Rate Schedule (Cont.) N % N % N % N % N % N % N % N % N % N % N11-1,000, %

SB 154 K.S.A a(a)(3)(D) (D) Effective rates. (i) For rate year 2016 and ensuing rate years, employer contribution rates to be effective for the ensuing calendar year shall be determined by the fund control table contained in this section. The average high cost multiple of the trust fund as of the computation date shall determine the contribution schedule in effect for the next rate year. For purposes of subsection (a)(4)(D)(i) and (v), the average high cost multiple is the reserve fund ratio, as defined by subsection (a)(4)(A), divided by the average high benefit cost rate. The average high benefit cost rate shall be determined by averaging the three highest benefit cost rates over the last 20 years from the preceding fiscal year which ended June 30. The high benefit cost rate is defined by dividing total benefits paid in the fiscal year by total payrolls for covered employers in the fiscal year. Fund Control Table Lower AHCM Upper AHC Solvency Adjustment Threshold Threshold to Standard Rate – % – % – % – % – % – % Reserve Fund Ratio Average High Cost Multiple (AHCM) = Average High Benefit Cost Rate Total Assets in Trust Fund Reserve Fund Ratio = Total Payroll for Contributing Employers in the Fiscal Year Average High Benefit Cost Rate = The average of the 3 highest Benefit Cost Rates over last 20 years. Total Benefits Paid in a Fiscal Year Benefit Cost Rate = Total Payroll for Covered Employers in the Fiscal Year.

Standard SB 154 Rates to 2015 Rates SB 154 Rate Schedule Standard Rate Lower Reserve Ratio Comparison to 2015 Rate Schedule Rate Group 10.20% Rate Groups 1-36 with rates of 0.07% to 4.15% Rate Group 20.40% Rate Groups with rates of 4.15% to 4.26% Rate Group 30.60% Rate Group 37 with rate of 4.26% Rate Group 40.80% Rate Groups with rates of 4.26% to 4.38% Rate Group 51.00% Rate Groups with rates of 4.50% to 4.62% Rate Group 61.20% Rate Groups with rates of 4.62% to 4.74% Rate Group 71.40% Rate Groups with rates of 4.74% to 4.86% Rate Group 81.60% Rate Groups with rates of 4.86% to 4.97% Rate Group 91.80% Rate Groups with rates of 4.97% to 5.09% Rate Group % Rate Group 44 with rate of 5.09% Rate Group % Rate Groups with rates of 5.09% to 5.21% Rate Group % Rate Groups with rates of 5.21% to 5.33% Rate Group % Rate Group 46 with rate of 5.33% Rate Group %9.295 Rate Groups with rates of 5.33% to 5.40% Rate Group %8.580 Rate Group 47 with rate of 5.40% Rate Group %7.865 Rate Groups with rate of 5.40% Rate Group %7.150 Rate Group 48 with rate of 5.40% Rate Group %6.435 Rate Groups with rate of 5.40% Rate Group %5.720 Rate Group 49 with rate of 5.40% Rate Group %5.005 Rate Group 49 with rate of 5.40% Rate Group %4.290 Rate Groups with rate of 5.40% Rate Group %3.575 Rate Group 50 with rate of 5.40% Rate Group %2.860 Rate Group 50 with rate of 5.40% Rate Group %2.145 Rate Groups with rate of 5.40% Rate Group %1.430 Rate Group 51 with rate of 5.40% Rate Group %0.715 Rate Group 51 with rate of 5.40% Rate Group %0.000 Rate Group 51 with rate of 5.40%

Acquisition of Existing Company Successorship [K.S.A (h)(4)(A)] occurs if the transaction involved the acquisition of substantially all of the employing enterprises, trade, business, organization, or assets of an employer by an employing unit. The transfer of factors is optional except in those transactions which involve the same controlling interest. Partial Successorship [K.S.A (h)(4)(B)] occurs when an employing unit acquires less than 100% of an employer’s annual taxable payroll and the partial successor employing unit is controlled substantially by the same interests as the predecessor employing unit and intends to continue the acquired percent as an ongoing business.. A mandatory transfer of experience rating factors is required. The partial successor will acquire the same percentage of the experience rating factors from the predecessor. [K.S.A (h)(4)(B)] The 120-day time limit for transfer of the rate and rate factors

State Information Data Exchange System: SIDES & SIDES E-Response Minimizes UI rates Electronic response to unemployment insurance (UI) information requests saves time and eliminates mailing delays Ensures accurate information exchanges Reduces administrative costs Addresses two of the greatest causes of UI overpayments

Audit Objectives 1. Ensure employer compliance with the taxing provisions of the law. 2. Promote employer knowledge and understanding of their requirements under the law. 3. Maintain a mutually beneficial employer-Agency relationship. Provide an effective and essential means of ensuring employer compliance with the provisions of the Kansas Employment Security Law.

AUDIT RECORDS List of records that will be examined, IF MAINTAINED. Disbursements Journal Chart of Accounts General Journal Payroll Journal Petty Cash Record Individual Payroll Records Supporting Journals and Ledgers Check Register (the record of all checks drawn) Check Stubs (of all accounts, if more than one is used) Cancelled Checks (for all accounts) All other records showing business expenditures Federal Forms: W-2 (Annual Wage and Tax Statement) W-3 (Transmittal of Wage and Tax Statements) 1120 or 1120S (U.S. Corporate Income Tax Return) 1096 (Annual Summary & Transmittal of US Information Returns) 1099 (U.S. Information Returns) 1065 (U.S. Partnership Return of Income) 1040 (U.S. Individual Income Tax Return) 940 or 940EZ (Employer's Annual Federal Unemployment Tax Return) 941 (Employer's Quarterly Federal Tax Return) 943 (Employer's Annual Tax Return for Agricultural Employees) Schedule H (Household Employment Taxes) State Forms: K-CNS 100 (Employer's Quarterly Wage Report and Contribution Return)

Audit Information Audit selection is random 2% of all Kansas Employers Audited Yearly No specific system of bookkeeping required Verifying business entity Type of ownership & FEIN Certifying all wages have been reported correctly or adjusted

Human Resources - Dictionary "Competitive salary" = We remain competitive by paying less than our competitors. "Must be deadline oriented" = You'll be six months behind schedule on your first day. "Some overtime required" = Some time each night and some time each weekend. "Must have an eye for detail" = We have no quality control. "Career minded" = Female Applicants must be childless and remain that way. "No phone calls please" = We've filled the job; our call for résumés is just a legal formality. "Seeking candidates with a wide variety of experience" = You will, in fact, be replacing three people who have just left. "Problem solving skills a must" = You're walking into a company which is in perpetual chaos. "Requires team leadership skills" = You'll have the responsibilities of a manager, without the pay nor the respect. "Good communication skills" = Management communicates, you listen, figure out what they want and do it