- What is Unemployment Compensation (UC)?
- What are my UC tax responsibilities if I hire an employee?
- How do I register for an Employer UC account number?
- How do I know what my Employer UC account number is?
- How do I know what my contribution rate is?
- How do I report my wages?
- Do I have to use the Department's Forms UC-2/2A?
- Where can I get information / specifications about filing wage detail reports electronically?
- Where can I get information about filing quarterly wage and tax reports via the Internet?
- What is the difference between gross and taxable wages?
- What do I withhold from my employees?
- Is agricultural employment reportable for UC purposes?
- Is domestic employment (a maid or nanny) reportable for UC purposes?
- In a sole proprietorship, are my family's wages reportable for UC purposes?
- How do I get a Clearance Certificate?
- How do I tell you that my address has changed?
- My business is anticipating temporary layoffs. What should I do to prepare my employees?
- If I reduce the work hours of my employee(s), how will that affect their eligibility for UC benefits?
- What if I no longer have employees but expect to in the future?
- How do I close my business?
- What happens if my business has offered a job to an applicant who is receiving unemployment compensation benefits and the applicant refused the job offer?
1. What is Unemployment Compensation (UC)?
Unemployment Compensation (UC) is a form of income support against job loss. It provides an income to individuals who become unemployed through no fault of their own. UC benefits are paid, for a limited time, to individuals who are able and available for suitable work, but continue to be unemployed while looking for another job. To be covered by the UC program, a worker must have performed services covered by the Pennsylvania UC Law (Law), and must have worked for an employer who is required by Law or elects to pay into the UC Fund.
2. What are my UC tax responsibilities if I hire an employee?
The UC Law requires covered employers to make contributions into a pooled reserve known as the UC Trust Fund. These contributions are used to pay benefits to jobless individuals who meet the claimant eligibility requirements of the Law. Employers are required to report covered wages paid and remit contributions due on a quarterly basis. In certain calendar years, employers are also required to withhold a portion of an employee's gross wages and include this amount on the quarterly UC reports. All covered employers providing full and/or part time covered employment to one or more workers must be registered with the Department of Labor and Industry's Office of UC Tax Services.
All employers, whether or not liable for the payment of contributions, must maintain the following records so they can be made available for review by the Department when necessary: employment and payroll records, cash books, journals, ledgers, corporate minutes. These records must be retained for at least four years after contributions relating to such records have been paid. (Daily attendance records need not be retained for more than two years.) These records must be maintained at the place of employment or at a central location and must be available for inspection or audit by Department personnel.
3. How do I register for an Employer UC account number?
- The Online Business Registration Interview (OBRI) guides users through the process of registering an enterprise with the Pennsylvania Departments of Labor & Industry, Revenue, and State. It is designed for individuals who are unfamiliar with Pennsylvania taxes, services, and business registration requirements.
- The Online Version of the PA-100, PA Enterprise Registration Form is based on the paper document. It does not register the enterprise with the Department of State. It is designed for users who are familiar with the PA-100 process and know the taxes and services for which they need to register.
4. How do I know what my Employer UC account number is?
A Notice of Pennsylvania Unemployment Compensation Responsibilities (Form UC-851) is mailed to an employer when the registration information has been processed. It provides the UC account number assigned, as well as other important UC tax information.
5. How do I know what my contribution rate is?
A Contribution Rate Notice (Form UC-657) is mailed to employers at the end of each calendar year and shows the rate effective for the coming calendar year. This percentage is to be applied to taxable wages paid (refer to the taxable wage base
chart) to determine the amount of employer contributions due.
6. How do I report my wages?
Employers report their quarterly wages and contributions due on the Employer's Report for Unemployment Compensation Quarterly Tax Forms.
The easiest and fastest way to file UC reports and pay contributions is electronically via UCMS
, or you may use department issued forms.
7. Do I have to use the Department's Forms UC-2/2A?
No, reports can be filed electronically via UCMS
Employers submitting paper UC-2/2A reports are expected to use the Department-issued forms as they were specifically designed to be machine read by our scanning equipment. The purpose is to provide employers with a report format that will maximize the accuracy of the data and minimize Departmental administrative costs funded through employer taxes.
Department-issued UC-2/2As cannot be photocopied and filed as the red ink will not reproduce onto the copy and the scanning equipment will not be able to read the document.
8. Where can I get information / specifications about filing wage detail reports electronically?
9. Where can I get information about filing quarterly wage and tax reports via the Internet?
Information about Internet filing can be obtained from our UC Management System page
or you may call our UC TAX Information Line at 1-866-403-6163 or, if within the Harrisburg area, at 717-787-7679, from 8 a.m. to 4:30 p.m., Monday through Friday. You may also email us at UCemail@example.com
10. What is the difference between gross and taxable wages?
Both gross and taxable wages are reportable on Employer's Report for Unemployment Compensation.
Gross wages are the total amount of wages paid to an employee. This includes salaries, wages, commission, bonuses, overtime pay, incentive awards and tips; basically, all remuneration defined as wages in the PA UC Law
Taxable wages are determined annually by law. (Refer to the taxable wage base
11. What do I withhold from my employees?
In certain calendar years, employers are required to withhold a portion of an employee's gross wages and include this amount on the quarterly UC reports. The amount of tax to be withheld is determined by multiplying the employee's gross wages for the payroll period by an annually determined employee contribution rate
. The taxable wage base
does not apply to employee contributions.
12. Is agricultural employment reportable for UC purposes?
An agricultural enterprise must report wages paid to employees if the enterprise:
- employs at least 10 full-time or part-time employees for any part of a day in 20 or more calendar weeks in the current or preceding year, or
- pays $20,000 in cash wages in any calendar quarter of the current or preceding calendar year.
13. Is domestic employment (a maid or nanny) reportable for UC purposes?
Individual homeowners, local college clubs, fraternities or sororities paying a domestic employee $1000 or more in cash wages in any quarter in the current or preceding calendar year must report those wages.
14. In a sole proprietorship, are my family's wages reportable for UC purposes?
Wages of an individual employed by his son, daughter or spouse are not covered wages for UC purposes. Wages of a child under the age of 18 working for a parent are not reportable for UC purposes. "Family" also includes stepchildren and their parents, foster children and their parents and adopted children and their parents.
15. How do I get a Clearance Certificate?
If you have already been assigned an account number, you may request a Clearance Certificate in UCMS
or you may contact the:
Office of UC Tax Services
Room 916 Labor & Industry Building
651 Boas Street
Harrisburg, PA 17121
16. How do I tell you that my address has changed?
To change an address, you can log into your UCMS
account and change your address or complete Form UC-2B, Employer's Report of Employment and Business Changes
. This form should be mailed to: Department of Labor and Industry, Office of UC Tax Services, Registration and Document Management Section, 651 Boas Street, Room 908, Harrisburg, PA 17121.
17. My business is anticipating temporary layoffs. What should I do to prepare my employees?
Form UC-1609P, Employer Information
, is designed to provide employees with accurate employer information to use when filing an application for UC benefits. Completing this form and providing it to employees at the time of layoff ensures that the employer information provided to us is significantly more accurate, which assists the UC Service Center in processing the claim for UC benefits.
18. If I reduce the work hours of my employee(s), how will that affect their eligibility for UC benefits?
Where a claimant works less than his full-time hours through no fault of his own, the claimant may be potentially eligible to receive full or partial benefits, depending on his gross earnings and Partial Benefit Credit (PBC). A claimant's PBC is the amount equal to 30 percent of his Weekly Benefit Rate (WBR). Where a claimant is working less than his full-time hours and his gross earnings for a week are equal to or less than the PBC, the claimant's full WBR is payable for the week. When the claimant's gross earnings for a week exceed the PBC, the gross earnings are deducted from the sum of the WBR plus PBC to determine the amount of any partial benefits for which the claimant may be eligible. NOTE: If the claimant's gross earnings for a week are not a whole dollar amount, the earnings are rounded up to the next dollar.
If the claimant's gross earnings for a week are equal to or greater than the sum of his WBR plus PBC, no benefits are payable for the week even though the claimant may have worked less than his full time hours. A claimant working his full time hours is not eligible for UC, regardless of the amount of earnings for the week.
The following examples illustrate how the amount of any partial benefits payable to a claimant who worked less than his full time, is calculated. In each example, the claimant was determined financially eligible for a WBR of $100. The PBC for each example is therefore $30 (30 percent of $100).
Example 1: The claimant's earnings for the week are $29. As $29 is less than the PBC, the claimant is eligible for the full WBR ($100) for the week.
Example 2: The claimant's earnings for the week are $30. As $30 is equal to the PBC, the claimant is eligible for the full WBR ($100) for the week.
Example 3: The claimant's earnings for the week are $31. As $31 exceeds the PBC by $1, the claimant is eligible for partial benefits of $99 ($130 - $31 = $99).
Example 4: The claimant's earnings for the week are $31.01. The $31.01 is rounded up to $32.00. As $32 exceeds the PBC by $2, the claimant is eligible for partial benefits of $98 ($130 - $32 = $98).
Example 5: The claimant's earnings for the week are $132. As the claimant's weekly earnings exceed the combined rate sum of the WBR and PBC, the claimant is ineligible for UC benefits for that week.
19. What if I no longer have employees but expect to in the future?
When employment has discontinued, but is expected in the future, the enterprise may continue to file the quarterly UC reports, indicating that no wages are being paid. This will cause the UC account to remain active, and the enterprise will continue to receive all mailings. When employment commences, the enterprise will again file quarterly UC reports showing that wages are being paid.
Note: If no wages are paid for four consecutive quarters, the Department will automatically remove the enterprise from the active employer files.
20. How do I close my business?
To discontinue business in PA for UC purposes, you may log into your UCMS
account and close your business electronically or complete Form UC-2B, Employer's Report of Employment and Business Changes
. Indicate the date employment was discontinued and the date gross wages were last paid. This form should be mailed to: Department of Labor and Industry, Office of UC Tax Services, Registration and Document Management Section, 651 Boas Street, Room 908, Harrisburg, PA 17121.
21. What happens if my business has offered a job to an applicant who is receiving unemployment compensation benefits and the applicant refused the job offer?
Section 402(a) of Pennsylvania Unemployment Compensation Law provides, in part, that an employee shall be ineligible for compensation for any week in which their unemployment is due to failure, without good cause, to accept suitable work; provided that the employer who offers the work notifies the department of the refusal within seven days from when the offer is made.
The department has created a new form, UC-1921W, so employers can notify the department that suitable work was refused. The form can be saved, printed, and submitted directly to the department online. Be an active partner in helping to improve the integrity of unemployment compensation payments. Notify the department within seven days of the offer by submitting the form, UC-1921W
, online. If you prefer to send the form via facsimile, please complete, print, and fax the form with any additional documentation to UIAS at 717-772-0378.