Unemployment Insurance Law Summaries
Maryland, Unemployment Insurance Law Summaries
Maryland's unemployment insurance law is located in the Annotated Code of Maryland, 1991, Labor and Employment, Title 8, Secs. 8-101 to 8-1505 (for full text, see Unemployment Insurance Reports UI-MD ¶4101 et seq. ); and in Regulations of the Department of Employment and Training, Title 24 of the Code of Maryland Regulations.
DEFINITIONS
“Employer:” One who employs one or more individuals for some portion of a day. Generally, employer who is subject to the FUTA is automatically an employer under the Maryland law.
“Employment:” Service, including service in interstate commerce, performed for remuneration or under any contract of hire, written or oral, express or implied, with exceptions listed below.
Service performed by individual for wages or under any contract of hire constitutes employment, irrespective of whether common-law master and servant relationship exists, unless and until it is shown that such individual is:
free from control or direction;
performing such service outside usual course of employer's business or outside all places of employer's business; and
customarily engaged in independent business of same nature as that involved in contract of service.
Service by an officer or member of the crew of an American vessel or aircraft is covered if management and control of that vessel or aircraft is within this state.
“Wages:” All compensation for personal services, including commissions, bonuses, tips, and the cash value of noncash remuneration (unless paid for service not in the course of the employer's trade or business. Note that certain payments are excluded from wages only for the purpose of computing benefit payments. “Wages” does not include:
Remuneration over $8,500 paid by employer to an individual during any calendar year with respect to employment. Wages for services in another state and wages paid by predecessor may be included in the first $8,500. Amount will be increased if federal taxable wage base is increased to an employer over Maryland's limit.
Other exclusions from wages are listed below.
COVERAGE
Generally, employer who is subject to the FUTA is automatically an employer under the Maryland law.
Service, including service in interstate commerce, performed for remuneration or under any contract of hire, written or oral, express or implied, with exceptions listed below.
Service performed by individual for wages or under any contract of hire constitutes employment, irrespective of whether common-law master and servant relationship exists, unless and until it is shown that such individual is:
free from control or direction;
performing such service outside usual course of employer's business or outside all places of employer's business; and
customarily engaged in independent business of same nature as that involved in contract of service.
Service by an officer or member of the crew of an American vessel or aircraft is covered if management and control of that vessel or aircraft is within this state.
Agricultural and domestic employers.- Agricultural labor is covered if performed for an employer who employed 10 or more workers in such labor for 20 different weeks in the current or preceding calendar year or paid cash remuneration of $20,000 or more for such service in any quarter of the current or preceding calendar year. When agricultural labor is supplied by a crew leader, the employing unit for which the services are performed is the employer of the crew members unless the crew leader is registered under the Federal Migrant and Seasonal Agricultural Worker Protection Act, or substantially all of the crew members operate or maintain mechanized equipment that is provided by the crew leader. In either of these instances, the crew leader is the employer. Note that the crew leader is also the employer if the individual performs custom poultry work, including harvesting, breeding, debeaking, sexing and health services and is not required to be away from the individual's permanent place of residence other than during normal working hours.
Domestic service.- Domestic service in a private home, local college club or local chapter of a college fraternity or sorority is covered if performed for an employing unit that paid cash remuneration of $1,000 or more in any quarter of the current or preceding calendar year for such service.
Government and nonprofit employers.- Coverage is mandatory for nonprofit organizations employing one or more individuals. The state and its political subdivisions are mandatorily covered. Other government services remain exempt.
Nonprofit organizations may finance benefit payments by the regular contributions method or the reimbursement method. Covered state governmental entities may also pay contributions or make payments in lieu of contributions.
Employers using reimbursement financing have a choice of the following methods:
payments equal to the full amount of regular and work sharing plus 50% of the extended benefits paid to claimants (100% for governmental entities); or
a variable percentage based on total payroll.
Under (2), employers are subject to an adjustment to reflect actual benefit costs.
Employment by an inmate of a custodial or penal institution for a not-for-profit organization or a governmental entity is not covered; however, services performed by such an inmate for a private, for-profit employer is covered if the inmate continues to be employed by the employing unit after being permanently released from the institution, including release by parole.
Nonprofit organizations that elect reimbursement financing are required to execute and file a surety bond or to deposit money or securities, including irrevocable letters of credit. A nonprofit organization that elects to pay contributions after having used reimbursement financing is presumed to have reported wages in each fiscal year during the election in which the organization actually paid individuals for services, and the organization will be presumed to be chargeable with benefits during any period when it was using reimbursement financing.
EXCEPTIONS
Wages.- Wages does not include:
Remuneration over $8,500 paid by employer to an individual during any calendar year with respect to employment. Wages for services in another state and wages paid by predecessor may be included in the first $8,500. Amount will be increased if federal taxable wage base is increased to an employer over Maryland's limit.
Payments by employer to employees under plan or system established on account of retirement; sickness or accident disability (but only those payments received under a workers' compensation law); medical or hospitalization expenses in connection with sickness or accident disability; or death, including payments for insurance or an annuity or into a fund and including payments to employee's dependents.
Payments for sickness or accident disability made over six months after separation.
Payments from, to, or under an annuity plan exempt from federal income tax.
Payment of domestic or agricultural employees' FICA tax without deduction from wages.
Payment required from employee under a state unemployment insurance law.
Compensation paid in any medium other than cash for service not in the course of the employer's trade or business.
Payment other than vacation pay or sick pay made after the month in which the employee became 65 if the employee did no work for the employer in the period for which the payment is made.
Payments made to, or on behalf of, employee under plan or system for supplementing unemployment benefits.
Payment as compensation for jury service.
Payment as travel allowance or other expenses incurred on behalf of the employer, up to the amount actually incurred and accounted for to the employer.
Cafeteria plan payments if the payments would not be treated as wages outside a cafeteria plan (Sec. 8-101(v)(3)).
Dependent care assistance payments to the extent that the payments are excludable from gross income under IRC Secs. 127 or 129.
Wages paid by a private, for-profit employer to an inmate of a custodial or penal institution before the inmate is permanently released, including release by parole.
Employment.- The term employment does not include:
Barbers and cosmetologists operating under certain lease arrangements.
Direct sellers engaged in selling or soliciting sale of consumer products in the home or otherwise than in a permanent retail establishment if remuneration received is related to sales or other output, rather than to hours worked, and the services are performed pursuant to a contract providing that the direct seller will not be treated as an employee for federal tax purposes.
Service not in the course of employer's trade or business.
Insurance agents or solicitors on commission basis.
Messenger service drivers, under certain conditions.
Newspaper and shopping news carriers under 18.
Nonimmigrant aliens admitted to the United States under the Federal Immigration and Nationality Act (Sec. 8-223).
Organizations exempt from income tax with respect to service performed in any calendar quarter if remuneration for such service is less than $50.
Railroad employees.
Real estate salespersons or brokers on commission basis if exempt from Federal Act.
Relatives, i.e., service performed by individual in employ of son, daughter, or spouse, or by child under 21 in employ of parent.
Service covered by federal unemployment system providing for payment of benefits.
Service for school, college or university by student in regular attendance, or by spouse of that student if spouse's employment is under program of assistance to the student.
Service by student enrolled at a nonprofit or public educational institution in a full-time work study program. Exemption not applicable if program established for employer or group of employers.
Service for a hospital by a patient of the hospital.
Student nurses and interns in postgraduate education.
Taxicab drivers, under certain conditions.
Service by officer or crew member of a vessel of 10 net tons or less capacity while engaged in catching, taking, harvesting, cultivating, or farming any kind of fish, shellfish, crustacea, sponges, seaweed or other aquatic forms of animal or vegetable life, if individual is compensated on a share basis, and not by salary or wage.
Service by a full-time student for an organized camp if the camp did not operate for more than seven months in the current or preceding calendar year or had average gross receipts for any six months in the preceding calendar year that were not more than 33 1/3% of gross receipts for the other six months and the student performed services for the camp for fewer than 13 calendar weeks in the year.
Volunteer test subject who is paid on a per study basis for scientific, medical, or drug-related research, unless service is performed for a not-for-profit organization or governmental entity.
Yacht salesperson performing services for a licensed trader for payment solely by commission.
Certain owner-operators of Class F tractors and Class E truck under specific circumstances.
Government and nonprofit employers.- Coverage is mandatory for nonprofit organizations employing one or more individuals. The state and its political subdivisions are mandatorily covered. Other government services remain exempt.
The following services for nonprofit organizations and the state are not covered:
Church or organization operated primarily for religious purposes and which is controlled by a church.
Religious duties of a minister or member of a religious order.
Patients performing services in a rehabilitation facility or sheltered workshop.
Individual receiving unemployment work-relief or work-training under program financed by a federal agency or an agency of a state or political subdivision.
Inmates of custodial or penal institutions.
Elected officials.
Members of a legislative body or the judiciary.
Members of the State National Guard or Air National Guard.
Temporary employees serving in case of fire, storm, snow, earthquake, flood or other similar emergency.
Individuals in certain major nontenured policymaking or advisory positions.
Election official or election worker if remuneration received during the calendar year is less than $1000.
PROCEDURES
Base period.- First four of the last five completed calendar quarters immediately preceding start of benefit year (Sec. 8-101).
Benefit year.- Year beginning with first day of first week for which claim is filed, or if individual already has a benefit year, first day of first week for which a claim is filed after the termination of the preceding benefit year (Sec. 8-101).
Weekly benefit amount.- $25 to $340 (effective 10/1/2006; $310 through 9/30/2006), depending on highest quarterly and total base-period wages. $8 is payable for each dependent child (up to five children) under age 16, but absolute maximum is $340. Wages payable for week in excess of $70, rounded to next lower multiple of $1, are deducted. Wages paid by a private, for-profit employer for services performed while an inmate of a custodial or penal institution are counted for benefit purposes if the individual continues to be employed by the private, for-profit employer after being permanently released, including release by parole. Number of dependents is set as of first day of benefit year, and they are not counted in any other claim for duration of that year (Sec. 8-803; and Sec. 8-804).
Maximum total benefits.- 26 times the weekly benefit amount, plus amounts for dependents. In addition, during periods of high unemployment, payment of extended benefits at a claimant's regular weekly benefit amount.
A claimant may receive a shared work weekly benefit amount equal to the product of the affected employee's regular weekly benefit amount multiplied by the percentage of reduction (at least 10% but not more than 50%) in his or her normal weekly hours of work, for up to 26 weeks, if his or her employer has elected to participate in a shared work program designed to reduce the hours or days of work of certain employees in order to reduce employment and stabilize the work force.
Benefit eligibility; Requirements.- Claimant must have base-period wage of 1
times the upper limit of highest quarterly base-period earnings shown in schedule in law for claimant's weekly benefit amount, with wages in at least two quarters of base period, plus high-quarter base period wages of at least $576.01 (if claimant has received benefits in a benefit year, he or she must have earned wages in insured work of at least 10 times his or her weekly benefit since the start of the benefit year in which he or she received benefits).
Claimant must be able and available for work and actively seeking work, except illness or disability occurring after registration for benefits does not make claimant ineligible if no suitable work offered after beginning of illness or disability and summons for jury duty does not create ineligibility. The disability of a qualified person may not be used as a factor in finding that the person is not able to work. Claimant 60 or over, temporarily furloughed and subject to recall, need not actively seek work.
Notwithstanding the availability for work requirement or the disqualification for refusal to apply for or accept suitable work, benefits may not be denied to an otherwise eligible individual in approved training. If an employer closes its plant for a vacation or inventory or other purpose causing unemployment for a certain and definable period not exceeding 10 weeks, the employees who become unemployed may be exempted from actively seeking work. If otherwise available, an individual may not be considered unavailable because he or she is engaged in inactive duty for training as a member of the National Guard or other reserve component of the U.S. Armed Forces.
Benefits may not be paid to instructors, researchers or principal administrators of an educational institution during school vacation periods or paid sabbatical leaves based on service with such institutions.
Nonprofessional employees of educational institutions are not eligible during periods between academic years or terms if there is reasonable assurance of reemployment in the second year or term. Retroactive payments of benefits are provided for those who are not offered work in the second year or term.
A similar disqualification applies to an individual performing services in an educational institution while in the employ of an educational service agency.
Benefits are not payable to professional athletes for periods between sport seasons if there is a reasonable assurance that the individual will perform services in both seasons.
Benefits are not payable to an alien unless he or she has been lawfully admitted for permanent residence, was lawfully present in the U.S. to perform services, or was lawfully residing in the U.S. under color of law.
Disqualifications Period.- Leaving work voluntarily without good cause-first week of unemployment caused by leaving and, if valid circumstance exists for leaving, for five to 10 subsequent weeks; if valid circumstance does not exist for leaving, first week of unemployment and until individual is reemployed and has earned wages in covered employment equal to at least 15 times the weekly benefit amount (wba). Leaving to become self-employed, to accompany or join a spouse at a new locality, or to attend an educational institution requires disqualification. Leaving due to health or the health of another person who must be cared for by the claimant must be documented by evidence from a physician or hospital.
A circumstance for voluntarily leaving work is valid only if it is a substantial cause that is directly attributable to, arising from, or connected with conditions of employment or actions of the employing unit or of such necessitous or compelling nature that the individual has no reasonable alternative other than to leave.
Voluntary quit is for good cause if the individual has been laid off through no fault of his or her own, obtains subsequent employment that pays weekly wages totaling less than 50% of the weekly wage earned in the work from which he or she was laid off, and leaves the subsequent employment to attend approved training.
A claimant who is otherwise eligible for benefits from the loss of full-time employment is not disqualified from benefits attributable to the full-time employment because he or she voluntarily quit a part-time employment, if he or she quit the part-time employment before the loss of the full-time employment.
Refusal to apply for or accept suitable work-five to 10 weeks or until he or she has become re-employed and earned 10 times his or her wba in insured work.
Discharge for misconduct connected with the work or suspension as a disciplinary measure-five to 10 weeks.
Discharge or suspension for gross misconduct-until claimant becomes re-employed and earns 20 times wba in insured work.
Discharge or suspension as a disciplinary measure for aggravated misconduct-first week for which unemployment is caused by the discharge and continuing until the individual is reemployed and has earned wages equal to at least 30 times the weekly benefit amount. An individual's wage credits do not include any wages paid by a base period employer against whom the individual committed aggravated misconduct that resulted in disqualification.
Labor dispute-duration.
Receipt of unemployment benefits under other state or federal law-period for which payments are made.
False statement, representation or failure to disclose material fact-for one year from the date of the determination of improper claim and thereafter until the benefits are repaid; benefits may also be recovered by offset against future benefits.
Receipt of pension, annuity, retirement or retired pay or any other similar periodic payment that is based on previous work from a plan maintained by a base-period employer-reduction in weekly benefits by total amount of pension if all contributions to plan were paid by base-period employer and reduction by one-half if some, but not all, contributions were made by base-period employer. In case of payments made under the Social Security or Railroad Retirement Acts, the individual's contribution will be taken into consideration and the weekly benefit amount will not be reduced.
Receipt of holiday or vacation pay earned or accumulated to the individual's credit if, on or before the date of the layoff or separation, the individual has been notified by the employer of a definite date on which he or she will return to work. No disqualification if the individual has received holiday pay or vacation pay that is attributable to any period that is outside the terms of an employment agreement that specifies scheduled vacation or holiday periods or employee discretion in scheduling vacation or holiday periods.
Receipt of dismissal pay or wages in lieu of notice-if the payment at least equals the individual's weekly benefit amount, the individual is disqualified from benefits; if the payment is less than the weekly benefit amount, the individual may receive UI benefits reduced by the amount of the payment (Sec. 8-1009).
WHAT THE EMPLOYER MUST DO
Standard rate.- The maximum and minimum earned contribution rates assignable beginning in 2006 have both increased. The minimum rate rose from 0.1% to 0.3%. The maximum rate jumped from 9.5% to 13.5%. No employee tax.
New employer rate.- New employers pay the highest of 1.0% of the taxable wage base, the 5-year benefit cost rate of the state, or the contribution rate that applies to an employer with a zero benefit ratio, but not higher than 2.3% (2.6% in 2006 and thereafter) of the taxable wage base. The new employer's rate for 2009 is 2.2%, except that new construction employers headquartered in another state pay 4.5% in 2009.
Experience rating.- Experience rates are assigned on a calendar year basis. An employing unit qualifies for experience rating if, during each of the three calendar years immediately preceding the computation date (July 1), it had an earned rating record that was chargeable with benefits and reported taxable wages on or before the computation date immediately following each of those three calendar years. An employing unit that fails to meet these requirements still qualifies if throughout the calendar year immediately preceding the computation date, it had an earned rating record that was chargeable with benefits, and during each of the two calendar years immediately preceding the computation date, it reported taxable wages on or before the computation date immediately following each of those two years. Employers transferring operations into Maryland from another state may be able to qualify for an experience rate on the basis of their employment experience in the other state.
An employing unit that has qualified for an earned rate, but failed to file contribution reports on time, is assigned the higher of its earned rate or the standard rate of contributions.
A benefit ratio is computed for each employer meeting these requirements. For an employer qualifying under minimum experience requirements, benefit ratio is quotient obtained by dividing total of regular, work sharing, and extended benefits chargeable to employer and paid during the period beginning with the first day of the quarter in which the employer first became subject and ending on December 31 immediately preceding the computation date by the total of the reported taxable wages for the same period. For an employer meeting regular requirements, benefit ratio is quotient obtained by dividing total of regular, work sharing, and extended benefits chargeable to employer and paid during the three calendar years immediately preceding the computation date by the total of reported taxable wages for the same period. Benefit ratio is computed to 4th decimal place.
Rates for 2006 and beyond.- Effective January 1, 2006, employers will no longer determine their earned contribution rates by referring to the Table of Basic Rates and then calculating the applicable percentage increase or decrease based on the Schedule of Basic Rate Adjustments. The law now provides six separate rate tables, Rate Tables A through F, for easier reference by employers. The term “Basic Rate” is no longer used. Rather, the term “Standard Rate” refers to the maximum rate in the Rate Table applicable to the employer. This method is applicable only for tax contributions due that are based on taxable wages for calendar years beginning with 2006.
The maximum and minimum earned contribution rates assignable beginning in 2006 have both increased. The minimum rate rose from 0.1% to 0.3%. The maximum rate jumped from 9.5% to 13.5%.
Also effective January 1, 2006, employers who qualify for an earned rate, but have filed no contribution reports for the previous three rating years, will be assigned the standard rate of contribution. This rule applies only for tax contributions due that are based on taxable wages for calendar years beginning with 2006.
For calendar year 2009, Table B is in effect. Rates may be determined from the following table:
Table of Rates-Table A
Employing Unit's
Benefit Ratio
|
Employing Unit's
Rate
|
|---|
(1)
|
.0000-
|
0.60%
|
(2)
|
.0001-.0027
|
0.90%
|
(3)
|
.0028-.0054
|
1.20%
|
(4)
|
.0055-.0081
|
1.50%
|
(5)
|
.0082-.0108
|
1.80%
|
(6)
|
.0109-.0135
|
2.10%
|
(7)
|
.0136-.0162
|
2.40%
|
(8)
|
.0163-.0189
|
2.70%
|
(9)
|
.0190-.0216
|
3.00%
|
(10)
|
.0217-.0243
|
3.30%
|
(11)
|
.0244-.0270
|
3.60%
|
(12)
|
.0271-.0297
|
3.90%
|
(13)
|
.0298-.0324
|
4.20%
|
(14)
|
.0325-.0351
|
4.50%
|
(15)
|
.0352-.0378
|
4.80%
|
(16)
|
.0379-.0405
|
5.10%
|
(17)
|
.0406-.0432
|
5.40%
|
(18)
|
.0433-.0459
|
5.70%
|
(19)
|
.0460-.0486
|
6.00%
|
(20)
|
.0487-.0513
|
6.30%
|
(21)
|
.0514-.0540
|
6.60%
|
(22)
|
.0541-.0567
|
6.90%
|
(23)
|
.0568-.0594
|
7.20%
|
(24)
|
.0595-.0621
|
7.50%
|
(25)
|
.0622-.0675
|
7.80%
|
(26)
|
.0649-.0675
|
8.10%
|
(27)
|
.0676-.0702
|
8.40%
|
(28)
|
.0703-.0729
|
8.70%
|
(29)
|
.0730-and over
|
9.00%
|
Successor employers.- Effective January 1, 2006, when an employer transfers its trade or business to another employer, and, at the time of transfer, there is any common ownership, management or control of the trade or business, then the contribution rate of the acquiring employer will be based on a combination of payroll and benefit charge experience of both employers through December 31st of the year of transfer.
If the business transfer was partial, and the transferring employer remains in business, then, beginning on the January 1st after the transfer and thereafter, the rate of contribution of the acquiring employer will be based on its payroll and benefit charge experience in combination with the proportionate share of payroll and benefit charges acquired from the transferring employer.
If the transferring employer does not remain in business after the transfer, a single acquiring employer’s rate for the years beginning on the January 1st after the transfer will be based on the acquiring employer’s experience with payroll and benefit charges in combination with the proportionate share of payrolls and benefit charges from the transferring employer. If there is more than one acquiring employer, then, on January 1 after the transfer and thereafter, the rates of each employer will be determined by combining each employer’s own experience with payroll and benefit charges and each employer’s proportionate share of payroll and benefit charges from the transferring employer.
SUTA dumping.- Effective July 1, 2005, penalties will be imposed when the sole or primary purpose of a business transfer is to obtain a lower rate of contributions. First, the experience rating accounts of the employers involved will be combined into a single account with a single assigned rate for the combined employing unit. This employing unit will be assigned the highest rate assignable for the rate year during which such violation or attempted violation occurred and for the three years immediately following. If the employing unit is already at the highest rate, or if the increase would be less than 2%, then a penalty rate contribution of 2% of taxable wages will be imposed for the year.
A person who is not an employer who violates, attempts to violate or knowingly advises an employing unit in a manner that results in a violation will be subject to a civil penalty of up to $5,000.
Criminal penalties may also apply. An employer that knowingly violates the restrictions against transferring a business in order to avoid state unemployment tax (SUTA) will be guilty of a misdemeanor and, on conviction, subject to a fine of up to $10,000 or imprisonment up to one year, or both. Further, any person who is not an employer who violates or knowingly advises an employer or prospective employer in a manner that results in a violation is guilty of a misdemeanor punishable on conviction by a fine of up to $10,000 or one year imprisonment, or both.
DEADLINES
Tax and wage.- Forms DLLR/OUI 15 and DLLR/OUI 16, Quarterly Contribution Report and Quarterly Employment Report, along with contributions owed, are due quarterly on or before last day of following month. If due date falls on day when Department is not open for business, return may be filed on the following business day. All employers should use Internet filing as encouraged by the department. Internet filing is available on the state's website. Employers with up to 3,000 may use WebWage filing. Employers with 100 or less employees may use paper filing. Employers who report no wages or who report wages paid to 20 or less employees may use telephone filing. All employers also have the option of E-wage filing, which entails filling out the paper contribution report and attaching the wage file to an e-mail.
Wage.- Wage information report is required on Form DLLR/OUI 16 and is due with contribution report.
ENFORCEMENT
The Maryland Unemployment Insurance Law is administered by the Department of Labor, Licensing and Regulations, Office of Unemployment Insurance.
If an employing unit fails to pay a contribution, reimbursement or interest thereon, the amount due may be collected in a civil action in the name of the state. The employer judged in default must pay the cost of such action.
The Secretary is authorized to compromise, settle and adjust any claim or judgment for a contribution, reimbursement payment and/or interest assessed against an employing unit if in the judgment of the Secretary the best interests of the state will be promoted thereby.
Assessments made by the Secretary are final within 15 days after their mailing, unless the employing unit applies to the Board of Appeals for a hearing. Subsequent to the hearing the Board will pass an order to affirm, modify, or set aside the assessment.
The Maryland Unemployment Insurance Law provides an employer with a remedy for any erroneously collected contributions or interest. An application for an adjustment or refund must be made within the latter of one year from the date on which the payment was made, or three years from the last day of the calendar quarter with respect to which the payment was made. If the Secretary determines that the contested amount or any part thereof was erroneously collected, the employing unit will be allowed an adjustment without interest to the amount of a contribution due, or will be granted a refund if such an adjustment cannot be made. The Secretary may also take the initiative to grant an adjustment or refund within the limitation period. Where an employing unit has reported wages that were included in the determination of an eligible claimant for benefits, any refund or adjustment is to be reduced by the amount of the benefits received by the claimant that are chargeable to the employing unit. If an application is denied, the employing unit may, within 15 days, petition the Board of Appeals for a hearing. The Regulations allow the Board to refer the appeal to a special examiner for a hearing and decision, which may be appealed to the Board in the same manner as an appeal from a decision of a hearing examiner. Provision is made for an adjustment or refund pursuant to judicial review. In regard to the administrative processing of applications for an adjustment or refund.
Provision is also made for a refund from an assessment that is found upon judicial review to have been invalidly or illegally collected.
Records.- The Department of Economic and Employment Development may require from any employer sworn reports with respect to the individuals it employs which are deemed necessary for the effective administration of the Act. Such information is confidential but will be made available to a claimant at a hearing to the extent necessary for the proper presentation of a claim. If an employing unit fails to make required reports within ten days after the Secretary has sent it notice, it may, upon a complaint by the Secretary, be enjoined by a court from operating until the report has been submitted. In most instances the necessary forms and reports are automatically supplied to the employer.
WHO TO CONTACT
The Maryland Unemployment Insurance Law is administered by the Department of Labor, Licensing and Regulations, Division of Unemployment Insurance, 1100 N. Eutaw St., Baltimore, Maryland 21201. Telephone 1-800-492-5524.
RECORDKEEPING
The Maryland Unemployment Insurance Law provides that employers are to keep true and accurate work records containing such information as the Secretary or Board of Appeals requires. The information contained in such records, as well as any cash disbursement journals, check registers, tax returns, and other documents that corroborate or supplement the records, may be inspected and copied by the Secretary or Board of Appeals at any reasonable time without notice.
Records for the purposes of inspection and audit shall be retained, preserved and made readily accessible at the place of business for a period of at least five years from the last day of the calendar quarter to which they relate. Employment units that maintain computerized employment records, and employing units with more than 250 employees whose computerized employment records are maintained by a third party, shall retain such records in the original magnetic storage format.
POSTING
All employers are required to post in places readily accessible to its employees printed statements, provided without cost by the Secretary, about benefit rights and claims. The Regulations also provide that reimbursing employers are to post notice of their liability for payments instead of contributions under the Act.
See ¶21-9900 for a copy of the required poster.
PENALTIES
If an employer fails to file a report before the due date, or such report is incorrect or insufficient, the Secretary shall require by written notice that the employing unit submit a correct and sufficient report within 10 days, and if the employing unit fails to do so, the Secretary shall make an assessment on the basis of such information as can be obtained.
A corporation may forfeit its charter for failure to pay contributions.
An employer, its officer or agent, or another person who knowingly makes a false statement or representation, or knowingly fails to disclose a material fact, to avoid or reduce the payment of any contribution due or which may become due under the Act may be punished by a fine or imprisonment or both.
Employers who finance payments by the reimbursement method and whose payments are past due are subject to the same interest rates, penalties, and collection procedures applicable to employers whose contributions are past due.
Employers who present checks or other negotiable instruments that are returned for insufficient funds are subject to a $25 penalty.
A payment of penalties and interest is applied first to the total amount of any penalty imposed, then to the amount of interest due and owing to the date of payment, and then to the amount of any contribution owed. The Secretary may waive any penalties or interest for cause upon the employer's request or upon review.
An employer that refuses to pay contributions or make reimbursement payments covered by an assessment after 10 days' written notice may be enjoined from doing business until such payment is made.
Interest.- Interest accrues at a rate of 1.5% per month or fraction thereof against contributions which remain unpaid upon the due date. Such interest is assessed until payment plus accrued interest is received by the Secretary.
If an employer files a report for the purposes of determining contributions due under the Act but fails to pay contributions or interest, the Secretary may assess the amount of contributions or interest due on the basis of the information submitted.
If the Secretary believes the collection of any contribution or interest will be jeopardized by delay, it may immediately assess such contributions or interest and give written notice of the assessment to the employer.
Records.- An employer that willfully fails or refuses to produce required records or allow those records to be copied or inspected is subject to a $1,000 fine or imprisonment not to exceed 90 days, or both.
Failure to file quarterly contribution or employment reports in the time or manner required will subject the employer to a penalty of $35 unless the Secretary waives the penalty for cause. An employing unit that fails to submit separation notices may be subjected to a $15 penalty for each notice.
Bankruptcy.- In the event there is a distribution of an employing unit's assets pursuant to an order of any court of Maryland, including an adjudicated insolvency, assignment for the benefit of creditors, receivership or similar proceeding, contributions or reimbursement payments then due or thereafter due are to be paid in full prior to all other claims except taxes, with which they shall share pro rata.
In the event of an employer's death, claims for contributions or reimbursement payments are allowable against the estate of the employer as preferred debts. In the event that an employing unit is adjudicated bankrupt, has debts adjusted in composition, or has an extension judicially confirmed under the Federal Bankruptcy Act, contributions or reimbursement payments then or thereafter due are entitled to priority as a tax as provided in section 64(a) of that Act.
No final report or act of an assignee, trustee, receiver, auditor, personal representative or other fiduciary or officer engaged in administering the assets of an employing unit and acting under the authority or supervision of any court shall be allowed by the court unless the Secretary of Economic and Employment Development is given ten days' written notice thereof, in which time the Secretary may file a claim or interpose an objection to the report or act.
Liens.- If an employing unit defaults in the payment of any sum assessed by the Secretary, the latter may file with the clerk of the circuit court of the county wherein the employing unit has its principal place of business and any other county a notice of lien which states the name and address of the employing unit, the amount of the assessment, and that the time for filing an appeal for judicial review has expired without an appeal having been taken. Thereupon, the amount of such assessment so docketed, plus court costs, recording costs and accumulated interest will be a lien upon the real and personal property of the employer with the same force and effect as a judgment lien.
<p>Liens.— If an employing unit defaults in the payment of any sum assessed by the Secretary, the latter may file with the clerk of the circuit court of the county</p>
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