Unemployment Insurance Law Summaries
New Mexico, Unemployment Insurance Law Summaries
New Mexico's unemployment insurance law is located in Chapter 51, Article 1, New Mexico Statutes of 1978, as amended, Secs. 51-1-1 to 51-1-58 (for full text, see Unemployment Insurance Reports UI-NM ¶4001 ); and in the Regulations and Rules Under the Employment Security Commission of New Mexico, Regulation Series 100 to 500.
DEFINITIONS
“Employer” means an employer of one or more individuals in each of 20 different weeks in either current or preceding calendar year; or employing unit that paid wages of $450 or more for employment during a calendar quarter.
In general, if an individual or entity contracts to supply an employee to perform services for a client or customer and is a leasing or temporary services employer, the individual or entity is the employer of the employee who performs the services.
“Employment:” means service, including service in interstate commerce, performed for wages or under any contract of hire, written or oral, express or implied, with certain exceptions that are listed below.
Service performed for wages constitutes “employment ” unless and until it is shown that the individual is:
free from control or direction; and
performing such service outside usual course of employer's business or outside all places of employer's business; and
customarily engaged in independently established business of same nature as that involved in contract of service.
Generally, employment subject to the FUTA is subject to the New Mexico law.
“Wages:” means all remuneration for services, including commissions, bonuses, and the cash value of all remuneration in any medium other than cash, including tips received by an employee in the course of his or her employment from persons other than his or her employer, provided the tips are accounted for by the employee to the employer, and provided the tips are considered in fixing the amount of wages the employee receives direct from the employer. Also included are payments representing deferred compensation or other reduction of an employee's normal taxable wages or any payments made to a third party on behalf of an employee as part of an agreement of deferred compensation. The following are excluded from wages:
Taxable wage base is determined annually as 65% of state's average annual earnings, rounded to next higher multiple of $100, but not less than $7,000. For 2009, the taxable wage base is $20,900. Wages for services in another state and wages paid by employer's predecessor may be included as part of taxable limit.
Other exclusions from wages are listed below.
COVERAGE
Generally, employment subject to the FUTA is subject to the New Mexico law. Exclusions from coverage are listed below.
Agricultural and domestic employers.- Coverage is required for service performed in agricultural labor for an employer who employs 10 or more individuals for 20 weeks in either the current or preceding calendar year in such service or who pays cash remuneration of $20,000 or more for such service in any quarter of the current or preceding calendar year. Service performed by an alien prior to 1/1/80 is excluded. When agricultural labor is supplied by a crew leader, the employing unit for which the service is performed is the employer unless the crew leader is registered under the Farm Labor Contractor Registration Act of 1963 or substantially all of the crew members operate or maintain mechanized agricultural equipment that is provided by the crew leader. In either of these instances, the crew leader is the employer.
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 employer who paid $1,000 or more in any quarter of the current or preceding calendar year for such service.
Government and nonprofit employers.- Coverage is required regarding services performed for nonprofit organizations employing one or more individuals for some portion of a day in at least 20 different weeks in the current or preceding calendar year.
Most services for the state and political subdivisions are mandatorily covered. Service performed for another state or the federal government is excluded.
Nonprofit organizations may finance benefit payments by the regular contributions or the reimbursement method. Payments equal to the full amount of regular benefits plus
the amount of extended benefits paid to claimants are required. A surety bond may be required from any reimbursing nonprofit organization.
EXCEPTIONS
Wages.- The following are excluded from wages:
Taxable wage base is determined annually as 65% of state's average annual earnings, rounded to next higher multiple of $100, but not less than $7,000. For 2008, the taxable wage base is $19,900. Wages for services in another state and wages paid by employer's predecessor may be included as part of taxable limit.
Payments by employer to, or on behalf of, individuals in its employ under plan or system established on account of retirement, if payments are made under a simplified employee pension plan that provides for payments in addition to the salary or other remuneration normally payable to the employee; sickness or accident disability payments, but only if made under a workers' compensation or occupational disease disablement law; medical and hospitalization expenses; or death.
Payment of employees' FICA tax without deduction from wages.
Remuneration for agricultural labor paid in any medium other than cash.
Any payment made to or on behalf of an employee or an employee's beneficiary under a cafeteria plan.
Any payment made or benefit furnished to or for the benefit of an employee if at the time of such payment or furnishing, it is reasonable to believe that the employee will be able to exclude such payment or benefit from income under IRC Sec. 129.
Any payment made by an employer to a survivor or the estate of a former employee after the calendar year in which the employee died.
Notwithstanding the above provisions, the term “wages ” includes any remuneration subject to the federal unemployment insurance tax.
Employment.- The term “employment” does not include the following:
Service for a hospital by a patient of the hospital.
Insurance agents or solicitors wholly on commission basis.
Newspaper and shopping news carriers under 18.
Real estate salespersons paid solely on commission basis.
Relatives, i.e., service performed by individual in employ of son, daughter, or spouse, or by a child under the age of majority in the employ of parent.
Service covered by federal unemployment compensation system.
Service by a student enrolled at a nonprofit or public educational institution in a full-time work-study program. This exemption is not applicable to a program established for an employer or a group of employers.
Service for a school, college or university by a student in regular attendance.
Services performed by an individual for a fixed or contract fee officiating at a sporting event that is conducted by or under the auspices of a nonprofit or governmental entity if that person is not otherwise an employee of the entity conducting the sporting event.
Service performed for a private for-profit person or entity by an individual as a landman if substantially all remuneration is directly related to the completion by the individual of the specific tasks contracted for, rather than to the number of hours worked by the individual.
Service performed by a product demonstrator or merchandiser, if the service is pursuant to a written contract between the individual and the person or entity whose business is to obtain product demonstrators or merchandisers for third parties (Sec. 51-1-42).
Agricultural and domestic employers.- Service performed by an alien prior to 1/1/80 is excluded.
Government and nonprofit employers.- Coverage is required regarding services performed for nonprofit organizations employing one or more individuals for some portion of a day in at least 20 different weeks in the current or preceding calendar year.
Most services for the state and political subdivisions are mandatorily covered. Service performed for another state or the federal government is excluded.
Services for nonprofit organizations or the state do not include the following:
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 a program financed by a federal agency or an agency of a state or political subdivision.
Inmate of a custodial or penal institution performing services for any employer.
Elected officials.
Members of legislative body or the judiciary.
Members of the National Guard or Air National Guard.
Employees serving on a temporary basis in case of fire, snow, earthquake, flood or similar emergency.
Individuals in certain major policymaking or advisory positions.
PROCEDURES
Base period.- First four of last five completed calendar quarters preceding date of claim or last four completed calendar quarters immediately preceding the first day of the individual's benefit year.
Benefit year.- One-year period beginning with first day of first week of unemployment with respect to which individual first files claim for benefits.
Weekly benefit amount.-
of claimant's high-quarter base-period wages, within a limitation on maximum and minimum benefit amount determined as a percentage of the state-wide average weekly wage (minimum is 10%, maximum 50%), computed to the next-lower multiple of $1, and claimant will be able to earn up to
of his or her weekly benefit amount in wages (including all remuneration for services actually performed in any week for which benefits are claimed, wages in lieu of notice, back pay for loss of employment and vacation pay for any period for which there is a definite return-to-work date, but does not include payments for jury service) or earnings from self-employment without reducing his or her benefit. As thus determined, maximum and minimum for 2009 are $356 and $67, respectively. Note that dependency benefits of $15 per child are permitted subject to certain conditions. Such benefits may not exceed 50% of the individual's weekly benefit amount, however.
Maximum total benefits.- Lesser of 26 times the weekly benefit amount or 60% of base-period wages, computed to next lower multiple of $1. In addition, during certain periods of high unemployment, payment of extended benefits at weekly benefit rate.
Benefit eligibility; Requirements.-
claimant must have wages in at least two quarters of his or her base period;
serve one-week waiting period;
be able to work, available for work, and actively seeking permanent and substantially full-time work in accordance with the terms, conditions, and hours common in the occupation or business in which he or she is seeking work; and
participate in reemployment services if required.
Search-for-work requirement may be waived for claimant on temporary layoff status from regular employment with an assurance from the employer that the layoff will not exceed four weeks or who has an express offer in writing of substantially full-time work that will begin within a period not exceeding four weeks.
To qualify for benefits in a consecutive benefit year, individual must earn at least five times his or her weekly benefit amount.
An individual must report to a Department office for the purpose of an examination and review of his or her availability for and search for work, for employment counseling, referral and placement and for participation in a job finding or employability training and development program; he or she may not be denied benefits during such participation.
An otherwise eligible individual in approved training cannot be denied benefits by reason of the application of the availability for work requirement or the disqualification for refusal of suitable work without good cause.
An individual in an instructional, research or principal administrative capacity for an educational institution is ineligible during school vacations and paid sabbatical leaves based on service for such institution.
An individual employed in a nonprofessional capacity by an educational institution is ineligible during periods between two school years or terms if there is reasonable assurance of reemployment in the second year or term. If work is not actually offered in the second year or term after such reasonable assurance, retroactive payments of benefits may be claimed.
Employees performing services in an educational institution while in the employ of a state or local governmental service agency or other governmental entity or nonprofit organization are also subject to the two above disqualifications.
Benefits are not payable to a professional athlete during periods between two sport seasons if there is reasonable assurance that he or she will return for the second season.
Benefits are not payable to an alien unless he or she has been lawfully admitted for permanent residence, or is lawfully present for the purpose of performing services, or is otherwise permanently residing in the United States under color of law.
Claimant's benefit eligibility is preserved for up to 36 months while he or she is suffering from a continuous period of illness or injury compensable under the New Mexico Workers' Compensation Act or the New Mexico Occupational Disease Disablement Law, provided he or she files his or her claim within four weeks after termination of the illness, and provided he or she was eligible before the sickness or injury occurred. However, if the claimant has received a lump-sum award in settlement of the claim under either of these two laws, his or her continuous period of sickness or injury will be terminated and he or she must file a claim within four weeks after the award or settlement.
Students who are enrolled in a full-time course schedule in an educational institution or training institution or program, other than those persons in an approved training program, are ineligible for benefits.
Individual employed by a ski area operator on a regular seasonal basis as a seasonal ski employee is ineligible for a week of unemployment that commences between two successive ski seasons unless the employee establishes that he or she is available for and is making an active search for permanent full-time work. If such an individual has been reemployed as a seasonal employee by a ski area operator during two successive ski seasons, he or she is presumed to be unavailable for permanent new work during a period after the second successive ski season. However, such a presumption does not arise as to any seasonal ski employee who has been employed by the same ski area operator during two successive ski seasons and has resided continuously for at least 12 successive months and continues to reside in the county in which the ski area facility is located.
An individual will not be denied benefits for any week due to inability to or unavailability for work because he or she is before any court of the U.S. or any state pursuant to a lawfully issued summons to appear for jury duty.
Disqualifications Period.- Discharge (from last employer) for misconduct connected with work-duration of unemployment, plus person must earn wages equal to at least five times his or her weekly benefit amount.
Voluntary leaving (from last employer) without good cause -duration of unemployment and until claimant has earned wages equal to 5 × weekly benefit amount. No individual may be disqualified solely on the basis of pregnancy or the termination of pregnancy or domestic abuse evidenced by medical or legal documentation or by a sworn statement from the claimant.
Refusal of suitable work without good cause-duration of unemployment, plus person must earn wages equal to at least five times his or her weekly benefit amount.
Labor dispute-duration of unemployment caused by such dispute.
Receipt of governmental or other pension, retirement pay, annuity or other similar periodic payment based on previous work from plan financed in whole or in part by a base-period employer-reduction in weekly benefit amount by amount of such payment; no reduction if payments are made under federal Social Security Act.
Receipt of unemployment benefits under another law -period during which such other benefits are received.
WHAT THE EMPLOYER MUST DO
Pay the standard rate.- 5.4%. New employers pay 2.0%. Maximum possible rate is 5.4%. No employee tax.
Experience rates.- Employer becomes eligible for experience rating if its account was chargeable with benefits throughout the 36 months preceding the computation date. Until then, it pays 2.0%. The reserve of an eligible employer is then computed as the excess of total contributions over total benefit charges, expressed as a percentage of its average annual payroll for the past three years ending on the computation date. Depending on which schedule of contribution rates is in effect, the employer's rate may now be determined. Schedule 0 applies if as of the computation date, the amount in the fund is at least 3.7% or more of total remuneration paid for employment in the year ending on the computation date.
Schedule 1 applies if as of the computation date the amount in the fund is less than 3.7% but more than 3.4% or more of total remuneration paid for employment in the year ending on the computation date.
Schedule 2 applies if this ratio is 2.7% or more but less than 3.4%;
Schedule 3 applies if the ratio is 2% or more but less than 2.7%;
Schedule 4 applies if the ratio is 1.5% or more but less than 2%;
Schedule 5 applies if the ratio is 1% or more but less than 1.5%; and
Schedule 6 applies if the fund is less than 1%.
The following seven schedules are in effect:
Employer Reserve (%)
|
Schedule0 (%)
|
|
|
|---|
10.0 and over
|
0.03
|
|
|
9.0–9.9
|
0.06
|
|
|
8.0–8.9
|
0.09
|
|
|
7.0–7.9
|
0.1
|
|
|
6.0–6.9
|
0.3
|
|
|
5.0–5.9
|
0.5
|
|
|
4.0–4.9
|
0.8
|
|
|
3.0–3.9
|
1.2
|
|
|
2.0–2.9
|
1.5
|
|
|
1.0–1.9
|
1.8
|
|
|
0.9–0.0
|
2.4
|
|
|
−0.1–−0.5
|
3.3
|
|
|
−0.5–−1.0
|
4.2
|
|
|
−1.0–−2.0
|
5.0
|
|
|
Under −2.0
|
5.4
|
|
|
Employer Reserve (%)
|
Schedule1 (%)
|
Schedule2 (%)
|
Schedule3 (%)
|
|---|
10.0 and over
|
0.05
|
0.1
|
0.6
|
9.0-9.9
|
0.1
|
0.2
|
0.9
|
8.0-8.9
|
0.2
|
0.4
|
1.2
|
7.0-7.9
|
0.4
|
0.6
|
1.5
|
6.0-6.9
|
0.6
|
0.8
|
1.8
|
5.0-5.9
|
0.8
|
1.1
|
2.1
|
4.0-4.9
|
1.1
|
1.4
|
2.4
|
3.0-3.9
|
1.4
|
1.7
|
2.7
|
2.0-2.9
|
1.7
|
2.0
|
3.0
|
1.0-1.9
|
2.0
|
2.4
|
3.3
|
0.9-0.0
|
2.4
|
3.3
|
3.6
|
−0.1– −0.5
|
3.3
|
3.6
|
3.9
|
−0.5– −1.0
|
4.2
|
4.2
|
4.2
|
−1.0– −2.0
|
5.0
|
5.0
|
5.0
|
Under −2.0
|
5.4
|
5.4
|
5.4
|
Employer
Reserve (%)
|
Schedule4 (%)
|
Schedule5 (%)
|
Schedule6 (%)
|
|---|
10.0 and over
|
0.9
|
1.2
|
2.7
|
9.0-9.9
|
1.2
|
1.5
|
2.7
|
8.0-8.9
|
1.5
|
1.8
|
2.7
|
7.0-7.9
|
1.8
|
2.1
|
2.7
|
6.0-6.9
|
2.1
|
2.4
|
2.7
|
5.0-5.9
|
2.4
|
2.7
|
3.0
|
4.0-4.9
|
2.7
|
3.0
|
3.3
|
3.0-3.9
|
3.0
|
3.3
|
3.6
|
2.0-2.9
|
3.3
|
3.6
|
3.9
|
1.0-1.9
|
3.6
|
3.9
|
4.2
|
0.9-0.0
|
3.9
|
4.2
|
4.5
|
−0.1– −0.5
|
4.2
|
4.5
|
4.8
|
−0.5– −1.0
|
4.5
|
4.8
|
5.1
|
−1.0– −2.0
|
5.0
|
5.1
|
5.3
|
Under −2.0
|
5.4
|
5.4
|
5.4
|
For 2008 through 2010, the rates in Schedule 0, reproduced above, are in effect. No employer's rate may be raised as a penalty for late filing of contributions; other penalties, however, are provided.
Voluntary payments.- Voluntary contributions allowed. Voluntary payments will be included in employer's account as of its most recent computation date if made on or before the following March 1. Not refunded in whole or in part.
Nonprofit organizations may finance benefit payments by the regular contributions or the reimbursement method. Payments equal to the full amount of regular benefits plus
the amount of extended benefits paid to claimants are required. A surety bond may be required from any reimbursing nonprofit organization.
State agencies must make payments in lieu of contributions through the state government unemployment compensation reserve fund. Payments equal to the full amount of regular and extended benefits paid to claimants are required. Local public bodies (political subdivisions) may elect to participate in the local public body compensation reserve fund, pay contributions or make payments in lieu of contributions in the same manner as nonprofit organizations. Those participating in the local public body compensation fund must also make payments equal to the full amount of regular and extended benefits paid to claimants.
Note that Indian tribes may also elect the reimbursement method of financing benefits.
DEADLINES
Tax and wage.- Quarterly wage and contribution report, Form ES-903A, are due on or before the last day of the month following the completed calendar quarter. Online filing is available. Employers with 250 or more employees are required to report wages via electronic media. Employers with 75 or more employees are encouraged to file electronically.
ENFORCEMENT
The New Mexico Unemployment Compensation Law is administered by the Labor Department.
Any employer aggrieved by the imposition of penalties for late reports or late payment of contributions or payments in lieu of contributions may, within 15 days following the mailing of notice thereof, file a written application for relief with the appeal tribunal for the division.
If, after due notice, any employer defaults in any payment of contributions or interest thereon, the amount due may be collected by civil action in the name of the Division. An employer adjudged in default must pay the costs of the action. A court action to collect contributions, interest, and penalties due, may not be commenced more than four years after a report was filed showing the amount of contributions. However, this period may be extended by agreement between the employer and the Division. There is no time limit for the commencement of a court action to collect contributions, interest, and penalties in cases of fraudulent contribution reports or failure to file reports of contributions due. Where an assessment has been made and action to collect has been commenced within four years of the due date of the contributions, interest or penalty, the action is not subject to any period of limitations.
Records.- The Secretary may require from any employing unit any sworn or unsworn reports, with respect to persons employed by it, which the Secretary deems necessary for the effective administration of the Law.
WHO TO CONTACT
The New Mexico Unemployment Compensation Law is administered by the Labor Department, Box 1928, 401 Broadway NE, Albuquerque, New Mexico 87103. Telephone (505) 841-8437.
RECORDKEEPING
Every employing unit is required to keep true and accurate work records of whatever information the Department may prescribe. These records are to be open to the inspection of the Division or any of its authorized agents, who, in turn, must keep confidential any information obtained from such records.
POSTING
Every employer, including each employing unit that has elected coverage, must post a notice informing the workers that the employer is liable for contributions.
PENALTIES
The law provides for a penalty of a fine or imprisonment, or both, for willful violation of its terms. Specific penalties are also provided for the nondisclosure of information to avoid contribution payments or to reduce their amount.
Interest.- Contributions unpaid on the due date bear interest at the rate of one per centum per month from and after such date until payment plus accrued interest is received by the Division. Contributions, interest, and penalties may not be assessed more than four years after a report was filed showing the amount of the contributions. However, this period may be extended by agreement between the employer and the Division. There is no time limit on collection of contributions, interest, and penalties in cases of fraudulent contribution reports or failure to file reports of contributions due.
The law specifically provides that an employer's contribution, in any case, is not to be raised as a penalty for, or as a result of, the late filing of any notice, report or payment of contributions. However, delinquent contribution reports and contributions will be subject to the following penalties: a fine of $50 for contribution reports not filed within 10 days after the due date; a penalty of five percent, but not less than $25 on contributions that remain unpaid ten days after the due date. Finally, late reporting and late payment of contributions will not be penalized if circumstances beyond an employer's control prevented compliance.
Employers whose payments in lieu of contributions are past due are subject to the same interest applicable to employers whose contributions are past due.
Liens.- If any contribution or interest or penalty imposed by the law is not paid within 30 days after the same becomes due, the Division under its official seal may issue a warrant directed to a sheriff of any county in New Mexico commanding him or her to sell the real and personal property of the person in his county owing such contributions, interest or penalty. Within five days after the receipt of a warrant, the sheriff is to file the same with the clerk of his or her county who is to record such warrant. Thereupon the amount of the warrant so entered becomes a lien upon the real and personal property of the person against whom the warrant is issued including choses in action, except negotiable instruments not past due.
Bankruptcy.- In the event of any distribution of an employer's assets pursuant to an order of any court under the laws of this state, including any receivership, assignment for the benefit of creditors, adjudicated insolvency, composition or similar proceedings, contributions then or thereafter due must be paid in full prior to all other claims except taxes and claims for wages of not more than $250 to each claimant, earned within six months of the commencement of the proceeding. In the event of an employer's adjudication in bankruptcy, judicially confirmed extension proposal, or composition, under the Federal Bankruptcy Act, contributions then or thereafter due are entitled to such priority as is provided in section 64(A) of such Act.
<p>Bankruptcy.— In the event of any distribution of an employer's assets pursuant to an order of any court under the laws of this state, including any receivership</p>
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