The Maryland Department of Labor sent out a notification which said:

“Governor Larry Hogan today issued an Executive Order that waives the charging of COVID-19 unemployment insurance benefits to employers. This Executive Order prevents Maryland’s contributory employers from having their experience rating negatively impacted because they had to lay off or furlough employees due to the economic consequences of the pandemic. By maintaining the 2020 benefit ratio, employers’ 2021 tax rates will be reduced from what they would have been without the Executive Order.

The Executive Order maintains the same benefit ratio used to calculate an employer’s 2020 tax rate in the calculation of their tax rate for 2021. Therefore, an employer’s 2021 tax rate will be calculated based on their pre-pandemic experience by excluding the 2020 fiscal year and, instead using the last three fiscal years of 2017, 2018, and 2019. All chargeable benefits paid to former employees from July 1, 2019, to June 30, 2020, will not impact employer tax rates for 2021.

‘While our Division of Unemployment Insurance has been working around the clock to provide much-needed benefits to claimants, we have surely not forgotten about Maryland’s employers, who have been faced with incredibly difficult circumstances and decisions during the COVID-19 pandemic,” said Labor Secretary Tiffany P. Robinson. “While we cannot prevent the tax table from dropping due to the economic impact of the pandemic, the Governor’s Executive Order will provide relief to employers by reducing the impact to their experience rating.’

Since the beginning of the pandemic, over $1.5 billion in benefits have been awarded from the Unemployment Insurance Trust Fund. Based on the balance of the Trust Fund, Maryland employers will be taxed under Table F in 2021. Due to the change in the applicable Tax Table, all employers will still see an increase in their tax rate for the calendar year 2021. Maintaining the 2020 benefit ratio for employers in 2021 will ultimately reduce many employers’ tax rates from what they would have been without the Executive Order.

Maryland’s employers will receive a direct email with this information today, but do not have to take any additional steps at this time. The Division of Unemployment Insurance will provide employers with their preliminary 2021 tax rate in their BEACON 2.0 portal in the latter half of December. Employers will then receive their 2021 Experience Rate Notice early next year. Those who qualify can also apply for payment plans in 2021 through their BEACON 2.0 portal.”

What does this mean for employers?

Employers will not see the effects of charges to their tax rates; but the state specifically noted that employers will continue to be taxed under Table F, directly raising employer’s tax rates for 2021. The Employer Tax Tables in Maryland are based on the status of the state’s Unemployment Insurance Trust Fund.


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