Employers are responsible for paying their UI Tax debt each quarter. In addition, Contributory Employers are responsible for additional debts which occur between quarterly due dates due to wage adjustments on past quarters. Reimbursable 2% Employers make quarterly payments to the UI Tax fund while reimbursable 0% reimburse the UI Tax fund for any benefits claimed by their former. While Contributory and Reimbursable accounts are billed differently, the actual function of processing and managing payments is the same for all reporting methods.
All Employers with an active UI account are required to submit a quarterly Wage report to DEW (SUITS calculates the Contribution Report automatically). When the Employer submits their quarterly report, the system automatically calculates the Employer’s UI Payment, based on the wages reported for the quarter, the Employer’s tax rate, and any interest, penalties or fines accrued. The contribution and replenishment portion of the UI Tax Payment goes into South Carolina’s UI Trust Fund from which UI benefits are paid. Contingency, interest, penalties and fees go into South Carolina’s Contingency and Administrative Fund.
Employers (and Agents on behalf of Employers) can make UI Payments using a variety of payment methods. Employers and Agents can make payments by ACH Credit, ACH Debit, Credit Card, or Paper Check/Cashier’s Check/Money Order. ACH Debit payments remain pending until the bank receives the payment; all others appear as ‘Posted’ once the system processes them and are considered paid unless the payment is later dishonored. While an ACH debit payment is in a ‘Pending’ status, the Employer or Agent can edit or cancel the payment.
When Employers make their UI Payments by check or other manual payment method, DEW will receive and record these payments throughout the day using the existing RPS scanning system. As part of a nightly batch process, the payments scanned through RPS are sent to the bank for processing, and will be batched in the SUITS system via an interface with the bank.
If an Employer does not make a timely payment for the due amount, they will be subject to interest and penalties. Interest is calculated monthly and accrues on the account automatically unless an exception, such as a bankruptcy or extension, exists to prevent this.
Penalties and fines can be accrued for various reasons, from filing a late Wage report to an administrative fine for violation of filing guidelines. Penalties and fines are added to the total UI Payment due; however, the Employer or Agency will be able to see the breakdown of the total payment due, including separate line items for penalties and fines. Some penalties, such as those for a late Wage report(s), are automatically charged to an Employer’s account. In addition, Staff can manually add a penalty or fine, of any given amount, on an Employer’s account.
DEW does not allow the Employer or Agent to overpay on their account online. A hard error and validation message will be displayed if the Employer or Agent enters a payment amount which is greater than their total debt. In the event that the Employer writes a check for more than the payment, the system will allow staff to enter this overpayment in order to deposit the money.
From time to time, an Employer’s payment (ACH debit or check) cannot be honored by the bank. This could happen for reasons such as insufficient funds, or a bad routing number. Each day, DEW receives an email with a report of the dishonored check payments and an interface file for the dishonored ACH debit payments from the financial institution. Dishonored checks are entered into the system by staff and the system processes and records dishonored ACH debits. The system then reverses the payment out of the Employer’s UI account, charges a dishonored payment penalty, and recalculates interest and penalties as though the payment was never received.
Although it is rare, there can be a scenario in which a payment is posted to the wrong Employer account. In this event, the system contains functionality for Staff to transfer a payment from one account to another. Authorized Staff are also able to modify the payment amount of check payments if a deposit correction is received from the financial institution.
There are instances where a received payment cannot be applied to an employer’s account, such as an invalid account number being written on the check. In this case, the payment will be suspended and placed in a work queue for staff to research. The suspense queue allows DEW to accept and deposit the money per federal guidelines, but will not apply the payment to a specified account. Staff has the option to post payments to an employer account or refund payments from the suspense queue based on their research. In addition, authorized staff can manually place a payment in suspense. This might be done because a payment was applied to the incorrect account, but the correct employer account is not yet known.