The Tennessee Department of Labor & Workforce Development has confirmed that it will not to include unemployment benefits charged from March 15, 2020 to July 31, 2020 when calculating employer’s unemployment tax rates for future years.
Senate Bill 2520, which was signed into law by Governor Bill Lee on June 22, 2020, clarifies this as follows:
“The employer tax account of any contributory employer in a claimant’s base period for any unemployment benefits paid to a claimant as a result of the COVID-19 pandemic, and its effects, for the period of March 15, 2020 through July 31, 2020, shall be held harmless and not charged.”
Tennessee is one of the four states who issues unemployment tax rates on a fiscal year basis (July 1 through June 30) and the calculation period typically runs from January 1st through December 31st. Thus, the 2020/2021 tax rate calculation period ended on December 31, 2019 and would not include benefits paid during the pandemic period indicated. As a result, SB 2520 will not have an impact on rates issued for the 2020/2021 fiscal year but will take effect for the following rate year.
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