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Employers Benefit from Low Unemployment Tax Rates
More than 20,000 out of 33,378 South Dakota employers have benefited from a zero percent unemployment tax rate since HB 1101 was passed during the 2023 legislative session. In the prior year, only 4,800 obtained a zero percent rate.
This legislation created a new tax Schedule C to reduce employer contribution rates by 0.5% when the Unemployment Insurance Trust Fund balance at the end of the fiscal year is at or above the average high-cost multiplier of 1.5.
“We intended to provide a tax cut while ensuring the fund remained at a healthy and responsible level,” said state Labor and Regulation Secretary Marcia Hultman. “Our hardworking business owners saved $18 million, and we are seeing the positive impacts.”
South Dakota’s unemployment rate is the lowest in the nation at 2.0%. Only 1,344 people are receiving reemployment assistance benefits.
“People are choosing to work, and our economy is booming,” said Hultman. “Many new businesses are calling our state home, and thousands of new workers are relocating to the Mount Rushmore state.”
The first year for the new schedule was calendar year 2024. Employers are notified each October of what schedule and rates apply to them at the beginning of the new year. Projections indicate Schedule C will remain in place for 2025.
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Federal Bonding Program Limits Employer Hiring Risk
Every year, justice-involved men, women, young adults, and those recovering from substance abuse look to restart their lives, including obtaining new jobs. They are often met with skepticism, hostility, and reluctance to hire. Failure to get a job after release is a major factor in the high rate of recidivism according to the U.S. Department of Justice.
Through the Federal Bonding Program, DLR has received a federal grant providing bonds as incentives for employers willing to hire individuals whose backgrounds may pose barriers to securing or retaining employment.
The program benefits both the employers struggling to find workers and individuals struggling to find jobs. Employers who participate in the program gain access to skilled candidates who want to work without risk to their businesses. In turn, the employees, who may otherwise not be given a chance, are given opportunities to prove themselves.
The bonds:
- Cover the first six months of employment at no cost to job applicants or employers.
- Range from $5,000 to $25,000 per individual. Employers receive the bonds free of charge as an incentive to hire these applicants.
- Can be applied to full- or part-time wages.
- Protect employers against losses caused by fraudulent/dishonest acts of a bonded employee. Since inception, dishonesty claims have been filed on 1% of bonds.
To request a bond, complete the Federal Bonding Program Request Bond to Be Issued online. There is no cost for applicants or employers. For more information, contact your Job Service office.
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Don’t Forget: Postings for Employers
South Dakota law requires only two workplace postings:
- Reemployment Assistance Employee Notification Posting Requirement
- Safety on the Job Posting Requirement
DLR offers a compliance poster which includes the six required posters at no charge. You may request the 6-in-1 poster through your Job Service office.
Various federal agencies (such as the U.S. Department of Labor, the Occupational Safety and Health Administration (OSHA), and the Equal Employment Opportunity Commission (EEOC) require workplace postings. View more information.
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Participate in Hiring Events –
Both In-person and Virtual
Hiring events can foster meaningful connections between job seekers and employers.
These events, whether in person or virtual, allow job seekers to be more than words on a resume/application. They can showcase their skills directly to employers. Employers can meet and evaluate numerous candidates and share insights into their company culture and workplace environment.
Our virtual hiring events connect employers and job seekers in real-time through text chats and offer the option to employers to request video interviews on the spot.
View upcoming events via our Hiring Events page. To learn how you can participate, contact a Job Service office to speak with a member of our Business Services team.
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QUICK LINKS
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South Dakota Department of Labor and Regulation
Employer Connection E-Newsletter
You have received this email because you have an account with the South Dakota Department of Labor and Regulation or have subscribed to the DLR Employer Newsletter ListServ
This correspondence is sent from an account we use to send messages only. Please refer to our Staff Directory page to contact the appropriate department or use this web form to contact us. Thank you.
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