New Hire Reporting Requirements

New Reporting Requirements for New Hires

All employers must now report "new hires" within twenty days and to furnish certain information to the appropriate state agency. This new requirement is a result of the new federal welfare reform law (Personal Responsibility and Work Opportunity Reconciliation Act).

In most states, the new hire reporting requirement is effective October 1, 1997. Generally, employers will report new hires to state unemployment insurance departments.

The primary purpose of the new hire reporting procedures is to enhance child support enforcement. The new hire reporting system will help the government locate individuals who are obligated to pay child support.

Under the new law, employers’ reports of new hires must include the following information:

• the employee’s first name, middle initial and last name
• the employee’s Social Security Number
• the employee’s home address
• the employer’s name, address and Federal Employer Identification Number (FEIN)
• the employer’s state identification number.

Reports may be submitted by sending a copy of the employee’s W- 4, a form furnished by the appropriate state department or any other hiring document that satisfies the above criteria. Reports may be sent via first class mail or transmitted magnetically or electronically.

Employers filing magnetically must file reports by two monthly transmissions not less than twelve days nor more than sixteen days apart. Multi-state employers that file magnetically may choose one state in which they have employees to which they may report all new hires.

Failure to comply with this new reporting requirement may result in civil monetary penalties and/or non-monetary civil penalties.

NOTE: Employers that outsource their payroll should contact their payroll administrator about automatic reporting services provided by the payroll administrator. ADP, one of the nation's largest payroll administering companies, already has such service programs available.

After the appropriate state agency receives the new hire information, it will transmit it to the National Directory of New Hires. When a match is found with data in the national and state directories, a withholding order will be issued to the employer to withhold an amount equal to the employee’s child support obligations.

For specific information on new hire reporting requirements in your state, we suggest that you begin your search with your state unemployment insurance department. Following is new hire reporting information for the states listed below:

Illinois:   Illinois Department of Employment Security    
Iowa:   Bureau of Collections  - (515) 281-5331 
Wisconsin:   Department of Workforce Development  

Updated 2/15/2002