The Department of Labor and Training (DLT) today announced the 2023 tax rates for the unemployment insurance (UI) and temporary disability insurance (TDI) programs.
Effective January 1, 2023, unemployment insurance tax rates will move down to Schedule G, with rates ranging from 1.1 percent to 9.7 percent. These rates include the 0.21 percent Job Development Assessment. In 2022, tax Schedule H was in effect, with rates ranging from 1.2 percent to 9.8 percent. The rate for new employers will be 1.09 percent for calendar year 2023, a decrease from the new employer rate of 1.19 percent in 2022.
The unemployment insurance tax schedule is determined using a statutory formula based on the balance of the state’s employment security fund. Next year’s schedule change is due in part to an infusion of $100 million in American Rescue Plan funds approved by the General Assembly in the state’s fiscal year 2023 budget.
The 2023 UI Taxable Wage Base for most employers will be $28,200 in 2023, an increase from the 2022 taxable wage base of $24,600. For employers at the highest tax rate, the UI taxable wage base will be $29,700 in 2023. Per statute, the UI taxable wage base is set at 46.5% of the average annual wage of workers in Rhode Island, which increased in calendar year 2021.
The TDI taxale wage base, which is equal to the annual earnings needed by an individual to qualify for the maximum weekly benefit rate, will be $84,000 in 2023, an increase from the 2022 taxable wage base of $81,500. The TDI contribution rate will remain at 1.1 percent.
Unemployment Insurance provides temporary income support to workers who have lost their jobs through no fault of their own and have sufficient wages in the base period to meet the monetary requirements. Worker benefits are funded entirely from state and federal UI taxes paid by Rhode Island employers.
TDI protects workers against wage loss due to a non-work-related illness or injury, and through Temporary Caregiver Insurance (TCI), which provides up to four weeks of payments to bond with a new child or to care for a seriously ill family member. TCI is not a separate state program; TCI is part of the TDI program. TDI is paid by employees, not employers, through a payroll tax.