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NJBIA on Wednesday supported a bill to protect nonprofits from surprise unemployment insurance (UI) bills resulting from pandemic-caused layoffs and a different interpretation of a recent law than what was intended.

Bill A-5691 (Greenwald/Murphy/Verrelli) was released by the Assembly Appropriations Committee and moves to the full Assembly for a vote.

In January, Gov. Phil Murphy signed a law reducing the amount of an employer’sunemployment taxes through 2023 to soften a $1 billion UI tax increase and to protect nonprofits that have opted to pay reimbursements for UI, instead of through the payroll tax.

Chris Emigholz

Christopher Emigholz, NJBIA Vice President of Government Affairs

However, the new law is being interpreted differently from what was intended. In fact, several nonprofits have received UI bills from the state totaling hundreds of thousands of dollars after they have been closed or restricted for more than a year.

“This bill will protect our much-valued nonprofits from massive UI liabilities that will slow job recovery,” said NJBIA Vice President of Government Affairs Christopher Emigholz, who has worked on the bill with legislators from both houses. 

“Nonprofits traditionally have a stable workforce with typically small UI bills. Yet they are major employers, providing jobs to about 10% of the state – including childcare services that support the rest of New Jersey’s workforce. Their recovery is desperately needed for a broad economic and job recovery.”