Establishment of Consumers as Employers of Workers

General Policies for Consumer Employers

Policy:

This sub-chapter identifies general policies for Consumer Employers in participant-directed programs served by a Fiscal/Employer Agent.

A participant need only operate as an employer or designate a representative to serve as an employer on the participant's behalf if the participant chooses to directly hire employees. In general, any worker who is not employed by another entity when he/she provides service to a participant and does not have a specific license to provide the service provided to the participant and who the participant directs is an employee of the participant employer.

The Internal Revenue Service generally views consumers or their representatives as common law employers of workers that the participant or representative directs as part of the participant-directed program.

<<Insert program specific policy for who can be an employer on the participant's behalf in the program>>

For purposes of acting in the official capacity as the employer of workers who provide service to the participant, the participant or someone the participant designates can act as the employer. If the participant chooses to designate someone to act on the participant's behalf as the employer, that individual is referred to as the 'employer' or 'representative.'

Employer tax registration and F/EA authorization forms are completed using the employer's name and identifying information. If the participant operates as the employer, the participant's information is populated on employer tax registration and F/EA authorization forms as the "employer." If the representative operates as the employer, the representative's information is populated on employer tax registration and F/EA authorization forms as the "employer."

In many cases throughout this manual, the employer may be referred to as the "employer", "participant", "participant employer" or "representative" depending on the context.

In programs served by the F/EA, participant employers are considered "Household" or "Domestic" employers by the Internal Revenue Service, Department of Labor and State Departments of Labor.

Employer Start Up Packages

Policy:

<<Before making changes to this chapter, identify who is authorized to operate as an employer in the program. Some programs only allow consumers to be employers while others allow the participant to authorize another person (often called a representative) to operate as the employer>> See General Policies for Consumer Employers

The Employer Start Up Package includes important introductory forms for the participant and all required forms for the participant or his/her representative to be established with tax agencies as an employer. This package also includes forms for the participant or representative to designate tax filing and payment responsibilities for the participant's employer accounts to F/EA.

A new participant receives the Start Up package from <<the participant's Counselor only after the Counselor has received a referral from Program Administrator.>> <<This package is provided to the participant or representative by the Counselor at the intake and orientation meeting.>> The Counselor goes over each form with the participant, helping the participant to understand and complete them.

<<Insert policy for how and when Employer Start Up Packages are produced and distributed. Insert any program specific policies about production and distribution of Start Up packages.>>

Employer Start Up packages are completed by consumers or consumers' representatives

The F/EA checks for updated forms on a monthly basis. As new versions of forms are identified, the Start Up Package is updated with the new version.

Upon request, F/EA submits a copy of the Employer Start Up Package to Program Administrator, participant direction program Manager.

Procedure:

<<Insert Process for how Employer Start-Up Packages are Distributed to Consumer Employers>>

Internal Controls:

The internal controls used by F/EA to monitor this process establish responsibility, segregate duties, document procedures and ensure independent internal verification.

The methods of internal control utilized by F/EA to distribute Consumer Orientation Packages are:

A control document is used to track checking for updated forms at least monthly.
Staff verifies whether there are new forms in use at relevant agency websites prior to placing a printing order for new forms (See Stay Up to Date with Forms, Rules and Regulations)
<<Insert other Internal Controls related to pre-populating and distributing Employer Start-Up Packages to Consumers>>

Consumer Agreement(s)

Policy:

F/EA includes an agreement between the F/EA and the participant in every Employer Start-up Package. The intent of the Consumer Agreement is to ensure that both the participant and F/EA clearly understand each other's roles in the participant direction program and both agree to their roles. This form is included as a standard part of every employer packet produced.

The F/EA Consumer Agreement is attached here.

Form SS-4, Application for Employer Identification Number

Policy:

F/EA includes IRS Form SS-4, Application for Employer Identification Number, in every employer start up package.

On line 1 of Form SS-4, after listing the employer's name, "HCSR" must be written. HCSR is the IRS' term for participant employers. It stands for Home Care Service Recipient. Line 1 of Form SS-4 should appear like the below:

"John Doe, HHCSR"

Otherwise, Form SS-4 should be completed per the attached example.

IRS Form 2678, Employer Appointment of Agent

Policy:

F/EA includes IRS Form 2678, Employer Appointment of Agent, in every Employer start up package. F/EA completes Form 2678 per attached example. This form is included as a standard part of every employer packet produced.

IRS Form 8821, Tax Information and Authorization

Policy:

F/EA includes IRS Form 8821,Tax Information and Authorization, in every employer start up package. Form 8821 is completed per attached example. This form is included as a standard part of every employer packet produced.

Note that an executed Form 8821 is no longer required by the IRS for Fiscal/Employer Agent services, but it is a best practice to obtain executed Forms 8821 and file them with the IRS.

State Power of Attorney for State Income Tax

Policy:

F/EA should update this sub-chapter per State requirements. Verify with your state if a Power of Attorney or similar form is needed for the F/EA to operate on behalf of an employer to file and pay withheld state income taxes. If so, update this sub-chapter to reflect the appropriate policy, procedure and internal controls.

State Power of Attorney for State Unemployment Tax

Policy:

F/EA should update this sub-chapter per State requirements. Verify with your state if a Power of Attorney or similar form is needed for the F/EA to operate on behalf of an employer to file and pay state unemployment taxes. If so, update this sub-chapter to reflect the appropriate policy, procedure and internal controls.

Collect and Process F/EA Start Up Packages

Policy:

The F/EA Start-Up Package includes all forms that a participant must complete to become an employer in the participant direction program. F/EA receives Fiscal/Employer Agent Start-Up Packages, as completed by consumers, via the Counselors. Original signatures must be on all forms, so original packages are only accepted via mail and drop-off at F/EA. All packages are quality checked within 2 business days of receipt. F/EA Start-Up Packages that are incomplete or inaccurate are returned to consumers within 2 business days of receipt.

All forms included in the F/EA Start-Up Package are required. A participant will not be established as an employer in the Worker program without satisfactorily completing all forms in the F/EA Start-Up package. For F/EA Start-Up Packages that pass a quality check without errors, F/EA obtains an Employer Identification Number (EIN) on the participant’s behalf. After successfully obtaining an EIN for the participant, the participant information can be entered into the payroll system.

Procedure:

Quality Check the F/EA Start-Up Package

All F/EA Start-Up Packages are quality checked by F/EA staff immediately upon receipt. <<Staff Title>> (or assigned staff member) is responsible for quality checking F/EA Start-Up packages. Forms that are not accurately or completely filled out are returned to the Counselor with an explanation of errors that must be corrected. Under no circumstances does F/EA obtain an EIN for a participant if forms are missing or are not correctly completed.

F/EA cannot provide tax advice for completion of any forms. If consumers or representatives have questions about the impact on their personal tax liability by completing forms, F/EA directs them to a tax professional.

Steps 1 through 5 below outline the general quality check procedures for the F/EA Start-Up package. Subsequent steps outline the required information for each form.

<<Staff Title>> or assigned staff quality check F/EA Start-Up Packages
Any F/EA Start-Up Packages received via the mail or drop-off are date stamped and placed in the F/EA Start-Up inbox
<<Staff Title>> collects packages from F/EA Start-Up inbox daily.
Upon completing review of each form, and verifying that it has been satisfactorily completed, <<Staff Title>> initials and dates the form.
<<Staff Title>> tracks completion of forms in “For F/EA Use Only” sheet, the back of the third form in the package.
Write any errors on forms on “For F/EA Use Only” sheet
Prior to submitting the F/EA Start-Up package to the F/EA, the Counselor completes the New Client Action Sheet and staples the Action Sheet as the first page in the package
Review the Action Sheet
Ensure that the following information is complete:

Effective Date
Consumer’s Name
Consumer’s Address
Sex
Date of Birth
Phone number
Social security number
Representative Information is not required, but it is preferred if the participant has a representative
Same preference applies if there is Legal Guardianship

10. Review the Consumer Agreement

11. Ensure that the following information is complete:

Printed Consumer’s name
Consumer’s signature
If the Consumer is a minor, one of the three signature options can be exercised:

The person who has Power of Attorney (P.O.A.) can sign the Consumer Agreement. If a Power of Attorney signs the Consumer Agreement, the Power of Attorney forms must be included in the package
The Legal Guardian can sign the Consumer Agreement. If a Guardian signs the Consumer Agreement, the Guardian paperwork must be included in the package

12. Review Form SS-4, Application for Employer Identification NumberEnsure that the requisite information is complete.

The person who has Power of Attorney (P.O.A.) can sign this form. If a Power of Attorney signs the Consumer Agreement, the Power of Attorney forms must be included in the package
The Legal Guardian can sign this form. If a Guardian signs this form, the Guardian paperwork must be included in the package
The Representative cannot sign this form, unless the representatve is listed as the employer on Line 1 of Form SS-4

13. Review Form 2678, Employer Appointment of Agent

14. Ensure that the requisite information is complete.

If the Consumer is a minor, one of the two signature options can be exercised:

The person who has Power of Attorney (P.O.A.) can sign this form. If a Power of Attorney signs the Consumer Agreement, the Power of Attorney forms must be included in the package
The Legal Guardian can sign this form. If a Guardian signs this form, the Guardian paperwork must be included in the package
The Representative cannot sign this form, unless the representative is listed as the employer on line 1 of Form SS-4

17. Review Form 8821

18. Ensure that the requisite information is complete.

Follow-Up on Incomplete Forms

If any of the forms are not completed as described in the section above, Quality Check the F/EA Start-Up Package, action must be taken within 2 business days of F/EA receiving the forms. Use the following procedure to follow up with Counselors regarding incomplete or inaccurate F/EA Start-Up Packages.

1. If any of the forms have any of the below problems, F/EA will not proceed with getting an EIN and will contact the Counselor for follow-up:

Any of the forms are missing from the package
Any forms are missing a signature
Any forms have inconsistent name, Social Security Number or other information

2. If any required sections of forms are incomplete or inaccurately completed, F/EA will follow-up with the Counselor within 2 business days.

3. After identifying forms with problems and notating the problems on the “For F/EA Use Only” control sheet, <<Staff Title>> (or assigned staff member) contacts the Counselor via e-mail

The <<Staff Title>> communicates which forms have problems and explains what is incomplete or inaccurate about completion of the form
<<Staff Title>> notifies the Counselor that they can work with the participant to complete only the form(s) with problems and mail them to F/EA
If the Counselor reports that they will work with the participant to fix the incomplete form and then mail the form to F/EA, print the e-mail stating that and staple to the back of the F/EA Start-Up Package
<<Staff Title>> puts F/EA Start-Up Package in “Packages with Issues” sorter

1. Sort the package under the participant’s last name

Any F/EA Start-Up Forms that are received by F/EA are date stamped and then compared to packages in the sorter

1. Any forms for consumers with packages in the sorter are added to those packages and quality checked

2. The complete F/EA Start-Up Package, with added form (s) is processed through the steps in Quality Check the F/EA Start-Up Package

Every two business days, the <<Staff Title>> goes through the sorter

1. Any packages remaining in the sorter have not had updated forms received for them

2. For each participant with a package in the sorter, <<Staff Title>> opens their Cust. Service tab in Payroll System

3. <<Staff Title>> checks to see if any new information about the package has been logged in the Customer Service Log

4. <<Staff Title>> reviews the date in the Customer Service Log that F/EA first contacted the Counselor

5. If five business days has passed since initial contact with the Counselor and corrected forms have not been received, <<Staff Title>> contacts Counselor again via e-mail to check on status

6. Any response on status from Counselor is printed and attached to package

Follow steps until all completed forms are received or for 90 days
When a complete F/EA Start-Up Package is received, re-start process at Quality Check the F/EA Start-Up Package

Record Worker Information in Applicable Systems

After a F/EA Start-Up Package has cleared quality check for all forms, <<Staff Title>> or <<Staff Title>> (or assigned staff member) assigns the participant a Consumer ID and enters the participant in applicable systems.

Internal Controls:

The internal controls used by F/EA to monitor this process establish responsibility, segregate duties, document procedures and ensure independent internal verification.

The methods of internal control utilized by F/EA to collect and process F/EA Start-Up Packages are:

1. All systems are password protected

Only staff authorized to perform certain duties are provided with password access to systems

2. An Employer Identification Number (EIN) is not obtained on the participant’s behalf until all forms have successfully passed a quality check.

An EIN is required to enter a participant in the reporting agent’s payroll system.
This policy prevents a participant from paying a workers without an F/EA Start-Up package that successfully passes a quality check.

3. All packages are date stamped immediately upon receipt.

Verification of date stamp occurs by a separate staff member than the staff member who quality checks the packages
This segregation of duties helps F/EA to track the time between receiving a package and quality checking it, ensuring that all packages are quality checked within 2 business days

4. During quality check, each form is separately initialed and dated as it passes a satisfactory quality check

5. A control sheet titled “For F/EA Use Only” is included in each F/EA Start-Up Package

During quality check, this control sheet is completed by the reviewer
The control sheet is reviewed subsequently by a second person during entry of participant information in to participant databases

6. Each participant database is password protected.

Only F/EA staff authorized to update the database are provided a user ID and password.

7. Prior to assigning a Consumer ID, the Census database is checked to ensure the Consumer ID has not already been assigned

This validation ensures data integrity

8. All participant documents are scanned and saved for a minimum of 7 years per File Retention Policy.

File Registration and Authorization Forms with Tax Agencies

Policy:

F/EA obtains applicable employer account numbers with the Internal Revenue Service (IRS) and State Department of Revenue (DOR) on behalf of each active participant served by F/EA in the participant direction program. F/EA registers consumers with the State Department of Labor (DOL) for State Unemployment Insurance, but only after the participant has been determined liable for State Unemployment Insurance (See Register Consumer with State Department of Labor (Unemployment)).

As employers of workers in the participant direction program, consumers must be established with applicable tax agencies as employers for the purposes of withholding, depositing and filing applicable employer taxes and returns.

Consumers also delegate responsibility for withholding, depositing and filing applicable employer taxes and returns to the F/EA. This document outlines the policy, procedures and internal controls used by F/EA to file these registration and authorization forms with applicable tax agencies.

Below, each step is outlined. The Policy associated with each step is stated beneath the step header.

Procedure:

Create Consumer Folder

After completing the procedure in Collect and Process F/EA Start Up Packages, a folder for participant F/EA Start-Up Package paperwork is created. This process is completed by a <<Staff Title>>. New folders are created daily as packets pass quality check and all other procedures in Collect and Process F/EA Start Up Packages.

<<Staff Title>> or assigned staff selects a blank file folder from the F/EA supply
<<Staff Title>> writes participant last name, first name and <<MMIS ID>> on file folder tab
Before filing participant’s F/EA Start-Up package

<<Staff Title>> places all F/EA Start-Up Package forms in folder.
- This folder will be stored in alphabetical order by participant last name in the participant file cabinets after all paperwork has been filed
- These file cabinets are locked for HIPAA protection (See HIPAA Policy)

The folder is placed in the box labeled “Paperwork” in the Customer Service Unit

Internal Controls:

The internal controls used by F/EA to monitor this process establish responsibility, segregate duties, document procedures and ensure independent internal verification.

The methods of internal control utilized by F/EA to collect and process F/EA Start-Up Packages are:

1. All systems are password protected

Only staff authorized to perform certain duties are provided with password access to systems

2. The New Weekly Consumer List is independently verified each week by the <<Staff Title>> to ensure paperwork is being processed timely

<<Staff Title>> initials and dates printed weekly participant list and stores in Payroll Department.

3. An e-mail address is provided to State Department of Revenue (DOR) or equivalent during registration

If DOR cannot validate the registration, an e-mail is automatically sent to F/EA for resolution

4. The Payroll Department submits a test to DOR monthly to verify that all employers liable for state withholding taxes are appropriately registered with DOR and that the reporting agent has accurate account numbers for consumers

5. The Payroll Department provides an independent internal quality check of State Income Tax Account Number Registration Form when the employer is registered with DOR.

6. The Payroll Department verifies that the reporting agent is correctly reporting an employer’s first payroll date by running a report for each employer who the reporting agent reports as liable for state withholding taxes

This report verifies the employer’s first payroll date

Apply for Employer Identification Number

Policy:

Applying for an Employer Identification Number (EIN) from the IRS is the first step in registering the employer with tax agencies and authorizing the F/EA to file and pay taxes on the employer’s behalf. An Employer Identification Number is required on all other employer tax forms. As of 2013, the IRS now allows Fiscal/Employer Agents to apply for EINs online.

Procedure:

<<Staff Title>> (or assigned staff member) removes Form SS-4 from participant’s folder for all consumers for whom EINs have not yet been applied for
<<Insert process for getting the EIN>>

If applying for EIN online:

Visit the IRS EIN Application site and click "Apply Online Now" button
Enter the information on the completed SS-4 for each step. For the question "What type of structure is applying for an EIN?", select "View Additional Types", then click Continue.
Select "Household Employer" on the following screen.
Finish the application process and save the CP 575 confirmation of EIN letter PDF file for recordkeeping.

If applying for EIN via fax:

Put all F/EA Start-Up package forms for Forms SS-4 faxed to IRS in a folder
Label this folder with the date that Forms SS-4 were faxed to the IRS
Staple the SS-4 to the front of the folder
Any EIN fax confirmation forms received are placed in the above folders
Review folders daily to check for EIN confirmations received
If an EIN has not been received within 7 days, call the IRS at 1-800-829-4933 If EIN confirmation is received over the phone, write the EIN on Form SS-4 and attach a sheet of paper to the SS-4 with the message “IRS gave EINs over the phone on DATE. Did not get confirmation from fax.”
If EIN confirmation is received via fax, attach the fax confirmation sheet to the form SS-4
Write the participant’s EIN on each form in the F/EA Start-Up package
Enter participant’s EIN in Payroll System

Internal Controls:

1. Forms SS-4 are quality checked prior to obtaining an EIN (see Collect and Process F/EA Start Up Packets)

2. After contact IRS to obtain EIN, the EIN or any issues with obtaining the EIN are recorded in the participant’s file

Register Employer with State Department of Revenue

Policy:

A participant is registered with the State Department of Revenue (DOR) to allow the participant to deposit and file state income taxes that are withheld from the participant’s workers(s). Registration with DOR occurs after obtaining an EIN on the participant employer's behalf.

Procedure:

Submit Form 2678, Employer Appointment of Agent, to the IRS

Policy:

Filing a completed Form 2678 with the IRS authorizes F/EA to withhold, file and pay employment and Federal Withholding taxes on behalf of the participant. Form 2678 is not effective until the IRS approves F/EA to act on behalf of the participant employer. This approval is submitted to the F/EA with Notice LTR-1997C.

Because Form 2678 is not effective until the IRS approves the F/EA as an agent of the employer and therefore F/EA does not have joint liability for federal employer taxes until the IRS approves the Form 2678, F/EA includes language in each participant contract stating that F/EA is liable per the participant contract for employer taxes even before the IRS approves Form 2678.

Procedure:

<<Staff Title>> (or assigned staff member) separates Form 2678 from participant’s F/EA Start-Up package for those consumers for whom EINs were recently obtained
Open Form 2678 letter template <<File Path>>

Collect up to 25 Forms 2678
Copy forms
Place copy of forms in consumers' folders and mail originals to IRS
No more than 25 Forms 2678 can be included in a single letter
If more than 25 Forms 2678 will be submitted, prepare multiple letters
Review Forms 2678 for selected consumers
Ensure the participant’s EIN is written on Form 2678
Print completed 2678 Letter

Mail 25 Forms 2678 and 2678 Letter to:

<<Insert address from IRS "Where to File" chart based on location of F/EA>>

<<Staff Title>> opens Payroll System

In forms tracking module of payroll system, find participant by last name
Enter date Form 2678 mailed to IRS for each participant

LTR-1997-C, notice from the IRS to approve F/EA to act as each participant’s agent should arrive by mail within 60 days

<<Staff Title>> opens Payroll System
In forms tracking module of payroll system
Find participant by last name
Enter date approval via LTR-1997-C received

<<Staff Title>> reviews forms tracking module of payroll system weekly

Any consumers for whom 2678 approval has not been received within 75 days are followed-up on
<<Staff Title>> contacts IRS at 1-800-829-4933 and inquires about status of 2678 approval
Status is stored in participant’s Customer Service System

Submit Form 8821, Tax Information Authorization, to the IRS

Policy:

Filing a completed Form 8821 with the IRS authorizes officers/staff of the F/EA to discuss employer tax matters on the participant’s behalf with the IRS. 8821 Appointee status does not authorize F/EA officers to represent the participant for the IRS. Note that an executed Form 8821 is no longer required by the IRS for Fiscal/Employer Agent services, but it is a best practice to obtain executed Forms 8821 and file them with the IRS.

Procedure:

<<Staff Title>> (or assigned staff member) separates Form 8821 from participant’s F/EA Start-Up package for those consumers for whom EINs were recently obtained
Open Form 8821 letter to IRS2 from <<File Path>>

Collect all not submitted Forms 8821
Copy Forms 8821
Store original in participant's folder
Mail copies to IRS
Unlike Form 2678, there is not a limit to how many Forms 8821 can be submitted to the IRS in a single mailing
Review Forms 8821 for selected consumers
Ensure the participant’s EIN is written on Form 8821

3. Mail Forms 8821, list of officers and 8821 Letter to:

Internal Revenue Service

Memphis Accounts Management Center

Stop 8423

5333 Getwell Road

Memphis, TN 38118

4. <<Staff Title>> opens forms tracking module in Payroll System

Open tab labeled “8821”
Find participant by last name
Enter date Form 8821 mailed to IRS

5. The IRS does not notify of 8821 approval

Internal Controls:

F/EA keeps a record of all forms not yet mailed to the IRS and reviews this record to ensure all forms get mailed to the IRS.
When Forms 8821 are mailed to the IRS, it is recorded that they have been.
Mailing records are periodically reviewed to ensure forms have not been missed.

Register Consumer with State Department of Labor (Unemployment)

Policy:

Employers are not registered for Unemployment Insurance (UI) with the State Department of Labor until the employer has paid at least $1000 in gross wages in a single calendar quarter. The payroll department produces the <<report>> <<weekly>> that shows any employers who do not have a UI account number and have just crossed the $1000 per calendar quarter threshold. After reaching this limit, the employer is liable for all wages previously paid in the calendar year and all wages going forward up to the taxable wage base for each workers.

<<Staff Title>> or assigned staff runs a ”Quarterly Report” from the payroll system to verify that $1000 in wages have been paid in a single calendar quarter and to collect wage information for prior quarters. <<Staff Title>>collects completes the state Employer Status Report form for the participant. This information is used to apply for a DUA account number for the employer through the state’s registration system. F/EA applies for a UI account number for the employer within five business days of learning that an employer has reached or crossed the $1000 in a single calendar quarter threshold.

Procedure:

Weekly the payroll department creates a <<report>> for employers without a UI Account No. and gross wages greater than $1000 in a single calendar quarter

<<Staff Title>> creates the report
<<Staff Title>> date stamps report
<<Staff Title>> assigns task to a <<Staff Title>> or other F/EA staff
Assigned staff completes state Employer Status Report forms <<that is what the forms are usually called, but an individual state may have a different form name or a different process>> for each participant employer using the employer name, address and FEIN information

2. Collect Quarterly tax payroll data from the payroll system for each employer who needs a UI number

3. <<Insert Process to collect the data>>

Review the data for each quarter for the participant
Write the applicable gross wage information on the Employer Status Report <<process may vary by state; insert where on the form to insert applicable data>>

4. Insert the following on the Employer Status Report Form for each participant as applicable <<This process will vary based on the state form requirements>>

Enter the First Date of Employment, which is the first check date, on the Employer Status Report Form in “Please Enter a Valid Payroll or Employment Start Date”
Select “Continue”
In “Company Name”, enter Employer’s First and Last Name
In “Attention To:” enter C/O F/EA – F/EA
In “Legal Address” enter employer's address
In "Mailing Address" enter the F/EA's mailing address
Enter the employer's FEIN on the form as applicable
In “Are you liable for federal unemployment tax?”, select “Yes”
In “First Date of Liability”, enter first check date from Employer Status Report
Select the participant’s city from the drop down
In “Please describe the principal activity…”, enter “Household Employer”
In “What is the principal product or service…”, enter “None”
“Please enter the address of your physical location…” enter participant’s address information
In “Please choose the option that best describes your business” select Domestic
In “Please choose the option that best describes your business” select Domestic
In “Name”, enter Consumer’s Name
In “Home Address” enter Consumer’s Address
In “Social Security Number”, enter the participant’s SSN
In “Is this individual compensated for services performed for the company”, select “No”
In “Select the above individual’s title”, select “Owner”
On the next page, the participant’s DUA ID will be listed.

5. Record in the database the date that the Employer Status Report Form is submitted to the state for each participant

6. Mail the forms to the state

7. In approximately <<X>> days, F/EA will receive each employer's UI Account No. via <<mail>>

Date stamp letter upon receipt
This letter contains the UI Account No. and the employer's contribution rate <<there may also be a 'surcharge rate' or disability insurance rate or other, additional rate>>
Enter the new UI Account No. in the participant database for the employer
This number will be used to file and pay state unemployment tax on behalf of the participant employer
Enter the employer's rate in the database

8. On a monthly basis, <<Staff Title>> runs report from payroll system that shows any consumers for whom a "Date Sent" was entered for the date the Employer's Status Report was sent to the state, but a UI Account No. has not yet been received

This report shows any consumers that should have a UI Account No., but don't
<<Staff Title>> follows up with state to inquite about status of UI Account No.s for these consumers

Internal Controls:

The internal controls used by F/EA to monitor this process establish responsibility, segregate duties, document procedures and ensure independent internal verification.

The methods of internal control utilized by F/EA to Register Consumer with MA DUA are:

1. All systems are password protected

Only staff authorized to perform certain duties are provided with password access to systems

2. After payroll department creates weekly report of consumers who are newly liable for state unemployment insurance, <<Staff Title>> verifies integrity of report by running an independent report of gross wages

3. All tracking documents are date stamped, initialed, scanned and saved for 7 years per File Retention Policy.

4. A report is run monthly to identify any consumers for whom the F/EA has applied for a UI Account No. but the number hasn not yet been received.