New-Hire Quick Facts
New-Hire Act of 1997
Act 97-228, the New-Hire Act of 1997, brought Alabama into compliance with the Federal Welfare Reform Act of 1996 (Public Law 104-193). This act is designed to accomplish the following:
- Prevent payment of unemployment compensation to individuals who have returned to work.
- Prevent individuals from receiving workers' compensation while employed.
- Recoup from unemployment compensation the cost of over-issuance of food stamps.
- Locate non-custodial parents who are delinquent in legal child support obligations.
New hire reports are entered into the Alabama State Directory of New Hires in order to prevent program abuse and to assist the Federal Parent Locator Service. New hire reports are transmitted to the National Directory of New Hires where the data is cross matched with other states.
Alabama New-Hire provides a direct means for identifying workers who refuse jobs while receiving unemployment compensation. An individual can be denied benefits for failure to accept suitable employment.
Since October 1,1997, all employers are required to report each newly hired or recalled employee to the Alabama Department of Labor. The information must be furnished within seven days from the date of hire or reemployment. (Employers reporting electronically may transmit twice monthly, not less than twelve (12) days nor more than sixteen (16) days apart.) Employers who fail to report newly hired or recalled workers may be fined up to $25 for each violation.
All reports of hire will require the following data: employee's name, address, and social security number; first day of work; and, whether the employee was newly hired or recalled to work. A newly hired employee is an employee who: 1.) has not previously been employed by the employer or 2.) was previously employed by the employer but has been separated from such employment for at least 60 consecutive days. Also required are the employer's Federal Employer Identification Number (FEIN), name, and address.
Effective May 1, 2008, employers with 5 or more employees must report via the Internet through this website (click here). Employers with less than 5 employees may use the Internet system, or they may send copies of W-4's to the New Hire unit. W-4's must have additional notations showing the date the employee began work, and whether the employee was a new hire or recall.
Benefits for Employers
The employer community and the taxpayers of Alabama will benefit from New-Hire in the following ways:
- A reduction in UC taxes where benefits would have otherwise been charged against an employer's experience rating account.
- A reduction in UC shared costs, which affect all tax-rated employers.
- A reduction in outstanding overpayments of UC benefits and their adverse effect on the Unemployment Insurance Trust Fund.
- A reduction in time and resources required for completing Form AL 8605A, the Unemployment Insurance Benefit Payment Audit.
- A reduction in unemployment benefits paid to workers who refuse jobs.
- A reduction in the cost of Temporary Assistance for Needy Families.
- A reduction in Food Stamp costs.
- A reduction in Medicaid costs.
- A reduction in Workers' Compensation costs.
How to Contact Us
You may contact the Alabama Department of Labor New-Hire Unit by one of the following:
Alabama Department of Labor
649 Monroe St., Room 3205
Montgomery, AL 36131-0378
Phone: (334) 206-6020
Fax: (334) 206-6020