Unemployment Insurance Fund, on shaky ground

Unemployment in North Dakota has reached exceedingly high levels, which is depleting the Unemployment Insurance (UI) Fund managed by Job Service North Dakota (JSND). This fund is paid into by employers, in the form of premiums and is drawn out as needed by JSND to pay unemployment insurance claims that are submitted by furloughed/laid off or nonworking individuals. 

The fund has a formula that is used to replenish dollars ensuring amounts are always available. Premiums are based upon employer’s usage by former employees or returning workers, also known as "job-attached" claims. Employers who utilize the fund more pay higher premiums, those who use it less, retaining employees on the payroll, pay less. Previously, North Dakota had very low premiums for light users but have some of the highest for those utilize the fund often. This has much to do with the seasonality of numerous industries in the state due to weather, which impacts working conditions and opportunities. 

Now, this process could radically alter due to response to COVID-19. Funds that are coming to the state through the CARES Act may be used to fill the void left by excessive Unemployment Insurance claims cause by COVID-19. This use of these funds is being voted on by the Emergency Commission on Tuesday, May 12. An approval would be a significant benefit to businesses in the state. An increase in Unemployment Insurance premiums now would be a significant hardship to business. All indication is that this will pass the Emergency Commission. GNDC continues to monitor these impacts and engage in conversations with members and legislators.