Please note: Due to ongoing challenges associated with the COVID-19 pandemic, the Minnesota Legislature recently passed a special law to “carry over” 2020 UI experience rates into 2021. If you are an experience rated employer, your UI experience rate this year will be exactly the same as it was last year.
Employers with covered employment must pay quarterly unemployment insurance tax into the Minnesota Unemployment Insurance Trust Fund (the Fund), which is used solely to pay unemployment benefits. This tax is a percentage of the taxable wages paid to employees and may not be withheld from employee wages.
Employers that have only paid wages for a short time will be assigned one of two new employer tax rates, depending on their type of business - a rate which is the computed average rate of all employers or a rate which is assigned to employers in a high experience rating industry - each year until the employer qualifies for an experience rating. Each employer's tax rate is comprised of several factors, which may change yearly depending on the balance in the Fund.
Once an employer qualifies for an experience rating, their tax rate will be determined by dividing the total unemployment benefits paid to former employees by the total taxable wages paid to all of their employees. Reference the Experience Rating section of this handbook for more information.
Employers with an active employer account will receive a Tax Rate Determination in the mail every December that assigns the upcoming year's tax rate components and taxable wage base. The Tax Rate Determination informs the employer of their right to appeal if they disagree with the tax rate assigned to their account.
View unemployment insurance tax rates.