Finance News & Insights

What expanded ‘new hire’ definition means to Payroll

Back in the fall, President Obama signed into law a new definition of who qualifies as a new hire, and there a few things about this definition that your Payroll staff needs to know.

The new law, which takes effect on 4/21/12, says that a “newly hired” employee is someone who either:

  • hasn’t previously been employed by the organization, or
  • was formerly hired by the company, “but has been separated from such prior employment for at least 60 consecutive days.”

This means that Payroll must report all new and rehired employees to their state’s new hire directories.

While the compliance deadline is slated for 4/21/12, it’s important to keep in mind that states that need to pass legislation to put the change into effect may have more time to do so — depending on when their legislatures are in session.



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