Virginia Senate Bill 759 Change Notification Virginia SB 759 updates the state’s unemployment insurance framework by revising the weekly benefit amount (WBA) tables used to calculate claimant payments. While the underlying methodology, basing benefits on wages earned in the two highest quarters of the base period, remains unchanged, the bill introduces higher benefit tables to increase the amount payable to eligible individuals. The legislation establishes a two-phase implementation: an initial updated table effective January 1, 2026, followed by a second, revised table that becomes effective on the earlier of six weeks after enactment or July 1, 2026. These changes are designed to incrementally enhance benefit levels without altering the fundamental calculation structure. Effective Date The first updated benefit table takes effect January 1, 2026. A subsequent revised table becomes effective on the earlier of six weeks after the bill’s enactment or July 1, 2026. Virginia SB 759 Implication to Stakeholders Although the calculation methodology remains consistent, the increase in weekly benefit amounts is likely to raise overall unemployment insurance payouts. Over time, this may place upward pressure on the solvency of Virginia’s Unemployment Trust Fund, which can translate into higher employer contribution rates or adjustments to taxable wage bases in future rate cycles. Employers may also see a marginal increase in claims costs charged to their experience rating accounts, particularly in industries with higher turnover. Recommended Action for Employers Employers should review their unemployment insurance cost projections and monitor future communications from the Virginia Employment Commission regarding rate adjustments tied to these enhanced benefit levels. It is advisable to continue emphasizing strong claims management practices, including timely responses to separation notices and proper documentation of terminations, to mitigate potential increases in experience-rated charges. Additionally, budgeting for potential increases in UI tax liability over the next several years would be a prudent step.

Executive summary 2026 is an enforcement year. Federal worksite scrutiny is up, with ICE reaffirming three‑day production timelines and penalty exposure during I‑9 inspections. At the same time, wage‑and‑hour recovery trends remain strong, and multi‑state pay transparency obligations continue to expand. Employers that hire remotely, operate across multiple jurisdictions, or still rely on paper I‑9s face outsized risk—and opportunity—to standardize, document, and prove compliance. Paper I‑9 compliance remains a high‑risk area, with studies showing that 76% of paper forms contain at least one error, while DHS’s 2023 final rule has made DHS‑authorized remote examination a permanent option—but only for E‑Verify employers in good standing, and only if they complete a live video review and properly mark the Form I‑9 checkbox. At the same time, wage‑and‑hour enforcement continues to deliver results, with more than $1.5 billion in stolen wages recovered between 2021 and 2023 through federal, state, and class action efforts. Layered onto this enforcement landscape are increasingly complex pay transparency requirements, as New York’s statewide law, Colorado’s 2024 amendments (including mandatory post‑selection notices), Washington’s 2025 “notice and cure” amendments, and California’s SB 1162 now directly shape how multi‑state and remote recruiting must be executed. I‑9: Why audits are back in force Error‑prone paperwork. Paper completion is fragile at scale: analyses have found that 76% of paper I‑9s contain at least one fine‑able error—the kind of technical miss that includes dates, signatures, document numbers compounds across high‑volume or decentralized hiring. Audit volume & penalties. ICE reiterates core mechanics: a Notice of Inspection (NOI) starts the clock; employers generally have three business days to produce forms and records; technical errors get a 10‑day correction window, while substantive violations and uncorrected issues can trigger monetary fines. Paperwork fine schedules have been updated in recent years (e.g., ranges in the hundreds to low thousands per form), and repeat violations escalate. Remote/anywhere hiring reality. Since Aug. 1, 2023, DHS authorizes a remote alternative procedure—only for E‑Verify employers in good standing—requiring: copies of the documents a live video interaction checking the new I-9 box indicating the alternative was used. Use is optional but must be applied consistently at a hiring site. Effective I-9 action plan for 2026 An effective I‑9 action plan for 2026 should focus on proactive auditing, clear process documentation, and rapid inspection readiness. Employers should begin with a counsel‑guided self‑audit of a neutral sample—or all—I‑9s to identify and correct technical errors without backdating, documenting fixes with single‑line strike‑throughs, initials, and dates, while ensuring current employees’ I‑9s are retained for the duration of employment and former employees’ forms are purged three years after hire or one year after termination, whichever is later. Centralizing I‑9 storage, tracking reverifications, and enforcing a routine purge schedule help reduce both compliance and data‑retention risk. For organizations enrolled in E‑Verify and in good standing, it’s also critical to codify the DHS‑authorized alternative procedure in a written SOP that details how document copies are collected, how live video verification is conducted, how the Form I‑9 checkbox is completed, and how supporting records are retained, while clearly defining when in‑person inspection is still required. Finally, employers should establish a clear Notice of Inspection (NOI) response protocol that specifies who receives and triages an NOI, how and when counsel is engaged, what documentation must be assembled within the 72‑hour window, and how communications flow to site leaders, training all stakeholders against ICE’s inspection guidance to ensure a coordinated, audit‑ready response. Wage theft: Expect sustained recovery actions Between 2021 and 2023, more than $1.5B in unpaid wages was returned to workers through federal enforcement, states, and top class action settlements—evidence that investigations and private litigation work and will continue. Recurring risks: off‑the‑clock work, unpaid overtime, misclassification, and weak recordkeeping. What to do In multi‑location and multi‑state environments, employers must also validate that meal and rest break logic aligns with applicable jurisdictional rules, particularly where state requirements diverge. Scheduling systems, timekeeping configurations, and manager prompts should be tested regularly to ensure they reflect local law and operational reality. Enforcement and recovery data consistently show that multijurisdictional inconsistencies are a leading driver of wage‑and‑hour claims, making alignment across locations a critical risk‑reduction step. Pay transparency: A patchwork - with teeth New York (statewide. Employers with 4+ employees must include pay ranges and job descriptions (if they exist) in postings. Coverage includes roles performed outside NY that report to a supervisor/office in NY; FAQs give detailed edge‑case illustrations. Colorado (EPEWA, amended 2024). Postings must include ranges, benefits/other comp, how/when to apply, and employers must issue internal “job opportunity” notices and post‑selection notices (e.g., selected candidate and how to express interest next time). Agencies have published INFO #9A guidance interpreting the rules. Penalties can reach $500–$10,000 per violation. Washington (RCW 49.58.110). Employers with 15+ employees must include range (or fixed wage if only one amount) and benefits in postings. From July 27, 2025 through July 27, 2027, a five‑business‑day notice‑and‑cure period applies before remedies attach—aimed at curbing litigation over technical defects. California (SB 1162). Employers with 15+ must include a pay scale in job ads (including third‑party postings), and employers with 100+must submit annual pay data reports; FAQs clarify that postings that could be filled from CA (including remote) must include the range within the posting—no links/QR codes in lieu of a range. Multi‑state checklist for recruiters & HR operations To manage multi‑state pay transparency compliance effectively, employers should start by standardizing a job‑posting template that consistently includes the pay range (or fixed wage, where permitted), benefits and other compensation, and clear application window and instructions, with a designated field for jurisdiction‑specific addenda such as Colorado’s post‑selection notice requirements. Organizations should also define clear remote‑role routing logic to determine which jurisdiction’s rules apply when a position can be filled from anywhere, incorporating tests like New York’s “reports‑to” standard and California’s remote‑role applicability, and mapping those conditions directly into ATS fields to reduce manual errors. Recruiters should be trained regularly on these requirements, and employers should actively audit third‑party job postings—particularly in light of Washington’s 2025 amendments, which allow a notice‑and‑cure window and acknowledge nonconsensual reposts but still require prompt corrective action—ideally supported by a weekly scraper audit. Finally, maintaining robust “range substantiation” files for each role, including compensation philosophy, market data, leveling frameworks, and approved variances, enables faster responses to agency inquiries and internal questions and supports the good‑faith range expectations emphasized in Colorado guidance. FAQs We still have legacy paper I‑9s. What’s the fastest low‑risk cleanup? Run a counsel‑guided self‑audit. Correct technical errors transparently (no white‑out; don’t backdate), initial/date changes, and attach an explanation if the employee can’t fix Section 1. Then calculate purge dates and schedule destruction for forms past the 3‑years‑from‑hire / 1‑year‑from‑termination (whichever later) rule. Can we use the DHS remote alternative for some employees but not others? Yes—if you’re an E‑Verify employer in good standing. You can offer the alternative procedure at certain hiring sites and still perform physical inspection for on‑site roles, provided you apply the approach consistently and avoid discriminatory selection. Document your decision logic in an SOP. What are our must‑have elements in an I‑9 NOI response? Within three business days, produce I‑9s for current and relevant former employees, plus payroll, active/terminated lists, and corporate documents as requested. If ICE flags technical issues, you typically have 10 business days to correct. Prepare a single source of truth (index + PDF set) before day three. We recruit nationally. Which postings need a pay range? NY: Roles performed in NY or outside NY but reporting to NY require a range and job description. CO: Any job opportunity for CO employees requires a range, benefits/comp, how/when to apply, plus internal post‑selection notices. WA: For 15+ employees, include range and benefits; a five‑day cure window applies 7/27/2025–7/27/2027. CA: For 15+, include a pay scale directly in the posting (no links/QRs), including roles that could be filled from CA (remote). What’s driving the “enforcement‑first” posture on wage theft? Documented recoveries—$1.5B across 2021–2023—demonstrate measurable ROI for enforcement at federal and state levels, and class actions remain a strong parallel channel. Plan on continued investigations and private litigation pressure in 2026.

Virginia Senate Bill 433 Change Notification Virginia SB 433 amends § 60.2-612 of the Code of Virginia to modify unemployment insurance eligibility rules, primarily by addressing how employer lockouts are treated. The measure clarifies that a lockout initiated by an employer is not considered a disqualifying labor dispute, meaning impacted employees may qualify for unemployment benefits. However, benefits may still be denied in limited circumstances, such as when the employee’s bargaining representative refuses to negotiate in good faith or violates an existing collective bargaining agreement. Effective Date July 1, 2026 Virginia SB 433 Implication to Stakeholders This change increases the likelihood that employees involved in employer-initiated lockouts will qualify for unemployment benefits, which may lead to higher benefit charges to employer accounts in those situations. Employers engaged in labor disputes no longer have the same ability to rely on a blanket disqualification of benefits during lockouts. Additionally, the enhanced verification requirements may improve program integrity overall, but they do not materially reduce employer exposure to claims arising from labor disputes. Recommended Action for Employers Employers should carefully evaluate labor relations strategies, particularly when considering or implementing a lockout, as such actions may now result in increased unemployment claims liability. Coordination with legal counsel and labor relations advisors is recommended to understand the financial and compliance implications.Employers should also continue to monitor claims closely and respond promptly to agency inquiries, ensuring accurate reporting of separation circumstances to mitigate improper charges.

Virginia has passed a new Paid Family and Medical Leave (PFML) law, signed into effect by Governor Spanberger on April 22, 2026. This law creates a state-run program that will give eligible employees paid time off for major life and health events. New paid leave option for Virginia employees Under the new law, employees can take paid leave for their own serious health condition, to care for a family member, or to bond with a new child after birth, adoption, or foster placement. Some military-related situations are also covered. Employees may receive up to twelve weeks of paid leave in a year, with partial wage replacement. The program will roll out in stages. Starting April 1, 2028, employers and employees must begin making payroll contributions to fund the program. Benefits will become available on December 1, 2028, when employees can begin taking paid leave. Funding the program through payroll deductions Most employees in Virginia will be covered, including part-time workers. The program will be funded through payroll deductions shared by employers and employees, with rates set by the state each year. Some small employers may not have to pay the employer portion, but they still must follow other requirements. Employers will need to handle several new responsibilities. These include collecting and sending payroll contributions to the state, giving required notices to employees, protecting employees’ jobs while they are on leave, and keeping accurate records. Employers must also avoid any retaliation against employees who use the leave. Compliance considerations to understand There are real risks for not complying with the law. Employers may face financial penalties for failing to pay contributions or follow the rules. Employees may also bring claims if they are denied benefits or not returned to their jobs after leave. More details on penalties are expected, but enforcement is likely to be taken seriously. Overall, this law is a major change for Virginia employers. While the deadlines are still a couple of years away, it is important to start preparing now to avoid issues later. Get in touch with one of our experts to learn how your organization can best prepare.

Virginia House Bill 1320 Virginia HB 1320 amends § 60.2-602 of the Code of Virginia to increase weekly unemployment insurance (UI) benefit amounts. While benefits will continue to be calculated using the Benefit Table based on wages in the two highest-paid quarters of a claimant’s base period, the measure updates the table to provide a flat increase of $48 to weekly benefit amounts. This change applies to claims effective on or after the earlier of six weeks following enactment or July 1, 2026. The bill is enacted as an emergency measure, accelerating implementation. Effective Date July 1, 2026 Virginia HB 1320 Implication to Stakeholders The increase in weekly benefit amounts is expected to raise overall unemployment insurance benefit payouts from the state trust fund. Although the direct impact on employer tax rates is not specifically defined in the law, higher benefit outflows may place downward pressure on trust fund solvency over time. This can increase the likelihood of future adjustments to employer contribution rates or taxable wage bases, particularly if claim volume rises or economic conditions weaken. Employers may ultimately experience higher unemployment insurance costs, especially those with greater claims activity affecting their experience rating. Recommended Action for Employers Employers should monitor updates from the Virginia Employment Commission regarding any future changes to unemployment tax rates or trust fund conditions. It is advisable to review and strengthen internal unemployment claims management processes to ensure that only valid claims are charged to the employer’s account. Employers may also want to factor potential increases in UI-related costs into financial planning and budgeting forecasts. Proactive workforce management and documentation practices will help mitigate exposure to higher experience-rated contributions as benefit levels increase.

Kentucky Senate Bill 129 Kentucky Senate Bill 129 updates KRS 341.243 by modifying the structure and funding mechanism of the existing Service Capacity Upgrade Fund, which supports modernization of the state’s unemployment insurance (UI) system. While the fund itself is not new, the bill revises how employer contributions are calculated and introduces a new rate adjustment methodology. Through December 31, 2026, employers will continue contributing based on the existing 0.075% rate reduction. Beginning January 1, 2027, the contribution structure changes, allowing the Secretary to set the rate annually, with a cap of 0.025%. The bill also establishes specific conditions under which contributions may be reduced or suspended, including when the fund reaches certain balance thresholds or if the UI trust fund balance declines below defined levels. Effective Date The bill maintains the current structure through December 31, 2026. The updated rate-setting methodology and ongoing provisions take effect January 1, 2027. Kentucky SB 129 Implication to Stakeholders Employers should expect continued contributions to the Service Capacity Upgrade Fund, but with a shift in how those contributions are determined beginning in 2027. While the updated structure introduces flexibility and may result in lower contribution rates due to the capped annual adjustment, it also creates variability, as the rate will be set annually at the Secretary’s discretion. Additionally, the presence of defined suspension thresholds may provide periods of relief depending on fund balances. Overall, employers may see changes in their UI tax calculations and should anticipate less predictability in year-over-year contribution amounts. Recommended Action for Employers Employers should closely monitor annual unemployment insurance tax rate notices, particularly beginning in 2027, to understand how the revised rate-setting process impacts their contributions. Coordination with payroll providers or tax advisors is recommended to ensure accurate budgeting and compliance. Employers should also stay informed on announcements from the Kentucky Office of Unemployment Insurance regarding rate adjustments or suspension of contributions, as these changes may affect cost planning and forecasting.

Nebraska Legislative Alert 847 Change Notification Nebraska LB 847 revises how the combined unemployment insurance (UI) tax rate is allocated between the employer contribution rate and the state unemployment insurance tax rate when the state UI tax rate is greater than zero. Under prior law, at least 80% of the combined rate was required to be assigned to the contribution rate and no more than 20% to the state UI tax rate. This measure changes that formula so that at least 50% of the combined rate must be attributed to the contribution rate and no more than 50% may be assigned to the state UI tax rate. The existing provision remains in place for employers with a combined tax rate of 5.4% or greater, where the state UI tax rate is zero and the full rate is assigned to the contribution rate. Effective Date April 7, 2026 Nebraska Legislative Alert 847 Implication to Stakeholders While the total combined UI tax rate may not necessarily increase, this change allows for a greater portion of the rate to be allocated to the state unemployment insurance tax component rather than the experience-rated contribution portion. As a result, employers may experience a shift in how their rates are structured, potentially reducing the direct impact of claims experience on a portion of their overall tax rate. However, it may also reduce predictability in how rates are distributed year-over-year, depending on how the state applies this flexibility. Recommended Action for Employers Employers should review their unemployment tax rate notices carefully to understand how their combined rate is being allocated under the revised formula. It is advisable to continue focusing on effective claims management practices, as the contribution rate component remains experience-based and subject to employer control. Employers may also want to consult with their unemployment insurance advisor to evaluate any shifts in tax rate composition and ensure they are prepared for potential changes in how their UI taxes are calculated going forward.

Unemployment Insurance (UI) claims management is a critical compliance function for multi‑state employers—yet it’s also one of the most complex, time‑consuming, and risk‑laden areas of HR and payroll operations. Employers must navigate evolving state regulations, tight response deadlines, and increasing scrutiny around documentation and eligibility. This blog provides a clear comparison of in‑house UI claims management versus outsourced solutions, helping employers determine which model best supports efficiency, compliance, and cost control. Whether you’re scaling rapidly, struggling with high claim volumes, or evaluating ways to improve win rates and reduce UI tax costs, this guide outlines the core benefits, drawbacks, and strategic considerations for each approach. Unemployment insurance challenges Multi-state employers face a unique challenge when managing unemployment insurance claims: each state has its own rules, timeliness, and documentation expectations. As claims rise during economic fluctuations and turnover remains a persistent issue, organizations must decide whether to retain UI claims processing internally or partner with specialized third-party administrators. Understanding the operational, financial, and strategic implications of each option allows employers to choose a UI management model that aligns with their goals, resources, and compliance needs. In-house UI claims management Managing unemployment insurance (UI) claims in-house gives organizations a high level of ownership and oversight. One of the primary advantages is the direct control it provides. Internal teams can tailor workflows, documentation standards, and claim responses to align precisely with the company’s policies and operational needs. This flexibility allows HR professionals to pivot quickly when internal processes or policies shift. Another benefit is the immediate access to internal data. HR teams can easily retrieve essential documents such as performance records, attendance logs, and separation details, all of which contribute to more accurate and timely claim responses. In addition, internal staff possess relationship-based insight—an understanding of the context behind each termination or separation. This familiarity helps them craft nuanced and personalized responses that an external provider might not be able to replicate. However, managing UI claims internally also presents significant challenges. The administrative workload involved can be overwhelming, especially for lean HR teams. Tasks such as gathering documentation, responding to claims on strict deadlines, preparing for hearings, and conducting fact-findings require considerable time and attention. Multi-state employers face additional complexity because each state has its own statutes, response protocols, and claim systems. Keeping up with these variations can strain HR resources and increase compliance risk. Another limitation is the lack of specialized expertise. Even highly experienced HR teams may not have deep knowledge of UI regulations, hearing procedures, or tax rate management, which can limit their ability to contest inaccurate claims successfully. Finally, ongoing training is essential to stay current with evolving UI laws. When turnover occurs, accumulated knowledge can easily be lost, making consistency in claims management difficult to maintain. Outsourced UI claims management Outsourcing UI claims management offers distinct advantages for organizations seeking increased efficiency and expert support. Third-party administrators bring specialized expertise in state regulations, hearing practices, tax implications, and appeals strategies. Their focused knowledge often leads to improved claim outcomes, including higher win rates and reduced UI tax costs. Outsourcing also streamlines internal operations by reducing the time and labor required of HR teams. Providers leverage standardized workflows and automated systems to ensure timely, compliant responses across jurisdictions. In addition, outsourced partners typically offer data analytics and trend reporting tools, giving employers valuable insights into claim patterns, root causes, and financial impact. These insights can guide better workforce planning and employer decision-making. Despite these strengths, outsourcing presents its own challenges. External vendors may lack the internal context needed to fully understand the circumstances behind each employee separation. If employers fail to provide complete or timely information, outsourced responses may be less accurate or compelling. Communication gaps can also occur when internal teams and vendors are not fully aligned, leading to delays or missteps that negatively affect claim outcomes. Finally, the quality of outsourcing providers varies widely. Not all vendors offer the same level of expertise, technology, or state-specific knowledge. Choosing the right partner is essential to create operational efficiencies and overcome the challenges of managing UI claims. Key comparison for multi-state employers FactorIn‑HouseOutsourcedControlHighModerateAdministrative BurdenHighLowCompliance ConfidenceModerateHighCost PredictabilityLowerHigherExpertise LevelGeneral HR KnowledgeUI-law specialistsScalabilityLimited by team sizeStrong, especially for large or growing employersResponse TimelinessDependent on HR capacitySystem-driven and deadline-focused Which option is best for multi-state employers? Multi‑state employers typically benefit most from outsourced UI claims management due to the complexity and volume of claims across jurisdictions. Outsourcing ensures compliance, reduces administrative strain, and can significantly lower UI tax liability. The best model often depends on: Claim volume Internal HR capacity Multi-state footprint Desired control vs. efficiency Cost sensitivity Need for specialized guidance FAQ Section FAQ Section Why is UI claims management more complex for multi-state employers? Each state has its own filing system, deadlines, documentation requirements, and adjudication rules. Managing these variations requires significant administrative bandwidth and expertise. What are the biggest risks of keeping UI claims in-house? Missed deadlines, incomplete documentation, and lack of specialized knowledge can lead to lost claims, increased UI tax rates, and potential compliance exposure. Does outsourcing guarantee lower UI tax rates? Not guaranteed, but many employers experience reduced tax rates because specialists help prevent incorrect benefit charges and improve win rates. What size employer benefits most from outsourcing? Businesses with high turnover, significant seasonal fluctuations, or operations in multiple states tend to see the greatest ROI. Can an employer outsource just part of the UI claims process? Yes—many providers offer hybrid solutions such as handling hearings only, managing documentation flow, or providing audit and compliance support. However, with the right partner a full-service unemployment management solution will offer the most benefit. Learn how you can implement a streamlined unemployment management process by speaking with one of our experts.

Maryland House Bill 242 Change Notification Maryland House Bill 242 updates the state’s unemployment insurance (UI) confidentiality provisions to align more closely with federal requirements. Specifically, the measure revises how the Maryland Department of Labor handles, safeguards, and discloses UI-related information so that it complies with governing federal statutes, including the Social Security Act, the Federal Unemployment Tax Act (FUTA), and implementing regulations such as 20 C.F.R. Part 603. These federal rules establish strict standards for the confidentiality, disclosure, and permissible use of UI data, and the bill ensures Maryland law is consistent with those standards. Effective Date Upon enactment Maryland HB 242 Implication to Stakeholders For employers, this change primarily affects how unemployment insurance information, such as wage data, contribution records, and claim details, may be shared or accessed. Employers may experience tighter controls around the release of UI information and potentially more formalized processes when requesting or responding to information from the state. While the change does not directly alter tax rates or benefit eligibility, it reinforces data privacy requirements and may limit informal or broad access to claim-related information, emphasizing compliance and proper authorization. Recommended Action Employers should review their internal processes for handling unemployment insurance information to ensure they align with stricter confidentiality standards. This includes confirming that only authorized personnel access UI data, maintaining secure recordkeeping practices, and responding appropriately to state requests for information. Employers may also want to coordinate with their third-party administrators or legal advisors to ensure continued compliance and to understand any procedural changes in how UI information is requested or disclosed under the updated law.

The IRS has now done more than preview updated 1099 form layouts. Its draft 2026 Instructions for Forms 1099-MISC and 1099-NEC confirm that the agency is moving toward more detailed reporting for cash tips, Treasury Tipped Occupation Codes, and overtime compensation. The draft also confirms that the reporting threshold for many covered payments is increasing from $600 to $2,000 for tax years beginning after 2025. That makes this a meaningful development for businesses that issue Forms 1099-MISC or 1099-NEC. The change is not limited to form appearance. The draft instructions show how the IRS expects these new fields to work within total income reporting, which means filers may need to revisit data collection, reporting logic, and year-end compliance processes before the 2026 filing cycle. What the draft instructions change for 2026 1099 forms The draft instructions identify several updates in the “What’s New” section. They state that new boxes 1b and 13a were added for cash tips, new boxes 1c and 13b were added for Treasury Tipped Occupation Codes, and new boxes 1d and 14 were added for overtime compensation. The same section also says the payer and recipient address fields were separated into individual entry boxes and that the minimum threshold for certain reporting and backup withholding requirements increased to $2,000, with inflation adjustments beginning in calendar year 2027. The instructions also clarify that these new amounts do not replace total income reporting. On Form 1099-NEC, cash tips and overtime compensation are still included in Box 1a. On Form 1099-MISC, those amounts are still included in Box 3. That means the IRS is adding detail without abandoning the broader roll-up structure already familiar to filers and recipients. Why this stands out Compared with the April 2025 instructions, this is a clear reporting shift. The prior instructions did not include these new tip, Tipped Occupation Code, or overtime boxes, and they reflected the older $600 threshold framework. In practical terms, the 2026 draft is asking for more granular reporting while also changing the dollar threshold that triggers reporting for many payments. The IRS had already hinted at this direction in the draft forms themselves and in Publication 1099, but the instructions matter because they tell filers how the agency expects the forms to be used. That is what makes the April 2026 draft instructions especially useful for tax, payroll, and compliance teams evaluating the impact. What this means for filers For companies that rely on established 1099 workflows, these draft instructions are an early warning. Systems that currently capture only total nonemployee or miscellaneous income may need to account for new subcategories tied to tips and overtime. Teams may also need to evaluate whether upstream payment classification, recipient communications, and year-end reporting controls are still aligned with the new structure the IRS is signaling. This is still draft guidance, but it is detailed enough to justify early planning. Suggested takeaway The IRS’s draft 2026 instructions for Forms 1099-MISC and 1099-NEC confirm that broader reporting changes are on the table for 2026. The biggest developments are the addition of specific boxes for cash tips, Treasury Tipped Occupation Codes, and overtime compensation, along with a higher reporting threshold for many covered payments. While these rules are not final yet, they are substantial enough to put filers on notice that 2026 reporting may look materially different from 2025. Simple comparison table Topic2025 instructions2026 draft instructionsCash tipsNo dedicated reporting boxesAdds Box 1b on 1099-NEC and Box 13a on 1099-MISCTreasury Tipped Occupation CodesNot separately reportedAdds Box 1c on 1099-NEC and Box 13b on 1099-MISCOvertime compensationNo dedicated reporting boxesAdds Box 1d on 1099-NEC and Box 14 on 1099-MISCTotal income treatmentNo special tip/overtime box guidanceTips and overtime still included in Box 1a on 1099-NEC and Box 3 on 1099-MISCReporting threshold$600 framework$2,000 for many covered payments beginning after 2025Address layoutTraditional combined address format  Address fields split into individual entry boxes

Washington Senate Bill 6134 Change Notification Washington Senate Bill 6134 updates the state’s unemployment insurance (UI) law by requiring the Employment Security Department (ESD) to provide clear notice to workers who apply for benefits due to a strike. Specifically, workers must be informed that if they later receive retroactive wages, such as back pay following a strike resolution, for weeks in which they also collected UI benefits, they may be subject to an overpayment determination. The law does not change the state’s authority to recover overpaid benefits but formalizes the requirement that workers be notified of this possibility in advance. It also outlines acceptable methods of delivering this notice, includes a federal conformity provision to ensure continued federal funding and tax credit eligibility, and establishes that this notice requirement will remain in effect through December 31, 2035. Effective Date Immediately Washington SB 6134 Implication to Stakeholders While the primary obligation under this law falls on the state, employers may see increased scrutiny and coordination around strike-related claims and any subsequent retroactive wage payments. If retroactive wages are issued following a strike, those payments could trigger overpayment determinations for impacted employees, potentially leading to administrative follow-up or inquiries involving the employer. This may also influence how claims are adjudicated and how employer accounts are impacted, particularly if benefit payments are later reversed or recovered. Recommended Employer Action Employers should ensure accurate and timely documentation of any strike activity and clearly track any retroactive wage payments made to employees following a labor dispute. It is advisable to coordinate closely with internal payroll and HR teams to ensure consistency in reporting and to respond promptly to any ESD inquiries. Employers may also benefit from reviewing their internal processes for handling strike-related claims to minimize administrative complications and ensure compliance with evolving UI requirements.

Pennsylvania House Bill 274 Change Notification Pennsylvania House Bill 274 expands eligibility for unemployment compensation by allowing individuals who are victims of domestic violence to qualify for benefits under certain circumstances. The measure permits claimants to confidentially submit “reasonable evidence” of recent domestic violence when applying for benefits. Importantly, the law removes the requirement that individuals provide formal documentation such as a police report or protective order, broadening the types of acceptable proof and lowering barriers to eligibility. Effective Date Immediately Pennsylvania HB 274 Implication to Stakeholders This change may result in an increase in unemployment claims that are approved under circumstances where an employee voluntarily leaves employment due to domestic violence. Because the evidentiary standard is more flexible and confidentiality is emphasized, employers may have limited visibility into the specifics of the claim and fewer opportunities to contest eligibility based on lack of traditional documentation. As a result, employers could see a potential impact on their unemployment tax rates if more claims are charged to their accounts. Recommended Employer Action Employers should review and update their internal policies and procedures related to employee separations and unemployment claims to account for this expanded eligibility category. It is advisable to ensure that HR and management teams are trained to handle sensitive situations involving domestic violence appropriately and to document separations carefully, while respecting employee privacy. Additionally, employers should monitor unemployment claims closely and work with their unemployment cost management partners to evaluate chargeability and respond appropriately within the bounds of the updated law.

Executive Summary Selecting an HR compliance partner is a high‑stakes decision that extends far beyond administrative support. Employment regulations continue to evolve at an accelerated pace, placing increasing pressure on employers to remain compliant across federal, state, and local jurisdictions. The right compliance partner can help mitigate risk, improve consistency, and support strategic growth. The wrong one can expose organizations to costly penalties, operational disruption, and reputational harm. This guide outlines the critical considerations employers should evaluate before entering into an HR compliance partnership, highlighting the essential questions that reveal a provider’s expertise, accountability, and long‑term value. By asking the right questions before signing, employers can make informed decisions that protect both their workforce and their business. From Insight to Evaluation Before signing an agreement, employers should evaluate potential HR compliance partners by asking the following questions. Each question addresses a critical dimension of compliance expertise, responsiveness, accountability, and long‑term scalability. The 12 Essential Questions Which Employment Laws and Regulations Do You Actively Monitor? How Do You Stay Current as Regulations Change? Is Your Guidance Proactive—or Only Reactive When Issues Arise? Who Provides Compliance Guidance, and What Are Their Credentials? How Is Guidance Tailored to Our Industry, Workforce Size, and Risk Profile? How Do You Handle Multi‑State and Remote Workforce Compliance? What Are Your Response Time Expectations for Urgent Compliance Issues? How Do You Escalate High‑Risk Issues Such as Audits, Complaints, or Investigations? What Role Does Technology Play in Your Compliance Support Model? How Do You Support Employers During Audits, Investigations, or Disputes? What Accountability Do You Assume If Guidance Is Inaccurate or Incomplete? How Does Your Compliance Support Scale as Our Organization Grows? Why HR Compliance Has Become a Business‑Critical Function HR compliance is now one of the most complex and risk‑sensitive areas of modern business operations. From wage and hour laws and leave mandates to pay transparency, worker classification, and data privacy requirements, employers are expected to remain compliant in an environment where regulations evolve quickly and enforcement continues to intensify. Despite this reality, many organizations still approach the selection of an HR compliance partner as a routine vendor decision—often prioritizing cost or surface‑level features over long‑term impact. This approach can leave employers exposed when compliance issues arise. The Difference Between Reactive Support and Strategic Guidance A true HR compliance partner should function as an extension of an organization’s leadership team, delivering proactive guidance rather than reactive fixes. Before entering into an agreement, employers should understand which employment laws and regulations the partner actively monitors and how they stay current as rules change. Periodic updates alone are insufficient. Employers need confidence that guidance reflects the latest legal developments and is reviewed by qualified professionals who specialize in employment compliance. Who Provides the Guidance—and How It’s Applied Equally important is understanding who provides compliance guidance and how it is implemented. Employers should evaluate whether recommendations come from subject‑matter experts or generalists, and whether guidance is tailored to the organization’s industry, workforce size, and risk profile. As multi‑state and remote workforces become more common, compliance partners must demonstrate a practical, defensible approach to navigating overlapping—and sometimes conflicting—state and local requirements. Generic advice can create confusion, while customized guidance supports consistency and defensibility. Responsiveness When Compliance Issues Become Urgent Responsiveness is another defining characteristic of a strong compliance relationship. When urgent issues arise—such as employee complaints, audits, or regulatory inquiries—timely and actionable guidance can prevent escalation. Employers should clearly understand response time expectations, escalation processes, and how quickly their partner can deliver direction when it matters most. While technology can support compliance efforts, it should enhance expert judgment rather than replace it. The most effective tools translate legal requirements into everyday HR practices, streamline documentation, and improve visibility into compliance obligations. Accountability, Risk Support, and Long‑Term Scalability Accountability during high‑risk situations is a critical but often overlooked consideration. Employers should understand how a compliance partner supports audits, investigations, or disputes—and what responsibility the partner assumes if guidance proves inaccurate or incomplete. Real‑world examples, measurable outcomes, and long‑term client relationships can offer valuable insight into how a provider performs beyond sales conversations. Finally, organizations should assess whether the partnership is designed to scale. As businesses grow, expand into new markets, or evolve workforce strategies, compliance needs will change. A strong compliance partner anticipates growth and adapts alongside it. Moving from Vendor Relationships to True Partnerships Asking the right questions before signing an agreement helps employers move beyond transactional relationships and toward true compliance partnerships. When approached strategically, HR compliance becomes more than a defensive necessity—it becomes a foundation for trust, stability, and sustainable growth. Frequently Asked Questions About HR Compliance Partners Why is it important to carefully evaluate an HR compliance partner before signing an agreement? HR compliance partners influence how employment laws are interpreted and applied across an organization. Inadequate or outdated guidance can expose employers to legal, financial, and reputational risk, making thorough evaluation essential. How is an HR compliance partner different from an HR vendor? An HR vendor typically provides tools or administrative services. A compliance partner, by contrast, offers expert interpretation of employment laws, proactive monitoring of regulatory changes, and strategic guidance tailored to an employer’s specific circumstances. Do small and mid‑sized employers need the same level of compliance support as larger organizations? Yes. While organizational scale may differ, legal exposure does not. Smaller employers often face greater risk due to limited internal resources, making the right compliance partnership especially valuable. What role should technology play in HR compliance services? Technology should support compliance by improving efficiency, documentation, and visibility. It should never replace expert judgment or personalized guidance. How often should employers reassess their HR compliance partner? Employers should review the relationship at least annually—or sooner if there are significant changes in workforce size, geographic reach, or regulatory exposure.

Washington Senate Bill 5874 Change Notification Washington Senate Bill 5874 updates and clarifies employer reporting requirements under the state’s unemployment insurance (UI) program. Employers are now explicitly required to maintain accurate employment records and report detailed information, including employee wages, hours worked, and job titles or standard occupational classifications. The law allows employers to correct reporting errors in a timely manner without penalty, which provides some flexibility for compliance. Additionally, the measure refines reporting obligations for certain entities such as contractors and federally recognized tribes and establishes default methods for calculating hours worked when employers fail to report them. It also revises penalty provisions by introducing a graduated structure for late, incomplete, or inaccurate reports, along with clearer standards for waivers and stronger enforcement authority in cases of misrepresentation or unpaid contributions. Effective Date June 2026 Washington SB 5874 Implication to Stakeholders This change increases the level of detail and accuracy expected in employer wage and hour reporting, which may require adjustments to payroll systems and internal processes. Employers face greater exposure to penalties if reports are late or inaccurate, particularly under the enhanced enforcement provisions. However, the ability to make timely corrections without penalty offers some protection for employers who identify and fix errors quickly. Overall, employers should expect closer scrutiny of their reporting practices and a greater administrative emphasis on compliance, especially for organizations with complex workforces or contractor relationships. Recommended Employer Action Employers should review and, if necessary, update their payroll and reporting systems to ensure they can capture and report all required data elements accurately, including hours worked and job classifications. Internal processes should be evaluated to confirm that reporting deadlines are consistently met and that there are controls in place to identify and correct errors promptly. Employers may also benefit from training HR and payroll personnel on the updated requirements and documenting procedures for handling corrections. For organizations that utilize contractors or have unique reporting structures, consulting with a UI specialist or advisor is recommended to ensure full compliance and minimize the risk of penalties.

Main LD 2101 Change Notification Maine LD 2101 introduces a new financial penalty for employers whose unemployment insurance (UI) payments are returned unpaid under the state’s Employment Security Law. If a payment fails for any reason, such as insufficient funds, a closed or invalid account, or a stop-payment order, the Maine Department of Labor is required to assess a penalty. The penalty will be the greater of $25 or 1% of the unpaid contribution amount. This formalizes a consistent consequence for invalid or rejected UI payments. Effective Date Maine LD 2101 introduces a new financial penalty for employers whose unemployment insurance (UI) payments are returned unpaid under the state’s Employment Security Law. If a payment fails for any reason, such as insufficient funds, a closed or invalid account, or a stop-payment order, the Maine Department of Labor is required to assess a penalty. The penalty will be the greater of $25 or 1% of the unpaid contribution amount. This formalizes a consistent consequence for invalid or rejected UI payments. Main LD 2101 Implication to Stakeholders This change increases the financial and administrative risk associated with errors in UI payment processing. Even inadvertent issues, such as banking errors or timing mismatches, can now result in additional costs. Employers with high contribution volumes or frequent transactions may be particularly exposed, as even small percentage-based penalties can accumulate. Additionally, repeated payment failures could draw increased scrutiny from the state and potentially impact an employer’s compliance standing. Recommended Action Employers should review and strengthen their internal payroll and payment processes to ensure all UI contributions are accurate and successfully processed on the first attempt. This includes verifying bank account information, maintaining sufficient account balances, and coordinating closely with payroll providers or third-party administrators. Implementing internal controls or payment verification steps prior to submission can help prevent avoidable penalties. Regular reconciliation of UI payments and prompt resolution of any rejected transactions will also be critical under this new requirement.

Indiana Senate Bill 162 Change Notification This measure makes several changes to Indiana’s unemployment insurance law that may affect benefit eligibility, employer coverage, and claims processing: Vacation and sick pay excluded from deductible income Payments for accrued vacation or sick leave will no longer be treated as deductible income when determining unemployment benefits. As a result, individuals may be eligible to receive full unemployment benefits even if they receive these types of payments at separation. “Suitable work” definition limited to extended benefit claims The definition of suitable work has been narrowed to apply primarily to extended benefit claims. This change may impact how refusals of work are evaluated outside of extended benefit periods. Revised definition of employment for certain organizations The law removes the requirement that religious, charitable, and educational organizations must employ four or more individuals to be considered subject to unemployment insurance. This change may expand coverage to smaller organizations that were previously excluded. Limited direct deposit disbursements authorized The Department of Workforce Development is now permitted to issue certain unemployment benefit payments via direct deposit, allowing for more efficient distribution of benefits. Additional benefits for disaster unemployment assistance claims Individuals filing for Disaster Unemployment Assistance may qualify for expanded benefits under qualifying circumstances, increasing the potential duration or amount of assistance available. Effective Date July 1, 2026 Indiana SB 162 Implication to Stakeholders These changes may result in increased unemployment benefit payouts on certain claims, particularly due to the exclusion of vacation and sick pay from deductible income, which could impact employer chargeability and future unemployment tax rates. Employers, especially smaller religious, charitable, and educational organizations, should review their status to determine if they are now subject to unemployment insurance coverage and related reporting requirements. Additionally, adjustments to how “suitable work” is defined may influence claim determinations involving job refusals. Overall, employers should be prepared for potential changes in claims handling, benefit costs, and compliance obligations under Indiana law. Recommended Action Employers should review their separation and payroll practices to account for the exclusion of vacation and sick pay from deductible income, as this may increase potential claim costs. Organizations, particularly smaller religious, charitable, and educational employers, should evaluate whether they are now subject to unemployment insurance coverage and ensure proper registration and reporting compliance. Employers should also monitor unemployment claims more closely, including job refusal issues, and respond promptly to agency requests. Finally, consider consulting with your unemployment insurance representative or advisor to assess potential impacts on your tax rate and claims strategy.

Trust is tested in moments most organizations overlook. In this webinar, Hidden Moments That Build Employee Trust, experts from Experian Employer Services and H3HR Advisors explored how routine HR compliance and operational processes—such as onboarding, payroll accuracy, employment verification, and tax withholding—play a critical but often invisible role in shaping employee trust.  While employees rarely think about HR systems, they deeply feel the impact when these processes fail—especially during major life moments like starting a new job, securing housing, managing benefits, or ensuring timely pay. When organizations invest in reliable infrastructure and reduce friction in these hidden moments, they create stability, predictability, and confidence that carry forward into engagement, retention, and performance.  The key takeaway: Compliance isn't just about checking boxes—it's about showing up for employees when it matters most.   Why trust is built in the moments we don't talk about  Historically, compliance processes have been treated as back-office necessities—tasks that must be completed to avoid audits, fines, or legal exposure. But as the panel emphasized, employees don't experience compliance as a transaction. They experience it as support—or friction—during some of the most stressful moments of their lives.  Employees aren't thinking about systems. They're thinking about questions like:  Will I get paid correctly and on time?  Will my employment be verified so I can rent an apartment or buy a home?  Will my benefits work when my family needs them?  When HR processes are reliable, employees rarely notice. When they break down, trust erodes instantly—not only in HR, but in the organization.  The Hidden Infrastructure of Trust  The webinar highlighted a powerful truth: trust is built through consistency and dependability over time.  Research shared during the session underscores why this matters:  Only 61% of employees say they are very confident their payroll and withholdings are correct, meaning nearly 40% are unsure.  50% of employees would struggle to meet financial obligations if their paychecks were delayed by just one week.  Errors or delays in HR operations aren't just administrative inconveniences. They introduce stress into employees’ lives—and often into their families’ lives—at moments when stability matters most.  Where Trust Is Most at Risk  Trust is especially tested at the intersection of HR processes and real-life moments, when everyday administrative tasks carry real personal stakes for employees. From new‑hire onboarding and I‑9 verification—where first impressions are formed and early delays can undermine confidence—to payroll and tax withholding, where inaccurate or unpredictable pay can quickly erode trust, these processes shape how employees experience their employer.   Employment and income verification directly affect an employee’s ability to secure housing, loans, or transportation, while benefits enrollment tied to life events such as marriage, childbirth, or medical needs increases sensitivity to errors and miscommunications. Even programs like the Work Opportunity Tax Credit (WOTC) extend beyond compliance, opening doors to employment while delivering measurable business value. Many of these issues never escalate to leadership, yet they have a profound impact on individual employees—making their invisibility to executives precisely what makes them so risky.  Friction Is the Enemy of Trust  The panel consistently returned to one theme: reduce friction everywhere you can.  Friction shows up as:  Manual handoffs and workarounds  Delays caused by fragmented systems  Knowledge locked in one or two tenured team members  Rework, errors, and exception handling  Modern HR infrastructure—especially when paired with trusted partners—helps reduce this friction by improving accuracy, speed, and reliability for everyone involved: HR teams, employees, and third parties alike. The goal isn't more process. The goal is fewer steps, fewer errors, and greater confidence.  How to Measure Trust and Not Just Compliance  Traditional compliance metrics matter—but they don't tell the full story.  In addition to tracking accuracy, timeliness, and audit outcomes, organizations can measure trust by asking questions such as:  How confident are you in our HR processes?  Was this experience simple and predictable?  Did issues get resolved quickly and clearly?  Do you feel confident reaching out to HR again?  Short, well-timed feedback—embedded naturally at the end of key HR experiences—can surface powerful insights without overwhelming employees.  Over time, these signals connect directly to engagement, retention, and performance outcomes.  Key Takeaways Compliance is a powerful trust-building opportunity, because routine HR processes quietly shape how employees feel about their employer—often more than headline initiatives ever do. What may feel ordinary to HR teams, such as onboarding, payroll, or employment verification, can be life‑altering for employees and their families, especially during moments of financial or personal transition. When these processes are predictable and accurate, reliability creates calm—reducing stress and reinforcing confidence in the organization.   That reliability depends on strong infrastructure: the right technology and trusted partners allow HR to move from reactive problem‑solving to proactive support. Over time, trust compounds through these small, unseen moments; handled consistently and well, they create lasting credibility and a stronger, more resilient employee experience.  Reframing Compliance as Care The most powerful shift discussed in the webinar was a mindset change: Compliance isn’t just about risk mitigation—it’s about care, predictability, and partnership.  When organizations show employees they've thought ahead, invested in reliability, and designed systems around real life—not just regulations—trust follows naturally.  Download the Webinar On-Demand Want the full conversation, real-world examples, and additional insights from Experian Employer Services and H3HR Advisors?  Download the full webinar recording and slides to explore how modern HR infrastructure turns hidden compliance moments into lasting employee trust. 

Washington House Bill 2264 Change Notification Washington House Bill 2264 expands the definition of when an employee is considered unemployed “through no fault of their own” for unemployment insurance purposes. Individuals who voluntarily elect to be included in a layoff or workforce reduction, after the employer initiates the process, may still qualify for unemployment benefits. Specifically, if the employer announces a planned reduction in force and an employee volunteers to be part of that reduction, the separation will still be treated as employer-initiated. The law also clarifies that allowing an employee to rescind their offer to be included in the layoff does not impact eligibility, and it excludes situations involving voluntary early retirement incentives or benefit modifications. Effective Date 90 days after adjournment Washington HB 2264 Implication to Stakeholders This change broadens eligibility for unemployment benefits in workforce reduction scenarios, which may lead to an increase in chargeable claims against employer accounts. Even when employees proactively volunteer for separation, these separations will generally be treated as employer-driven if the layoff process was initiated by the employer. As a result, employers may see higher unemployment insurance costs and reduced ability to contest claims on the basis that the separation was voluntary. Recommended Action Employers should review and potentially revise their workforce reduction policies and communication strategies to ensure clarity around layoff processes. It is advisable to carefully document that the employer initiated the reduction and maintain detailed records of all employee communications and decisions. Additionally, employers should anticipate potential increases in unemployment claims tied to voluntary layoff participation and consider incorporating this into workforce planning and cost projections. Consulting with unemployment insurance advisors or legal counsel can also help ensure compliance and effective claim management under the new standard.