State Unemployment Taxes and Employee Turnover. Understanding the impact of SUTA Increases.
Employee turnover can have a drastic impact on UI and SUTA expenses for companies with relatively low wages such as restaurants and hospitality based businesses. This tool helps estimate the financial impact on UI payments as turnover increases or decreases. Each state has different rules, wagebases and rates and our tool uses those bases to estimate the impacts of employee turnover on UI/SUTA taxes.
To calculate your company’s estimated cost of increases in State Unemployment taxes (SUTA) enter the values here and click the button for 'Get SUTA Analysis'. Results are estimates and do not reflect your actual SUTA obligations. The estimated impact on your SUTA taxes from employee turnover is also calculated. If you have questions about the formulas used or want more information about how to reduce your company’s cost from Unemployment Insurance, contact us.
Enter The Estimated Values For Your Company:
Confused about these calculations? Learn how SUTA is calculated and the relationship between Unemployment Insurance / SUTA and employee turnover.
SUTA Turnover Model Assumptions
- All employees are in the same state. If you have significant amounts of employees in different states you may want to run the model separately for the employees groups in each state.
- You are not located in one of the few states that charge a portion of unemployment insurance costs to the employees. To see if this affects your analysis, check the table located here State UI rate table or see your state UI website.
- Employee turnover rate is consistent throughout the year.
- All employees are fulltime with a standard work year of 2100 hours. Any number of part-time employees will cause SUTA costs in the analysis to be understated.
- Average hourly wage for the group is fair representation of actual wages. I.E there is not one group of highly compensated employees and another group of low compensated employees averaged together in the rate. If you have significant groups at different compensation levels you may want to run the model separately for each group.
- Number of active employees is consistent throughout the year. A large number of employee new hires or terminations will affect the analysis.