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New York - Definition of Employer and Unemployment Insurance

On December 20, 2019, New York Governor Andrew Cuomo signed legislation (A.B. 8035) amending the state’s labor law to clarify the definition of an employer for the state’s unemployment insurance law when the worker is placed with another employer. Under the clarification, when the New York Commissioner of Labor determines that the services performed by an individual are employment, and both of the following apply, then the entity that pays the worker for their services is their employer:

  • The supervision, direction, and control of the worker is exercised by one or more entities; and
  • One entity places or provides the worker to another for their employment.

Additionally, under these circumstances, if the employer is replaced by another then the replacement is considered a transfer for experience rating purposes. A contract may also allocate who the employer is for unemployment purposes.

These provisions do not apply to payroll agencies that provide payroll services on behalf of another employer.

The law is effective January 1, 2020.

Read NY A.B. 8035