July 1997

Workplace Labor Update - New Hire Reporting – July 1997

2 min

In the March 1997 Workplace Labor Update, we reported that as part of the "Personal Responsibility and Work Opportunity Reconciliation Act of 1996," commonly referred to as the welfare reform act, Congress has imposed a new requirement upon employers that is designed to help the government enforce child support payments.

Under the federal law, each state must require all employers to provide to the state the name, address, and social security number of any newly hired employee. The employer is required to submit its own address and employer identification number along with this information. The state must then create a state directory of new hires and submit it to the federal government, which will then create a national directory. These national and state directories will be used to compare the social security numbers of employees in the directory with those appearing in the case registries for paternity and child support cases.

The Maryland General Assembly has now enacted legislation providing for the State's compliance with the federal law. Under this legislation, Maryland employers must begin reporting new hires to the Secretary of Labor, Licensing and Regulation effective July 1, 1997. See Md. Code, Labor & Empl. Art. &#sect; 8-626.1. Maryland employers must submit the name, address, social security number, and date of employment of any employee hired on or after July 1, 1997, along with the employer's federal identification number and state unemployment insurance account number. This information must be submitted within 20 days of an employee's beginning employment, and may be transmitted either by mail, magnetically or electronically. Any Maryland employer that has employees in two or more states and that transmits reports magnetically or electronically may designate one state in which to transmit the report. If a Maryland employer chooses to transmit the data to another state, it must provide to the State of Maryland the name of the state receiving the report.

The State of Maryland Department of Labor, Licensing and Regulation has sent out compliance packages, which include forms to transmit the required new hire information, to assist employers with understanding and complying with this new law. State officials have indicated that they will allow employers some leeway in reporting for the first month.