Q: 2022 New Hire Paperwork Requirements

In 1996, congress passed the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA). It was a major piece of welfare reform legislation and had wide effects on how states manage social welfare programs. This is particularly important for business owners in terms of their new hire reporting requirements. Businesses must report personal identification information about newly hired employees in accordance with federal rules, plus additional reporting requirements which differ from state to state. 

Though it may seem a little daunting, PRWORA reporting is actually straightforward. By the end of this article, you’ll have an understanding of new hire reporting, and you’ll have the link you need to report in your state. 

Let’s get started. 

An overview of PRWORA 

Though PRWORA is federal legislation, the bill was designed to give states more control over social welfare programs. So long as states comply with a set of federal regulations, they can design additional requirements and limitations into their own system. 

For our purposes here, the bill was passed to do two essential things:

  • Ensure that people owed child support payments receive them quickly and efficiently, which can include such measures as wage garnishment and wage assignments. 
  • Reduce the risk of fraudulent government benefit payments.

Through reporting, federal and state governments are able to find anyone who is employed, but not paying child support. Reporting goes through the state to the National Directory of New Hires (NDNH), which is what the Federal Parent Locator Service (FPLS) relies upon to find parents who aren’t paying child support. 

Businesses that participate in new reporting are also ensuring that a new hire does not continue to receive unemployment and other government benefits they’re no longer entitled to. PRWORA is especially effective for tracking new hires who have children or receive benefits in another state. 

PRWORA Compliance

To comply, you need to report to your state’s State Directory of New Hires (SDNH). It may be its own department or part of a larger division—typically the Department of Health and Human Services or the Department of Labor. The state will share information with the NDNH, which then cross-references new hire information with other state reporting centers. 

Employers or their payroll service provider will be asked to submit a report within a set number of days after the individual is hired. The number of days varies by state, but won’t be more than 20 calendar days. The employer is required to report at least these seven pieces of information for each new hire or rehire:

  1. Employee’s name
  2. Employee’s address
  3. Social Security number (SSN)
  4. Date of hire (the date the employee first performs services for pay)
  5. Employer’s name
  6. Employer’s address
  7. Federal Employer Identification Number (FEIN)

Most states require additional information about employees and sometimes employers. This could be the employee’s date of birth or information about the employer’s point of contact. Many states ask employers to share optional information as well. 

Each state also has its own rules about where employers can file new hire reporting. Most states have easy-to-use online services where companies can create a profile for future use. Most states also have mail and fax options as well. See the table below for a detailed description of each state’s new hire reporting program and reporting requirements. 

Multistate employers can report via the Office of Child Support Enforcement’s Child Support Portal. This is a faster way to conduct reporting. State laws about reporting information still apply. 

What happens to the reported data?

When states get new hire data, they cross-reference it with child support orders. When a non-compliant parent is found, child support payments are automatically pulled from their paycheck. It works like other forms of income withholding, such as wage garnishment

When a new hire is found to have public assistance, the state government will remove the individual from the assistance program. Typically, nothing further is required from the employer, but there are some cases where the state will attempt to recuperate erroneous assistance payments. States do this through income withholding. 

Is PRWORA good for business?

Yes! Complying with reporting requirements reduces the chance of fraudulent worker’s compensation and unemployment payment. On the macro level, your tax dollars are working more efficiently. On the micro-level, you’re preventing other businesses from suffering the direct and indirect costs of paying out a worker’s comp claim. And those businesses are protecting you. 

What’s more, is that employers see low or no impact on their bottom line. In most states, reporting is easy and takes little time, as the information needed from the employee is part of the W-4 form. 

Reporting processes are continually improving. And, as reporting ultimately helps children live more financially secure lives, most employers experience intangible rewards as well. 

Which employers need to comply with PRWORA?

If you plan to pay a wage to a new hire, you will be considered an employer and should report your new hire. Employers include:

  • Temp agencies that pay a wage to an individual. The individual only needs to be reported once so long as there are no breaks in employment longer than 60 consecutive days.
  • Labor organizations of any kind and hiring halls that have individuals who work directly for the organization. 
  • All federal agencies.

Who is considered a new hire with PRWORA?

A new hire isn’t just a person coming to work for you for the first time. You should also report any employee who returns to work and has to complete a new W-4. Also, if your new hire quits before your reporting deadline, you still have to report them if they earned wages.

While federal law does not require you to report independent contractors, the following states (and one territory) do:

  • Arizona
  • California
  • Colorado
  • Connecticut 
  • Delaware
  • Florida
  • Guam
  • Iowa
  • Maine
  • Massachusetts
  • Minnesota
  • Nebraska
  • New Hampshire
  • New Jersey
  • Ohio
  • Texas
  • Utah
  • Virginia
  • West Virginia

Again, each state or territory will have its own rules about reporting requirements. 

PRWORA Enforcement

Every quarter, the federal government sends each state agency a list of employers that are not complying with reporting requirements. The state then has the option about how to proceed with enforcement, which can include:

  • A letter informing the employer of their requirements with information on how to report. 
  • A civil fine of up to $25 per unreported new hire.
  • A civil fine of up to $500 per unreported new hire when the employer and employee conspired not to report. 

New-Hire Reporting Requirements By State

Gathered below is a quick overview of each state’s reporting requirements with a link to the state’s new hire reporting center. 

State with Reporting LinkReporting TimeframeAdditional Reporting DataReporting options
Alabama7 daysWhether the employee was newly hired or recalled to workSate website. Employers with fewer than 5 employees can send hard copies
Alaska20 daysSEIN, health insuranceOnline, mail, fax
Arizona20 daysState of hireMail, phone, fax
Arkansas20 daysOptional:Employee DOB,Employer phone and fax numberOnline, fax, mail, payroll
California20 daysEmployer phone number and contact person, California EDD payroll tax account numberOnline, mail, fax
Colorado20 daysNoneOnline, mail, fax
Connecticut20 daysNoneOnline, mail, fax
Delaware20 daysOptional:Employee DOB and gender,if the employee left before filing,point of contact name, phone, fax, emailOnline, mail, fax, electronic transmission
District of Columbia20 daysNoneOnline, mail, fax, electronic transmission
Florida20 daysReemployment assistance, identification number (if applicable) Online (additional information may be required), mail, fax, phone
Georgia10 daysState of hireOnline, mail, fax, electronic
Guam20 daysOptional:Employee occupation, starting wage, wage frequency,health insurance availability,employer email, phone, fax, and contact personEmail, mail, fax, personal delivery from employer
Hawaii20 daysOptional:Employee DOB,state of hire,SEINPhone, fax, mail
Idaho20 daysIdaho unemployment insurance account number,contact name and phoneOnline, mail, fax
Illinois20 daysNoneOnline, electronic reporting, mail, fax
Indiana20 daysNoneOnline, mail, fax, payroll services
Iowa15 daysHealth insurance availability,date employee qualifies for health insurance coverage,address where withholding or garnishment orders can be sentOnline, mail, fax
Kansas20 daysOptional:Employee DOB,state of hire,health insurance availability for dependents,employer phone, fax, and emailOnline, mail, fax
Kentucky20 daysSEINOnline, electronic, mail, fax
Louisiana20 daysSEINOnline, mail, fax, payroll services
Maine7 daysNoneOnline, mail, fax
Maryland20 daysState of Maryland Unemployment Insurance Number (SUI),employee gender
Optional:Employee DOB
Online, electronic, mail, fax
Massachusetts14 daysNoneOnline, bulk filing, electronic file transfer
Michigan20 daysOptional:Employee DOB, drivers licensestate of hireemployer phone, fax, email, contact name,SEINOnline, mail, fax, payroll services
Minnesota20 daysOptional:Employee DOBEmployer informationOnline, mail, fax, payroll services
Mississippi15 daysEmployee DOB, gender, salary, payment frequency, health insurance availabilitySEINOnline, mail, fax
Missouri20 daysOptional:Employee DOB, state of hire, health insurance availability, employment type,employer payroll addressOnline, mail, fax
Montana20 daysOptional:State of hireemployee phone, DOB, health insurance availability,employer phone, faxOnline, mail, fax, file transfer system, phone
Nebraska20 daysOptional:Employee DOB,state of hiredependent health insurance availabilityOnline, mail, fax, payroll services
Nevada20 daysOptional:Employee DOB,state of hireOnline, mail, fax
New Hampshire20 daysNHES employer account number,work statetype of hireOnline, mail, fax, FTP transmission
New Jersey20 daysNoneOnline, electronic, mail, fax
New Mexico20 daysNoneOnline, mail, fax, payroll services, new hire mobile app
New York20 daysHealth insurance availabilityOnline, electronic transmission, mail fax
North Carolina20 daysSEIN
Optional:Employee DOB
Online, electronic transmission, mail fax, new hire data entry software
North Dakota20 daysHealth insurance availabilityOnline, mail, fax, payroll services
Ohio20 daysFor Independent Contractors:Date payment begins,length of contract
Optional:Employer income tax credit status, second address,additional new hire information
Online, mail, fax, payroll services
Oklahoma20 daysState of hire,occupation,Oklahoma employer account number (OESC)health insurance availability for dependentsOnline, mail, fax
Oregon20 daysNoneOnline, mail, fax
Pennsylvania20 daysEmployer contact person name and phone,employee DOBOnline, mail, fax, secure FTP
Puerto Rico20 daysSEIN,Employee DOB,health insurance availabilityOnline, mail, fax
Rhode Island15 daysState of hire
Optional:Employee DOB,health insurance availability, date health insurance beganemployer contact name, phone, email
Online, mail, fax
South Carolina20 daysOptional:Employee DOB,employer phoneOnline, mail, fax
South Dakota20 daysNoneOnline, mail, fax, phone
Tennessee20 daysState of hireOnline, mail, fax, electronic transmission
Texas20 calendar daysPayroll services addressOnline, mail, fax
Utah20 daysState of hire
Optional:
Employee DOB
Online, fax, phone
Vermont10 daysNoneOnline, mail, fax
Virginia20 daysOptional:Employee DOB,health insurance availability,employer contact name, phone, email, faxOnline, mail, fax, electronic transmission
Virgin Islands20 daysHealth insurance availability,employee’s first day of work,employer contact name, phone, fax,Virgin Islands Emergency Security Agency numberOnline, mail, fax
Washington20 daysNoneOnline, mail, fax, phone
West Virginia14 daysNoneOnline, mail, fax, electronic transmission, mobile app
Wisconsin20 daysFirst day of work,payroll services address
Optional:state of hire,employer contact name, phone, email, fax
Online, mail, fax, payroll services
Wyoming20 daysState of hire,first day of work
Optional:Employee DOB,employer contact name, phone
Online, mail, fax, payroll services, encrypted email

Comments

  • Susan

    Do I have to file a New Hire form for 1099 Contractors ?

    Reply
  • Melissa

    How can I see if the new hire paperwork was submitted to the state by Gusto?

    Reply
  • Eugen Bräunig

    When I first sign up for Gusto as a company owner/employee of said company does Gusto file this report on my behalf?

    Reply
  • Paul Gerhartz

    If a current employee relocates to a new state, do I need to hire the ‘new hire report’ for that state? Or is this only for brand new employees?

    Reply
    • Gusto Editors

      Hi Paul, great question! We recommend reaching out to your state agency to confirm. Usually, your new state may require it because the New Hire Reports help keep track of employees in case of any liens, garnishments, etc.

      Reply
  • Christine

    Is there a different form/process for new hires that are independent contractors vs. not?

    Reply
    • Gusto Editors

      Hi Christine — it can depend on your state! We recommend talking to your CPA/attorney about this, as they’ll be able to provide information specific to your situation!

      Reply
  • john

    does gusto do new hire reporting for me? if not, why not?

    Reply

*Required fields

Your email address will not be published.

Back to top