This is the Disability category of the Broad REach Benefits blog. At Broad Reach Benefits, we focus on employers that have between 30 and 500 benefit eligible employees. We’re employee benefit specialists, not a big box brokerage firm or payroll company with a sales force peddling policies.
New Jersey TDB Changes for 2013- State or Private Coverage?
Employers in New Jersey are required to provide short term disability known as Temporary Disability Benefits or TDB. Employers covered by the Unemployment Compensation Law are also subject to the Temporary Disability Benefits (TDB) Law, with a few exceptions. While employers must provide TDB coverage they can secure this coverage directly from the State of New Jersey or from a private carrier.
Back in 2012 the State of New Jersey lowered the employee rate for TDB coverage from .50% to .20% of taxable wages effectively calling this a tax decrease. Since this decrease was not viable from an actuarial standpoint the State of NJ has now increased (shocker..) the employee rate to .36% of taxable wages for 2013. The annual taxable wage base did increase from $30,300 in 2012 to $30,900 in 2013.
Because the state rates have once again increased, employers should carefully evaluate whether getting coverage through the state or from a private carrier is more cost effective.