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Proposed measures of unemployment tax-rate manipulation enforcement
Summary ETA proposed changes to the ETA 581 report and Tax Performance System reviews to measure state detection and enforcement of unemployment tax-rate manipulation, and sought states to test them. The attachment provides proposed report items. ETA still lists the letter as Active, but its printed expiration date was August 11, 2010 and later guidance addressed these revisions; current applicability is unclear.
Document
Federal guidance
Agency
U.S. Department of Labor, Employment and Training Administration (ETA)
Document number
UIPL No. 33-09
Date issued
August 11, 2009
Status
Unknown
ETA lists this letter Active as of 2026-10-24, but its PDF prints an expiration date of August 11, 2010 and describes proposed reporting changes later addressed in UIPL 02-11. Current applicability is unclear.
Status last verified October 24, 2026
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About this page: The full text below is the official document from U.S. Department of Labor, Employment and Training Administration (ETA). Ezel adds the plain-English summary and tracks the document's status. The official source linked on this page is authoritative for any reliance.
UIPL33-09acc.pdf (https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2009/UIPL33-09acc.pdf)
CLASSIFICATION
EMPLOYMENT AND TRAINING ADMINISTRATION UI
ADVISORY SYSTEM CORRESPONDENCE SYMBOL
U.S. DEPARTMENT OF LABOR OWS/DUIO
Washington, D.C. 20210 DATE
August 11, 2009
ADVISORY: UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 33-09
TO: STATE WORKFORCE AGENCIES
FROM: JANE OATES /s/
Assistant Secretary
SUBJECT: Measuring State Effectiveness in Implementing State Unemployment Tax Act
(SUTA) Dumping Detection and Enforcement Procedures
1. Purpose. To notify states of upcoming changes to the collection and reporting of data on the
ETA 581 Contributions Operations report and the Tax Performance System (TPS) program
reviews intended to measure the effectiveness of state SUTA dumping detection and
enforcement methods and to solicit state volunteers to test these changes.
2. References. Public Law (P.L.) No. 108-295, the “SUTA Dumping Prevention Act of 2004,”
the Social Security Act (SSA); the Internal Revenue Code (IRC), including the Federal
Unemployment Tax Act (FUTA); ETA Handbook No. 407; and Unemployment Insurance
Program Letters (UIPLs) No. 29-83, Change 3, No. 15-84, and No. 30-04 and 30-04,
Change 1.
3. Background. The SUTA Dumping Prevention Act of 2004 (the Act) was enacted to curtail
an employer tax avoidance practice known as SUTA dumping. The Act amended Federal
law by adding Section 303(k) to the Social Security Act, which required states to amend their
laws to prohibit certain tax avoidance schemes by January 1, 2006, and to establish
procedures for detecting these schemes.
The U.S. Department of Labor (DOL) organized a workgroup of state and Federal staff in the
summer of 2008 to 1) explore SUTA dumping factors that could be measured and reviewed
and 2) explore how to collect the data and review the states’ enforcement programs. The
workgroup recommended that DOL measure state SUTA dumping detection and enforcement
actions through data captured on a modified ETA 581 report, and also observe and verify state
SUTA dumping detection activities through enhanced TPS reviews.
4. Proposed Changes to the ETA 581 – Contributions Operations Report. States report
summary UI tax operation data to DOL on the quarterly ETA 581 report. DOL uses the data
to evaluate the states within UI Performs standards, after validating the data to ensure that
states reported properly. DOL proposes adding three new cells to this report to collect SUTA
RESCISSIONS EXPIRATION DATE
August 11, 2010
dumping data while simultaneously eliminating two cells that are not used for any computed
measures.
a. Proposed Cells Added. Section 303(k) requires states to (1) establish procedures to
identify the transfer or acquisition of a business for purposes of that subsection, (2)
mandate transfers of experience when there is a transfer of trade or business, or a
portion thereof, to another employer, and, at the time of the transfer, there is
substantial common ownership, management or control of the two employers, and (3)
prohibit transfers of experience whenever a person who is not an employer acquires
the trade or business of an employer if the state agency finds such person acquired the
business solely or primarily for the purpose of obtaining a lower rate of contributions.
DOL proposes to add Line 503, containing three new cells, to the ETA 581 report to
collect state data that measure the:
i. Number of mandatory unemployment experience transfers that resulted
from SUTA dumping detections and investigations;
ii. Number of prohibited unemployment experience transfers that resulted
from SUTA dumping detections and investigations;
iii. Amount of additional contributions due from mandatory and prohibited
transfers that resulted from SUTA dumping detections and investigations.
b. Proposed Cells Removed. The ETA 581 was modified in 1989 to collect
information on employers who have not filed contribution reports as required. States
were required to calculate and report a reasonable estimate for the amount of UI tax
due on those delinquent quarterly reports. The data collected in those two cells have
never been included in the UI Performs computed measures, nor are the data included
in any other aggregated reports. Therefore, ETA proposes removing the following
cells from the ETA 581 report:
i. Line 201, Item 12 – Number of Outstanding Quarters Prior to the Report
Quarter;
ii. Line 201, Item 13 – Total Estimated Contributions Due.
5. TPS. The TPS program and its predecessor, Revenue Quality Control, have been an important
part of DOL’s UI performance evaluation process. ET Handbook No. 407 states that “The Tax
Performance System (TPS) is intended to assist State administrators in improving their
Unemployment Insurance (UI) programs by providing objective information on the quality of
existing revenue operations. TPS will also serve to help the U.S. Department of Labor carry out
its oversight, technical assistance, and policy development responsibilities.” In addition to
collecting data on SUTA dumping activities on the ETA 581 report, DOL will revise the TPS
Systems Review of the Status Determination tax function to include whether states have
procedures to identify transfers and acquisitions of businesses to detect SUTA dumping or
other manipulations of state laws governing the transfer of experience. The review will verify
that the state agency:
a. Has written procedures or guidelines to identify and investigate potential SUTA
dumping activity and/or violations of other state law provisions mandating or denying
the transfer of experience;
b. Compiles an automated data base that identifies employers whose movement of
employees from one quarter to the next might be evidence of SUTA dumping and/or
violation of other state law provisions that mandate or deny the transfer of experience;
c. Routinely identifies and assigns for further investigation or action instances of SUTA
dumping and/or violations of other state law provisions that mandate or deny the
transfer of experience.
Unless the review confirms that the state agency conducts all three of the above, the tax
function will be considered “at risk” and suggestions will be made for improvement. TPS
acceptance sampling will not be performed for SUTA dumping activities. The TPS review,
together with the additional data collected on the revised ETA 581 report, will enable DOL
to measure the effectiveness of state performance with respect to meeting the requirements of
the SUTA Dumping Prevention Act.
6. Timeline. Reporting changes to the ETA 581 report are planned for the quarter ending
March 31, 2011. Changes to the TPS program are planned for the review of the 2010
calendar year tax operations, conducted during 2011.
7. Action Requested. State administrators should share this information with appropriate staff
and contact the appropriate Regional Office if the state is interested in participating in a pilot
to test the changes. States should specify whether they want to test the modified ETA 581
report, the TPS evaluation, or both.
8. Inquires. Questions concerning this advisory should be directed to your Regional Office.
9. Attachments. ETA 581 Contributions Operations report, current and proposed.
UIPL33-09a.pdf (https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2009/UIPL33-09a.pdf)
A. Facsimile of Form
ETA 581 - CONTRIBUTION OPERATIONS
STATE REGION REPORT FOR PERIOD ENDING
End Quarter Employers Delinquenc Total Number Wage
y Items Received
Cutoff
Employer Line Contributory Reim- Total Date
Count 101 bursement
(1) (2) (3) (4) (5)
Contributory Employers Reimbursing Employers
Filing Secured Resolved Filing Secured Resolved
Timely Timely
Employer (6) (7) (8) (9) (10) (11)
Reports for 201
Preceding
Quarters
Number Outstanding Quarters Total Estimated
Prior to Report Quarter Contributions Due
(12) (13)
Newly Established Employers Successor Employers
Number Time Time Number Time Time
Lapse Lapse Lapse Lapse
<=90 <=180 <=90 <=180
Status (14) (15) (16) (17) (18) (19)
301
Determinations
Inactivations/Terminations
(20)
Total Deter- Declared Removed Total
Beginning mined Liquidated Uncol- End End
Period Receivable lectible Period Period
(21) (22) (23) (24) (25) (26)
Contributory
Employers 401
Receivables
Number Employers
Owing Receivables in (26)
(27)
6 Months 9 Months 12 Months 15 Months Over 15
Age of or Less Months
Contributory 402
Receivables (28) (29) (30) (31) (32)
Total Deter- Declared Removed Total
Beginning mined Liquidated Uncol- End End
Period Receivable lectible Period Period
(33) (34) (35) (36) (37) (38)
Reimbursing
Employers 403
Receivables
Number Employers
Owing Receivables in (38)
(39)
6 Months 9 Months 12 Months 15 Months Over 15
Age of or Less Months
Reimbursing 404
Receivables (40) (41) (42) (43) (44)
Number of Audits Calendar
Quarters Audited
Large Change Total Audits
Employers Audits
(45) (46) (47) (48)
501
Total Wages Audited Hours Spent Number of Employees Misclassified
Auditing as Independent Contractors
Pre-Audit Post-Audit
(49) (50) (51) (52)
Audit
Activity
Amount Underreported
Total Wages Taxable Wages Contributions
(53) (54) (55)
502
Amount Overreported
Total Wages Taxable Wages Contributions
(56) (57) (58)
Comments:
O M B No.: 1205-0178 O M B Expiration Date: 12/31/2011 O M B Burden Hours: 510 Minutes
O M B Burden Statement: These reporting instructions have been approved under the Paperwork reduction Act of 1995. Persons are
not required to respond to this collection of information unless it displays a valid OMB control number. Public reporting burden for this
collection of information includes the time for reviewing instructions, searching existing data sources, gathering and maintaining the data
needed, and completing and reviewing the collection of information. Submission is mandatory under SSA 303(a)(6). Send comments
regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to the
U.S. Department of Labor, Office of Workforce Security, Room S-4231, 200 Constitution Ave., NW, Washington, DC, 20210.
A. Facsimile of Form – Proposed Revision
ETA 581 - CONTRIBUTION OPERATIONS
STATE REGION REPORT FOR PERIOD ENDING
March 31, 2011
End Quarter Employers Total
Delinquency Number Wage
Reim- Cutoff Date Items
Employer Line Contributory bursement Total
Received
Count 101
(1) (2) (3) (4) (5)
Contributory Employers Reimbursing Employers
Filing Secured Resolved Filing Secured Resolved
Timely Timely
(6) (7) (8) (9) (10) (11)
Employer
Reports for
Preceding 201
Quarters Number Outstanding Quarters Total Estimated
Prior to Report Quarter Contributions Due
(12) (13)
Reporting in this cell discontinued Reporting in this cell
3/31/11 discontinued 3/31/11
Newly Established Employers Successor Employers
Number Time Time Number Time Time
Lapse Lapse Lapse Lapse
<=90 <=180 <=90 <=180
Status (14) (15) (16) (17) (18) (19)
301
Determinations
Inactivations/Terminations
(20)
Total Deter- Declared Removed Total
Beginning mined Liquidated Uncol- End End
Period Receivable lectible Period Period
(21) (22) (23) (24) (25) (26)
Contributory
Employers 401
Receivables
Number Employers
Owing Receivables in (26)
(27)
6 Months 9 Months 12 Months 15 Months Over 15
Age of or Less Months
Contributory 402
Receivables (28) (29) (30) (31) (32)
Total Deter- Declared Removed Total
Beginning mined Liquidated Uncol- End End
Period Receivable lectible Period Period
(33) (34) (35) (36) (37) (38)
Reimbursing
Employers 403
Receivables
Number Employers
Owing Receivables in (38)
(39)
6 Months 9 12 Months 15 Months Over 15
Age of or Less Months Months
Reimbursing 404
Receivables (40) (41) (42) (43) (44)
Number of Audits
Calendar
Large Change Total Audits Quarters Audited
Employers Audits
(45) (46) (47) (48)
501
Total Wages Audited Hours Spent Number of Employees
Auditing Misclassified as Independent
Pre-Audit Post-Audit Contractors
(49) (50) (51) (52)
Amount Underreported
Total Wages Taxable Wages Contributions
Audit
Activity (53) (54) (55)
502
Amount Overreported
Total Wages Taxable Wages Contributions
(56) (57) (58)
NEW FOR 3/31/2011 *** SUTA Dumping Detection Activity *** NEW FOR 3/31/2011
Number Mandatory Number Prohibited Transfers Amount of Additional
Transfers Contributions Due
503
(##) (##) (##)
New Reporting New Reporting (NNN) New Reporting ($$$)
(NNN)
Comments:
O M B No.: 1205-0178 O M B Expiration Date: 12/31/2011 O M B Burden Hours: 510 Minutes
O M B Burden Statement: These reporting instructions have been approved under the Paperwork reduction Act of 1995. Persons are
not required to respond to this collection of information unless it displays a valid OMB control number. Public reporting burden for this
collection of information includes the time for reviewing instructions, searching existing data sources, gathering and maintaining the data
needed, and completing and reviewing the collection of information. Submission is mandatory under SSA 303(a)(6). Send comments
regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to the
U.S. Department of Labor, Office of Workforce Security, Room S-4231, 200 Constitution Ave., NW, Washington, DC, 20210.
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