For specific questions on new hire reporting requirements, refer to your state.
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 requires employers to gather and report information about newly hired or rehired employees. The information must be reported timely to the states via the mandated medium (magnetically, first class mail, or electronically). Federal law requires employers to report new hires within 20 days of the hire date; however, states may establish reporting timeframes shorter than 20 days.
A single-state employer is required to report all new hires to the state in which it does business, which is the same state where all its employees work. A multi-state employer hires and employs people in two or more states. Multi-state employers have the option of reporting all new hires to their home state or to report each new hire to employee’s state of residence. If employers choose to report new hires to each state, they must always report this way. They cannot report some new hires who live in another state to the company’s home state and report other new hires to their state of residence. Paychex reports all new hires to the employer’s home state regardless of where the employees live.
If reporting on paper, the employer must use the Form W-4 or an equivalent form used by the company. States may provide alternative reporting forms, but use is optional.
Each New Hire report must contain the six data elements found on Form W-4:
employee name
employee address
social security number
employer name
employer address
federal employer identification number
Some states may require additional information, and some require that current employees be re-reported if required information changes.
States may impose monetary and non-monetary civil penalties for noncompliance, but federal law limits the fine to $25.00 per newly hired employee. If there is a conspiracy between the employer and employee not to report, the penalty may not exceed $500.00 per newly hired employee.