APA and Others Tell Congress: “Don’t SOC it to us!”

The American Payroll Association (APA) joined 60 other organizations in a letter formally objecting to new employer reporting requirements being considered by Congress. Dated June 9, 2015, the letter was delivered by the Strategic Services on Unemployment & Workers’ Compensation (UWC) to the Chairmen and ranking members of the U.S. House Committee on Ways and Means and the Senate Finance Committee.

The text of the letter opposes an amendment included in Section 913 of the S. 1269 customs bill passed by the Senate on May 14. That amendment would, beginning in 2017, require employers to determine and provide standard occupational classification (SOC) codes for all employee quarterly wage reports submitted to state unemployment agencies.

Opponents claim this requirement would “impose billions of dollars of unfunded burden on employers and add significant additional administrative costs for state workforce agencies.” Congressional Budget Office (CBO) estimates and other details are included in the letter to support the claims of anticipated hardship.

Established in 1977, the SOC system was revised in the 1990s and updated again in 2010. The next update is scheduled for 2018 and is already underway. The system is used by federal agencies to categorize workers for collecting, calculating or distributing data. Workers are classified into one of 840 detailed occupations according to definitions of those occupations.

The attempt to require expanded use of the SOC codes is part of the DOL’s consideration of ways to collect enhanced and more consistent unemployment insurance wage data. Though consistency and other aspects could be advantageous for payroll service providers in some ways, the industry leaders feel that the anticipated negatives outweigh the positives.

Though passed in the Senate, the U.S. House did not include the SOC requirement when it took up the bill. It will be interesting to see what happens as a conference committee works to reconcile the House and Senate versions on the way to trying to pass it into law.

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