UI Claims Management

Increase of Puerto Rico Unemployment Insurance Wage Base


Emptech's founder, Jeff Aleixo


Jeff Aleixo

Puerto Rico Unemployment Insurance Wage Base

As part of a larger labor reform law to attract businesses to the territory, Governor Ricardo Rossello Nevares approved legislation that increases Puerto Rico unemployment insurance wage base from $7,000 to $10,500.

The Labor Transformation and Flexibility Act also increases the weekly unemployment benefit for laid off workers from a range of $7 to $133 to a range of $60 to $240 and both changes are effective immediately.

Puerto Rico unemployment insurance tax rates in 2016 ranged from 2.4% to 5.4%, with the rate for new employers at 3.3%.

The territory’s jobless rate is more than 11%, one of the highest of all US jurisdictions and significantly more than the US average of near 5%.

Use this detailed guide on UI compliance to find out how to reduce unemployment tax expenses while improving handling of unemployment claims.

The Labor Transformation and Flexibility Act

The Labor Transformation and Flexibility Act of 2017 took effect on January 26, 2017 leading to changes of Puerto Rico unemployment insurance. The Act amends a number of statutes on a variety of subjects including working time, compensation and unemployment benefits. Prior rights and entitlements of employees under the various statutes are excluded for individuals employed prior to the law’s effective date. The new terms and conditions introduced under the Act apply only to individuals starting employment on or after the effective date of the law, with the exception of those changes that improve on or establish new rights and entitlements that apply to all employees.

Outsource your unemployment claims management, provide necessary unemployment information, and leave everything to a specialized team of analysts.

Editor’s Note: This post has been updated for accuracy and comprehensiveness.