New Hire Reporting — What You Need to Know

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New Hire Reporting Helps Support Child Support Reporting

Illinois Requires New Hire Reporting

Businesses need to remember that state and federal laws require all employers to report each new and rehired employee to a state Directory of New Hires. Congress and the states adopted these laws to increase child support collections on both state and national levels and reduce fraudulent unemployment and worker’s compensation payments. In Illinois, employers submit information on newly hired or rehired employees to the Illinois Department of Employment Security (IDES), New Hire Directory. IDES then forwards the data to the Federal Office of Child Support Enforcement (OCSE), where it becomes a part of the National Directory of New Hires.

IDES compares the information against current state child support files. When a match occurs, the Illinois Department of Healthcare and Family Services, Division of Child Support Services, issues an Order/Notice to Withhold Income for Child Support. In tandem, the National Directory of New Hires compares the data received from one state with child support information from other states and when a match occurs, provides the information to the appropriate state agency. With new hire reporting, state child support enforcement agencies can promptly issue an Order/Notice to Withhold Income for Child Support – the most effective means of collecting child support.

Employers are required to report all newly hired employees within 20 calendar days of their start date. This applies to full-time, part-time, and temporary employees as well as any employee returning to work who has been off the payroll for 60 consecutive days or more. A rule of thumb is if the employee fills out a W-4 form – employers must report the employee.

How to Report New Hires

Employers can report new hires using one of the following five methods:

  • Use the New Hire Reporting form from IDES (via first-class mail or fax or online);
  • Submit copies of the employee’s W-4 form, with all information completed legibly, including the employer information (first-class mail or fax);
  •  Submit a separate listing of new employees, with the required data (first-class mail, fax, or e-mail);
  • Complete the online New Hire Reporting Web form or upload a file; or
  • Submit new hires using a secure file transfer protocol (sFTP). To use this method, please call (888)-245-1938 to request login credentials and to receive the specified file layout for this method of submission.

Prior to new hire reporting, employment data from other sources would often be six- to eight-months old. New hire reporting provides a quick turnaround time for getting the information from the employer to child support agencies, increases the reliability of the data received, and ultimately improves the well-being of the families and children depending on child support.
Through data sharing with other programs, new hire reporting provides a powerful tool for reducing fraud in Illinois’ public assistance, workers’ compensation, and unemployment insurance programs.

Taxpayers also benefit from new hire reporting through a reduced tax burden. When parents who have not been supporting their children begin paying child support, families may no longer have a need to apply for public assistance or if on public assistance, may no longer need it.