Experience Rates

Unemployment Insurance (UI) experience rates, also called computed rates, are assigned to employer who have paid wages for a sufficient number of quarters as of June 30 of the year prior to the new rate year. Most employers will have an experience rate after their first year of activity in Colorado.

Experience rates are based on the experience of the business, based primarily on three components:

• Premiums Paid 
  All contributions made by the employer over the life of their UI account.*
   
• Benefits Charged 
  All benefits charged to the employer of the life of their UI account.*
   
• Average Annual Payroll 
  The average annual chargeable wages reported during he previous three state fiscal years (July-June).
   

*The life of the account also includes any predecessor employer history, when applicable.

Percent of Excess

An employer's Percent of Excess is based on the same three components as the employer's experience rate. The percent of excess determines the rate assigned to the employer based on the corresponding rate schedule.

Calculating Percent of Excess

An employer's percent of excess is calculated using the following formula:

Total Lifetime Premiums Paid (minus) Total Lifetime Benefits Charged (divided by) Average Annual Payroll (equals) Percent of Excess

With any given rate schedule, the percent of excess corresponds to the rate assigned to the employer. 

• A higher percent of excess means a lower rate is assigned.
   
• A lower percent of excess (including a negative excess) means a higher rate is assigned. 

Changes in Percent of Excess

Experienced employers may notice a change in their percent of excess over time. 

In general:

• The more premiums an employer pays the higher their percent of excess will be, assuming their average annual payroll and the amount of benefits charged to their account remain stable.
   
• The more benefits that are charged to an employer account the lower their percent of excess will be, assuming their average annual payroll and the amount of premiums they paid remain stable.

Premium Rate Schedule

The Premium Rate Schedule is used for all Colorado employers and is determined by the Reserve Ratio as computed by the Colorado Department of Labor and Employment (CDLE) Division of Labor Market Information (LMI). The Reserve Ratio is used to indicate the health of the UI Trust Fund.

• A higher reserve ratio means the compensation fund is health, resulting in a lower rate schedule.
   
• A lower reserve ratio means the compensation fund is low, resulting in a higher rate schedule.
   

Visit the Premium Rates page for more information about premium rates, and current rate schedules.

Premium Rates and Benefits Charges

When an employer has UI benefits charged against their account, they will receive a Statement of Benefit Charges (form UI A-20) by mail, or in their MyUI Employer+ account. Statements of Benefits Charges are sent the quarter after the charges occur. 

The amount charged to an employer account is based on the benefits paid. Whether or not a former employee receives benefits (and how much) is based on many factors, including but not limited to:

• The reason(s) the individual separated from their job.
   
• Whether the individual meets the weekly eligibility requirements.
   
• How quickly the individual returns to work. 

  Employers have 60 days from the date listed on the Statement of Benefit Charges to protest the charges.

Protesting Rates

Employers may protest rates and benefit charges if they believe there is an error in the figures used to calculate their rate, or with the benefits charged to their account. Employers can submit a rate protest in MyUI Employer+.

  Note

Employers can only protest rates during the rate protest period, which is typically 20 calendar days after the mailing date of the rate notice. The Division will not accept protests based on legislatively-mandated rates, including the Support Rate and the Solvency Surcharge.