Last week, I talked about the pros and cons of rehiring former employees, and mentioned that the Hiring Incentives to Restore Employment (HIRE) Act is one of the major reasons employers should be looking at hiring unemployed workers (which could include former employees). But let’s explore further why the bill is so important — both for unemployed workers and the employers hiring them. After all, as a CFO, controller, business owner, vice president of human resources, hiring manager, accountant, or anyone else with a stake in your business’s bottom line, the HIRE Act could have a significant impact on your business.
What is the HIRE Act?
The $17.5 billion legislation, signed into law by President Obama on March 18, 2010, gives a potential tax exemption and credit to businesses that hire unemployed workers. Specifically, the HIRE Act grants businesses that hire workers unemployed 60 days or longer an exemption from the 6.2 percent Social Security payroll taxes for each worker for the remainder of 2010. Additionally, if workers are retained for one year, participating businesses get a tax credit of $1,000.