10 estimation processing
Estimation Processing
The first requirement of estimations is to locate the employment and wage fields that are missing. Reported and even estimated employment/wage fields are not subject to estimation (or re-estimation). However, worksites, of course, may also show earlier estimates that may need to be overridden based on new master account data. Similarly, delinquent or partially-reported master accounts may need to be revised when reported worksite data change. Besides this, certain fields—especially employment—can still be exempt from estimation even when they are marked as missing. The contingency is whether the establishment is active for all or only part of the quarter. All of these conditions are described in the following paragraphs.
After the initial selection has been completed, having isolated an account for processing in the “true estimation” portion of the program, a specific determination must be made as to whether there is an estimate required in any of the employment and wage fields. A forerunner to this determination is the identification of a “partially active” account, namely one which either is activated or terminated in the midst of the processed quarter. This is investigated by checking the liability and end-of-liability dates.
The end-of-liability date is first checked. If the EOL date is found to reside within the boundaries of the processed quarter (the year matches, and the month is one of the three months of the quarter), a termination indicator will denote the number of active months (0, 1, 2, or 3), based upon the particular month of the end-of-liability date (first, second, or third month of the quarter). This indicator is decremented if the EOL day-of-the-month field is less than 12. Any other EOL date will set the termination indicator to 3.
If the termination indicator ends up with a value of 3, the liability date is isolated and compared to the processed quarter. If the year matches the processed year and the month is one of the three within the processed quarter, a liability indicator is set to the number of liable months (3 for the first month of the quarter, 2 for the second, 1 for the third). This indicator is decremented if the day of the month exceeds 15, indicating that the base employment period including the 12th of the month is absent from the first month of liability. A liability date in any other quarter sets the liability indicator to 3.
When either of these indicators shows a value less than 3, a proration factor (referred to as Prorate in the estimation documentation to follow) is computed as the fraction of the quarter for which the account is liable for U-I taxation. The default for the proration is a full-quarter activity, with a proration factor of 1.0000000 (carried to seven decimal places). An account active for two months (with a liability date at the beginning of the second month of the quarter, or an EOL date at the end of the second month) will show ⅔ (stored as 0.6666667). Those active for one month (having a liability date at the beginning of the third month of the quarter, or an EOL date at the end of the first month) show a proration factor of ⅓ (listed as 0.3333333). Those with no full months of activity (becoming liable after the 15th of the last month of the quarter, or terminating prior to the 12th day of the first month), show a zero proration factor. This factor will be utilized throughout the total wage and employment estimation processes, described in subsequent pages.
In determining whether an account is to receive estimates, the first check conducted is for delinquent master account re-estimation due to changed reported worksite data. This is the converse of worksite redistribution from a changed reported master account. Employment and total wage values are checked separately, examining master delinquency and worksite sum comparisons. The summed worksite data are obtained from the Worksite Summary File, produced by the ES2UT01 program run earlier in any job stream involving the estimation program (ES2MI02). If any of the three months of employment shows reported data for the master account, no change is attempted for employment. Similarly, reported total wages exempt the master from wage estimates. For the master account that is missing (i.e., shows estimates for) the three employment months or the total wage field, and the value disagrees with the sum of the worksites, the field(s) will be set to zero and the associated indicator flag(s) set to “M”, so the master account data can receive revised
Next, the Worksite Summary File is examined to spot fully delinquent worksite families, using delinquency flags that measure full-, partial-, or non-reporting of the worksites’ employment and/or wage data. If it is found that both employment and total wages are non-reported for the entire family, the worksites become potential candidates for a reproration of all fields (or an initial proration, if they were not formerly estimated). There is a bypass to this selection under the following combination of conditions – when the worksites are mostly reported, with only a few delinquents, the proration will only be possible for the worksites if the master account shows reported data. When the master is delinquent and the worksites are mainly reported, the sum of the reported worksite data will be used to produce summed-level (or “S” indicator) imputations for the master account’s employment and/or wage fields. Any missing worksites must remain missing in this case, as there would be no employment/wages left to distribute to the delinquents.
When the master has reported, but some of the worksites have also reported, then the remaining worksites can be prorated based on whatever data remain once the reported worksites are deducted from the master account’s total. This process will be more fully described later; the presence of delinquent worksites in the family will at least enable an attempt for prorating the balance (excepting the one bypass condition described in the previous paragraph).
The master account’s record is checked before a final decision is made regarding further estimation processing of the worksite. A value of ‘N’ in the master account’s edit flag indicates that it has been modified on-line since the last time it underwent edit and/or estimation processing. In addition, a delinquent master account (with a ‘Y’ in the delinquency flag) can signal an estimation processing for the entire family, if delinquent accounts are to be processed (via the estimation selection parameter switch).
When either of the aforementioned conditions occurs, the worksite’s non-reported current employment and wage data will be cleared out (reset to zero and missing), except under the following condition. Before any erasure of worksite current data is enacted, all of the back quarters of employment and wage data are examined in the worksite’s record. If they all show zero data, any non-zero data in the processed quarter are left untouched (with the exception of taxable wages and contributions, which may be reallocated (except in Minnesota)). The reason for this exemption of data is simple. The presence of non-zero employment and wage data for a worksite with no historical employment and wages indicates that the estimates were made by a QCEW analyst. None of the EXPO system’s estimation methods can produce a non-zero estimate without some historical data. If the hand-estimated data were to be removed, the only recourse for the estimations is to leave it zero, which would force the QCEW analyst to repeat their research work.
The remaining worksite selection processing involves those families selected for reproration of taxable wages and/or contributions resultant from the out-of-balance checks enacted within the initial record selection process. If both fields, or just the contributions, are found in need of reallocation, they are flagged for processing.
A final multi-family change condition is checked before going on to the non-worksite selections. If total wage figures have been altered within a family, all data may be in balance, but the shift of total wages from one worksite to another without a corresponding shift in the taxable wages and contributions causes the taxable-to-total wage ratio to vary throughout the family. A detection for this computes a worksite’s would-be taxable wage value using the master’s taxable-to-total wage ratio, applied to the worksite’s current total wages. If the computed value differs from the current estimate, the worksite’s taxable wage and contribution fields are cleared for re-estimation.
Note: The above condition is not applied in Minnesota. The reason is that Minnesota’s processing collects taxable wage and contribution data at the worksite level, summing this information to produce master account estimates. Since certain parts of a State can have a different wage distribution than others for a multi-unit family, the taxable-to-total wage ratio will not remain constant throughout the State when these data are collected at the worksite level.
The residual accounts are primarily the non-worksites (singles and master accounts). For these accounts, the next phase in estimation selection is a split between delinquent and partially reported accounts. Delinquents are checked for individual missing indicators. This comparison is augmented for taxable wages and contributions, since they can only be applied to experience-rated accounts. In addition, contributions can only be selected for estimation if the taxable wage field is either positive or is also flagged for estimation.
Among the partially reported accounts, the total wage field is marked for estimation if the zero total wage value is a non-reported worksite or is missing. For experience-rated accounts, zero taxable wage fields may be estimated if they are missing or represent a previously estimated worksite value. Contributions are estimable if the taxable wages were sanctioned for estimation, or if the taxable wage amount is positive. The employment indicators are examined individually. Any missing flag approves the particular month for estimation.
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