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Find out how Remote can guide you through the complexities of managing cross-border hiring, payroll, taxes, and compliance.

Payroll management in Rhode Island

Rhode Island has a strong economy supported by industries such as healthcare, manufacturing, tourism, and technology. With state-specific payroll regulations, including a high minimum wage, progressive state income tax, and paid leave mandates, employers in Rhode Island must ensure compliance with both state and federal payroll laws. Understanding these regulations is crucial for smooth payroll operations and compliance.

Payroll breakdown in Rhode Island

Employers in Rhode Island must adhere to both federal and state payroll regulations regarding wages, taxes, and benefits. Below is an overview of key payroll components:

Minimum wage and overtime

  • Minimum wage: Rhode Island’s minimum wage is $15.00 per hour
  • Overtime rules:
    • Rhode Island follows federal overtime laws, requiring employers to pay 1.5 times an employee’s regular rate for hours worked beyond 40 hours in a workweek.
    • Some exemptions apply based on job classification and industry.

State income tax

  • Rhode Island has a progressive state income tax system, with rates ranging from 3.75% to 5.99%, depending on income levels.
  • Employers must withhold state income tax and remit it to the Rhode Island Division of Taxation.

Unemployment insurance (UI) tax

  • Employers must contribute to Rhode Island’s Unemployment Insurance (UI) program, managed by the Rhode Island Department of Labor and Training (DLT).
  • The UI wage base in Rhode Island is $29,200.
  • UI tax rates vary based on an employer’s experience rating and range from 0.69% to 9.59%.
  • New employers typically pay a 1.0% UI tax rate.

Workers’ compensation

  • Rhode Island law requires all employers with one or more employees to carry workers’ compensation insurance to cover medical expenses and lost wages for employees injured on the job.
  • Coverage can be obtained through private insurance carriers or the Rhode Island Workers’ Compensation Insurance Fund.

Paid family and medical leave

  • Rhode Island Temporary Caregiver Insurance (TCI): Provides up to six weeks of paid family leave.
  • Temporary Disability Insurance (TDI): Provides short-term benefits for non-work-related injuries or illnesses.
  • Employers must withhold contributions from employee wages and remit payments to the Rhode Island Department of Labor and Training.

Payroll tax filing and payment deadlines

  • Employers must register for a Rhode Island Withholding Tax Account with the Rhode Island Division of Taxation.
  • State withholding tax returns must be filed quarterly or annually, depending on employer classification.
  • UI tax reports must be submitted quarterly to the Rhode Island Department of Labor and Training.
  • Payroll tax payments can be made electronically through the Rhode Island Division of Taxation’s online portal.

Quick facts: Important considerations for employers

  • State minimum wage compliance: Rhode Island’s minimum wage is $15.00.
  • Final paycheck rules:
    • If an employee is terminated, employers must provide the final paycheck by the next scheduled payday.
    • If an employee resigns, the final paycheck must be provided by the next scheduled payday.
  • New hire reporting: Employers must report new hires to the Rhode Island New Hire Reporting Directory within 14 days.
  • Paid sick leave: Rhode Island requires employers to provide one hour of paid sick leave for every 35 hours worked, up to 40 hours per year.
  • Payroll recordkeeping: Employers must maintain payroll records for at least three years to comply with state and federal laws.
  • Right-to-work state: Rhode Island is not a right-to-work state, meaning employees may be required to join a union if applicable.

Run payroll in Rhode Island with Remote

Managing payroll in Rhode Island requires careful attention to state-specific regulations, including minimum wage compliance, UI tax requirements, and workers’ compensation laws. Employers must stay informed about tax rates, wage laws, and reporting deadlines to ensure smooth payroll processing and avoid penalties.

The good news is, you can pay anyone, anywhere — from your team in the office to your team abroad, all with Remote Payroll. To see just how easy global payroll can be, book a demo with Remote today.