Q: Do I have to purchase unemployment insurance for our employees?
A: Nonprofit organizations are not required to purchase unemployment insurance through the State of Colorado. However, they are required to register with the Unemployment Division if you have more than three employees. If an employee files a claim the organization will be asked to reimburse the State of Colorado for payments made.

Q: What alternatives are available to cover the cost of unemployment compensation claims?
A: Electing to reimburse the State for claims approved and paid by them could present a financial risk to the organization.  Your nonprofit organization could join a Trust.  You will make regular contributions to the Trust to build your reserves to make possible claim payments.  Additional services such as assistance with handling claims and investment of reserve funds will be provided.  The reserve fund belongs to your organization and regular contributions made to the Trust are based on your claim experience.

Q: Will my small organization qualify for participation in a Trust?
A: Any organization with 20 or more employees may qualify. Because your money is used to pay claims presented, it is too risky for small nonprofit groups.

Q: May I join a Trust at any time during the year?
A: The State of Colorado allows a company to withdraw from the Unemployment Compensation system as of the first of any year. Therefore, you would start your participation in a Trust on that date. If you are a direct reimburser, you may join a Trust at any time.