This probably is not your employers decision. 0bama had the IRS change the withholding tables for last year. It was to put more money in peoples pockets to “stimulate” the economy. I spent a lot of time telling people I know to expect this. But most did not listen until it was too late. You might want to consider withholding even more than 10% now because the reductions in rates President Bush established expire. Not only will there be withholding shock, there will also be tax rate increases (timed to be felt after the 2010 election). In other words, if you were shocked when you paid this years taxes, just wait another shock is coming.
Actually, they didn’t “change the tax rate tables,” just changed the withholding amount for everybody so they got more money in their checks. If they had changed the tables to reflect the withholding, the right amount of tax would have been taken out.