2015 -- H 6001

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LC002278

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2015

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A N   A C T

RELATING TO LABOR AND LABOR RELATIONS - EMPLOYMENT SECURITY -

VOLUNTARY CONTRIBUTIONS

     Introduced By: Representatives DeSimone, Palangio, and Ackerman

     Date Introduced: March 27, 2015

     Referred To: House Labor

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 28-43-1 and 28-43-3 of the General Laws in Chapter 28-43

entitled "Employment Security - Contributions" are hereby amended to read as follows:

     28-43-1. Definitions. -- The following words and phrases as used in this chapter have the

following meanings, unless the context clearly requires otherwise:

      (1) "Balancing account" means a book account to be established within the employment

security fund, the initial balance of which shall be established by the director as of September 30,

1979, by transferring the balance of the solvency account on that date to the balancing account.

      (2) "Computation date" means September 30 of each year.

      (3) "Eligible employer" means an employer who has had three (3) consecutive

experience years during each of which contributions have been credited to his account and

benefits have been chargeable to this account.

      (4) "Employer's account" means a separate account to be established within the

employment security fund by the director as of September 30, 1958, for each employer subject to

chapters 42 -- 44 of this title out of the money remaining in that fund after the solvency account

has been established in the fund, by crediting to each employer an initial credit balance bearing

the same relation to the total fund balance so distributed, as his or her tax contributions to the

fund during the period beginning October 1, 1955 and ending on September 30, 1958 have to

aggregate tax contributions paid by all employers during the same period; provided, that nothing

contained in this section shall be construed to grant to any employer prior claim or rights to the

amount contributed by him or her to the fund.

      (5) "Experience rate" means the contribution rate assigned to an employer's account

under whichever is applicable of schedules A -- I in § 28-43-8.

      (6) "Experience year" means the period of twelve (12) consecutive calendar months

ending September 30 of each year.

      (7) "Most recent employer" means the last base period employer from whom an

individual was separated from employment and for whom the individual worked for at least four

(4) weeks, and in each of those four (4) weeks had earnings of at least twenty (20) times the

minimum hourly wage as defined in chapter 12 of this title.

      (8) "Reserve percentage" means, in relation to an employer's account, the net balance of

that account on a computation date, including any voluntary contributions made in accordance

with § 28-43-5.1, stated as a percentage of the employer's twelve (12) month average taxable

payroll for the last thirty-six (36) months ended on the immediately preceding June 30.

      (9) "Reserve ratio of fund" means the ratio which the total amount available for the

payment of benefits in the employment security fund on September 30, 1979, or any computation

date thereafter, minus any outstanding federal loan balance, bears to the aggregate of all total

payrolls subject to this chapter paid during the twelve (12) month period ending on the

immediately preceding June 30, or the twelve (12) month average of all total payrolls during the

thirty-six (36) month period ending on that June 30, whichever percentage figure is smaller.

      (10) "Taxable payroll" means, for the purpose of this chapter, the total of all wages as

defined in § 28-42-3(28).

      (11) "Tax year" means the calendar year.

      (12) "Total payroll" means, for the purpose of this chapter, the total of all wages paid by

all employers who are required to pay contributions under the provisions of chapters 42 -- 44 of

this title.

      (13) "Voluntary contribution" means a contribution paid by an employer to his or her

account in accordance with § 28-43-5.1 to reduce the employer's experience rate for the ensuing

tax year.

     28-43-3. Employer's accounts -- Credits and charges. -- Subsequent to the

establishment of a separate employer's account for each employer subject to chapters 42 -- 44 of

this title as set forth in § 28-43-1(4), the credits and charges to each employer's account, exclusive

of the state of Rhode Island, its political subdivisions, and their instrumentalities, shall be

determined as follows:

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      (1) Credits to each employer's account:

      (i) After the September 30, 1958 computation date all contributions required under § 28-

43-8 and paid by each employer.

     (ii) All surcharges required and paid under § 28-43-4.

     (iii) All voluntary contributions made by the employer made in accordance with § 28-43-

5.1.

     (2) Charges to each employer's account:

     (i) Refunds of overpayments under § 28-43-13, as of the date refunded;

     (ii) For benefit years beginning subsequent to September 30, 1993, an amount equal to

the benefits provided in §§ 28-44-6(a) and (b), 28-44-7, and 28-44-8, and paid to each individual

with respect to a benefit year, as of the date paid. Those benefits shall be charged to the account

of the most recent base period employer, as defined in § 28-43-1(7); provided, that if a claimant

works for two (2) or more employers concurrently, either full-time or part-time, and becomes

unemployed on the same day from more than one employer, any benefits paid as a result of the

unemployment shall be charged to the employers' accounts proportionately based upon the ratio

of base period wages paid by each employer to the total base period wages paid by the concurrent

employers from whom the claimant became separated from employment. No charge for benefits

paid under § 28-44-7 shall be made against the account of any employer who shows to the

satisfaction of the director that he or she has continued to employ the individual during the weeks

of his or her claim to the same extent that he or she had employed him or her during that

individual's base period, and those benefits, if not chargeable to the most recent base period

employer, shall be charged to the balancing account.

      (iii) If any base period employer, whether or not he or she was the most recent, shows to

the satisfaction of the director that the individual who is in receipt of benefits became separated

from his or her last employment with that employer for reasons which did result or would have

resulted in a disqualification under § 28-44-17 or 28-44-18 had that base period employer been

his or her most recent, those benefits shall be charged to the balancing account.

      (iv) The entire amount charged to the employer's account under § 28-43-9 relating to the

balancing rate.

      (v) Whenever the provisions in this section specify that an employer's account shall not

be charged, that non-charging shall be limited to benefits paid based on service with an employer

required to pay contributions under the provisions of chapters 42 -- 44 of this title.

      (vi) An amount equal to the benefits provided in § 28-44-62 and paid to each individual

with respect to a benefit year as of the date paid minus the proportionate share of those benefits

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for which the state has been or will be reimbursed by the federal government. The federal share of

any payments shall be charged to the balancing account and federal reimbursements shall be

credited to the balancing account.

      (vii) Whenever any benefits are paid for benefit years beginning subsequent to July 7,

1996 to an individual unemployed as a result of physical damage to the real property at the

employer's usual place of business caused by severe weather conditions, including, but not

limited to, hurricanes, snowstorms, ice storms or flooding, or fire except where caused by the

employer, those benefits shall be charged to the balancing account.

      (viii) An employer's account shall not be relieved of charges relating to any benefits

payments made if the director establishes on or after October 1, 2013 that the payment was made

because the employer, or an agent of the employer, was at fault for failing to respond timely or

adequately to the request of the department for information relating to the claim for

unemployment benefits that was subsequently overpaid.

     SECTION 2. Chapter 28-43 of the General Laws entitled "Employment Security -

Contributions" is hereby amended by adding thereto the following section:

     28-43-5.1. Employer's account - Voluntary contributions. -- Any employer who has

been assigned an experience rate, and who has filed all reports required under chapters 42 through

44 of this title, and has paid all contributions, interest and penalties due under chapters 42 through

44 of this title, may make a voluntary contribution to his or her account. Such voluntary

contribution shall be paid not later than thirty (30) days after the date on which the department

has issued a notice of the employer's experience rate, or prior to the expiration of one hundred

twenty (120) days after the start of the calendar year, for which the experience rate is effective,

whichever is earlier. Upon timely payment of a voluntary contribution, the contribution shall be

credited to the employer's account balance, and that employer shall receive a recomputation of its

experience rate for that calendar year. No voluntary contribution shall be refunded in whole or in

part.

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO LABOR AND LABOR RELATIONS - EMPLOYMENT SECURITY -

VOLUNTARY CONTRIBUTIONS

***

     This act would allow employers to make voluntary contributions to their unemployment

account, in order to lower their unemployment insurance tax rate for the following calendar year.

     This act would take effect upon passage.

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