2015 -- S 0759 SUBSTITUTE A

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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

BENEFITS

     

     Introduced By: Senators Lombardi, Jabour, Conley, Lombardo, and Archambault

     Date Introduced: March 24, 2015

     Referred To: Senate Labor

     (Labor & Training)

It is enacted by the General Assembly as follows:

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     SECTION 1. Sections 28-42-8 and 28-42-62.1 of the General Laws in Chapter 28-42

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

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     28-42-8. Exemptions from "employment". -- "Employment" does not include:

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      (1) Domestic service in a private home performed for a person who did not pay cash

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remuneration of one thousand dollars ($1,000) or more in any calendar quarter after December

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31, 1977, in the current calendar year, or the preceding calendar year to individuals employed in

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that domestic service in a private home;

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      (2) Service performed by an individual in the employ of a sole proprietorship or LLC

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single member filing as a sole proprietorship with the IRS for his or her son, daughter, or spouse,

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and service performed by a child under the age of eighteen (18) in the employ of his or her father

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or mother who is designated as a sole proprietorship or LLC single-member filing as a sole

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proprietorship with the IRS, and service is performed by an individual under the age of eighteen

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(18) in the employ of a partnership or LLC partnership consisting only of his or her parents or

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domestic partners;

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      (3) Service performed in the employ of any other state, or any of its political

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subdivisions, the United States government, an instrumentality of any other state or states or their

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political subdivisions, or of an instrumentality of the United States, except, that if the Congress of

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the United States permits states to require any instrumentalities of the United States to make

 

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payments into an unemployment fund under a state unemployment compensation act, then, to the

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extent permitted by Congress, and from and after the date as of which permission becomes

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effective, all of the provisions of chapters 42 -- 44 of this title shall be applicable to those

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instrumentalities and to services performed for those instrumentalities, in the same manner, to the

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same extent, and on the same terms, as to all other employers, employing units, individuals, and

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services. If this state is not certified by the Secretary of Labor under 26 U.S.C. § 3304 for any

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year, then the payments required of those instrumentalities with respect to that year shall be

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deemed to have been erroneously collected within the meaning of § 28-43-12 and shall be

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refunded by the director from the fund in accordance with § 28-43-12;

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      (4) Service performed:

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      (i) In the employ of:

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      (A) A church or convention or association of churches, or

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      (B) An organization that is operated primarily for religious purposes and that is operated,

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supervised, controlled, or principally supported by a church or convention or association of

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churches;

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      (ii) By a duly ordained, commissioned, or licensed minister of a church in the exercise of

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his or her ministry or by a member of a religious order in the exercise of duties required by that

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order;

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      (iii) In a facility conducted for the purpose of carrying out a program of rehabilitation for

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individuals whose earning capacity is impaired by age, physical or mental deficiency, or injury or

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providing remunerative work for individuals who, because of their impaired physical or mental

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capacity, cannot be readily absorbed in the competitive labor market, by an individual receiving

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that rehabilitation or remunerative work;

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      (iv) As part of an unemployment work relief or work-training program assisted or

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financed in whole, or in part, by any federal agency or an agency of a state or one of its political

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subdivisions, by an individual receiving that work relief or work training;

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      (v) In the employ of a hospital by a patient of the hospital; or

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      (vi) By an inmate of a custodial or penal institution;

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      (5) Service with respect to which unemployment compensation is payable under an

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unemployment compensation system established by an act of Congress. The director is authorized

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and directed to enter into agreements with the proper agencies under that act of Congress, which

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agreements shall become effective ten (10) days after their publication as in the manner provided

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in § 28-42-34, to provide reciprocal treatment to individuals who have, after acquiring potential

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rights to benefits under chapters 42 -- 44 of this title, acquired rights to unemployment

 

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compensation under that act of Congress, or who have, after acquiring potential rights to

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unemployment compensation under that act of Congress, acquired rights to benefits under those

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chapters;

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      (6) Service covered by an election duly approved by the agency charged with the

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administration of any other state or federal employment security law in accordance with an

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arrangement pursuant to § 28-42-58 during the effective period of that election, except as

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provided in § 28-42-3(15)(i) 28-42-3(16)(i);

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      (7) Services performed by an individual, in any calendar quarter on or after January 1,

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1972, in the employ of any organization exempt from income tax under 26 U.S.C. § 501(a)(other

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than services performed for an organization defined in § 28-42-3(24) 28-42-3(25) or for any

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organization described in 26 U.S.C. § 401(a) or under 26 U.S.C. § 521) if the remuneration for

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that service is less than fifty dollars ($50.00);

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      (8) Service that is occasional, incidental, and occurs irregularly, and is not in the course

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of the employing unit's trade or business. Service for a corporation shall not be excluded;

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      (9) Service as a golf caddy, except as to service performed solely for a club with respect

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to which the club alone bears the expense. A golf caddy, except as in this specifically provided

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subdivision, shall not be construed to be an "employee" as defined in § 28-42-3(14) 28-42-3(15);

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      (10) Notwithstanding any provisions of titles 5 and 27, service performed by an

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individual as a real estate salesperson if all the service performed by that individual is performed

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for remuneration solely by way of commission;

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      (11) Notwithstanding any provisions of titles 5 and 27, service performed by an

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individual as an insurance broker, agent, or subagent if all the service performed by that

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individual is performed for remuneration solely by way of commission. This exemption shall not

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apply to service performed as industrial and debit insurance agents;

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      (12) Service performed by an individual who is enrolled at a nonprofit or public

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educational institution that normally maintains a regular faculty and curriculum and normally has

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a regular organized body of students in attendance at the place where its educational activities are

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carried on, as a student in a full-time program, taken for credit at that institution that combines

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academic instruction with work experience, if that service is an integral part of that program, and

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that institution has so certified to the employer, except that this subdivision shall not apply to

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service performed in a program established for, or on behalf of, an employer or group of

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employers;

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      (13) Service performed by an individual on a boat engaged in catching fish or other

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forms of aquatic animal life under an arrangement with the owner or operator of that boat

 

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pursuant to which:

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      (i) That individual does not receive any cash remuneration other than a share of the

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boat's catch of fish or other forms of aquatic animal life or a share of the proceeds from the sale

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of that catch; and

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      (ii) The operating crew of that boat is normally made up of fewer than ten (10)

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individuals; and

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      (14) Services performed by a member of an Americorps program. ; and

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     (15) Services performed by a self-employed individual.

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     28-42-62.1. Fraud and abuse. -- (a) (1) It shall be unlawful to do any of the following:

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      (A) Make or cause to be made any knowingly false or fraudulent material statement or

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material representation for the purpose of obtaining or denying any benefits;

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      (B) Present or cause to be presented any knowingly false or fraudulent written or oral

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material statement in support of, or in opposition to, any claim for benefits or petition regarding

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the continuation, termination or modification of benefits;

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      (C) Knowingly assist, aid and abet, solicit, or conspire with any person who engages in

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an unlawful act under this section;

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      (D) Willfully misrepresent or fail to disclose any material fact in order to avoid or reduce

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any contribution or other payment required of an employing unit under chapters 42 -- 44 of this

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title;

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      (E) Willfully fail to report or provide false or misleading information regarding

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ownership changes as required by regulations promulgated by the department.

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      (F) Willfully make or require any deduction from wages to pay all or any portion of the

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contributions required from employers, or try to induce any individual to waive any right under

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chapters 42-44 of this title.

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      (2) For purposes of this section, "statement" includes, but is not limited to, the receipt of

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unemployment benefits deposited to a direct deposit account or electronic payment card, any

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endorsement of a benefit check, application for registration, oral or written statement or report,

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proof of unemployment, or other documentation offered as proof of, or the absence of,

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entitlement to benefits or the amount of benefits.

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      (3) If it is determined that any person concealed or knowingly failed to disclose that

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which is required by law to be revealed, knowingly gave or used perjured testimony or false

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evidence, knowingly made a false statement of fact, participated in the creation or presentation of

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evidence which he knows to be false, or otherwise engaged in conduct in violation of this section,

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that person shall be guilty of a misdemeanor and subject in criminal proceedings to a fine and/or

 

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penalty not exceeding one thousand dollars ($1,000), or double the value of the fraud, whichever

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is greater, or by imprisonment up to one year in state prison, or both.

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      (4) Beginning October 1, 2013, whenever the director establishes that an erroneous

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payment was made to an individual due to fraud committed by the individual, that individual will

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be assessed a penalty equal to fifteen percent (15%) of the amount of the erroneous payment. All

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penalties assessed and collected under this subsection shall be immediately deposited into the

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employment security fund.

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      (b) The director, in consultation with the attorney general, shall establish a form to give

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notice that the endorsement of a benefit check sent or the receipt of unemployment benefits

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deposited to a direct deposit account or electronic payment card pursuant to chapter 44 of this title

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is the endorser's affirmation that he or she is qualified to receive benefits under the employment

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security act. The notice shall be sent to all individuals who are presently receiving benefits and

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given to those who file claims for benefits in the future.

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     SECTION 2. Sections 28-44-12, 28-44-18 and 28-44-38 of the General Laws in Chapter

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28-44 entitled "Employment Security - Benefits" are hereby amended to read as follows:

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     28-44-12. Availability and registration for work. -- (a) An individual shall not be

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eligible for benefits for any week of his or her partial or total unemployment unless during that

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week he or she is physically able to work full-time and be available for full-time work. To prove

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availability for work, every individual partially or totally unemployed shall register for work and

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shall:

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      (1) File a claim for benefits within any time limits, with any frequency, and in any

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manner, in person or in writing, as the director may prescribe;

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      (2) Respond whenever duly called for work through the employment office; and

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      (3) Make an active, independent search for suitable full-time work.

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      (b) If an unemployed individual has been determined to be likely to exhaust regular

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benefits and to need reemployment services pursuant to a profiling system established by the

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director, the individual shall be eligible to receive benefits with respect to any week only if the

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individual participates in reemployment services, such as job search assistance services, unless

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the director determines that:

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      (1) The individual has completed those services; or

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      (2) There is justifiable cause for the individual's failure to participate in those services.

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     28-44-18. Discharge for misconduct. – (a) For benefit years beginning prior to July 1,

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2012, an individual who has been discharged for proved misconduct connected with his or her

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work shall become ineligible for waiting period credit or benefits for the week in which that

 

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discharge occurred and until he or she establishes to the satisfaction of the director that he or she

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has, subsequent to that discharge, had at least eight (8) weeks of work, and in each of that eight

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(8) weeks has had earnings of at least twenty (20) times the minimum hourly wage as defined in

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chapter 12 of this title for performing services in employment for one or more employers subject

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to chapters 42 -- 44 of this title. For benefit years beginning on or after July 1, 2012, and prior to

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July 6, 2014, an individual who has been discharged for proved misconduct connected with his or

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her work shall become ineligible for waiting period credit or benefits for the week in which that

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discharge occurred and until he or she establishes to the satisfaction of the director that he or she

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has, subsequent to that discharge, had at least eight (8) weeks of work, and in each of that eight

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(8) weeks has had earnings greater than, or equal to, his or her weekly benefit rate for performing

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services in employment for one or more employers subject to chapters 42 -- 44 of this title. For

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benefit years beginning on or after July 6, 2014, an individual who has been discharged for

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proved misconduct connected with his or her work shall become ineligible for waiting-period

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credit or benefits for the week in which that discharge occurred and until he or she establishes to

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the satisfaction of the director that he or she has, subsequent to that discharge, had earnings

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greater than, or equal to eight (8) times, his or her weekly benefit rate for performing services in

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employment for one or more employers subject to chapters 42 -- 44 of this title. Any individual

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who is required to leave his or her work pursuant to a plan, system, or program, public or private,

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providing for retirement, and who is otherwise eligible, shall under no circumstances be deemed

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to have been discharged for misconduct. If an individual is discharged and a complaint is issued

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by the regional office of the National Labor Relations board or the state labor relations board that

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an unfair labor practice has occurred in relation to the discharge, the individual shall be entitled to

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benefits if otherwise eligible. For the purposes of this section, "misconduct" is defined as

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deliberate conduct in willful disregard of the employer's interest, or a knowing violation of a

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reasonable and uniformly enforced rule or policy of the employer, provided that such violation is

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not shown to be as a result of the employee's incompetence. Notwithstanding any other provisions

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of chapters 42 -- 44 of this title, this section shall be construed in a manner that is fair and

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reasonable to both the employer and the employed worker.

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     (b) For the purposes of chapters 42 through 44 of this title, a suspension without pay from

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work for proved misconduct shall be treated as a discharge for proved misconduct and subject to

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the same conditions as a discharge for proved misconduct in accordance with subsection (a) of

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this section.

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     28-44-38. Filing of claims -- Procedures -- Printed copies -- Notices. -- (a) Claims for

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waiting period credit and for benefits shall be filed in accordance with regulations adopted as

 

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prescribed. Each employer shall post and maintain printed copies or statements of those

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regulations in places readily accessible to individuals employed by him or her. The director shall

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supply each employer with copies of those regulations or statements of the regulations without

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cost to the employers.

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      (b) The director shall prescribe the type of reports required from employers and the

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manner in which the reports shall be presented.

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      (c) Upon the filing of a claim, the director shall promptly mail a notice of the filing of

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the claim to the claimant's notify the most recent employer and to all employers for whom the

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claimant states he or she performed services and earned wages during his or her base period. The

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employers shall promptly furnish the information required to determine the claimant's benefit

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rights. If the claimant's employer or employers have any information which might affect either

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the validity of the claim or the right of the claimant to waiting period credit or benefits, he or she

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shall return the notice with that information. If an employer fails without good cause as

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established to the satisfaction of the director to return this notice within seven (7) ten (10)

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working days of its mailing, the employer shall have no standing to contest any determination to

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be made by the director with respect to the claim and any benefit charges pursuant to it, and the

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employer shall be barred from being a party to any further proceedings relating to the claim.

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Notwithstanding any inconsistent provisions of chapters 42 -- 44 of this title, any employer who

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fails to return the notice within that time shall pay a penalty of twenty-five dollars ($25.00) for

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each failure. The preceding penalty shall be paid into the employment security tardy account

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fund, and if any employer fails to pay the penalty, when assessed, it shall be collected by civil

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action as provided in § 28-43-18.

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     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

BENEFITS

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     This act would exempt services performed by self-employed individuals from the

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definitions of employment for employment security benefit purposes. It would also allow

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unemployment benefit checks to be directly deposited to an account or through the use of an

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electronic payment card. It would clarify the law so that workers that work full-time would be

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ineligible for unemployment benefits. Finally, it would render employees who are suspended

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without pay from work at the time of their discharge from being eligible for unemployment

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benefits.

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     This act would take effect upon passage.

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