05 LC 28
2459S
The
Senate Insurance and Labor Committee offered the following substitute to HB
520:
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Chapter 8 of Title 34 of the Official Code of Georgia Annotated, relating
to employment security, so as to provide a change to the definition of the term
"employment"; to identify certain business acquisitions with respect to which
the succession of experience tax rates shall not be permitted and to impose
civil and criminal penalties with regard thereto; to extend suspension of
adjustments based upon the State-wide Reserve Ratio for the calendar year 2006
and to provide for a reduced adjustment in contribution rates through December
31, 2006; to continue provisions relating to administrative assessments; to
provide for a change in the weekly benefit amount over a two-year period; to
provide for the Department of Labor a supplemental appropriation, pursuant to
and in accordance with the provisions of Code Section 34-8-81, relating to the
creation and purposes of the Employment Security Administration Fund, and Code
Section 34-8-85, relating to certain withdrawals from the Unemployment Trust
Fund, of additional funds which are otherwise available to the Department of
Labor out of funds credited to and held in this
statés
account in the Unemployment Trust Fund by the Secretary of the Treasury of the
United States pursuant to Section 903 of the Social Security Act, as amended,
for the purpose of providing for the payment of expenses of administration of
Chapter 8 of Title 34 of the Official Code of Georgia Annotated, the "Employment
Security Law," as amended, including personal services and operating and other
expenses incurred in the administration of said law, as well as for the
procurement, through purchase or rental, either or both, of offices, lands,
buildings or parts of buildings, fixtures, furnishings, equipment, technology,
data, reports and studies, supplies, and the construction of buildings or parts
of buildings suitable for use in this state by the Department of Labor, and for
the payment of expenses incurred for the construction, maintenance,
improvements, or repair of or alterations to such real or personal property; to
authorize the Commissioner of Labor to direct the obligation and expenditure of
said funds and to employ workers, contract with persons, public and private
agencies, corporations, and other entities, and to do all other things
necessary to accomplish such purposes; to provide for related matters; to
provide an effective date; to repeal conflicting laws; and for other
purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Chapter
8 of Title 34 of the Official Code of Georgia Annotated, relating to employment
security, is amended by striking the word "or" at the end of paragraph (15) and
by striking the period and inserting "; or" at the end of paragraph (16) of
subsection (n) of Code Section 34-8-35, relating to employment, and inserting at
the end of said subsection a new paragraph (17) to read as follows:
"(17)
Services performed for a common carrier of property by an individual consisting
of the pickup, transportation, and delivery of property; provided
that:
(A)
The individual is free to accept or reject assignments from the common
carrier;
(B)
Remuneration for the individual is on the basis of commissions or deliveries
accomplished;
(C)
Such individual personally provides the vehicle used in the pickup,
transportation, and delivery of the property;
(D)
Such individual has a written contract with the common carrier;
(E)
The written contract states expressly and prominently that the individual
knows:
(i)
Of the responsibility to pay estimated social security taxes and state and
federal income taxes;
(ii) That the social security tax the individual must pay is higher than the
social security tax the individual would pay if he or she were an employee;
and
(iii) That the work is not covered by the unemployment compensation laws of
Georgia; and
(F)
The written contract does not prohibit such individual from the pickup,
transportation, or delivery of property for more than one common carrier or any
other person or
entity."
SECTION
2.
Said
chapter is further amended by striking in its entirety Code Section 34-8-151,
relating to the rate of employer contributions, and inserting in lieu thereof
the following:
"34-8-151.
(a)
For periods prior to April 1, 1987, or after December 31,
2005
2011,
each new or newly covered employer shall pay contributions at a rate of 2.7
percent of wages paid by such employer with respect to employment during each
calendar year until the employer is eligible for a rate calculation based on
experience as defined in this chapter, except as provided in Code Sections
34-8-158 through 34-8-162.
(b)
For periods on or after April 1, 1987, but on or before December 31, 1999, each
new or newly covered employer shall pay contributions at a rate of 2.64 percent
of wages paid by such employer with respect to employment during each calendar
year until the employer is eligible for a rate calculation based on experience
as defined in this chapter, except as provided in Code Sections 34-8-158 through
34-8-162.
(c)
For periods on or after January 1, 2000, but on or before December 31,
2005,
2011
each new or newly covered employer shall pay contributions at a rate of 2.62
percent of wages paid by such employer with respect to employment during each
calendar year until the employer is eligible for a rate calculation based on
experience as defined in this chapter, except as provided in Code Sections
34-8-158, 34-8-159, 34-8-160, 34-8-161, and
34-8-162."
SECTION
3.
Said
chapter is further amended by striking in its entirety Code Section 34-8-153,
relating to the liability of succeeding employers and computation of rate of
contributions, and inserting in lieu thereof the following:
"34-8-153.
(a)
Subject to the
provisions of subsections (g) and (h) of this Code section,
any
Any
corporation, partnership, individual, or other legal entity who acquires by
purchase, merger, consolidation, or other means substantially all of the
trade,
business,
or assets of any employer and who thereafter continues the acquired
trade
or business shall be deemed to be a
successor to the employer from whom the
trade
or business was acquired. The successor
shall acquire the experience rating record of the predecessor except as
otherwise provided in this Code section
or in the
rules and regulations of the Department of
Labor. If the successor is not already an
employer at the time of the acquisition, the rate of contributions applicable to
the predecessor shall continue to be applicable to the successor; provided,
however, if the existing rate of contributions of the predecessor exceeds the
new employer rate as specified in Code Section 34-8-151, the successor shall be
assigned a new employer rate of contributions; in such event, the experience of
the predecessor shall not be considered for purposes of rate calculations and
the successor shall be otherwise treated as a new employer.
(b)
Subject to the
provisions of subsections (g) and (h) of this Code section,
if
If
the successor is already an employer at the time of the acquisition, the rate of
contributions applicable to the successor shall continue until the end of the
quarter in which the acquisition occurred. The rate of contributions applicable
to the successor beginning on the first day of the quarter following the
acquisition will be determined by the combined experience of the predecessor and
successor as of the applicable computation date; provided, however, the
experience of the predecessor shall not be combined with that of the successor
for purposes of rate calculation if the
predecessoŕs
rate of contributions immediately preceding the acquisition exceeded the rate
already in effect for the successor; in such event, the experience of the
predecessor shall not be considered for purposes of rate calculations unless
this combination of experience results in a reduction of rates.
(c)
Subject to the
provisions of subsections (g) and (h) of this Code section,
any
Any
employing unit which acquires by any means any clearly identifiable or separable
portion of the
trade
or business of an employer and is an
employer at the time of the acquisition or becomes an employer within six months
from the end of the quarter in which the acquisition is made may be deemed to be
a partial successor to the employer from whom the portion of the
trade
or business was acquired. A portion of the
predecessoŕs
experience rating records which are attributable to the portion of
trade
or the business which was acquired may be
transferred to the successor. Mutual consent of both parties must be given to
effectuate the partial transfer. The Commissioner shall prescribe by regulation
the time frame for notification to the department of partial acquisitions and
the method by which the portion of the experience rating record to be
transferred will be determined.
(d)
Subject to the
provisions of subsections (g) and (h) of this Code section,
if
If
the conditions of subsection (c) of this Code section are met and the partial
successor is not already an employer at the time of the acquisition, the rate of
contributions applicable to the predecessor shall be applicable to the
successor. Future rates will be determined by combining the transferred portion
of the
predecessoŕs
experience rating record with the
successoŕs
own experience rating record as of the applicable computation date.
(e)
Subject to the
provisions of subsections (g) and (h) of this Code section,
if
If
the conditions of subsection (c) of this Code section are met and the partial
successor is already an employer at the time of the acquisition, the rate of
contributions applicable to the successor shall continue until the end of the
quarter in which the acquisition occurred. The rate of contributions applicable
to the successor beginning on the first day of the quarter following the
acquisition will be determined by combining the transferred portion of the
predecessoŕs
experience rating record with the
successoŕs
own experience rating record as of the applicable computation date.
(f)
Nothing in this Code section shall be construed to affect liens which are
created pursuant to Code Section 34-8-167.
(g)
Notwithstanding
any other provision in this chapter to the contrary, effective July 1,
2006:
(1)
If an employer transfers its trade or business, or any portion thereof, to
another employer and, at the time of the transfer, there is substantially common
ownership, management, or control of the two employers then the rate of
contributions attributable to the predecessor shall be transferred to the
successor employer to whom such business is so transferred. The rates of
contributions of both employers shall be recalculated and made effective
immediately upon the date of the transfer of the trade or business.
(2)
Whenever the successor is not already an employer at the time of the
acquisition, the unemployment experience of the acquired business shall not be
transferred to the successor if the Commissioner determines that the successor
acquired the business solely or primarily for the purpose of obtaining a lower
rate of contribution. Instead, the successor shall be assigned the new employer
rate under Code Section 34-8-151. In determining whether the trade or business
was acquired solely or primarily for the purpose of obtaining a lower rate of
contributions, the Commissioner shall use objective factors which may include
the following:
(A)
The cost of acquiring the trade or business;
(B)
Whether the successor actually continued the business enterprise of the acquired
trade or business;
(C)
How long the acquired trade or business was continued; and
(D)
Whether or not a substantial number of new employees were hired for the
performance of duties unrelated to the business activity conducted by the
predecessor prior to acquisition.
(h)(1)
Any person would knowingly violates or attempts to violate subsection (g) or any
other provision of this chapter related to determining the assignment of a rate
of contributions or any person who knowingly advises another person in a manner
that results in a violation of such provision shall be subject to the following
penalties.
(A)
If the person is an employer, then such employer shall be assigned the highest
rate assignable under this chapter for the rate year during which such violation
or attempted violation occurred and the three rate years immediately following
that rate year; provided, however, that if:
(i)
The
persońs
business is already at the highest rate; or
(ii)
If the amount of increase in the rate of contributions for such person would be
less than 2 percent for such year,
then
a penalty rate of contributions of 2 percent of taxable wages shall be imposed
for such year;
(B)
If the person is not an employer, such person shall be subject to a civil money
penalty of not more than $5,000.00 per violation. Any such fine collected shall
be deposited in the penalty and interest account established under Code Section
34-8-92.
(2)
For the purposes of this Code section, the term 'knowingly' means having actual
knowledge of or acting with deliberate ignorance or reckless disregard for the
prohibited act or omission.
(3)
For the purposes of this Code section, the term 'violates or attempts to
violate' includes, but is not limited to, intent to evade, misrepresentation,
and willful nondisclosure.
(4)
For the purposes of this Code section, the term 'person' shall have the meaning
given such term by Section 7701(a)(1) of the Internal Revenue Code of 1986, as
amended.
(5)
For the purposes of this Code section and administration of the Employment
Security Law, the terms 'trade, business, or assets' and 'trade or business'
shall include:
(A)
The
employeŕs
work force or any part of the
employeŕs
work force; and
(B)
Any part of the
employeŕs
trade, business, or assets, whether or not clearly identifiable or separable
within the meaning of subsection (c) of this Code section.
Tax
liability under Chapter 7 of Title 48 shall not be affected by the definitions
of 'trade, business, or assets' and 'trade or business' in this Code
section.
(6)
In addition to the penalty imposed by paragraph (1) of this subsection, any
violation of this Code section may be prosecuted as a felony under Code Section
16-10-20.
(7)
The Commissioner shall establish procedures to identify the occurrence of any
transfer or acquisition of a business that violates any provision of this Code
section."
SECTION
4.
Said
chapter is further amended by striking in its entirety subparagraph (B) of
paragraph (4) of subsection (d) of Code Section 34-8-156, relating to State-wide
Reserve Ratio, and inserting in lieu thereof the following:
"(B)
Except for any year or portion of a year during which the provisions of
paragraph (1) of subsection (f) of Code Section 34-8-155 apply, when the
State-wide Reserve Ratio, as calculated above, is less than 1.7 percent, there
shall be an overall increase in the rate, as of the computation date, for each
employer whose rate is computed under a rate table in Code Section 34-8-155 in
accordance with the following table:
|
If
the State-wide Reserve Ratio:
|
||
|
Equals
or
Exceeds
|
But
Is
Less
Than
|
Overall
Increase
|
|
1.5
percent
|
1.7
percent
|
25
percent
|
|
1.25
percent
|
1.5
percent
|
50
percent
|
|
0.75
percent
|
1.25
percent
|
75
percent
|
|
Under
0.75 percent
|
|
100
percent
|
provided,
however, that for the period of January 1 through December 31,
2005
2006,
the overall increase in the rate required under this subparagraph shall be
suspended and the provisions of this subparagraph shall be null and void, except
in the event the State-wide Reserve Ratio, as calculated above, is less than
1.00 percent, then the Commissioner of Labor shall have the option of imposing
an increase in the overall rate of up to 35 percent, as of the computation date,
for each employer whose rate is computed under a rate table in Code Section
34-8-155."
SECTION
5.
Said
chapter is further amended by striking in its entirety Code Section 34-8-180,
relating to an administrative assessment on all wages, and inserting in lieu
thereof the following:
"34-8-180.
(a)
For the periods on or after April 1, 1987, but on or before January 1, 2000,
there is created an administrative assessment of .06 percent to be assessed upon
all wages, as defined in Code Section 34-8-49, except wages of the following
employers:
(1)
Those employers who have elected to make payments in lieu of contributions as
provided by Code Section 34-8-158 or who are liable for the payment of
contributions as provided in said Code section; or
(2)
Those employers who, by application of the State-wide Reserve Ratio as provided
in Code Section 34-8-156, have been assigned the minimum positive reserve rate
or the maximum deficit reserve rate.
(b)
For the periods on or after January 1, 2000, but on or before December 31,
2005
2011,
there is created an administrative assessment of 0.08 percent to be assessed
upon all wages as defined in Code Section 34-8-49, except the wages
of:
(1)
Those employers who have elected to make payments in lieu of contributions as
provided by Code Section 34-8-158 or who are liable for the payment of
contributions as provided in said Code section; or
(2)
Those employers who, by application of the State-wide Reserve Ratio as provided
in Code Section 34-8-156, have been assigned the minimum positive reserve rate
or the maximum deficit reserve rate.
(c)
Assessments pursuant to this Code section shall become due and shall be paid by
each employer and must be reported on the
employeŕs
quarterly tax and wage report according to such rules and regulations as the
Commissioner may prescribe. The assessments provided in this Code section shall
not be deducted, in whole or in part, from the remuneration of individuals in
the employ of the employer. Any deduction in violation of this subsection is
unlawful."
SECTION
6.
Said
chapter is further amended by striking in its entirety Code Section 34-8-181,
relating to an additional administrative assessment for new or newly covered
employers, and inserting in lieu thereof the following:
"34-8-181.
(a)
For the periods on or after April 1, 1987, but on or before December 31, 1999,
in addition to the rate paid under Code Section 34-8-151, each new or newly
covered employer shall pay an administrative assessment of .06 percent of wages
payable by it with respect to employment during each calendar year until it is
eligible for a rate calculation based on experience as defined in this chapter,
except as provided in Code Section 34-8-158.
(b)
For the periods on or after January 1, 2000, but on or before December 31,
2005
2011,
in addition to the rate paid under Code Section 34-8-151, each new or newly
covered employer shall pay an administrative assessment of 0.08 percent of wages
payable by it with respect to employment during each calendar year until it is
eligible for a rate calculation based on experience as defined in this chapter,
except as provided in Code Section
34-8-158."
SECTION
7.
Said
chapter is further amended by striking in its entirety Code Section 34-8-185,
relating to the automatic repeal of Article 6, and inserting in lieu thereof the
following:
"34-8-185.
This
article shall stand repealed in its entirety on December 31,
2005
2011."
SECTION
8.
Said
chapter is further amended by striking in their entirety subsections (a), (b),
and (c) of Code Section 34-8-193, relating to determination of the weekly
benefit amount, and inserting in lieu thereof the following:
"(a)
The weekly benefit amount of an
individuaĺs
claim shall be that amount computed by dividing the two highest quarters of
wages paid in the base period by
46
44.
Any fraction of a dollar shall then be disregarded. Wages must have been paid
in at least two quarters of the base period and total wages in the base period
must equal or exceed 150 percent of the highest quarter base period wages. For
claims that fail to establish entitlement due to failure to meet the 150 percent
requirement, an alternative computation shall be made. In such event, the
weekly benefit amount shall be computed by dividing the highest single quarter
of base period wages paid by
23
22.
Any fraction of a dollar shall then be disregarded. Under this alternative
computation, wages must have been paid in at least two quarters of the base
period and total base period wages must equal or exceed 40 times the weekly
benefit amount. Regardless of the method of computation used, wages must have
been paid for insured work, as defined in Code Section 34-8-41.
(b)
Weekly benefit amount entitlement as computed in this Code section shall be no
less than $27.00 per week for benefit years beginning on or after July 1, 1983;
provided, however, that for benefit years beginning on or after July 1, 1987,
when the weekly benefit amount, as computed, would be more than $26.00 but less
than $37.00, the
individuaĺs
weekly benefit amount will be $37.00, and no weekly benefit amount shall be
established for less than $37.00; provided, further, that for benefit years
beginning on or after July 1, 1997, when the weekly benefit amount, as computed,
would be more than $26.00 but less than $39.00, the
individuaĺs
weekly benefit amount will be $39.00, and no weekly benefit amount shall be
established for less than $39.00; provided, further, that for benefit years
beginning on or after July 1, 2002, when the weekly benefit amount, as computed,
would be more than $26.00 but less than $40.00, the
individuaĺs
weekly benefit amount will be $40.00, and no weekly benefit amount shall be
established for less than
$40.00;
provided, further, that for benefit years beginning on or after July 1, 2005,
when the weekly benefit amount, as computed, would be more than $26.00 but less
than $42.00, the
individuaĺs
weekly benefit amount will be $42.00, and no weekly benefit amount shall be
established for less than
$42.00.
(c)
Weekly benefit amount entitlement as computed in this Code section shall not
exceed these amounts for the applicable time period:
(1)
For claims filed on or after July 1, 1990, but before July 1, 1994, the maximum
weekly benefit amount shall not exceed $185.00;
(2)
For claims filed on or after July 1, 1994, but before July 1, 1995, the maximum
weekly benefit amount shall not exceed $195.00;
(3)
For claims filed on or after July 1, 1995, but before July 1, 1996, the maximum
weekly benefit amount shall not exceed $205.00;
(4)
For claims filed on or after July 1, 1996, but before July 1, 1997, the maximum
weekly benefit amount shall not exceed $215.00;
(5)
For claims filed on or after July 1, 1997, but before July 1, 1998, the maximum
weekly benefit amount shall not exceed $224.00;
(6)
For claims filed on or after July 1, 1998, but before July 1, 1999, the maximum
weekly benefit amount shall not exceed $244.00;
(7)
For claims filed on or after July 1, 1999, but before July 1, 2000, the maximum
weekly benefit amount shall not exceed $264.00;
(8)
For claims filed on or after July 1, 2000, but before July 1, 2001, the maximum
weekly benefit amount shall not exceed $274.00;
(9)
For claims filed on or after July 1, 2001, but before July 1, 2002, the maximum
weekly benefit amount shall not exceed $284.00;
(10)
For claims filed on or after July 1, 2002, but before July 1, 2003, the maximum
weekly benefit amount shall not exceed $295.00; and
(11)
For claims filed on or after July 1, 2003,
but before
July 1, 2005, the maximum weekly benefit
amount shall not exceed
$300.00.;
(12)
For claims filed on or after July 1, 2005, but before July 1, 2006, the maximum
weekly benefit amount shall not exceed $310.00; and
(13)
For claims filed on or after July 1, 2006, the maximum weekly benefit amount
shall not exceed
$320.00."
SECTION
8A.
Said
chapter is further amended by striking in its entirety division (iii) of
subparagraph (B) of paragraph (2) of Code Section 34-8-194, relating to the
grounds for disqualification of benefits, and inserting in lieu thereof the
following:
"(iii)
The discharge occurred because of absenteeism and the absences were caused by
illness of the claimant or a family member, unless the claimant has without
justification failed to notify the employer
or the absence
for such illness which led to discharge followed a series of absences, the
majority of which were attributable to fault on the part of the claimant in
direct violation of the
employeŕs
attendance policy and regarding which the claimant has been advised in writing,
prior to any of the absences, that unemployment benefits may be denied due to
such violations of the
employeŕs
policy on attendance; provided, however, that no waiver of an
employeés
rights under the federal Family and Medical Leave Act of 1993, as amended, or
any other applicable state or federal law shall be construed under this
division;".
SECTION
9.
There
is appropriated to the Department of Labor out of funds credited to and held in
this
statés
account in the Unemployment Trust Fund by the Secretary of the Treasury of the
United States pursuant to and in accordance with Section 903 of the Social
Security Act, as amended, an additional amount of $1,642,647.11. Of said
additional amount, the sum of $1,642,647.11 is authorized to be allocated for
expenses incurred in the administration of Chapter 8 of Title 34 of the Official
Code of Georgia Annotated, the "Employment Security Law" as amended, including
personal services and operating and other expenses incurred in the
administration of said law, as well as for the purchase or rental, either or
both, of improvements, repairs, or alterations to and of offices, lands,
buildings or parts of buildings, fixtures, furnishings, equipment, technology,
data, reports and studies, supplies, and the construction of buildings or parts
of buildings suitable for use in this state by the Department of Labor, and for
the payment of expenses incurred for the acquisition, purchase, rental,
construction, maintenance, improvements, repairs, or alterations of and to such
real or personal property. Notwithstanding any other provision of this section,
the amount appropriated in this Act shall not exceed the amount in the
Unemployment Trust Fund, which may be obligated for expenditure for such
purposes as provided in Code Section 34-8-85 of the Official Code of Georgia
Annotated, relating to certain withdrawals from the Unemployment Trust Fund, and
the amount which may be obligated shall not exceed the limitations provided in
Code Section 34-8-85 of the Official Code of Georgia Annotated, relating to
certain withdrawals from the Unemployment Trust Fund; provided, however, that
said additional funds shall not be obligated for expenditure, as provided in
this Act, after the close of the two-year period which begins on the date of
enactment of this Act.
SECTION
9A.
The
Commissioner of Labor is authorized, pursuant to and in accordance with Section
903 of the Social Security Act, as amended, to requisition, and to direct the
obligation and expenditure for use in such locations in this state as the
Commissioner finds to be economical and desirable, such money as authorized in
this Act and in Code Section 34-8-81 of the Official Code of Georgia Annotated,
relating to the creation and purposes of the Employment Security Administration
Fund, and Code Section 34-8-85 of the Official Code of Georgia Annotated,
relating to certain withdrawals from the Unemployment Trust Fund, and, in the
manner and for the purposes authorized in this Act, including personal services
and operating and other expenses incurred in the administration of said laws, as
well as for the procurement, through purchase or rental, either or both, of
offices, lands, buildings or parts of buildings, fixtures, furnishings,
equipment, technology, data, reports and studies, supplies, and the construction
of buildings or parts of buildings suitable for use by the Department of Labor,
for the payment of expenses incurred for the construction, maintenance,
improvements, or repair of or alterations to such real or personal property, to
employ workers, contract with persons, public and private agencies,
corporations, and other entities, to allocate any unexpended amounts
appropriated by this Act, and to do all other things necessary to accomplish the
purposes of this Act. The acquisition of any real or personal property and the
expenditure of any funds appropriated by this Act shall be in accordance with
this
statés
applicable laws existing on the effective date of this Act.
SECTION
10.
This
Act shall become effective upon its approval by the Governor or upon its
becoming law without such approval.
SECTION
11.
All
laws and parts of laws in conflict with this Act are repealed.