PRIOR PRINTER'S NO. 2463 PRINTER'S NO. 3201
No. 1898 Session of 2001
INTRODUCED BY METCALFE, HERSHEY, STERN, DALLY, CREIGHTON, LEH,
TRICH, WASHINGTON AND WILT, SEPTEMBER 18, 2001
AS REPORTED FROM COMMITTEE ON LABOR RELATIONS, HOUSE OF
REPRESENTATIVES, AS AMENDED, JANUARY 29, 2002
AN ACT
1 Amending the act of December 5, 1936 (2nd Sp.Sess., 1937
2 P.L.2897, No.1), entitled "An act establishing a system of
3 unemployment compensation to be administered by the
4 Department of Labor and Industry and its existing and newly
5 created agencies with personnel (with certain exceptions)
6 selected on a civil service basis; requiring employers to
7 keep records and make reports, and certain employers to pay
8 contributions based on payrolls to provide moneys for the
9 payment of compensation to certain unemployed persons;
10 providing procedure and administrative details for the
11 determination, payment and collection of such contributions
12 and the payment of such compensation; providing for
13 cooperation with the Federal Government and its agencies;
14 creating certain special funds in the custody of the State
15 Treasurer; and prescribing penalties," further providing for <--
16 contributions and for election of reimbursement. PROVIDING <--
17 FOR RELIEF FROM CERTAIN EMPLOYER CHARGES.
18 The General Assembly of the Commonwealth of Pennsylvania
19 hereby enacts as follows:
20 Section 1. Section 1003 of the act of December 5, 1936 (2nd <--
21 Sp.Sess., 1937 P.L.2897, No.1), known as the Unemployment
22 Compensation Law, amended July 21, 1983 (P.L.68, No.30), is
23 amended to read:
24 Section 1003. Contributions.--(a) In lieu of contributions
25 required to be paid by employers under this act, the
1 Commonwealth of Pennsylvania shall pay into the Unemployment
2 Compensation Fund an amount equal to the amount of regular
3 benefits and of one-half of the extended benefits paid, (after
4 December 31, 1978 the full amount of extended benefits paid)
5 that is attributable to service in the employ of the
6 Commonwealth and all its departments, bureaus, boards, agencies,
7 commissions and authorities[.]: Provided, that, if an individual
8 is receiving benefits pursuant to an eligibility determination
9 based on a separation from another employer, the Commonwealth
10 shall not be liable to the Unemployment Compensation Fund for
11 any benefits paid to the individual if the individual's most
12 recent separation from the Commonwealth was due to being
13 discharged for willful misconduct connected with the service, or
14 due to the individual's leaving the service without good cause
15 attributable to employment, if the Commonwealth has filed notice
16 with the department in accordance with its rules and regulations
17 and within the time limits prescribed.
18 (b) The amount which the Commonwealth shall pay into the
19 Unemployment Compensation Fund, as hereinabove set forth, shall
20 be computed by the department and reported quarterly to the
21 State Treasurer who shall thereupon pay such amount from the
22 General Fund of the Commonwealth, upon approval thereof in
23 accordance with the law then in effect, except that to the
24 extent that compensation is paid on the basis of wages paid by
25 an authority of the Commonwealth from its funds such authority
26 shall pay such amount into the Unemployment Compensation Fund
27 from its own funds.
28 (c) Past due payments of amounts in lieu of contributions,
29 or reports with respect thereto, shall be subject to the same
30 interest and penalties that, pursuant to section 308 apply to
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1 past due contributions and section 206 apply to past due
2 reports.
3 Section 2. Sections 1104 and 1202.2 of the act, amended or
4 added July 6, 1977 (P.L.41, No.22), are amended to read:
5 Section 1104. Election of Reimbursement.--(a) Any nonprofit
6 organization which, on or after January 1, 1972, is or becomes
7 liable to the contribution provisions of this act may, in lieu
8 of payment of such contributions, elect to pay to the department
9 for the Unemployment Compensation Fund an amount equal to the
10 amount of regular benefits and of one-half of the extended
11 benefits paid, that is attributable to service in the employ of
12 such nonprofit organization[.]: Provided, that if an individual
13 is receiving benefits pursuant to an eligibility determination
14 based on a separation from another employer, the nonprofit
15 organization shall not be liable to the Unemployment
16 Compensation Fund for any benefits paid to the individual if the
17 individual's most recent separation from the nonprofit
18 organization was due to being discharged for willful misconduct
19 connected with the service, or due to the individual's leaving
20 the service without good cause attributable to employment, if
21 the nonprofit organization has filed notice with the department
22 in accordance with its rules and regulations and within the time
23 limits prescribed. Such employer shall continue to be liable for
24 reimbursement of benefit payments based on wages paid prior to
25 the termination date of such election.
26 (b) Such election shall be for a period of not less than two
27 taxable years unless sooner terminated by the department as
28 hereinafter provided.
29 Section 1202.2. Election of Reimbursement.--(a) Any
30 political subdivision of the Commonwealth or any instrumentality
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1 of one or more thereof, which on or after January 1, 1978 and
2 prior to January 1, 1979 is or becomes liable to the
3 contribution provisions of the act may, in lieu of payment of
4 such contributions, elect to pay to the department for the
5 Unemployment Compensation Fund, an amount equal to the amount of
6 regular benefits and of one-half of the extended benefits paid,
7 (after December 31, 1978 the full amount of extended benefits
8 paid) that is attributable to service in the employ of such
9 political subdivision of the Commonwealth or any instrumentality
10 of one or more thereof[.]: Provided, that, if an individual is
11 receiving benefits pursuant to an eligibility determination
12 based on a separation from another employer, the political
13 subdivision or instrumentality shall not be liable to the
14 Unemployment Compensation Fund for any benefits paid to the
15 individual if the individual's most recent separation from the
16 political subdivision or instrumentality was due to being
17 discharged for willful misconduct connected with the service, or
18 due to the individual's leaving the service without good cause
19 attributable to employment, if the political subdivision or
20 instrumentality has filed notice with the department in
21 accordance with its rules and regulations and within the time
22 limits prescribed. Such employer shall continue to be liable for
23 reimbursement of benefit payments based on wages paid prior to
24 the termination date of such election.
25 (b) Such election shall be for a period of not less than two
26 taxable years unless sooner terminated by the department as
27 hereinafter provided.
28 Section 3. This act shall take effect in 60 days.
29 SECTION 1. THE ACT OF DECEMBER 5, 1936 (2ND SP.SESS., 1937 <--
30 P.L.2897, NO.1), KNOWN AS THE UNEMPLOYMENT COMPENSATION LAW, IS
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1 AMENDED BY ADDING A SECTION TO READ:
2 SECTION 212. RELIEF FROM CHARGES FOR CERTAIN EMPLOYERS.--(A)
3 AN EMPLOYER THAT MAKES PAYMENTS IN LIEU OF CONTRIBUTIONS
4 PURSUANT TO ARTICLE X, XI OR XII SHALL BE RELIEVED OF CHARGES IN
5 ACCORDANCE WITH SECTION 302(A) AND REGULATIONS OF THE
6 DEPARTMENT, FOR COMPENSATION PAID ON APPLICATIONS FOR BENEFITS
7 EFFECTIVE DURING A CALENDAR YEAR, IF THE EMPLOYER SATISFIES THE
8 FOLLOWING REQUIREMENTS:
9 (1) THE EMPLOYER PAYS A NONREFUNDABLE SOLVENCY FEE UNDER
10 SUBSECTION (B) FOR THE CALENDAR YEAR WITHIN THIRTY (30) DAYS
11 AFTER NOTICE OF THE FEE IS SENT TO THE EMPLOYER'S LAST KNOWN
12 ADDRESS. THE DEPARTMENT MAY FOR GOOD CAUSE EXTEND THE PERIOD
13 WITHIN WHICH THE FEE MUST BE PAID.
14 (2) ALL REPORTS REQUIRED BY THIS ACT AND REGULATIONS OF THE
15 DEPARTMENT FOR CALENDAR QUARTERS THROUGH THE SECOND CALENDAR
16 QUARTER OF THE PRECEDING CALENDAR YEAR ARE FILED.
17 (B) AN EMPLOYER'S SOLVENCY FEE FOR A CALENDAR YEAR SHALL BE
18 THE MONETARY AMOUNT DETERMINED BY MULTIPLYING THE SOLVENCY FEE
19 RATE FOR THE YEAR BY THE AMOUNT OF WAGES PAID, WITHOUT REGARD TO
20 THE EXCLUSION IN SECTION 4(X)(1), BY THE EMPLOYER IN THE FOUR
21 CONSECUTIVE CALENDAR QUARTERS ENDING ON JUNE 30 OF THE PRECEDING
22 CALENDAR YEAR: PROVIDED, THAT AN EMPLOYER'S SOLVENCY FEE FOR A
23 YEAR SHALL NOT BE LESS THAN TWENTY-FIVE DOLLARS ($25).
24 (1) FOR CALENDAR YEARS 2003, 2004 AND 2005, THE SOLVENCY FEE
25 RATE SHALL BE THREE TEN THOUSANDTHS (.0003).
26 (2) IN 2005 THE SECRETARY SHALL REDETERMINE THE SOLVENCY FEE
27 RATE. THE SECRETARY SHALL REDETERMINE THE RATE SO THAT THE
28 UNROUNDED RATE YIELDS SOLVENCY FEES APPROXIMATELY EQUAL TO THE
29 AMOUNT OF COMPENSATION FOR WHICH CHARGES ARE RELIEVED UNDER THIS
30 SECTION. FOR PURPOSES OF REDETERMINING THE RATE, THE SECRETARY
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1 SHALL USE THE AMOUNT OF COMPENSATION FOR WHICH CHARGES ARE
2 RELIEVED UNDER THIS SECTION PAID DURING 2003 AND 2004 AND THE
3 AMOUNT OF WAGES PAID, WITHOUT REGARD TO THE EXCLUSION IN SECTION
4 4(X)(1), DURING THE SAME TIME PERIOD BY EMPLOYERS WHO PAID A
5 SOLVENCY FEE UNDER THIS SECTION. THE RATE AS REDETERMINED SHALL
6 TAKE EFFECT FOR THE NEXT CALENDAR YEAR AND SHALL REMAIN IN
7 EFFECT FOR THREE YEARS.
8 (3) BEGINNING IN 2008 AND EACH FIFTH YEAR THEREAFTER, THE
9 SECRETARY SHALL REDETERMINE THE SOLVENCY FEE RATE. THE SECRETARY
10 SHALL REDETERMINE THE RATE SO THAT THE UNROUNDED RATE YIELDS
11 SOLVENCY FEES APPROXIMATELY EQUAL TO THE AMOUNT OF COMPENSATION
12 FOR WHICH CHARGES ARE RELIEVED UNDER THIS SECTION. FOR PURPOSES
13 OF REDETERMINING THE RATE, THE SECRETARY SHALL USE THE AMOUNT OF
14 COMPENSATION FOR WHICH CHARGES ARE RELIEVED UNDER THIS SECTION
15 PAID DURING THE FIVE CALENDAR YEARS IMMEDIATELY PRECEDING THE
16 YEAR IN WHICH THE REDETERMINATION OCCURS AND THE AMOUNT OF WAGES
17 PAID, WITHOUT REGARD TO THE EXCLUSION IN SECTION 4(X)(1), DURING
18 THE SAME TIME PERIOD BY EMPLOYERS WHO PAID A SOLVENCY FEE UNDER
19 THIS SECTION. THE RATE AS REDETERMINED SHALL TAKE EFFECT FOR THE
20 NEXT CALENDAR YEAR AND SHALL REMAIN IN EFFECT FOR FIVE YEARS.
21 (4) IF THE SOLVENCY FEE RATE REDETERMINED UNDER PARAGRAPHS
22 (2) AND (3) IS NOT A MULTIPLE OF ONE-HUNDREDTH OF ONE PER CENT
23 IT SHALL BE ROUNDED TO THE NEXT HIGHER MULTIPLE OF ONE-HUNDREDTH
24 OF ONE PER CENT.
25 (C) SOLVENCY FEES PAID BY EMPLOYERS UNDER THIS SECTION SHALL
26 BE DEPOSITED IN THE UNEMPLOYMENT COMPENSATION FUND. COMPENSATION
27 FOR WHICH CHARGES ARE RELIEVED UNDER THIS SECTION SHALL NOT BE
28 USED IN THE CALCULATION OF THE STATE ADJUSTMENT FACTOR UNDER
29 SECTION 301.1(E).
30 (D) THE PROVISIONS OF THIS SECTION SHALL CONSTITUTE THE
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1 EXCLUSIVE MEANS BY WHICH AN EMPLOYER WHO MAKES PAYMENTS IN LIEU
2 OF CONTRIBUTIONS PURSUANT TO ARTICLE X, XI OR XII MAY BE EXCUSED
3 FROM REIMBURSING THE UNEMPLOYMENT COMPENSATION FUND FOR
4 COMPENSATION PAID TO AN INDIVIDUAL THAT IS BASED ON WAGES PAID
5 BY THE EMPLOYER OR THAT PORTION OF THE INDIVIDUAL'S COMPENSATION
6 DETERMINED IN ACCORDANCE WITH SECTION 1108.
7 (E) A GROUP ACCOUNT UNDER SECTION 1109 SHALL CONSTITUTE AN
8 EMPLOYER FOR PURPOSES OF THIS SECTION.
9 SECTION 2. THE ADDITION OF SECTION 212 OF THE ACT SHALL BE
10 APPLICABLE TO CALENDAR YEARS BEGINNING AFTER DECEMBER 31, 2002,
11 AND TO COMPENSATION PAID ON APPLICATIONS FOR BENEFITS EFFECTIVE
12 AFTER DECEMBER 31, 2002.
13 SECTION 3. THIS ACT SHALL TAKE EFFECT IMMEDIATELY.
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