LRB-2772/2
JTK:cjs:rs
2011 - 2012 LEGISLATURE
October 6, 2011 - Introduced by Representative Ballweg, cosponsored by Senator
Wanggaard. Referred to Committee on Labor and Workforce Development.
AB310,2,2
1An Act to repeal 108.04 (8) (b), 108.04 (13) (cm), 108.05 (3) (b) and 108.09 (4r);
2to renumber 108.065 (1) and 108.065 (1m) and (2);
to renumber and amend
3108.05 (3) (c);
to amend 20.445 (1) (gd), 20.445 (1) (gg), 108.04 (2) (a) 3. (intro.),
4108.04 (11) (a) and (b), 108.04 (11) (bm), 108.05 (3) (a), 108.09 (2) (b), 108.09 (3)
5(a) 1., 108.09 (8) (b), 108.16 (6) (f), 108.16 (6) (L), 108.16 (6) (m), 108.16 (6m) (g),
6108.16 (8) (h), 108.16 (10), 108.19 (title), 108.19 (1m), 108.22 (1m), 108.22 (8)
7(b) 1. d., 108.225 (1) (b), 108.225 (16) (am) 1. (intro.), 108.225 (17) and 108.24
8(1);
to repeal and recreate 108.04 (11) (be); and
to create 20.445 (1) (u),
920.445 (1) (v), 25.17 (1) (xe), 25.17 (1) (xf), 108.04 (2) (bm), 108.04 (11) (bh),
10108.05 (3) (c) 1. to 3., 108.05 (3) (dm), 108.065 (1e), 108.065 (3), 108.19 (1q),
11108.19 (1s) and 108.22 (8) (bh) of the statutes;
relating to: various changes in
1the unemployment insurance law, providing a penalty, and making
2appropriations.
Analysis by the Legislative Reference Bureau
This bill makes various changes in the unemployment insurance (UI) law.
Significant provisions include:
Benefit changes
Concealment and program integrity
Currently, if a claimant conceals any material fact relating to his or her
eligibility for benefits or conceals any wages earned in or paid or payable for a given
week, the claimant is subject to graduated monetary penalties that increase in
severity with the number of determinations of concealment by the claimant. In
addition, if a claimant conceals any wages for a given week, the claimant is ineligible
to receive any benefits for that week.
This bill provides instead that a claimant who conceals any material fact
relating to his or her eligibility for benefits or conceals any wages is subject to a
graduated forfeiture of benefit amounts equivalent to specified weeks of benefit
eligibility that increases in severity with the number of determinations of
concealment by the claimant. In addition, a claimant who is found guilty of
concealment is subject to a penalty equal to 15 percent of the benefit payments paid
to the claimant.
The bill also creates a segregated fund called the unemployment program
integrity fund for deposit of all penalties collected under the above described penalty
provision created by the bill. Under the bill, moneys in the fund are to be used for
the payment of costs associated with program integrity (fraud detection and
prevention) activities.
Partial unemployment
Currently, with certain exceptions, if an employee earns wages or certain other
amounts treated as wages in a given week, the first $30 of the wages or other
amounts are disregarded and the claimant's weekly benefit payment is reduced by
67 percent of the remaining amount earned, but no employee is eligible to receive
benefits for any week if the benefits would be less than $5, and any wages that the
employee would have earned in any week for work performed for his or her employer
had the claimant accepted available work from that employer are treated as wages
earned for that week.
This bill provides that an employee is ineligible to receive any benefits for a
week if the employee receives from one or more employers 1) wages earned for work
performed in that week of more than $500; or 2) sick pay, holiday pay, vacation pay,
or termination pay which, by itself or in combination with wages earned for work
performed in that week, is equivalent to more than $500.
Eligibility of claimants who engage in full-time work
Currently, if a claimant receives wages or certain other amounts treated as
wages from an employer who paid at least 80 percent of the claimant's wages in his
or her base period (period preceding a claim during which benefit rights accrue) for
any week, the claimant is not eligible to receive benefits for that week if the claimant
works for at least 32 hours for that employer in that week and receives pay at not less
than the rate of pay that the claimant received during the calendar quarter in his or
her base period in which the claimant received his or her highest wages, or the
claimant receives certain other payments from that employer for that week that
alone or in combination with any paid wages equal at least the pay the claimant
would have received for 32 hours per week.
This bill substitutes a rule which provides that a claimant is ineligible to receive
any benefits for a week in which one or more of the following applies to the claimant
for 32 or more hours in that week: 1) The claimant performs work; 2) The claimant
receives certain amounts treated as wages for that week; or 3) The claimant receives
holiday pay, vacation pay, termination pay, or sick pay that is treated as wages under
current law.
Failure or refusal to take a test for illegal drugs
Currently, unless federal law otherwise provides, with certain exceptions, if an
employee fails, without good cause, to accept suitable work when offered, the
employee is ineligible to receive benefits until four weeks have elapsed since the end
of the week in which the failure occurs and the employee earns wages, or certain
other amounts treated as wages, equal to at least four times the employee's weekly
benefit rate in employment covered by the unemployment insurance law of any state
or the federal government. An employee's failure to accept an offer of work includes
either a) the employee's refusal without good cause to take a test for illegal drugs
conducted in a manner approved by the Department of Workforce Development
(DWD) that is given on behalf of the employer as a condition of employment; or b) the
employer's withdrawal of or failure to extend an offer of work due to a positive test
result on such a test.
This bill deletes an employee's refusal to take a test for illegal drugs or a
withdrawal or failure to extend an offer of employment due to a positive test result
as an element of failure to accept suitable work.
Ineligibility for failure to perform work searches
Currently, a claimant must conduct a reasonable search for suitable work
during each week that the claimant receives benefits unless DWD waives the work
search requirement by general rule under stated conditions. This bill provides that
a claimant is ineligible to receive benefits for any week for which there is a
determination that the claimant failed to conduct a reasonable search for suitable
work and DWD has not waived the work search requirement. If benefits have been
paid to a claimant for such a week, the bill permits DWD to recover the benefits in
the same manner as other overpayments are recovered.
Tax changes
Contribution liability of successor employers
Currently, when a business is transferred from one employer to another
employer, DWD must treat the transferee as the successor employer to the transferor
if the the transferee and the transferor are owned, controlled, or managed by the
same interests. DWD redetermines the contribution (tax) rate of a successor
employer as of the first quarter beginning after the effective date of the transfer. This
bill provides instead that DWD shall redetermine the contribution rate of a successor
employer as of the beginning of the first calendar year beginning after the effective
date of the transfer.
Other changes
Determining who is the employer of certain employees
Currently, when an employee has some relationship with more than one
employer in the course of performing a job, DWD must determines which employer
is considered to be the employee's employer for purposes of the UI law. Except in
certain limited circumstances, current statutes do not address the issue of how
employment status and employer responsibility for a particular employee is
determined. This bill provides that, except with respect to providers of home health
care and personal care services for medical assistance recipients, DWD must
consider nine factors concerning an employer's relationship to an employee and
three other factors concerning the beneficiary of an employee's services,
maintenance of a staff of employees to perform the employee's services, and
responsibility for employee compliance with regulatory laws in determining who is
the employer of a particular employee. The bill also provides that notwithstanding
these factors, a provider of home health care and personal care services for medical
assistance recipients may elect to be the employer of employees providing those
services, if the provider notifies in writing the recipient of the services of its election
and the provider is treated by the federal Internal Revenue Service as an employer
for purposes of compliance with federal unemployment tax laws.
Treatment of interest assessments and assessment-related revenue
Currently, when there are insufficient moneys in the unemployment reserve
fund to make full payment of benefit claims, DWD is authorized to borrow moneys
from the federal government sufficient to make full payment of claims. DWD then
levies an annual assessment against employers that engage employees in
employment covered by the UI law sufficient to pay the interest due on the federal
advances to the fund. Any interest earned on the assessments pending transfer to
the federal government is credited to the state general fund, and any amount
remaining after an interest payment is made is retained for the purpose of making
future interest payments or for certain other authorized uses relating to the UI
program. This bill creates a segregated fund called the unemployment interest
payment fund for deposit of all unencumbered moneys collected on interest
assessments and all moneys to be collected on assessments previously made. Under
the bill, any interest earned on the assessments pending transfer to the federal
government and any interest or penalties collected from employers who are
delinquent in paying their assessments is credited to this segregated fund. The bill
provides that DWD shall use the moneys in the fund to make interest payments due
to the federal government on advances made to the unemployment reserve fund. The
bill directs DWD to use excess moneys in the fund to pay interest due in future years,
or if DWD determines that additional interest obligations are unlikely, the bill
directs DWD to use the excess moneys to pay benefits. The bill also makes delinquent
assessments subject to a simplified collection procedure that is currently used by
DWD for collection of other UI liabilities.
Recovery of UI liabilities resulting from incorrect earnings reports
Currently, DWD may utilize procedures available under state and federal laws
to set off adjudicated UI liabilities against refunds or other payments that may be
payable to a liable individual under state law or to offset adjudicated UI liabilities
for fraudulent practices against refunds that may be payable to a liable individual
under federal tax laws. This bill permits DWD to offset adjudicated UI liabilities for
failure to report earnings in the same manner.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB310, s. 1
1Section
1. 20.445 (1) (gd) of the statutes is amended to read:
AB310,6,82
20.445
(1) (gd)
Unemployment interest and penalty payments. All moneys
3received as interest and penalties collected under ss. 108.04 (11) (c) and (cm) and (13)
4(c) and 108.22
, assessments under s. 108.19 (1m)
except interest and penalties
5deposited under s. 108.19 (1q), and forfeitures under s. 103.05 (5), all moneys not
6appropriated under par. (gg) and all moneys transferred to this appropriation
7account from the appropriation account under par. (gh) for the payment of benefits
8specified in s. 108.07 (5) and
1987 Wisconsin Act 38, section
132 (1) (c), for the
9payment of interest to employers under s. 108.17 (3m), for research relating to the
10condition of the unemployment reserve fund under s. 108.14 (6), for administration
11of the unemployment insurance program and federal or state unemployment
12insurance programs authorized by the governor under s. 16.54, for satisfaction of any
1federal audit exception concerning a payment from the unemployment reserve fund
2or any federal aid disallowance concerning the unemployment insurance program,
3for assistance to the department of justice in the enforcement of ch. 108, for the
4payment of interest due on advances from the federal unemployment account under
5title XII of the social security act to the unemployment reserve fund, and for
6payments made to the unemployment reserve fund to obtain a lower interest rate or
7deferral of interest payments on these advances, except as otherwise provided in s.
8108.20.
AB310, s. 2
9Section
2. 20.445 (1) (gg) of the statutes is amended to read:
AB310,6,1410
20.445
(1) (gg)
Unemployment information technology systems; interest and
11penalties. From the moneys received as interest and penalties collected under ss.
12108.04 (11) (c) and (cm) and (13) (c) and 108.22
except interest and penalties
13deposited under s. 108.19 (1q), as a continuing appropriation, the amounts in the
14schedule for the purpose specified in s. 108.19 (1e) (d).
AB310, s. 3
15Section
3. 20.445 (1) (u) of the statutes is created to read:
AB310,6,1816
20.445
(1) (u)
Unemployment interest payments and transfers. From the
17unemployment interest payment fund, a sum sufficient to make the payments and
18transfers authorized under s. 108.19 (1m).
AB310, s. 4
19Section
4. 20.445 (1) (v) of the statutes is created to read:
AB310,6,2220
20.445
(1) (v)
Unemployment program integrity. From the unemployment
21program integrity fund, a sum sufficient to make the payments authorized under s.
22108.19 (1s).
AB310, s. 5
23Section
5. 25.17 (1) (xe) of the statutes is created to read:
AB310,6,2424
25.17
(1) (xe) Unemployment interest payment fund (s. 108.19 (1q));
AB310, s. 6
25Section
6. 25.17 (1) (xf) of the statutes is created to read:
AB310,7,1
125.17
(1) (xf) Unemployment program integrity fund (s. 108.19 (1s));
AB310, s. 7
2Section
7. 108.04 (2) (a) 3. (intro.) of the statutes is amended to read:
AB310,7,123
108.04
(2) (a) 3. (intro.) The individual conducts a reasonable search for
4suitable work during that week
, unless the search requirement is waived under par.
5(b). The search for suitable work must include 2 actions that constitute a reasonable
6search as prescribed by rule of the department. This subdivision does not apply to
7an individual if the department determines that the individual is currently laid off
8from employment with an employer but there is a reasonable expectation of
9reemployment of the individual by that employer. In determining whether the
10individual has a reasonable expectation of reemployment by an employer, the
11department shall request the employer to verify the individual's employment status
12and shall also consider other factors, including:
AB310, s. 8
13Section
8. 108.04 (2) (bm) of the statutes is created to read:
AB310,7,1814
108.04
(2) (bm) A claimant is ineligible to receive benefits for any week for
15which there is a determination that the claimant failed to conduct a reasonable
16search for suitable work and the department has not waived the search requirement
17under par. (b). If the department has paid benefits to a claimant for any such week,
18the department may recover the overpayment under s. 108.22 (8).
AB310, s. 10
21Section
10. 108.04 (11) (a) and (b) of the statutes are amended to read:
AB310,7,2522
108.04
(11) (a) If a claimant, in filing his or her application for benefits or claim
23for any week, conceals any material fact relating to his or her eligibility for benefits,
24the claimant
shall forfeit benefits in accordance with
is ineligible for benefits as
25provided in par. (be).
AB310,8,4
1(b) If a claimant, in filing a claim for any week, conceals any of his or her wages
2earned in or paid or payable for that week, the claimant
shall forfeit benefits in
3accordance with par. (be). In addition, the claimant shall be denied benefits for that
4week is ineligible for benefits as provided in par. (be).
AB310, s. 11
5Section
11. 108.04 (11) (be) of the statutes is repealed and recreated to read:
AB310,8,76
108.04
(11) (be) A claimant is ineligible for benefits for acts of concealment
7described in pars. (a) and (b) as follows:
AB310,8,128
1. For each single act of concealment occurring before the date of the first
9determination of concealment under par. (a) or (b), the claimant is ineligible for
10benefits for which he or she would otherwise be eligible in an amount equivalent to
112 times the claimant's weekly benefit rate under s. 108.05 (1) for the week in which
12the claim is made.
AB310,8,1713
2. For each single act of concealment occurring after the date of the first
14determination of concealment under par. (a) or (b), the claimant is ineligible for
15benefits for which he or she would otherwise be eligible in an amount equivalent to
164 times the claimant's weekly benefit rate under s. 108.05 (1) for the week in which
17the claim is made.
AB310,8,2218
3. For each single act of concealment occurring after the date of a 2nd or
19subsequent determination of concealment under par. (a) or (b), the claimant is
20ineligible for benefits for which he or she would otherwise be eligible in an amount
21equivalent to 8 times the claimant's weekly benefit rate under s. 108.05 (1) for the
22week in which the claim is made.
AB310, s. 12
23Section
12. 108.04 (11) (bh) of the statutes is created to read:
AB310,9,224
108.04
(11) (bh) In addition to ineligibility for benefits resulting from
25concealment as provided in par. (be), the department shall assess a penalty against
1the claimant in an amount equal to 15 percent of the benefit payments paid to the
2claimant as a result of one or more acts of concealment described in pars. (a) and (b).
AB310, s. 13
3Section
13. 108.04 (11) (bm) of the statutes is amended to read:
AB310,9,164
108.04
(11) (bm)
The forfeiture established The department shall apply any
5ineligibility under par. (be)
may be applied against benefits
and weeks of eligibility
6for which
the claimant would otherwise
become payable to the claimant for weeks
7of unemployment occurring be eligible after the week of concealment and within 6
8years after the date of an initial determination issued under s. 108.09 finding that
9a concealment occurred.
The claimant shall not receive waiting period credit under
10s. 108.04 (3) for the period of ineligibility applied under par. (be). If no benefit rate
11applies to the week for which the claim is made, the department shall use the
12claimant's benefit rate for the claimant's next benefit year beginning after the week
13of concealment to determine the
forfeiture amount
. If the benefits forfeited would
14otherwise be chargeable to an employer's account, the department shall charge the
15amount of benefits forfeited to the employer's account and shall credit the fund's
16balancing account for that amount of the benefit reduction.
AB310, s. 15
19Section
15. 108.05 (3) (a) of the statutes is amended to read:
AB310,9,2520
108.05
(3) (a) Except as provided in pars.
(b), (c),
and (d)
, and (dm) if an eligible
21employee earns wages in a given week, the first $30 of the wages shall be disregarded
22and the employee's applicable weekly benefit payment shall be reduced by 67% of the
23remaining amount, except that no such employee is eligible for benefits if the
24employee's benefit payment would be less than $5 for any week. For purposes of this
25paragraph, "wages" includes any salary reduction amounts earned that are not
1wages and that are deducted from the salary of a claimant by an employer pursuant
2to a salary reduction agreement under a cafeteria plan, within the meaning of
26
3USC 125, and any amount that a claimant would have earned in available work
4under s. 108.04 (1) (a) which is treated as wages under s. 108.04 (1) (bm), but excludes
5any amount that a claimant earns for services performed as a volunteer fire fighter,
6volunteer emergency medical technician, or volunteer first responder. In applying
7this paragraph, the department shall disregard discrepancies of less than $2
8between wages reported by employees and employers.
AB310, s. 16
9Section
16. 108.05 (3) (b) of the statutes is repealed.
AB310, s. 17
10Section
17. 108.05 (3) (c) of the statutes is renumbered 108.05 (3) (c) (intro.)
11and amended to read:
AB310,10,1512
108.05
(3) (c) (intro.) A claimant is ineligible to receive any benefits for a week
13in which
the claimant works a total of 40 or more hours for one or more employing
14units. one or more of the following applies to the claimant for 32 or more hours in that
15week: