Citations Affected: IC 22-4.
Synopsis: Unemployment contribution rates. Delays from January 1,
2010, to January 1, 2011, changes in the taxable wage base and
employer contribution rates for the unemployment compensation
system.
Effective: January 1, 2010 (retroactive).
January 13, 2010, read first time and referred to Committee on Labor and Employment.
A BILL FOR AN ACT to amend the Indiana Code concerning labor
and safety.
agreement made and entered into by an employer, a union, and the
National Labor Relations Board.
(b) The term "wages" shall not include the following:
(1) That part of remuneration which, after remuneration equal to:
(A) seven thousand dollars ($7,000), has been paid in a
calendar year to an individual by an employer or the
employer's predecessor with respect to employment during any
calendar year that begins after December 31, 1982, and before
January 1, 2010; 2011; or
(B) nine thousand five hundred dollars ($9,500), has been paid
in a calendar year to an individual by an employer or the
employer's predecessor for employment during a calendar year
that begins after December 31, 2009; 2010;
unless that part of the remuneration is subject to a tax under a
federal law imposing a tax against which credit may be taken for
contributions required to be paid into a state unemployment fund.
For the purposes of this subdivision, the term "employment" shall
include service constituting employment under any employment
security law of any state or of the federal government. However,
nothing in this subdivision shall be taken as an approval or
disapproval of any related federal legislation.
(2) The amount of any payment (including any amount paid by an
employer for insurance or annuities or into a fund to provide for
any such payment) made to, or on behalf of, an individual or any
of the individual's dependents under a plan or system established
by an employer which makes provision generally for individuals
performing service for it (or for such individuals generally and
their dependents) or for a class or classes of such individuals (or
for a class or classes of such individuals and their dependents) on
account of:
(A) retirement;
(B) sickness or accident disability;
(C) medical or hospitalization expenses in connection with
sickness or accident disability; or
(D) death.
(3) The amount of any payment made by an employer to an
individual performing service for it (including any amount paid
by an employer for insurance or annuities or into a fund to
provide for any such payment) on account of retirement.
(4) The amount of any payment on account of sickness or accident
disability, or medical or hospitalization expenses in connection
with sickness or accident disability made by an employer to, or on
behalf of, an individual performing services for it and after the
expiration of six (6) calendar months following the last calendar
month in which the individual performed services for such
employer.
(5) The amount of any payment made by an employer to, or on
behalf of, an individual performing services for it or to the
individual's beneficiary:
(A) from or to a trust exempt from tax under Section 401(a) of
the Internal Revenue Code at the time of such payment unless
such payment is made to an individual performing services for
the trust as remuneration for such services and not as a
beneficiary of the trust; or
(B) under or to an annuity plan which, at the time of such
payments, meets the requirements of Section 401(a)(3),
401(a)(4), 401(a)(5), and 401(a)(6) of the Internal Revenue
Code.
(6) Remuneration paid in any medium other than cash to an
individual for service not in the course of the employer's trade or
business.
(7) The amount of any payment (other than vacation or sick pay)
made to an individual after the month in which the individual
attains the age of sixty-five (65) if the individual did not perform
services for the employer in the period for which such payment is
made.
(8) The payment by an employer (without deduction from the
remuneration of the employee) of the tax imposed upon an
employee under Sections 3101 et seq. of the Internal Revenue
Code (Federal Insurance Contributions Act).
SECTION 12, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2010 (RETROACTIVE)]: Sec. 2. (a) Except as provided
in IC 22-4-11.5, the department shall for each year determine the
contribution rate applicable to each employer.
(b) The balance shall include contributions with respect to the
period ending on the computation date and actually paid on or before
July 31 immediately following the computation date and benefits
actually paid on or before the computation date and shall also include
any voluntary payments made in accordance with IC 22-4-10-5 or
IC 22-4-10-5.5:
(1) for each calendar year, an employer's rate shall be determined
in accordance with the rate schedules in section 3.3 or 3.5 of this
chapter; and
(2) for each calendar year, an employer's rate shall be two and
seven-tenths percent (2.7%) before January 1, 2010, 2011, and
two and five-tenths percent (2.5%) after December 31, 2009,
2010, except as otherwise provided in IC 22-4-37-3, unless and
until:
(A) the employer has been subject to this article throughout
the thirty-six (36) consecutive calendar months immediately
preceding the computation date; and
(B) there has been some annual payroll in each of the three (3)
twelve (12) month periods immediately preceding the
computation date.
(c) This subsection applies before January 1, 2010. 2011. In addition
to the conditions and requirements set forth and provided in subsection
(b)(2)(A) and (b)(2)(B), an employer's rate shall not be less than five
and six-tenths percent (5.6%) unless all required contribution and wage
reports have been filed within thirty-one (31) days following the
computation date and all contributions, penalties, and interest due and
owing by the employer or the employer's predecessors for periods prior
to and including the computation date have been paid:
(1) within thirty-one (31) days following the computation date; or
(2) within ten (10) days after the department has given the
employer a written notice by registered mail to the employer's last
known address of:
(A) the delinquency; or
(B) failure to file the reports;
whichever is the later date.
The board or the board's designee may waive the imposition of rates
under this subsection if the board finds the employer's failure to meet
the deadlines was for excusable cause. The department shall give
written notice to the employer before this additional condition or
requirement shall apply.
(d) This subsection applies after December 31, 2009. 2010. In
addition to the conditions and requirements set forth and provided in
subsection (b)(2)(A) and (b)(2)(B), an employer's rate shall not be less
than twelve percent (12%) unless all required contributions and wage
reports have been filed within thirty-one (31) days following the
computation date and all contributions, penalties, and interest due and
owning owing by the employer or the employer's predecessor for
periods before and including the computation date have been paid:
(1) within thirty-one (31) days following the computation date; or
(2) within ten (10) days after the department has given the
employer a written notice by registered mail to the employer's last
known address of:
(A) the delinquency; or
(B) failure to file the reports;
whichever is the later date. The board or the board's designee may
waive the imposition of rates under this subsection if the board finds
the employer's failure to meet the deadlines was for excusable cause.
The department shall give written notice to the employer before this
additional condition or requirement shall apply.
(e) However, if the employer is the state or a political subdivision
of the state or any instrumentality of a state or a political subdivision,
or any instrumentality which is wholly owned by the state and one (1)
or more other states or political subdivisions, the employer may
contribute at a rate of:
(1) one percent (1%), before January 1, 2010; 2011; or
(2) one and six-tenths percent (1.6%), after December 31, 2009;
2010;
until it has been subject to this article throughout the thirty-six (36)
consecutive calendar months immediately preceding the computation
date.
(f) On the computation date every employer who had taxable wages
in the previous calendar year shall have the employer's experience
account charged with the amount determined under the following
formula:
STEP ONE: Divide:
(A) the employer's taxable wages for the preceding calendar
year; by
(B) the total taxable wages for the preceding calendar year.
STEP TWO: Multiply the quotient determined under STEP ONE
by the total amount of benefits charged to the fund under section
1 of this chapter.
(g) One (1) percentage point of the rate imposed under subsection
(c) or (d), or the amount of the employer's payment that is attributable
to the increase in the contribution rate, whichever is less, shall be
imposed as a penalty that is due and shall be deposited upon collection
into the special employment and training services fund established
under IC 22-4-25-1. The remainder of the contributions paid by an
employer pursuant to the maximum rate shall be:
(1) considered a contribution for the purposes of this article; and
(2) deposited in the unemployment insurance benefit fund
established under IC 22-4-26.
below are applicable in determining and assigning each employer's
contribution rate for the calendar year immediately following the
determination date. For purposes of this subsection, "total payroll"
means total remuneration reported by all contributing employers as
required by this article and does not include the total payroll of any
employer who elected or is required to become liable for payments in
lieu of contributions (as defined in IC 22-4-2-32). For purposes of this
subsection, "subject employers" means those employers who are
subject to contribution.
met, the rate of contributions shall be determined and assigned, with
respect to each calendar year, to employers whose accounts have a
credit balance and who are therefore eligible according to each
employer's credit reserve ratio. Each employer shall be assigned the
contribution rate appearing in the applicable schedule A through I on
the line opposite the employer's credit reserve ratio as set forth in the
rate schedule below:
RATE SCHEDULE FOR ACCOUNTS
WITH CREDIT BALANCES
When the Credit Reserve Ratio Is:
As But
Rate Schedules
Much Less
(%)
As Than
A
B
C
D
E
3.00
0.75
0.70
0.70
0.60
0.50
2.80 3.00
1.00
0.90
0.90
0.80
0.70
2.60 2.80
1.30
1.20
1.10
1.00
0.90
2.40 2.60
1.60
1.50
1.40
1.30
1.20
2.20 2.40
1.90
1.80
1.70
1.50
1.40
2.00 2.20
2.20
2.00
1.90
1.80
1.60
1.80 2.00
2.50
2.30
2.20
2.00
1.80
1.60 1.80
2.80
2.60
2.40
2.20
2.00
1.40 1.60
3.10
2.90
2.70
2.50
2.30
1.20 1.40
3.40
3.20
3.00
2.70
2.50
1.00 1.20
3.70
3.40
3.20
3.00
2.70
0.80 1.00
4.00
3.70
3.50
3.20
2.90
0.60 0.80
4.30
4.00
3.70
3.40
3.10
0.40 0.60
4.60
4.30
4.00
3.70
3.40
0.20 0.40
4.90
4.60
4.30
3.90
3.60
0.00 0.20
5.20
4.80
4.50
4.20
3.80
RATE SCHEDULE FOR ACCOUNTS
WITH CREDIT BALANCES
When the Credit Reserve Ratio Is:
As But
Rate Schedules
Much Less
(%)
As Than
F
G
H
I
3.00
0.40
0.40
0.30
0.00
2.80 3.00
0.60
0.50
0.40
0.00
2.60 2.80
0.80
0.70
0.60
0.10
2.40 2.60
1.10
1.00
0.90
0.10
2.20 2.40
1.30
1.20
1.00
0.10
2.00 2.20
1.40
1.20
1.00
0.10
1.80 2.00
1.60
1.40
1.20
0.10