This bill amends Iowa's unemployment insurance tax regulations for employers by modifying the definitions and calculations related to taxable wages and contribution rates. It changes the definition of taxable wages to exclude wages paid to employees from other states that do not extend reciprocity to Iowa. The bill also revises the calculation of taxable wages, reducing the percentage of the statewide average weekly wage used for employers in the first through eighth benefit ratio ranks from 66.66% to 17%, while setting it at 58% for those in the ninth rank. Additionally, it reduces the number of benefit ratio ranks from 21 to 9 and modifies the contribution rate tables from eight to four, changing the designations from numerical to lettered.

Furthermore, the bill alters the computation of the current reserve fund ratio by basing it on the preceding year rather than the previous five calendar quarters and removes the requirement to add $150 million to the total funds available for benefits. The highest contribution rate corresponding to the highest benefit ratio rank is reduced from 9% to 7%. Employers are encouraged to use any savings from these changes to pay for employee salaries or benefits or as an alternative to unemployment benefits during seasonal unemployment.

Statutes affected:
Introduced: 96.1A, 96.7