Stricken language would be deleted from and underlined language would be added to present law.
Act 196 of the Regular Session
1 State of Arkansas As Engrossed: H2/22/23
2 94th General Assembly A Bill
3 Regular Session, 2023 HOUSE BILL 1430
4
5 By: Representatives Lundstrum, Beaty Jr., Bentley, Burkes, C. Cooper,
6 Duffield, Haak, D. Hodges, Ladyman, Long, Maddox, McCollum, Pilkington, Ray,
7 R. Scott Richardson, Rye, Underwood, Unger
8 By: Senators K. Hammer, M. McKee, D. Wallace
9
10
11 For An Act To Be Entitled
12 AN ACT TO AMEND THE DIVISION OF WORKFORCE SERVICES
13 LAW; TO MODIFY THE DEFINITION OF "WAGES" IN CERTAIN
14 CIRCUMSTANCES UNDER THE DIVISION OF WORKFORCE
15 SERVICES LAW; TO REDUCE THE MAXIMUM POTENTIAL
16 UNEMPLOYMENT COMPENSATION BENEFITS; TO REGULATE
17 EMPLOYER CONTRIBUTIONS UNDER THE DIVISION OF
18 WORKFORCE SERVICES LAW; TO REVISE THE STABILIZATION
19 TAX RATE; TO AMEND THE LAW CONCERNING THE
20 UNEMPLOYMENT COMPENSATION FUND, THE DIVISION OF
21 WORKFORCE SERVICES TRAINING TRUST FUND, AND THE
22 UNEMPLOYMENT INSURANCE ADMINISTRATION FUND; TO
23 DECLARE AN EMERGENCY; AND FOR OTHER PURPOSES.
24
25
26 Subtitle
27 TO AMEND THE DIVISION OF WORKFORCE
28 SERVICES LAW; AND TO DECLARE AN
29 EMERGENCY.
30
31
32 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:
33
34 SECTION 1. Arkansas Code § 11-10-215(a)(2)(A)(i), concerning the
35 definition of "wages" and the taxable wage base under the Division of
36 Workforce Services Law, is amended to add additional subdivisions to read as
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1 follows:
2 (f) For a calendar year beginning on or after
3 January 1, 2024, "wages" shall not include remuneration that exceeds the
4 lesser of:
5 (1) Seven thousand dollars ($7,000) but
6 only if as of June 30 of the most recently completed state fiscal year the
7 balance of the unemployment insurance trust fund is in excess of six hundred
8 million dollars ($600,000,000); or
9 (2) The amount calculated under
10 subdivisions (a)(2)(A)(i)(d)(1)-(3) of this section.
11 (g) For any calendar year beginning after
12 December 31, 2023, when calculating the amount to determine remuneration
13 constituting wages, then the amount that is included as wages shall not
14 exceed the sum of two thousand dollars ($2,000) and the amount applicable to
15 the immediately preceding calendar year.
16
17 SECTION 2. Arkansas Code § 11-10-504(a), concerning the maximum
18 potential benefits payable in a benefit year, is amended to read as follows:
19 (a)(1) For initial claims filed on or after January 1, 2018, the
20 maximum potential benefits of an insured worker in a benefit year shall be
21 the amount equal to the lesser of:
22 (1)(A) Sixteen (16) times his or her weekly benefit
23 amount; or
24 (2)(B) One-third (⅓) of his or her wages for insured work
25 in his or her base period.
26 (2) For initial claims filed on or after January 1, 2024, the
27 maximum potential benefits of an insured worker in a benefit year shall be
28 the amount equal to the lesser of:
29 (A) Twelve (12) times his or her weekly benefit amount; or
30 (B) One-third (1/3) of his or her wages for insured work
31 in his or her base period.
32
33 SECTION 3. Arkansas Code § 11-10-704 is amended to read as follows:
34 11-10-704. Future rates — Experience rates generally.
35 (a) The Director of the Division of Workforce Services shall, for each
36 calendar year, classify employers in accordance with their actual experience
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1 in the payment of contributions on their own behalf and with respect to
2 regular benefits charged against their accounts, with a view to fixing the
3 contribution rates as will reflect their experience.
4 (b)(1) The Except as provided in subsection (c) of this section, the
5 director shall determine the contribution rates of each employer in
6 accordance with the requirements of this section and § 11-10-705:.
7 (1)(2)(A) Each employer's rate shall be two and nine-tenths
8 percent (2.9%) except as otherwise provided in the other provisions of this
9 subchapter.
10 (A)(i)(B)(i)(a) No employer's rate shall be less than two
11 and nine-tenths percent (2.9%) unless and until there shall have been three
12 (3) years immediately preceding the computation date throughout which an
13 individual in the employer's employ could have received benefits if eligible.
14 (b) Provided, however, an employer who, at the
15 time of establishing an account, is in business in another state or states
16 and who is not currently doing business in Arkansas may elect to receive a
17 beginning contribution rate of two and nine-tenths percent (2.9%) or a
18 contribution rate based on the rate schedule at § 11-10-705(b)(1), whichever
19 is lower, but in no event less than one percent (1%), provided:
20 (a)(1) The employer has been in
21 operation in the other state or states for at least three (3) years
22 immediately preceding the date of becoming a liable employer in Arkansas,
23 throughout which an individual in the employer's employ could have received
24 benefits if eligible;
25 (b)(2) The employer must provide the
26 authenticated account history from information accumulated from operations in
27 the other state or all the other states to compute a current Arkansas rate;
28 and
29 (c)(3) The employer's business
30 operations established in Arkansas are of the same nature as conducted in the
31 other state or states, as defined by the North American Industry
32 Classification System.
33 (ii)(a) The election authorized in subdivision
34 (b)(1)(A)(i)(b)(1)(B)(i) of this section must be made in writing within
35 thirty (30) days after receiving notice of Arkansas liability.
36 (b) A two-and-nine-tenths-percent rate will be
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1 assigned unless a timely election has been made.
2 (iii) If the election is made timely, the employer's
3 account will receive the rate elected for the remainder of that rate year.
4 The rate assigned for the next and subsequent years will be determined by the
5 condition of the account on the computation date.
6 (B)(C) However, any employer having no covered employment
7 under this chapter for any calendar year shall have a rate equal to his or
8 her most recently determined contribution rate until the employer has one (1)
9 full year of benefit risk experience immediately preceding the computation
10 date.
11 (2)(A)(3)(A) Notwithstanding any other provisions of §§ 11-10-
12 701 — 11-10-715, if the director determines that an employer has willfully
13 submitted false information which is material with respect to the employment
14 or separation from employment of any claimant, employee, or former employee,
15 for the purpose of preventing regular benefit charges to the employer's
16 account, the employer shall be assessed a penalty equivalent to twice the
17 amount of the claimant's maximum potential benefit amount.
18 (B) This charge penalty shall be charged against the
19 employer's account for experience rating purposes, regardless of whether or
20 not the employer is a base-period employer and irrespective of the identity
21 or number of base-period employers.
22 (3)(4) An employer who changes from reimbursement to the
23 contributory method of financing shall be considered a new or newly covered
24 employer and can be entitled to an experience rate only when the new or newly
25 covered employer has met the requirements of this subsection.
26 (4)(5) Each employer's rate beginning January 1 for each twelve-
27 month period shall be determined on the basis of the employer's record
28 through June 30 of the previous calendar year.
29 (c)(1) The director shall determine the contribution rates of each
30 employer according to the requirements of this section and § 11-10-705.
31 (2)(A) For any calendar year beginning on or after January 1,
32 2024, each employer's rate shall be one and nine-tenths percent (1.9%) except
33 as otherwise provided in this subchapter.
34 (B)(i)(a) An employer's rate shall not be less than one
35 and nine-tenths percent (1.9%) unless and until there have been three (3)
36 years immediately preceding the computation date throughout which an
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1 individual in the employer's employ could have received benefits, if
2 eligible.
3 (b) Provided, however, an employer who, at the
4 time of establishing an account, is in business in another state or states
5 and who is not currently doing business in Arkansas may elect to receive a
6 beginning contribution rate of one and nine-tenths percent (1.9%) or a
7 contribution rate based on the rate schedule in § 11-10-705(b)(1), whichever
8 is lower, but in no event less than one percent (1%), provided:
9 (1) The employer has been in operation
10 in the other state or states for at least three (3) years immediately
11 preceding the date of becoming a liable employer in Arkansas, throughout
12 which an individual in the employer's employ could have received benefits, if
13 eligible;
14 (2) The employer must provide the
15 authenticated account history from information accumulated from operations in
16 the other state or states to compute a current Arkansas rate; and
17 (3) The employer's business operations
18 established in Arkansas are of the same nature as conducted in the other
19 state or states, as defined by the North American Industry Classification
20 System.
21 (ii)(a) The election authorized in subdivision
22 (c)(2)(B)(i) of this section must be made in writing within thirty (30) days
23 after receiving notice of Arkansas liability.
24 (b) A one-and-nine-tenths-percent rate will be
25 assigned unless a timely election has been made.
26 (iii)(a) If the election is timely made, the
27 employer's account will receive the rate elected for the remainder of that
28 rate year.
29 (b) The rate assigned for the next and
30 subsequent years will be determined by the condition of the account on the
31 computation date.
32 (C)(1) However, any employer having no covered employment
33 under this chapter for any calendar year shall have a rate equal to his or
34 her most recently determined contribution rate until the employer has one (1)
35 full year of benefit risk experience immediately preceding the computation
36 date.
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1 (2)(A) Notwithstanding any other provisions of §§ 11-10-701 —
2 11-10-715, if the director determines that an employer has willfully
3 submitted false information that is material with respect to the employment
4 or separation from employment of any claimant, employee, or former employee,
5 for the purpose of preventing regular benefit charges to the employer's
6 account, the employer shall be assessed a penalty equivalent to twice the
7 amount of the claimant's maximum potential benefit amount.
8 (B) This penalty shall be charged against the employer's
9 account for experience rating purposes, regardless of whether or not the
10 employer is a base-period employer and irrespective of the identity or number
11 of base-period employer.
12 (3) An employer who changes from reimbursement to the
13 contributory method of financing shall be considered a new or newly covered
14 employer and can be entitled to an experience rate only when the new or newly
15 covered employer has met the requirements of this subsection.
16 (4) Each employer's rate beginning January 1 for each twelve-
17 month period shall be determined on the basis of the employer's record
18 through June 30 of the previous calendar year.
19
20 SECTION 4. Arkansas Code § 11-10-705(a)(2), concerning the computation
21 of employer contribution rates, is amended to read as follows:
22 (2) The record of an employer shall include, for the purpose of
23 computing an employer's contribution rate, any payment, except a payment that
24 represents a stabilization tax an administration assessment payment or a
25 payment that represents an extended benefit tax payment, made by the employer
26 on or before July 31 on wages paid by the employer on or before June 30 of
27 the calendar year.
28
29 SECTION 5. Arkansas Code § 11-10-705(b), concerning computation of
30 employer contribution rates, is amended to add an additional subdivision to
31 read as follows:
32 (3)(A) Notwithstanding any other provision of this chapter, for
33 any calendar year beginning on and after January 1, 2024, an employer that
34 has been assigned a contribution rate of six percent (6%) under this chapter
35 and that has had such a rate for the four (4) preceding calendar years will
36 be assigned an additional contribution assessment of two percent (2%).
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1 (B) After four (4) consecutive years of being assessed an
2 additional contribution of two percent (2%) under subdivision (b)(3)(A) of
3 this section, this additional contribution assessment shall increase to four
4 percent (4%).
5
6 SECTION 6. Arkansas Code § 11-10-705(b)(2), concerning the computation
7 of employer contribution rates, is repealed.
8 (2)(A) Notwithstanding any other provision of this chapter, for
9 any calendar year beginning on and after January 1, 2008, an employer that
10 has been assigned a contribution rate of six percent (6%) under this chapter
11 and that has had such a rate for the two (2) preceding calendar years will be
12 assigned an additional contribution assessment of two percent (2%).
13 (B) After two (2) consecutive years of being assessed an
14 additional contribution of two percent (2%) under subdivision (b)(2)(A) of
15 this section, this additional contribution assessment shall increase to four
16 percent (4%).
17 (C) For calendar years beginning January 1, 2014, and
18 thereafter, after two (2) consecutive years of being assessed an additional
19 contribution of four percent (4%) under subdivision (b)(2)(B) of this
20 section, the additional contribution assessment shall increase to six percent
21 (6%).
22 (D) For calendar years beginning January 1, 2014, and
23 thereafter, after two (2) consecutive years of being assessed an additional
24 contribution of six percent (6%) under subdivision (b)(2)(C) of this section,
25 the additional contribution assessment shall increase to eight percent (8%).
26
27 SECTION 7. Arkansas Code § 11-10-706 is amended to read as follows:
28 11-10-706. Future rates — Stabilization tax Administrative assessment.
29 (a)(1) Each Effective July 1, 2023, each employer shall be required to
30 pay a stabilization tax an administrative assessment on wages paid by the
31 employer with respect to employment.
32 (2) This stabilization tax administrative assessment shall not
33 be credited to the separate account of each employer.
34 (b)(1) The stabilization tax For the period July 1, 2023, through June
35 30, 2024, the administrative assessment shall be determined as follows:
36 twelve and one-half hundredths of one percent (0.125%).
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