S-754                 _______________________________________________

                                                   SENATE BILL NO. 5294

                        _______________________________________________

State of Washington                              50th Legislature                              1987 Regular Session

By Senators Barr, Hansen and Lee

Read first time 1/22/87 and referred to Committee on Commerce & Labor.

AN ACT Relating to unemployment compensation trust fund contribution rates for predecessor and successor employers; and amending RCW 50.29.062.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

        Sec. 1.  Section 6, chapter 205, Laws of 1984 and RCW 50.29.062 are each amended to read as follows:

          Predecessor and successor employer contribution rates shall be computed in the following manner:

          (1) If the successor is an employer at the time of the transfer, his or her contribution rate shall remain unchanged for the  remainder of the rate year in which the transfer occurs.  From and after January 1 following the transfer, the successor's contribution rate for each rate year shall be based on his or her experience with payrolls and benefits including the experience of the acquired business or portion of a business from the date of transfer, as of the regular computation date for that rate year.

          (2) If the successor is not an employer at the time of the transfer, he or she shall pay contributions at the rate assigned to the predecessor employer at the time of the transfer for the remainder for that rate year and continuing until such time as he or she qualifies for a different rate in his or her own right.

          (3) If the successor is not an employer at the time of the transfer and simultaneously acquires the business or a portion of the business of two or more employers in different rate classes, his or her rate from the date the transfer occurred until the end of that rate year and until he or she qualifies in his or her own right for a new rate, shall be the highest rate applicable at the time of the acquisition to any predecessor employer who is a party to the acquisition.

          (4) The contribution rate on any payroll retained by a predecessor employer shall remain unchanged for the remainder of the rate year in which the transfer occurs.

          (5) In all cases, from and after January 1 following the transfer, the predecessor's contribution rate for each rate year shall be based on his or her experience with payrolls and benefits as of the regular computation date for that rate year including the experience of the acquired business or portion of business up to the date of transfer:  PROVIDED, That if all of the predecessor's business is transferred to a successor or successors, the predecessor shall not be a qualified employer until he or she satisfies the requirements of a "qualified employer" as set forth in RCW 50.29.010.

For the purposes of this section, no predecessor-successor employer relationship exists based solely on the event of an employer changing its form of business organization without any change of ownership.