H-0668.1  _______________________________________________

                          HOUSE BILL 1351

          _______________________________________________

State of Washington      54th Legislature     1995 Regular Session

By Representatives Lisk, Chandler and Veloria; by request of Joint Task Force on Unemployment Insurance

Read first time 01/23/95.  Referred to Committee on Commerce & Labor.

Determining unemployment insurance contribution rates for successor employers.

    AN ACT Relating to unemployment insurance contribution rates for successor employers; and amending RCW 50.29.062.

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

    Sec. 1.  RCW 50.29.062 and 1989 c 380 s 81 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, as defined in RCW 50.04.080, at the time of the transfer, ((his or her)) its 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)) its 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)) it shall pay contributions at the ((rate class 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)) lowest rate determined under either of the following:

(a) The contribution rate of the rate class assigned to the predecessor employer at the time of the transfer for the remainder of that rate year and continuing until the successor qualifies for a different rate in its own right.  Any experience relating to the assignment of that rate class attributable to the predecessor is transferred to the successor; or

(b) The contribution rate equal to the average industry rate as determined by the commissioner, but not less than one percent, and continuing until the successor qualifies for a different rate in its own right.  Assignment of employers by the commissioner to industrial classification, for purposes of this subsection, must be in accordance with established classification practices found in the "Standard Industrial Classification Manual" issued by the federal office of management and budget to the third digit provided in the standard industrial classification code.

    (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)) its rate from the date the transfer occurred until the end of that rate year and until ((he or she)) it qualifies in ((his or her)) its own right for a new rate, shall be the highest rate class 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)) its 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)) it satisfies the requirements of a "qualified employer" as set forth in RCW 50.29.010.

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