S-0026.1  _______________________________________________


                         SENATE BILL 6023



State of Washington      55th Legislature     1997 Regular Session


By Senators Thibaudeau, Fraser and Kohl


Read first time 02/27/97.  Referred to Committee on Commerce & Labor.

Exempting members of boards of directors from unemployment compensation coverage.

    AN ACT Relating to unemployment compensation coverage for members of boards of directors; amending RCW 50.04.165; and creating new sections.




    NEW SECTION.  Sec. 1.  It is the intent of the legislature to provide taxation relief to those businesses or corporations that have been required to provide unemployment insurance coverage to members of their boards of directors.


    Sec. 2.  RCW 50.04.165 and 1993 c 290 s 2 are each amended to read as follows:

    Services performed by a person appointed as an officer of a corporation under RCW 23B.08.400 or as a member of a board of directors under RCW 23B.08.010, other than those covered by chapter 50.44 RCW, shall not be considered services in employment.  However, a corporation may elect to cover not less than all of its corporate officers or board of directors under RCW 50.24.160.  If an employer does not elect to cover its corporate officers or board of directors under RCW 50.24.160, the employer must notify its corporate officers or board of directors in writing that they are ineligible for unemployment benefits.  If the employer fails to notify any corporate officer or board member, then that person shall not be considered to be a corporate officer or board member for the purposes of this section.


    NEW SECTION.  Sec. 3.  If any part of this act is found to be in conflict with federal requirements that are a prescribed condition to the allocation of federal funds to the state or the eligibility of employers in this state for federal unemployment tax credits, the conflicting part of this act is inoperative solely to the extent of the conflict, and the finding or determination does not affect the operation of the remainder of this act.  Rules adopted under this act must meet federal requirements that are a necessary condition to the receipt of federal funds by the state or the granting of federal unemployment tax credits to employers in this state.


    NEW SECTION.  Sec. 4.  If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.


    NEW SECTION.  Sec. 5.  This act applies retroactively to all administrative tax claims currently pending before the employment security department for claims incurred after March 1, 1992, regarding unemployment insurance coverage of members of boards of directors.


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