AN ACT Relating to unemployment insurance; amending RCW 50.04.150, 50.29.025, 50.20.150, 50.20.120, and 50.20.100; reenacting and amending RCW 50.04.030; adding a new section to chapter 50.24 RCW; and creating new sections.

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

Sec. 1. Section 16, chapter 35, Laws of 1945 as last amended by section 2, chapter 292, Laws of 1977 ex. sess. and RCW 50.04.150 are each amended to read as follows:

Except as otherwise provided in RCW 50.04.155, the term "employment" shall not include service performed by individuals under eighteen years of age in agricultural labor ((~~except as otherwise provided in RCW 50.04.155~~)) or services in agricultural labor by individuals who performed such services in less than thirteen calendar weeks during any four consecutive calendar quarters.

Agricultural labor is defined as services performed:

(1) On a farm, in the employ of any person, in connection with the cultivation of the soil, or in connection with raising or harvesting any agricultural or horticultural commodity, including raising, shearing, feeding, caring for, training, and management of livestock, bees, poultry, and furbearing animals and wild life, or in the employ of the owner or tenant or other operator of a farm in connection with the operation, management, conservation, improvement, or maintenance of such farm and its tools and equipment; or

(2) In packing, packaging, grading, storing, or delivering to storage, or to market or to a carrier for transportation to market, any agricultural or horticultural commodity; but only if such service is performed as an incident to ordinary farming operations. The exclusions from the term "employment" provided in this paragraph shall not be deemed to be applicable with respect to commercial packing houses, commercial storage establishments, commercial canning, commercial freezing, or any other commercial processing or with respect to services performed in connection with the cultivation, raising, harvesting and processing of oysters or raising and harvesting of mushrooms or in connection with any agricultural or horticultural commodity after its delivery to a terminal market for distribution for consumption.

Sec. 2. Section 5, chapter 205, Laws of 1984 as last amended by section 3, chapter 171, Laws of 1987 and RCW 50.29.025 are each amended to read as follows:

The contribution rate for each employer shall be determined under this section.

(1) A fund balance ratio shall be determined by dividing the balance in the unemployment compensation fund as of the June 30th immediately preceding the rate year by the total remuneration paid by all employers subject to contributions during the second calendar year preceding the rate year and reported to the department by the following March 31st. The division shall be carried to the fourth decimal place with the remaining fraction, if any, disregarded. The fund balance ratio shall be expressed as a percentage.

(2) The interval of the fund balance ratio, expressed as a percentage, shall determine which tax schedule in subsection (5) of this section shall be in effect for assigning tax rates for the rate year. The intervals for determining the effective tax schedule shall be:

!tm2,1,1 !tcInterval!sc ,1of!sc ,1the

!tcFund!sc ,1Balance!sc ,1Ratio!tj1!tcEffective

!tcExpres!ttsed!sc ,1as!sc ,1a!sc ,1Percentage!tj1!tcTax!sc ,1Sc!tthedule

!tl3.40 and!sc ,1above!tcA

!tl2.90 to 3.39!tcB

!tl2.40 to 2.89!tcC

!tl1.90 to 2.39!tcD

!tl1.40 to 1.89!tcE

!tlLess!sc ,1than!sc ,0011.40!tcF

(3) An array shall be prepared, listing all qualified employers in ascending order of their benefit ratios. The array shall show for each qualified employer: (a) Identification number; (b) benefit ratio; (c) taxable payrolls for the four calendar quarters immediately preceding the computation date and reported to the department by the cut-off date; (d) a cumulative total of taxable payrolls consisting of the employer's taxable payroll plus the taxable payrolls of all other employers preceding him or her in the array; and (e) the percentage equivalent of the cumulative total of taxable payrolls.

(4) Each employer in the array shall be assigned to one of twenty rate classes according to the percentage intervals of cumulative taxable payrolls set forth in subsection (5) of this section: PROVIDED, That if an employer's taxable payroll falls within two or more rate classes, the employer and any other employer with the same benefit ratio shall be assigned to the lowest rate class which includes any portion of the employer's taxable payroll.

(5) The contribution rate for each employer in the array shall be the rate specified in the following table for the rate class to which he or she has been assigned, as determined under subsection (4) of this section, within the tax schedule which is to be in effect during the rate year:

!tp1,4 !tcPercent!sc ,1of

!tcCumulative!tj1!trSchedule!sc ,1of!sc ,1Contribution!sc ,1Rates!sc ,1for

!tcTaxable!sc ,1Pa!ttyrolls!trEffective!sc ,1Tax!sc ,1Schedule!sc ,6

!tm1,2,1,1,1,1,1,1,1 !tj2!tcRate

From!tj1!tcTo!tcClass!tlA!tcB!tcC !tcD!tcE!tcF

!sc ,0010.00!tj1!tc5. 00!tc1!tc0.48!tc0.58!tc0.98!tc1.48!tc1.88!tc2.48

!sc ,0015.01!tj1!tc10.00!tc2!tc0.48!tc0.78!tc1.18!tc1.68!tc2.08!tc2.68

10.01!tj1!tc15.00!tc3!tc0.58!tc0.98!tc1.38!tc1.78!tc2.28!tc2.88

15.01!tj1!tc20.00!tc 4!tc0.78!tc1.18!tc1.58!tc1.98!tc2.48!tc3.08

20.01!tj1!tc25.00!tc5!tc0.98!tc1.38!tc1.78!tc2.18!tc2.68!tc3.18

25.01!tj1!tc30.00!tc6!tc1.18!tc1.58!tc1.98!tc2.38!tc2.78!tc3.28

30.01!tj1!tc35.00!tc7!tc1.38!tc1.78!tc2.18!tc2.58!tc2.98!tc3.38

35.01!tj1!tc40.00!tc8!tc1.58!tc1.98!tc2.38!tc2.78!tc3.18!tc3.58

40.01!tj1!tc45.00!tc9!tc1.78!tc2.18!tc2.58!tc2.98!tc3.38!tc3.78

45.01!tj1!tc50.00!tc10!tc1.98!tc2.38!tc2.78!tc3.18!tc3.58!tc3.98

50.01!tj1!tc55.00!tc11!tc2.28!tc2.58!tc2.98!tc3.38!tc3.78!tc4.08

55.01!tj1!tc60.00!tc12!tc2.48!tc2.78!tc3.18!tc3.58!tc3.98!tc4.28

60.01!tj1!tc65.00!tc13!tc2.68!tc2.98!tc3.38!tc3.78!tc4.18!tc4.48

65.01!tj1!tc70.00!tc14!tc2.88!tc3.18!tc3.58!tc3.98!tc4.38!tc4.68

70.01!tj1!tc75.00!tc15!tc3.08!tc3.38!tc3.78!tc4.18!tc4.58!tc4.78

75.01!tj1!tc80.00!tc16!tc3.28!tc3.58!tc3.98!tc4.38!tc4.68!tc4.88

80.01!tj1!tc85.00!tc17!tc3.48!tc3.78!tc4.18!tc4.58!tc4.88!tc4.98

85.01!tj1!tc90.00!tc18!tc3.88!tc4.18!tc4.58!tc4.88!tc4.98!tc5.18

90.01!tj1!tc95.00!tc19!tc4.28!tc4.58!tc4.98!tc5.08!tc5.18!tc5.38

95.01!tj1!tc100.00!tc20!tc5.40!tc5.40!tc5.40!tc5.40!tc5.40!tc5.40

(6) The contribution rate for each employer not qualified to be in the array shall be ((~~a rate equal to the average industry tax rate as determined by the commissioner; however, the rate may not be less than one percent: PROVIDED, That~~)) as follows:

(a) Employers who do not meet the definition of "qualified employer" by reason of failure to pay contributions when due shall be assigned the contribution rate of five and four-tenths percent;

(b) The tax rate for employers exempt as of December 31, 1989, who are newly covered under section 1, chapter ... , Laws of 1989, (section 1 of this act) amendment to RCW 50.04.150 and not yet qualified to be in the array shall be two percent; and

(c) For all other employers not qualified to be in the array, the contribution rate shall be a rate equal to the average industry rate as determined by the commissioner; however, the rate may not be less than one percent. Assignment of employers by the commissioner to industrial classification, for purposes of this subsection, shall 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.

Sec. 3. Section 83, chapter 35, Laws of 1945 as last amended by section 7, chapter 2, Laws of 1970 ex. sess. and RCW 50.20.150 are each amended to read as follows:

The applicant for initial determination, ((~~his~~)) the applicant's most recent employing unit as stated by the applicant, all base year employers, and any other interested party which the commissioner by regulation prescribes, shall, if not previously notified within the same continuous period of unemployment, be given notice promptly in writing that an application for initial determination has been filed and such notice shall contain the reasons given by the applicant for his last separation from work. If, during ((~~his~~)) a benefit year, the applicant becomes unemployed after having accepted subsequent work, and reports for the purpose of reestablishing ((~~his~~)) eligibility for benefits, a similar notice shall be given promptly to ((~~his then~~)) the most recent employing unit as stated by ((~~him~~)) the applicant, ((or)) all base year employers, and to any other interested party which the commissioner by regulation prescribes.

((~~Each base year employer shall be promptly notified of the filing of any application for initial determination which may result in a charge to his account.~~))

Sec. 4. Section 4, chapter 35, Laws of 1945 as last amended by section 1, chapter 256, Laws of 1987 and by section 2, chapter 278, Laws of 1987 and RCW 50.04.030 are each reenacted and amended to read as follows:

"Benefit year" with respect to each individual, means the fifty-two consecutive week period beginning with the first day of the calendar week in which the individual files an application for an initial determination and thereafter the fifty-two consecutive week period beginning with the first day of the calendar week in which the individual next files an application for an initial determination after the expiration of the individual's last preceding benefit year: PROVIDED, HOWEVER, That the foregoing limitation shall not be deemed to preclude the establishment of a new benefit year under the laws of another state pursuant to any agreement providing for the interstate combining of employment and wages and the interstate payment of benefits nor shall this limitation be deemed to preclude the commissioner from backdating an initial application at the request of the claimant either for the convenience of the department of employment security or for any other reason deemed by the commissioner to be good cause.

An individual's benefit year shall be extended to be fifty-three weeks when at the expiration of fifty-two weeks the establishment of a new benefit year would result in the use of a quarter of wages in the new base year that had been included in the individual's prior base year.

No benefit year will be established unless it is determined that the individual earned wages in "employment" in not less than six hundred eighty hours of the individual's base year and that the number of hours for which wages were earned is two hundred twenty-seven hours or more in other than the quarter of the base year in which wages were highest: PROVIDED, HOWEVER, That a benefit year cannot be established if the base year wages include wages earned prior to the establishment of a prior benefit year unless the individual earned wages in "employment" since the beginning of the previous benefit year's waiting period under RCW 50.20.010(4) of not less than six times the weekly benefit amount computed for the individual's new benefit year.

If an individual's prior benefit year was based on the last four completed calendar quarters, a new benefit year shall not be established until the new base year does not include any hours used in the establishment of the prior benefit year.

If the wages of an individual are not based upon a fixed duration of time or if the individual's wages are paid at irregular intervals or in such manner as not to extend regularly over the period of employment, the wages for any week shall be determined in such manner as the commissioner may by regulation prescribe. Such regulation shall, so far as possible, secure results reasonably similar to those which would prevail if the individual were paid his or her wages at regular intervals.

Sec. 5. Section 80, chapter 35, Laws of 1945 as last amended by section 1, chapter 205, Laws of 1984 and RCW 50.20.120 are each amended to read as follows:

(1) Subject to the other provisions of this title, benefits shall be payable to any eligible individual during the individual's benefit year in a maximum amount equal to the lesser of thirty times the weekly benefit amount (determined hereinafter) or one-third of the individual's base year wages under this title: PROVIDED, That as to any week beginning on and after March 31, 1981, which falls in an extended benefit period as defined in RCW 50.22.010(1), as now or hereafter amended, an individual's eligibility for maximum benefits in excess of twenty-six times his or her weekly benefit amount will be subject to the terms and conditions set forth in RCW 50.22.020, as now or hereafter amended.

(2) An individual's weekly benefit amount shall be an amount equal to one ((~~twenty-fifth~~)) one-hundredth of the ((~~average quarterly wages of the~~)) individual's total wages during the ((~~two quarters of the~~)) individual's base year ((~~in which such total wages were highest~~)). The maximum and minimum amounts payable weekly shall be determined as of each June 30th to apply to benefit years beginning in the twelve-month period immediately following such June 30th. The maximum amount payable weekly shall be fifty-five percent of the "average weekly wage" for the calendar year preceding such June 30th: PROVIDED, That if as of the first December 31st on which the ratio of the balance in the unemployment compensation fund to total remuneration paid by all employers subject to contributions during the calendar year ending on such December 31st and reported to the department by the following March 31st is 0.024 or more, the maximum amount payable weekly for benefit years beginning with the first full calendar week in July next following, and thereafter, shall be sixty percent of the "average weekly wage". The computation for this ratio shall be carried to the fourth decimal place with the remaining fraction, if any, disregarded: PROVIDED FURTHER, That for benefit years beginning before July 7, 1985, the maximum amount payable weekly shall not exceed one hundred eighty-five dollars. The minimum amount payable weekly shall be fifteen percent of the "average weekly wage" for the calendar year preceding such June 30th. If any weekly benefit, maximum benefit, or minimum benefit amount computed herein is not a multiple of one dollar, it shall be reduced to the next lower multiple of one dollar.

NEW SECTION. Sec. 6. A new section is added to chapter 50.24 RCW to read as follows:

The department shall adopt rules to collect contributions from employers for individuals who performed agricultural services for one or more employers during at least thirteen calendar weeks during any four consecutive calendar quarters. The rules shall require that employers report wages, hours worked, and the number of weeks employed for all employees. The department shall bill liable employers quarterly for contributions due.

Sec. 7. Section 78, chapter 35, Laws of 1945 as last amended by section 6, chapter 33, Laws of 1977 ex. sess. and RCW 50.20.100 are each amended to read as follows:

Suitable work for an individual is employment in an occupation in keeping with the individual's prior work experience, education, or training and if the individual has no prior work experience, special education, or training for employment available in the general area, then employment which the individual would have the physical and mental ability to perform, and for individuals with base year work experience in agricultural labor, any agricultural labor available from any employer shall be deemed suitable unless it meets the conditions in RCW 50.20.110 or the commissioner finds elements of specific work opportunity unsuitable for a particular individual. In determining whether work is suitable for an individual, the commissioner shall also consider the degree of risk involved to the individual's health, safety, and morals, the individual's physical fitness, the individual's length of unemployment and prospects for securing local work in the individual's customary occupation, the distance of the available work from the individual's residence, and such other factors as the commissioner may deem pertinent, including state and national emergencies.

NEW SECTION. Sec. 8. (1) It is the intent of the legislature that the department undertake activities to accomplish the following:

(a) Ensure increased compliance with work search requirements;

(b) Provide employers prompt notification of potential claims filed against their experience rating and information in lay language explaining what their rights are to appeal the claim and how and where they must respond to protect those rights;

(c) Develop ways to better inform employers of the operations of the unemployment laws such as how employers must offer work which may involve different wage rates for different work activities to avoid confusion so employees may make a claim and qualifying for benefits when assigned a lower paying work activity;

(d) Reduce claimant and employer fraud; and

(e) Implement voluntary combined reporting for employment security department, department of labor and industries, department of licensing, and department of revenue required reports.

(2) The department shall report to the appropriate standing committees of the legislature by January 10, 1990, 1991, and 1992 and include a description of the activities of the department to carry out the intents of this section and provide quantitative data where possible on the effectiveness of the activities undertaken by the department to comply with the intents of this section during the previous calendar year.

NEW SECTION. Sec. 9. 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. 10. If any part of this act is found to be in conflict with federal requirements which 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 hereby declared to be inoperative solely to the extent of the conflict, and such finding or determination shall not affect the operation of the remainder of this act. The rules under this act shall meet federal requirements which 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.