WSR 97-16-012

PREPROPOSAL STATEMENT OF INQUIRY

EMPLOYMENT SECURITY DEPARTMENT

[Filed July 25, 1997, 2:40 p.m.]

Subject of Possible Rule Making: Amend WAC 192-12-072 to state that the transfer of employees to an employee leasing company is not a predecessor/successor relationship for UI contribution purposes. Add a section specifying the number of days a partial successor has in which to notify the department of the percentage transferred, and the consequences to the employer for failure to do so.

Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 50.12.010 Commissioner's duties and powers and 50.12.040 Rules and regulations.

Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: Chapter 50.29 RCW regulates employer experience ratings in general and RCW 50.29.062 outlines contribution rates for predecessor and successor employers. The law does not specifically address the transfer of employees to an employee leasing company, or specify how and when employers are to notify the department regarding partial transfers of employees. The proposed regulations will clarify these situations for employers.

Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: The United States Department of Labor reviews the state's administration of the unemployment insurance program to ensure conformity to federal statutes and regulations. The state has broad flexibility in the implementation of unemployment insurance laws as long as conformity is maintained. The proposed regulations will be shared with the United States Department of Labor Region X staff prior to adoption.

Process for Developing New Rule: The department intends to hold meetings with stakeholders, interested parties, and significantly affected persons to seek their input in the formation of regulations.

Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication. Persons interested in participating in public meetings to discuss the proposed regulatory changes may contact Bob Wagner, Employment Security Department, Unemployment Insurance Tax Branch, P.O. Box 9046, Olympia, WA 98507-9046, phone (360) 902-9521, or FAX (360) 902-9556.

July 23, 1997

Carver Gayton