UI Forum (ADP Unemployment Group)

Third Quarter 2017



What’s in the UI Forum? Topics include the latest changes to Unemployment Insurance (UI) laws across the country and tips on how to get the most out of your ADP service.

Announcement

If you’ve been around the Unemployment Insurance (UI) world long enough, then you know the importance of timely and accurate responses on Request For Information (RFI) forms you receive from ADP for an unemployment claim.

In fact, this aspect of compliance, known as UI Integrity, is so important that a pattern of below-par reporting may result in charges to your UI account, loss of benefit relief, and in some states, the loss of interested party status and appeal rights, and even monetary penalties. These penalties underscore efforts implemented a few years ago by the U.S. Department of Labor to tighten compliance standards, and some states followed by adding additional consequences.

While some may feel frustrated by today’s more stringent UI integrity laws and believe RFI questions are over the top, it’s important to know that answering questions in full also gives ADP leverage to challenge any “non-compliant” occurrence or “pattern of non-compliance” issued by the UI agency on your behalf.

And what happens if, say, you can’t provide the information needed because of a lost hardcopy personnel file or a crashed hard drive? Then please let your Customer Service Representative (CSR) know. While this may or may not impact your UI Integrity compliance, it will keep the CSR from sending subsequent RFIs to you. In most cases though, you will have access to files and details surrounding an individual’s separation from employment with your company.

The Bottom line: responding timely, fully and accurately is key to complying with UI laws and avoiding negative consequences.

STATE UNEMPLOYMENT LAW UPDATES

Several states have enacted recent law changes that you should understand:

ARKANSAS:
SB-635 (now Public Act 1115, effective from 1/1/18) modifies the definition of covered employment for owner/operators in the transportation and trucking industries.

An employee or agent of the owner-operator shall not be considered an employee of the motor carrier for purposes of employment security taxation or compensation, unless:

  • The service constitutes employment performed by an employee under the Federal Unemployment Tax Act (FUTA)
  • The owner-operator is a state or local government entity or federally recognized Indian tribe as described in 26 1 U.S.C. § 3306(c)(7) or a nonprofit organization as described in 26 U.S.C. § 2 3309(a)(1)

The bill’s full text can be found at: http://www.arkleg.state.ar.us/assembly/2017/2017R/Bills/SB635.pdf

IOWA
House File 533 (effective 7/2/17) creates a new subsection in the law to address disqualifications for incarceration. A disqualification will be imposed if an individual is separated from employment due to incarceration in a jail, municipal holding facility, or correctional institution or facility, unless the department finds all of the following:

  • The employer is notified of the employee’s absence from work due to the incarceration; and
  • Criminal charges relating to the incarceration were not filed against the employee, all criminal charges were dismissed, or the employee was found not guilty; and
  • The employee reported back to the employer within two work days of release from incarceration and offered services; and
  • The employer rejected the employee’s offer of services.

Any disqualification issued under this section shall continue until the employee has worked in and been paid wages for insured work equal to ten times the weekly benefit amount, provided the employee is otherwise eligible.

House File 542 (effective 7/2/17) amends requalification requirements for claimants. To qualify for UI benefits in a subsequent benefit year, an employee must earn in covered employment at least 8 times the Weekly Benefit Amount (WBA) in the current benefit year or subsequent benefit year. The prior requalification amount was $250 in covered employment in the current benefit year or subsequent benefit year.

House File 572 (effective 7/1/17) while not directly impactful to employers at this time, redirects funding to Iowa Workforce Development (IWD) for its UI system modernization efforts. In short, Iowa had been in a developmental consortium with Idaho and Vermont. The passage of this bill removes IWD from this consortium and allocates the federal funding received to develop its own modernized UI system. In conversations with the agency, this project is expected to take 18-24 months for completion. More information will be forthcoming as the modernization moves forward and any changes deemed impactful to employers are announced.

Full text of these bills can be found at:
https://www.legis.iowa.gov/docs/publications/LGE/87/HF533.pdf
https://www.legis.iowa.gov/docs/publications/LGE/87/HF542.pdf
https://www.legis.iowa.gov/docs/publications/LGE/87/HF572.pdf

In other news from Iowa Workforce Development (IWD), the policy and procedure for conducting some fact-finding interviews has been modified. Historically, fact-finding interviews were conducted with both the claimant and employer in cases of a protestable separation (such as a quit or discharge for misconduct). But now, one-party fact-findings are conducted with claimants who receive vacation pay.

The IWD made this change in an effort to improve the response rate from claimants who received vacation pay. In the past, hardcopy questionnaires were sent to such claimants but IWD experienced a low rate of responses. This new process provides a scheduled date and time for an IWD staff member and the claimant to address this issue only so it may be properly adjudicated. This change makesit more important than ever for employers to provide ADP with the gross dollar amount of any vacation pay received, the date of payment, and the time period represented by the pay.

IWD reiterates that two-party fact-findings will still be scheduled when a protestable separation has occurred.

MARYLAND
On 4/18/17, SB17 went into effect, allowing for two exclusive work search waivers for some UI claimants.

In part, if an employer closes all or part of its plant or business operation due to vacation, inventory, or other purpose not exceeding ten weeks, the agency may grant a waiver to impacted workers exempting them from an active work search.

If an employer closes all or part of its plant or business operation for reasons other than inventory or vacation not exceeding 26 weeks, a work search waiver can also be granted.

Certain requirements must be met to be applicable. The following link provides the verbiage included in SB-17 as passed: http://mgaleg.maryland.gov/2017RS/bills/sb/sb0017F.pdf

NORTH CAROLINA
On 04/27/17, HB5 went into law, making numerous technical and administrative changes to North Carolinas UI law, including:

  • A waiting week will not be required for claims resulting directly from a federally declared disaster.
  • The work search requirement will be waived for any week of unemployment directly related to a federally declared disaster.
  • Modification of how terminal payments are addressed. Effective 07/01/17, the agency determines if the employer has a written policy around the payment of “earned pays” (wages in lieu of notice, accrued vacation pay, terminal leave pay, severance pay, and separation pay) in place prior to the separation of the worker. If there is a written policy, then benefits will be reduced; however, no reduction will be applied in the absence of a written policy. “Bonus pay” is not affected by the passage of this bill.
  • The deadline for responding to a last employer claim (NCUI500-AB) has been reduced from 14 to 10 days. This modification is a return to the previous timeframe prior to UI reform in 2013.

Full text of this bill can be found at: http://www.ncleg.net/Sessions/2017/Bills/House/PDF/H5v4.pdf

WEST VIRGINIA
SB222 went into effect on 07/02/17, amending §21A-6-3 of the Code of West Virginia related to disqualifications for individuals involved in a labor dispute.

Now, striking employees or others involved in a bona fide labor dispute will be disqualified from receiving UI benefits. If the employer continues operations using non-striking employees, contractors, or other personnel, the disqualification still applies.

Disqualifications will not be imposed against a striking worker in cases where the position has been permanently filled by another worker.

Additionally, workers deemed to be “locked out” and otherwise eligible will be entitled to benefits.

A copy of the original code and amendments can be found at: http://www.legis.state.wv.us/Bill_Status/bills_text.cfm?billdoc=SB222%20SUB2.htm&yr=2017&sesstype=RS&i=222

NATIONAL WEEKLY BENEFIT AMOUNT UPDATES:

IOWA
For claims filed on or after 07/02/17, the maximum weekly benefit amount is $455 for an individual with no dependents; $473 for an individual with one dependent; $490 for an individual with two dependents; $516 for an individual with three dependents; and $559 for an individual with four or more dependents.

VERMONT
Effective 07/02/17, the maximum weekly benefit amount is $466.

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The information provided in this document is for informational purposes only and not for the purpose of providing legal, accounting, or tax advice. The information and services ADP provides should not be deemed a substitute for the advice of any such professional. Such information is by nature subject to revision and may not be the most current information available.

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