1.1 	A bill for an act
1.2 	relating to unemployment insurance; conforming various
1.3 	provisions to federal requirements; making technical
1.4 	and housekeeping changes; modifying appeal procedures;
1.5 	amending Minnesota Statutes 2004, sections 268.03,
1.6 	subdivision 1; 268.035, subdivisions 9, 13, 14, 20,
1.7 	21, 26; 268.042, subdivision 1; 268.043; 268.044,
1.8 	subdivisions 1, 2, 3; 268.045, subdivision 1; 268.051,
1.9 	subdivisions 1, 4, 6, 7, by adding a subdivision;
1.10 	268.052, subdivision 2; 268.053, subdivision 1;
1.11 	268.057, subdivision 7; 268.065, subdivision 2;
1.12 	268.069, subdivision 1; 268.07, subdivision 3b;
1.13 	268.085, subdivisions 1, 2, 3, 5, 12; 268.086,
1.14 	subdivisions 2, 3; 268.095, subdivisions 1, 4, 7, 8,
1.15 	10, 11; 268.101, subdivisions 1, 2, 3a; 268.103,
1.16 	subdivision 2; 268.105; 268.145, subdivision 1;
1.17 	268.18, subdivisions 1, 2, 2b; 268.182, subdivision 2;
1.18 	268.184, subdivisions 1, 2, by adding a subdivision;
1.19 	proposing coding for new law in Minnesota Statutes,
1.20 	chapter 268; repealing Minnesota Statutes 2004,
1.21 	sections 268.045, subdivisions 2, 3, 4; 268.086,
1.22 	subdivision 4; Laws 1997, chapter 66, section 64,
1.23 	subdivision 1; Minnesota Rules, parts 3310.2926;
1.24 	3310.5000; 3315.0910, subpart 9; 3315.1020; 3315.1301;
1.25 	3315.1315, subparts 1, 2, 3; 3315.1650; 3315.2210;
1.26 	3315.3210; 3315.3220.
1.27 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.28 	ARTICLE 1
1.29 	FEDERAL CONFORMITY PROVISIONS

1.30 	Section 1. [268.0435] SINGLE MEMBER LIMITED LIABILITY
1.31 	COMPANIES.
1.32 	If the only member of a limited liability company is a
1.33 	corporation, and the limited liability company is disregarded
1.34 	for purposes of filing federal corporate income tax, all the
1.35 	workers performing services for the limited liability company
1.36 	must be reported on the corporation's wage detail report under
2.1 	section 268.044.  A corporation that violates this section shall
2.2 	be subject to the penalties under section 268.184, subdivision
2.3 	1a.  Penalties shall be credited to the administration account
2.4 	to be used to ensure integrity in the unemployment insurance
2.5 	program.

2.6 	EFFECTIVE DATE. This section is effective for wage detail
2.7 	reports for the calendar quarter starting January 1, 2006.

2.8 	Sec. 2. Minnesota Statutes 2004, section 268.044,
2.9 	subdivision 1, is amended to read:
2.10 		Subdivision 1.Wage detail report.  (a) Each employer
2.11 	that has employees in covered employment shall submit, under the
2.12 	account provided for in section 268.045 or 268.046,a quarterly
2.13 	wage detail report by electronic transmission, in a format
2.14 	prescribed by the commissioner.  The report shall include for
2.15 	each employee in covered employment, the employee's name, Social
2.16 	Security number, the total wages paid to the employee, and total
2.17 	number of paid hours worked.  For employees exempt from the
2.18 	definition of employee in section 177.23, subdivision 7, clause
2.19 	(6), the employer shall report 40 hours worked for each week any
2.20 	duties were performed by a full-time employee and shall report a
2.21 	reasonable estimate of the hours worked for each week duties
2.22 	were performed by a part-time employee.  In addition, the wage
2.23 	detail report shall include the number of employees employed on
2.24 	the 12th day of each calendar month and, if required by the
2.25 	commissioner, the report shall be broken down by business
2.26 	location and type of employment , if section 268.046, subdivision
2.27 	1, paragraph (b), or subdivision 2, paragraph (b), applies, by
2.28 	separate unit.  If the information required is not submitted in
2.29 	a manner and format prescribed by the commissioner, it shall not
2.30 	be considered a wage detail report.  The report is due and must
2.31 	be received by the commissioner on or before the last day of the
2.32 	month following the end of the calendar quarter.  The
2.33 	commissioner may delay the due date on a specific calendar
2.34 	quarter in the event the department is unable to accept wage
2.35 	detail reports electronically.
2.36 	(b) The employer may report the wages paid to the next
3.1 	lower whole dollar amount.
3.2 	(c) An employer need not include the name of the employee
3.3 	or other required information on the wage detail report if
3.4 	disclosure is specifically exempted from being reported by
3.5 	federal law.
3.6 	(d) A wage detail report must be submitted for each
3.7 	calendar quarter even though no wages were paid, unless the
3.8 	employer has notified the commissioner, under section 268.042,
3.9 	subdivision 1, paragraph (c), of termination of business.

3.10 	Sec. 3. Minnesota Statutes 2004, section 268.044,
3.11 	subdivision 3, is amended to read:
3.12 		Subd. 3.Missing or erroneous information. (a) Any
3.13 	employer who that submits the wage detail report, but fails to
3.14 	include any all employee information or enters erroneous
3.15 	information, shall be subject to an administrative service fee
3.16 	of $25 for each employee for whom the information is partially 
3.17 	missing or erroneous.
3.18 	(b) Any employer that submits the wage detail report, but
3.19 	fails to include an employee, shall be subject to an
3.20 	administrative service penalty equal to two percent of the total
3.21 	wages for each employee for whom the information is completely
3.22 	missing.
3.23 	(c) An administrative service fee may be compromised under
3.24 	section 268.067or penalty under this subdivision shall be
3.25 	canceled if the commissioner determines that the failure or
3.26 	error by the employer was inadvertent occurred because of
3.27 	ignorance or inadvertence.

3.28 	Sec. 4. Minnesota Statutes 2004, section 268.045,
3.29 	subdivision 1, is amended to read:
3.30 		Subdivision 1.Account for each employer.  The
3.31 	commissioner shall maintain (1) a tax account for each taxpaying
3.32 	employer and (2) a reimbursable account for each nonprofit or
3.33 	government employer that has elected under section 268.052 or
3.34 	268.053 to be liable for reimbursements if that employer has
3.35 	employees in covered employment in the current or the prior
3.36 	calendar year,except as provided in this section 268.046.  The
4.1 	commissioner shall assess the tax account of a taxpaying
4.2 	employer for all the taxes due under section 268.051 and credit
4.3 	the tax account with all taxes paid.  The commissioner shall
4.4 	charge the reimbursable account of a nonprofit or government
4.5 	employer that elects to make reimbursements for any unemployment
4.6 	benefits determined chargeable to the employer under section
4.7 	268.047 and shall credit the reimbursable account with the
4.8 	payments made.

4.9 	Sec. 5. [268.046] TAX AND REIMBURSABLE ACCOUNTS ASSIGNED
4.10 	TO EMPLOYEE LEASING COMPANIES, PROFESSIONAL EMPLOYER
4.11 	ORGANIZATIONS, OR SIMILAR PERSON.
4.12 		Subdivision 1.Tax accounts assigned. (a) Any person
4.13 	that contracts with a taxpaying employer to have that person
4.14 	obtain the taxpaying employer's workforce and provide workers to
4.15 	the taxpaying employer for a fee shall, as of the effective date
4.16 	of the contract, be assigned for the duration of the contract
4.17 	the taxpaying employer's account under section 268.045.  That
4.18 	tax account must be maintained by the person separate and
4.19 	distinct from every other tax account held by the person and
4.20 	identified in a manner prescribed by the commissioner.  The tax
4.21 	account shall, for the duration of the contract, be considered
4.22 	that person's account for all purposes of this chapter.  The
4.23 	workers obtained from the taxpaying employer and any other
4.24 	workers provided by that person to the taxpaying employer must,
4.25 	under section 268.044, be reported on the wage detail report
4.26 	under that tax account, and that person shall pay any taxes due
4.27 	at the tax rate computed for that account under section 268.051,
4.28 	subdivision 2.
4.29 	(b) Any workers of the taxpaying employer who are not
4.30 	covered by the contract under paragraph (a) must be reported by
4.31 	the taxpaying employer as a separate unit on the wage detail
4.32 	report under the tax account assigned under paragraph (a).
4.33 	Taxes and any other amounts due on the wages reported by the
4.34 	taxpaying employer under this paragraph may be paid directly by
4.35 	the taxpaying employer.
4.36 	(c) If the taxpaying employer that contracts with a person
5.1 	under paragraph (a) does not have a tax account at the time of
5.2 	the execution of the contract, an account must be registered for
5.3 	the taxpaying employer under section 268.042, and the new
5.4 	employer tax rate under section 268.051, subdivision 5, must be
5.5 	assigned.  The tax account shall then be assigned to the person
5.6 	as provided for in paragraph (a).
5.7 	(d) A person that contracts with a taxpaying employer under
5.8 	paragraph (a) must, within 30 calendar days of the execution or
5.9 	termination of a contract, notify the commissioner by electronic
5.10 	transmission, in a format prescribed by the commissioner, of
5.11 	that execution or termination.  The taxpaying employer's name,
5.12 	the account number assigned, and any other information required
5.13 	by the commissioner must be provided by that person.
5.14 	(e) Any contract subject to paragraph (a) must specifically
5.15 	inform the taxpaying employer of the assignment of the tax
5.16 	account under this section and the taxpaying employer's
5.17 	obligation under paragraph (b).  If there is a termination of
5.18 	the contract, the tax account shall, as of the date of
5.19 	termination, immediately be assigned to the taxpaying employer.
5.20 		Subd. 2.Nonprofit and government reimbursable accounts
5.21 	assigned. (a) Any person that contracts with a nonprofit or
5.22 	government employer that is a reimbursing employer to have that
5.23 	person obtain the nonprofit or government employer's workforce
5.24 	and provide workers to the nonprofit or government employer for
5.25 	a fee, shall, as of the effective date of the contract, be
5.26 	assigned for the duration of the contract the nonprofit or
5.27 	government employer's account under section 268.045.  That
5.28 	reimbursable account must be maintained by the person separate
5.29 	and distinct from every other account held by the person and
5.30 	identified in a manner prescribed by the commissioner.  That
5.31 	reimbursable account shall, for the duration of the contract, be
5.32 	considered that person's account for all purposes of this
5.33 	chapter.  The workers obtained from the nonprofit or government
5.34 	employer and any other workers provided by that person to the
5.35 	nonprofit or government employer must, under section 268.044, be
5.36 	reported on the wage detail report under that reimbursable
6.1 	account, and that person shall pay any reimbursements due.
6.2 	(b) Any workers of the nonprofit or government employer who
6.3 	are not covered by the contract under paragraph (a) must be
6.4 	reported by the nonprofit or government employer as a separate
6.5 	unit on the wage detail report under the reimbursable account
6.6 	assigned under paragraph (a).  Reimbursements and any other
6.7 	amounts due on the wages reported by the nonprofit or government
6.8 	employer under this paragraph may be paid directly by the
6.9 	nonprofit or government employer.
6.10 	(c) If the nonprofit or government employer that contracts
6.11 	with a person under paragraph (a) does not have an account at
6.12 	the time of the execution of the contract, an account must be
6.13 	registered for the nonprofit or government employer under
6.14 	section 268.042.  The reimbursable account shall then be
6.15 	assigned to the person as provided for in paragraph (a).
6.16 	(d) A person that contracts with a nonprofit or government
6.17 	employer under paragraph (a) must, within 30 calendar days of
6.18 	the execution or termination of a contract, notify the
6.19 	commissioner of that execution or termination by electronic
6.20 	transmission, in a format prescribed by the commissioner.  The
6.21 	nonprofit or government employer's name, the account number
6.22 	assigned, and any other information required by the commissioner
6.23 	must be provided by that person.
6.24 	(e) Any contract subject to paragraph (a) must specifically
6.25 	inform the nonprofit or government employer of the assignment of
6.26 	the reimbursable account under this section and the nonprofit or
6.27 	government employer's obligation under paragraph (b).  If there
6.28 	is a termination of the contract, the reimbursable account
6.29 	shall, as of the date of termination, immediately be assigned to
6.30 	the nonprofit or government employer.
6.31 		Subd. 3.Penalties; application. (a) Any person that
6.32 	violates the requirements of this section and any taxpaying
6.33 	employer that violates subdivision 1, paragraph (b), or any
6.34 	nonprofit or government employer that violates subdivision 2,
6.35 	paragraph (b), shall be subject to the penalties under section
6.36 	268.184, subdivision 1a.  Penalties shall be credited to the
7.1 	administration account to be used to ensure integrity in the
7.2 	unemployment insurance program.
7.3 	(b) Section 268.051, subdivision 4, does not apply to
7.4 	contracts under this section.  This section shall not limit or
7.5 	prevent the application of section 268.051, subdivision 4, to
7.6 	any other transactions or acquisitions involving the taxpaying
7.7 	employer.  This section shall not limit or prevent the
7.8 	application of section 268.051, subdivision 4a.
7.9 	(c) An assignment of an account upon the execution of a
7.10 	contract under this section and a termination of a contract with
7.11 	the corresponding assignment of the account shall not be
7.12 	considered a separation from employment of any worker covered by
7.13 	the contract.  Nothing under this subdivision shall cause the
7.14 	person to be liable for any amounts past due under this chapter
7.15 	from the taxpaying employer or the nonprofit or government
7.16 	employer.
7.17 	(d) This section applies to, but is not limited to, persons
7.18 	registered under section 79.255, but does not apply to persons
7.19 	that obtain an exemption from registration under section 79.255,
7.20 	subdivision 9.
7.21 	
EFFECTIVE DATE. This section applies to all contracts
7.22 	executed on and after January 1, 2006.

7.23 	Sec. 6. Minnesota Statutes 2004, section 268.051,
7.24 	subdivision 1, is amended to read:
7.25 		Subdivision 1.Payments.  (a) Unemployment insurance
7.26 	taxes and any additional assessments, fees, or surcharges shall
7.27 	accrue and become payable by each employer for each calendar
7.28 	year on the taxable wages that the employer paid to employees in
7.29 	covered employment, except for:
7.30 	(1) nonprofit organizations that elect to make
7.31 	reimbursements as provided in section 268.053; and
7.32 	(2) the state of Minnesota and political subdivisions that
7.33 	make reimbursements, unless they elect to pay taxes as provided
7.34 	in section 268.052.
7.35 	Except as allowed under section 268.0511, each employer
7.36 	shall pay taxes quarterly, at the employer's assigned tax
8.1 	rate under subdivision 6, on the taxable wages paid to each
8.2 	employee.  The commissioner shall compute the tax due from the
8.3 	wage detail report required under section 268.044 and notify the
8.4 	employer of the tax due.  The taxes and any additional
8.5 	assessments, fees, or surcharges shall be paid to the trust fund
8.6 	and must be received by the department on or before the last day
8.7 	of the month following the end of the calendar quarter.
8.8 	(b) The tax amount computed, if not a whole dollar, shall
8.9 	be rounded down to the next lower whole dollar.
8.10 	(c) If for any reason the wages on the wage detail report
8.11 	under section 268.044 are adjusted for any quarter, the
8.12 	commissioner shall recompute the taxes due for that quarter and
8.13 	assess the employer for any amount due or credit the employer as
8.14 	appropriate.

8.15 	Sec. 7. Minnesota Statutes 2004, section 268.051,
8.16 	subdivision 4, is amended to read:
8.17 		Subd. 4.Experience rating history transfer.  (a) When:
8.18 	(1) a taxpaying employer acquires all of the organization,
8.19 	trade or business,or substantially all the assets workforce of
8.20 	another taxpaying employer,;and
8.21 	(2) there is 25 percent or more common ownership, directly
8.22 	or indirectly,or there is substantially common management or
8.23 	control between the predecessor and successor, the experience
8.24 	rating history of the predecessor employer shall be transferred
8.25 	as of the date of acquisition to the successor employer for the
8.26 	purpose of computing a tax rate.
8.27 	(b) When a taxpaying employer acquires a distinct severable
8.28 	portion of the organization, trade, business, or assets that is
8.29 	less than substantially all of the employing enterprises of
8.30 	another employer, and there is 25 percent or more common
8.31 	ownership, directly or indirectly, between the predecessor and
8.32 	successor, the successor employer shall acquire that percentage
8.33 	of a predecessor's experience rating equal to that percentage of
8.34 	the predecessor's employment positions it has obtained, and the
8.35 	predecessor employer shall retain that percentage of the
8.36 	experience rating equal to that percentage of the employment
9.1 	positions that it has retained, if the successor files an
9.2 	application by electronic transmission, in a format prescribed
9.3 	by the commissioner, for the transfer of a percentage of the
9.4 	experience rating of the predecessor within 180 calendar days
9.5 	from the date of acquisition, that furnishes sufficient
9.6 	information to substantiate the acquisition and to assign the
9.7 	appropriate percentage of the experience rating.When:
9.8 	(1) a taxpaying employer acquires a portion, but less than
9.9 	all, of the organization, trade or business, or workforce of
9.10 	another taxpaying employer; and 
9.11 	(2) there is 25 percent or more common ownership or there
9.12 	is substantially common management or control between the
9.13 	predecessor and successor, the successor employer shall acquire,
9.14 	as of the date of acquisition, the experience rating history
9.15 	attributable to the portion it acquired, and the predecessor
9.16 	employer shall retain the experience rating history attributable
9.17 	to the portion that it has retained.  If the commissioner
9.18 	determines that sufficient information is not available to
9.19 	substantiate that a distinct severable portion was acquired and
9.20 	to assign the appropriate distinct severable portion of the
9.21 	experience rating history, the commissioner shall assign the
9.22 	successor employer that percentage of the predecessor employer's
9.23 	experience rating history equal to that percentage of the
9.24 	employment positions it has obtained, and the predecessor
9.25 	employer shall retain that percentage of the experience rating
9.26 	history equal to the percentage of the employment positions it
9.27 	has retained.
9.28 	(c) The term "common ownership" for purposes of this
9.29 	subdivision includes ownership by a spouse, parent, grandparent,
9.30 	child, grandchild,brother, sister, aunt, uncle, niece, nephew,
9.31 	or first cousin, by birth or by marriage.
9.32 	(d) Each successor employer that is subject to paragraph
9.33 	(a) or (b) must notify the commissioner of the acquisition by
9.34 	electronic transmission, in a format prescribed by the
9.35 	commissioner, within 30 calendar days of the date of
9.36 	acquisition.  Any successor employer that fails to notify the
10.1 	commissioner is subject to the penalties under section 268.184,
10.2 	subdivision 1a, if the successor's experience rating was lower
10.3 	than the predecessor's experience rating at the time of the
10.4 	acquisition.  Penalties shall be credited to the administration
10.5 	account to be used to ensure integrity in the unemployment
10.6 	insurance program.
10.7 	(d) (e) If the successor employer under paragraphs (a) and
10.8 	(b) had an experience rating at the time of the acquisition, the
10.9 	transferred experience rating history of the predecessor shall
10.10 	be combined with the successor's experience rating history, as
10.11 	of the date of acquisition,for purposes of
10.12 	computing recomputing a tax rate.
10.13 	(e) (f) If there has been a transfer of an experience
10.14 	rating history under paragraph (a) or (b), employment with a
10.15 	predecessor employer shall not be considered to have been
10.16 	terminated if similar employment is offered by the successor
10.17 	employer and accepted by the employee.
10.18 	(f) (g) The commissioner, upon the commissioner's own
10.19 	motion or upon application notification of an employer, or upon
10.20 	the commissioner's own motion if the employer fails to provide
10.21 	the required notification,shall determine if an employer is a
10.22 	successor within the meaning of this subdivision and shall send
10.23 	the determination to the employer by mail or electronic
10.24 	transmission. The determination shall be final unless a protest
10.25 	is filed by the employer within 30 calendar days after sending
10.26 	the determination.  Upon receipt of a protest, the commissioner
10.27 	shall review all available evidence and determine whether an
10.28 	error has been made.  The commissioner shall either affirm or
10.29 	make a redetermination on whether the employer is a successor
10.30 	within the meaning of this subdivision and send the employer, by
10.31 	mail or electronic transmission, the affirmation or
10.32 	redetermination.  The affirmation or redetermination shall be
10.33 	final unless an appeal is filed by the employer within 30
10.34 	calendar days after the sending of the affirmation or
10.35 	redetermination.  Proceedings on the appeal shall be conducted
10.36 	in accordance with section 268.105.
11.1 	(g) The commissioner may, as the result of any
11.2 	determination or decision regarding shall, after determining the
11.3 	issue of succession or nonsuccession, recompute the tax
11.4 	rate under subdivision 6 of all employers affected by the
11.5 	determination or decision for any year, including the year of
11.6 	the acquisition and subsequent years, that is affected by the
11.7 	transfer or nontransfer of part or all of the experience
11.8 	rating.  This paragraph does not apply to rates that have become
11.9 	final before the filing of an application for the transfer of a
11.10 	severable portion of the experience rating under paragraph (b).
11.11 	The commissioner shall send the recomputed tax rate to all
11.12 	affected employers by mail or electronic transmission.  Any
11.13 	affected employer may protest the recomputed tax rate in
11.14 	accordance with the procedures in subdivision 6, paragraph (c).
11.15 	(h) Should an employer not have been in operation long
11.16 	enough to qualify for an experience rating under subdivision 3,
11.17 	paragraph (a),The " experience rating history" for purposes of
11.18 	this subdivision shall consist of and subdivision 4a means those
11.19 	factors set out in subdivision 3, paragraph (b),that normally 
11.20 	make up an experience rating, without the 12-month minimum.
11.21 	For purposes of this chapter, an "acquisition" means
11.22 	anything that results in the obtaining by the successor
11.23 	employer, in any way or manner, of the organization, trade or
11.24 	business, or workforce of the predecessor employer.
11.25 	A "distinct severable portion" in paragraph (b) means a
11.26 	location or unit separately identifiable within the employer's
11.27 	wage detail report under section 268.044.
11.28 	(i) If the commissioner finds that a transaction was done,
11.29 	in whole or in part, to avoid an experience rating or the
11.30 	transfer of an experience rating, the commissioner may transfer
11.31 	all or part of the experience rating regardless of the
11.32 	requirements or limitations of paragraphs (a) and (b).  This
11.33 	shall include the transferring of employees from the payroll of
11.34 	an employer with a higher experience rating to the payroll of an
11.35 	employer with a lower experience rating.
11.36 	(j) Regardless of the ownership, management, or control
12.1 	requirements of paragraph (a), if there is an acquisition or
12.2 	merger of a publicly held corporation by or with another
12.3 	publicly held corporation the experience ratings rating
12.4 	histories of the corporations shall be combined as of the date
12.5 	of acquisition or merger for the purpose of computing 
12.6 	recomputing a tax rate.

12.7 	Sec. 8. Minnesota Statutes 2004, section 268.051, is
12.8 	amended by adding a subdivision to read:
12.9 		Subd. 4a.Actions that avoid taxes. (a) If the
12.10 	commissioner determines that any action was done, in whole or in
12.11 	part, to avoid:
12.12 	(1) an experience rating history;
12.13 	(2) the transfer of an experience rating history; or 
12.14 	(3) the assignment of a tax rate for new employers under
12.15 	subdivision 5, paragraph (a) or (b), the commissioner, to insure
12.16 	that the trust fund receives all the taxes that would have been
12.17 	received had the action not occurred, may, effective the date of
12.18 	the action, transfer all or part of an experience rating history
12.19 	and recompute the tax rate, or assign the appropriate new
12.20 	employer tax rate.
12.21 	(b) This subdivision shall apply to any action between
12.22 	persons regardless of whether there is any commonality of
12.23 	ownership, management, or control between the persons.  The
12.24 	authority granted to the commissioner under this subdivision is
12.25 	in addition to any other authority granted to the commissioner.

12.26 	Sec. 9. Minnesota Statutes 2004, section 268.051,
12.27 	subdivision 6, is amended to read:
12.28 		Subd. 6.Notice of tax rate.  (a) On or before each
12.29 	December 15, the commissioner shall notify each employer by mail
12.30 	or electronic transmission of the employer's tax rate, along
12.31 	with any additional assessments, fees, or surcharges, for the
12.32 	following calendar year.  The notice shall contain the base tax
12.33 	rate and the factors used in determining the employer's
12.34 	experience rating.  Unless a protest of the tax rate is made,
12.35 	the computed tax rate shall be final,except for fraud or
12.36 	recomputation required under subdivision 4 or 4a,and shall be
13.1 	the rate at which taxes shall be paid. A recomputed tax rate
13.2 	under subdivision 4 or 4a shall be the rate applicable for the
13.3 	quarter that includes the date of acquisition and any quarter
13.4 	thereafter during the calendar year in which the acquisition
13.5 	occurred.The tax rate shall not be subject to collateral
13.6 	attack by way of claim for a credit adjustment or refund, or
13.7 	otherwise.
13.8 	(b) If the legislature, subsequent to the sending of the
13.9 	tax rate, changes any of the factors used to determine the rate,
13.10 	the earlier notice shall be void.a new tax rate based on the
13.11 	new factors shall be computed and sent to the employer.
13.12 	(c) A review of an employer's tax rate may be obtained by
13.13 	the employer filing a protest within 30 calendar days from the
13.14 	date the tax rate notice was sent to the employer.  Upon receipt
13.15 	of the protest, the commissioner shall review the tax rate to
13.16 	determine whether or not there has been any error in computation
13.17 	or assignment of the tax rate.  The commissioner shall either
13.18 	affirm or make a redetermination of the rate and a notice of the
13.19 	affirmation or redetermination shall be sent to the employer by
13.20 	mail or electronic transmission.  The affirmation or
13.21 	redetermination shall be final unless the employer files an
13.22 	appeal within 30 calendar days after the date the affirmation or
13.23 	redetermination was sent.  Proceedings on the appeal shall be
13.24 	conducted in accordance with section 268.105.
13.25 	(d) The commissioner may at any time upon the
13.26 	commissioner's own motion correct any error in the computation
13.27 	or the assignment of an employer's tax rate.

13.28 	Sec. 10. Minnesota Statutes 2004, section 268.065,
13.29 	subdivision 2, is amended to read:
13.30 		Subd. 2.Employee leasing firms company, professional
13.31 	employer organization, or similar person. (a) A person whose
13.32 	work force consists of 50 percent or more of workers provided by
13.33 	an employee leasing firms company, professional employer
13.34 	organization, or similar person for a fee, is jointly and
13.35 	severally liable for the unpaid amounts that are due under this
13.36 	chapter or section 116L.20 on the wages paid on the contract
14.1 	with the employee leasing firm company, professional employer
14.2 	organization, or similar person. "Employee leasing firm" means
14.3 	an employer that provides its employees to other persons without
14.4 	severing its employer-employee relationship with the worker for
14.5 	the services performed for the lessee.
14.6 	(b) This subdivision applies to, but is not limited to,
14.7 	persons registered under section 79.255, but does not apply to
14.8 	agreements with persons that obtain an exemption from
14.9 	registration under section 79.255, subdivision 9.

14.10 	Sec. 11. Minnesota Statutes 2004, section 268.184,
14.11 	subdivision 1, is amended to read:
14.12 		Subdivision 1.Administrative penalties.  (a) If the
14.13 	commissioner finds that any employer or any employee, officer,
14.14 	or agent of any employer, is in collusion with any applicant for
14.15 	the purpose of assisting the applicant to receive unemployment
14.16 	benefits fraudulently, the employer shall be penalized $500 or
14.17 	the amount of unemployment benefits determined to be overpaid,
14.18 	whichever is greater.
14.19 	(b) If the commissioner finds that any employer or any
14.20 	employee, officer, or agent of an employer has made (1) a false
14.21 	statement or representation knowing it to be false, including
14.22 	reporting employees on a wage detail report under section
14.23 	268.044 knowing the employees actually are employed by a
14.24 	different employer,or (2) has made a false statement or
14.25 	representation without a good faith belief as to correctness of
14.26 	the statement or representation, or (3) who knowingly fails to
14.27 	disclose a material fact, to prevent or reduce the payment of
14.28 	unemployment benefits to any applicant or to reduce or avoid any
14.29 	payment required from an employer under this chapter or section
14.30 	116L.20, the employer shall be penalized $500, or 50 percent of
14.31 	the reduced unemployment benefits or payment required, whichever
14.32 	is greater.
14.33 	(c) If the commissioner finds that an employer failed or
14.34 	refused to honor a subpoena issued under section 268.105,
14.35 	subdivision 4, or section 268.188, the employer shall be
14.36 	penalized $500 and any costs of enforcing the subpoena,
15.1 	including attorney fees.
15.2 	(d) Penalties under this section subdivision shall be in
15.3 	addition to any other penalties and subject to the same
15.4 	collection procedures that apply to past due taxes.  Penalties
15.5 	shall be paid to the department within 30 calendar days of
15.6 	assessment and credited to the contingent account.
15.7 	(e) The assessment of the penalty shall be final unless the
15.8 	employer files an appeal within 30 calendar days after the
15.9 	sending of notice of the penalty to the employer by mail or
15.10 	electronic transmission.  Proceedings on the appeal shall be
15.11 	conducted in accordance with section 268.105.

15.12 	Sec. 12. Minnesota Statutes 2004, section 268.184, is
15.13 	amended by adding a subdivision to read:
15.14 		Subd. 1a.Notification and misreporting penalties. (a)
15.15 	If the commissioner finds that any employer or agent of an
15.16 	employer failed to meet the notification requirements of section
15.17 	268.051, subdivision 4, the employer shall be assessed a penalty
15.18 	of $5,000 or two percent of the first full quarterly payroll
15.19 	acquired, whichever is higher.  Payroll is wages paid as defined
15.20 	in section 268.035, subdivision 30.  The penalty under this
15.21 	paragraph shall be canceled if the commissioner determines that
15.22 	the failure occurred because of ignorance or inadvertence.
15.23 	(b) If the commissioner finds that any individual advised
15.24 	an employer to violate the employer's notification requirements
15.25 	under section 268.051, subdivision 4, the individual, and that
15.26 	individual's employer, shall each be assessed the penalty in
15.27 	paragraph (a).
15.28 	(c) If the commissioner finds that any person or agent of a
15.29 	person violated the reporting requirements of section 268.0435
15.30 	or 268.046, the person shall be assessed a penalty of $5,000 or
15.31 	two percent of the quarterly payroll reported in violation of
15.32 	section 268.0435 or 268.046, whichever is higher.  Payroll is
15.33 	wages paid as defined in section 268.035, subdivision 30.
15.34 	(d) Penalties under this subdivision shall be in addition
15.35 	to any other penalties and subject to the same collection
15.36 	procedures that apply to past due amounts from an employer.
16.1 	Penalties must be paid within 30 calendar days after sending of
16.2 	the notice of penalty.
16.3 	(e) The assessment of a penalty shall be final unless the
16.4 	person assessed files an appeal within 30 calendar days after
16.5 	sending of the notice of the penalty by mail or electronic
16.6 	transmission.  Proceedings on the appeal shall be conducted in
16.7 	accordance with section 268.105.

16.8 	Sec. 13. Minnesota Statutes 2004, section 268.184,
16.9 	subdivision 2, is amended to read:
16.10 		Subd. 2.Criminal penalties.  Any employer or any officer
16.11 	or agent of an employer or any other individual who:
16.12 	(1) makes a false statement or representation knowing it to
16.13 	be false, or who ;
16.14 	(2) knowingly fails to disclose a material fact, including
16.15 	notification required under section 268.051, subdivision 4; or 
16.16 	(3) knowingly advises or assists an employer in violating
16.17 	clause (1) or (2),to avoid or reduce any payment required from
16.18 	an employer under this chapter or section 116L.20, or to prevent
16.19 	or reduce the payment of unemployment benefits to any applicant,
16.20 	is guilty of a gross misdemeanor unless the underpayment exceeds
16.21 	$500, in that case the individual is guilty of a felony.
16.22 	
EFFECTIVE DATE. This section is effective August 1, 2005,
16.23 	and applies to crimes committed on or after that date.

16.24 	Sec. 14. MANDATORY FEDERAL IMPLEMENTATION REQUIREMENT.
 16.25 	The commissioner must implement systems and processes to
16.26 	detect, investigate, and enforce section 268.051, subdivisions 4
16.27 	and 4a.

16.28 	Sec. 15. RELATION TO FEDERAL LAW.
 16.29 	This article is enacted to meet the requirements of the
16.30 	Federal SUTA Dumping Prevention Act of 2004, Public Law 108-295,
16.31 	amending United States Code, title 42, section 503, and shall be
16.32 	construed, interpreted, and applied consistent with the
16.33 	requirements of that federal law, including its definitions.

16.34 	Sec. 16. REPEALER.
 16.35 	(a) Minnesota Rules, parts 3315.1020, 3315.3210, and
16.36 	3315.3220, are repealed.
17.1 	(b) Minnesota Statutes 2004, section 268.045, subdivisions
17.2 	2, 3, and 4, are repealed.

17.3 	Sec. 17. EFFECTIVE DATE.
 17.4 	Except for the sections that include a separate effective
17.5 	date, this article is effective July 1, 2005.

17.6 	ARTICLE 2
17.7 	HOUSEKEEPING PROVISIONS

17.8 	Section 1. Minnesota Statutes 2004, section 268.03,
17.9 	subdivision 1, is amended to read:
17.10 		Subdivision 1.Statement.  The public purpose of sections
17.11 	268.029 to 268.23this chapter is:  Economic insecurity due to
17.12 	involuntary unemployment of workers in Minnesota is a subject of
17.13 	general concern that requires appropriate action by the
17.14 	legislature.  The public good will be promoted by providing
17.15 	workers who are unemployed through no fault of their own a
17.16 	temporary partial wage replacement to assist the unemployed
17.17 	worker to become reemployed.  This program will be known as the
17.18 	"Minnesota unemployment insurance program."

17.19 	Sec. 2. Minnesota Statutes 2004, section 268.035,
17.20 	subdivision 9, is amended to read:
17.21 		Subd. 9.Construction/independent contractor.  A worker
17.22 	doing commercial or residential building construction or
17.23 	improvement, in the public or private sector, performing
17.24 	services in the course of the trade, business, profession, or
17.25 	occupation of the employer, shall be considered an employee and
17.26 	not an "independent contractor" unless the worker meets all the
17.27 	following conditions:
17.28 	(1) maintains a separate business with the independent
17.29 	contractor's own office, equipment, materials, and other
17.30 	facilities;
17.31 	(2) holds or has applied for a federal employer
17.32 	identification number or has filed business or self-employment
17.33 	income tax returns with the federal Internal Revenue Service
17.34 	based on that work or service in the previous year;
17.35 	(3) operates under contracts to perform specific services
17.36 	or work for specific amounts of money under which the
18.1 	independent contractor controls the means of performing the
18.2 	services or work;
18.3 	(4) incurs the main expenses related to the service or work
18.4 	that the independent contractor performs under contract;
18.5 	(5) is responsible for the satisfactory completion of work
18.6 	or services that the independent contractor contracts to perform
18.7 	and is liable for a failure to complete the work or service;
18.8 	(6) receives compensation for work or service performed
18.9 	under a contract on a commission or per job or competitive bid
18.10 	basis and not on any other basis;
18.11 	(7) may realize a profit or suffer a loss under contracts
18.12 	to perform work or service;
18.13 	(8) has continuing or recurring business liabilities or
18.14 	obligations; and
18.15 	(9) the success or failure of the independent contractor's
18.16 	business depends on the relationship of business receipts to
18.17 	expenditures.

18.18 	Sec. 3. Minnesota Statutes 2004, section 268.035,
18.19 	subdivision 13, is amended to read:
18.20 		Subd. 13.Employee.  "Employee" means:
18.21 	(1) every individual, who is performing, or has performed
18.22 	services for an employer in employment; or 
18.23 	(2) each individual employed to perform or assist in
18.24 	performing the work of any agent or employee of the employer
18.25 	shall be considered to be an employee of that employer whether
18.26 	the individual was hired or paid directly by that employer or by
18.27 	the agent or employee, provided the employer had actual or
18.28 	constructive knowledge of the work.

18.29 	Sec. 4. Minnesota Statutes 2004, section 268.035,
18.30 	subdivision 14, is amended to read:
18.31 		Subd. 14.Employer.  "Employer" means any of the
18.32 	following person which has had one or more employees during the
18.33 	current or the prior calendar year:
18.34 	(1) any individual or type of organization, resident or
18.35 	nonresident, for profit or nonprofit, religious, charitable, or
18.36 	educational, including any partnership, limited liability
19.1 	company, trust, estate, or corporation, domestic or foreign, or
19.2 	the receiver, trustee in bankruptcy, trustee or successor of any
19.3 	of the foregoing, or the legal representative of a deceased
19.4 	person;
19.5 	(2) any government entity, state or federal, foreign or
19.6 	domestic, Indian tribe, including any subdivision thereof and
19.7 	any instrumentality thereof owned wholly or in part;
19.8 	(3) including any organization or person that has elected,
19.9 	under section 268.042, to be subject to the Minnesota
19.10 	Unemployment Insurance Law;and 
19.11 	(4) a joint venture composed of one or more employers;.
19.12 	(5) any nonprofit organization or government agency
19.13 	providing or authorizing the hiring of homeworkers, personal
19.14 	care attendants, or other individuals performing similar
19.15 	services in a private home is the employer of the homeworker,
19.16 	attendant, or similar worker whether the organization or agency
19.17 	pays the employee directly or provides funds to the recipient of
19.18 	the services to pay for the services.  This clause does not
19.19 	apply to the state of Minnesota or any county that provides
19.20 	federal, state, or local funds to a child care provider either
19.21 	directly or indirectly through a parent who is a child care
19.22 	assistance recipient; or 
19.23 	(6) each individual employed to perform or assist in
19.24 	performing the work of any agent or employee shall be considered
19.25 	to be employed by that employer whether the individual was hired
19.26 	or paid directly by that employer or by the agent or employee,
19.27 	provided the employer had actual or constructive knowledge of
19.28 	the work.
19.29 	An employee leasing company, professional employer
19.30 	organization, or similar person, that has been assigned a tax or
19.31 	reimbursable account under section 268.046 is an employer for
19.32 	purposes of this chapter.

19.33 	Sec. 5. Minnesota Statutes 2004, section 268.035,
19.34 	subdivision 20, is amended to read:
19.35 		Subd. 20.Noncovered employment.  "Noncovered employment"
19.36 	means:
20.1 	(1) employment for the United States government or an
20.2 	instrumentality thereof, including military service;
20.3 	(2) employment for a state, other than Minnesota, or a
20.4 	political subdivision or instrumentality thereof;
20.5 	(3) employment for a foreign government;
20.6 	(4) employment for an instrumentality wholly owned by a
20.7 	foreign government, if the employment is of a character similar
20.8 	to that performed in foreign countries by employees of the
20.9 	United States government or an instrumentality thereof and the
20.10 	United States Secretary of State has certified that the foreign
20.11 	government grants an equivalent exemption to similar employment
20.12 	performed in the foreign country by employees of the United
20.13 	States government and instrumentalities thereof;
20.14 	(5) employment covered under United States Code, title 45,
20.15 	section 351, the Railroad Unemployment Insurance Act;
20.16 	(6) employment covered by a reciprocal arrangement between
20.17 	the commissioner and another state or the federal government
20.18 	which provides that all employment performed by an individual
20.19 	for an employer during the period covered by the reciprocal
20.20 	arrangement is considered performed entirely within another
20.21 	state;
20.22 	(7) employment for a church or convention or association of
20.23 	churches, or an organization operated primarily for religious
20.24 	purposes that is operated, supervised, controlled, or
20.25 	principally supported by a church or convention or association
20.26 	of churches described in United States Code, title 26, section
20.27 	501(c)(3) of the federal Internal Revenue Code and exempt from
20.28 	income tax under section 501(a);
20.29 	(8) employment of a duly ordained or licensed minister of a
20.30 	church in the exercise of a ministry or by a member of a
20.31 	religious order in the exercise of duties required by the order,
20.32 	for Minnesota or a political subdivision or an organization
20.33 	described in United States Code, title 26, section 501(c)(3) of
20.34 	the federal Internal Revenue Code and exempt from income tax
20.35 	under section 501(a);
20.36 	(9) employment of an individual receiving rehabilitation of
21.1 	"sheltered" work in a facility conducted for the purpose of
21.2 	carrying out a program of rehabilitation for individuals whose
21.3 	earning capacity is impaired by age or physical or mental
21.4 	deficiency or injury or a program providing "sheltered" work for
21.5 	individuals who because of an impaired physical or mental
21.6 	capacity cannot be readily absorbed in the competitive labor
21.7 	market.  This clause applies only to services performed for
21.8 	Minnesota or a political subdivision or an organization
21.9 	described in United States Code, title 26, section 501(c)(3) of
21.10 	the federal Internal Revenue Code and exempt from income tax
21.11 	under section 501(a) in a facility certified by the
21.12 	Rehabilitation Services Branch of the department or in a day
21.13 	training or habilitation program licensed by the Department of
21.14 	Human Services;
21.15 	(10) employment of an individual receiving work relief or
21.16 	work training as part of an unemployment work relief or work
21.17 	training program assisted or financed in whole or in part by any
21.18 	federal agency or an agency of a state or political subdivision
21.19 	thereof.  This clause applies only to employment for Minnesota
21.20 	or a political subdivision or an organization described in
21.21 	United States Code, title 26, section 501(c)(3) of the federal
21.22 	Internal Revenue Code and exempt from income tax under section
21.23 	501(a).  This clause shall not apply to programs that require
21.24 	unemployment benefit coverage for the participants;
21.25 	(11) employment for Minnesota or a political subdivision as
21.26 	an elected official, a member of a legislative body, or a member
21.27 	of the judiciary;
21.28 	(12) employment as a member of the Minnesota National Guard
21.29 	or Air National Guard;
21.30 	(13) employment for Minnesota, a political subdivision, or
21.31 	instrumentality thereof, as an employee serving only on a
21.32 	temporary basis in case of fire, flood, tornado, or similar
21.33 	emergency;
21.34 	(14) employment as an election official or election worker
21.35 	for Minnesota or a political subdivision, but only if the
21.36 	compensation for that employment was less than $1,000 in a
22.1 	calendar year;
22.2 	(15) employment for Minnesota that is a major policy making
22.3 	or advisory position in the unclassified service, including
22.4 	those positions established pursuant to section 43A.08,
22.5 	subdivision 1a;
22.6 	(16) employment for a political subdivision of Minnesota
22.7 	that is a nontenured major policy making or advisory position;
22.8 	(17) domestic employment in a private household, local
22.9 	college club, or local chapter of a college fraternity or
22.10 	sorority performed for a person, only if the wages paid in any
22.11 	calendar quarter in either the current or preceding calendar
22.12 	year to all individuals in domestic employment totaled less than
22.13 	$1,000.
22.14 	"Domestic employment" includes all service in the operation
22.15 	and maintenance of a private household, for a local college
22.16 	club, or local chapter of a college fraternity or sorority as
22.17 	distinguished from service as an employee in the pursuit of an
22.18 	employer's trade or business;
22.19 	(18) employment of an individual by a son, daughter, or
22.20 	spouse, and employment of a child under the age of 18 by the
22.21 	child's father or mother;
22.22 	(19) employment of an inmate of a custodial or penal
22.23 	institution;
22.24 	(20) employment for a school, college, or university by a
22.25 	student who is enrolled and is regularly attending classes at
22.26 	the school, college, or university;
22.27 	(21) employment of an individual who is enrolled as a
22.28 	student in a full-time program at a nonprofit or public
22.29 	educational institution that maintains a regular faculty and
22.30 	curriculum and has a regularly organized body of students in
22.31 	attendance at the place where its educational activities are
22.32 	carried on, taken for credit at the institution, that combines
22.33 	academic instruction with work experience, if the employment is
22.34 	an integral part of the program, and the institution has so
22.35 	certified to the employer, except that this clause shall not
22.36 	apply to employment in a program established for or on behalf of
23.1 	an employer or group of employers;
23.2 	(22) employment of university, college, or professional
23.3 	school students in an internship or other training program with
23.4 	the city of St. Paul or the city of Minneapolis pursuant to Laws
23.5 	1990, chapter 570, article 6, section 3;
23.6 	(23) employment for a hospital by a patient of the
23.7 	hospital.  "Hospital" means an institution that has been
23.8 	licensed by the Department of Health as a hospital;
23.9 	(24) employment as a student nurse for a hospital or a
23.10 	nurses' training school by an individual who is enrolled and is
23.11 	regularly attending classes in an accredited nurses' training
23.12 	school;
23.13 	(25) employment as an intern for a hospital by an
23.14 	individual who has completed a four-year course in an accredited
23.15 	medical school;
23.16 	(26) employment as an insurance salesperson, by other than
23.17 	a corporate officer, if all the compensation for wages from the
23.18 	employment is solely by way of commission.  The word "insurance"
23.19 	shall include an annuity and an optional annuity;
23.20 	(27) employment as an officer of a township mutual
23.21 	insurance company or farmer's mutual insurance company operating
23.22 	pursuant to chapter 67A;
23.23 	(28) employment of a corporate officer, if the officer owns
23.24 	25 percent or more of the employer corporation, and employment
23.25 	of a member of a limited liability company, if the member owns
23.26 	25 percent or more of the employer limited liability company;
23.27 	(29) employment as a real estate salesperson, by other than
23.28 	a corporate officer, if all the compensation for wages from the
23.29 	employment is solely by way of commission;
23.30 	(30) employment as a direct seller as defined in United
23.31 	States Code, title 26, section 3508;
23.32 	(31) employment of an individual under the age of 18 in the
23.33 	delivery or distribution of newspapers or shopping news, not
23.34 	including delivery or distribution to any point for subsequent
23.35 	delivery or distribution;
23.36 	(32) casual employment performed for an individual, other
24.1 	than domestic employment under clause (17), that does not
24.2 	promote or advance that employer's trade or business;
24.3 	(33) employment in "agricultural employment" unless
24.4 	considered "covered agricultural employment" under subdivision
24.5 	11; or
24.6 	(34) if employment during one-half or more of any pay
24.7 	period was covered employment, all the employment for the pay
24.8 	period shall be considered covered employment; but if during
24.9 	more than one-half of any pay period the employment was
24.10 	noncovered employment, then all of the employment for the pay
24.11 	period shall be considered noncovered employment.  "Pay period"
24.12 	means a period of not more than a calendar month for which a
24.13 	payment or compensation is ordinarily made to the employee by
24.14 	the employer.

24.15 	Sec. 6. Minnesota Statutes 2004, section 268.035,
24.16 	subdivision 21, is amended to read:
24.17 		Subd. 21.Person.  "Person" means:
24.18 	(1) an individual, trust or estate, a partnership or a
24.19 	corporation or any type of organization or entity, resident or
24.20 	nonresident, for profit or nonprofit, religious, charitable or
24.21 	educational, including any receiver or trustee in a bankruptcy,
24.22 	successor of any of the foregoing, or legal representative of a
24.23 	deceased individual; and 
24.24 	(2) any government entity, state or federal, foreign or
24.25 	domestic, or Indian tribe, including any subdivision or
24.26 	instrumentality thereof owned wholly or in part.

24.27 	Sec. 7. Minnesota Statutes 2004, section 268.035,
24.28 	subdivision 26, is amended to read:
24.29 		Subd. 26.Unemployed.  An applicant shall be considered
24.30 	"unemployed":(1) in any week that the applicant performs no
24.31 	service in employment, covered employment, noncovered
24.32 	employment, self-employment, or volunteer work, and with respect
24.33 	to which the applicant has no earnings; or (2) in any week of 
24.34 	less than 32 hours of service in employment, covered employment,
24.35 	noncovered employment, self-employment, or volunteer work if the 
24.36 	; and (2) any earnings with respect to that week are less than
25.1 	the applicant's weekly unemployment benefit amount.

25.2 	Sec. 8. Minnesota Statutes 2004, section 268.042,
25.3 	subdivision 1, is amended to read:
25.4 		Subdivision 1.Employer registration.  (a) Each employer
25.5 	shall, upon or before the submission of its first wage detail
25.6 	report under section 268.044, register with the commissioner for
25.7 	a tax account or a reimbursable account, by electronic
25.8 	transmission in a format prescribed by the commissioner.  The
25.9 	employer must provide all required information for registration.
25.10 	(b) Except as provided in subdivision 3, any organization
25.11 	or person that is or becomes an employer subject to the
25.12 	Minnesota Unemployment Insurance Law within any calendar year
25.13 	shall be considered to be subject to this chapter the entire
25.14 	calendar year.
25.15 	(c) Upon the termination of business, an employer that has
25.16 	been assigned a tax account or reimbursable account shall notify
25.17 	the commissioner by electronic transmission, in a format
25.18 	prescribed by the commissioner, that the employer no longer has
25.19 	employees and does not intend or expect to pay wages to any
25.20 	employees in the next calendar year and into the foreseeable
25.21 	future.  Upon such notification, the commissioner shall not
25.22 	require the employer to file wage detail reports under section
25.23 	268.044, subdivision 1, paragraph (d), commencing the calendar
25.24 	quarter after the notice of termination was received by the
25.25 	commissioner.

25.26 	Sec. 9. Minnesota Statutes 2004, section 268.043, is
25.27 	amended to read:
25.28 	268.043 DETERMINATIONS OF COVERAGE.
25.29 	(a) The commissioner, upon the commissioner's own motion or
25.30 	upon application of an organization or a person, shall determine
25.31 	if that organization or person is an employer or whether
25.32 	services performed for it constitute employment and covered
25.33 	employment, or whether the compensation for services constitutes
25.34 	wages, and shall notify the organization or person of the
25.35 	determination.  The determination shall be final unless the
25.36 	organization or person, within 30 calendar days after sending of
26.1 	the determination by mail or electronic transmission, files a
26.2 	protest.  Upon receipt of a protest, the commissioner shall
26.3 	review all available evidence and determine whether an error has
26.4 	been made.  The commissioner shall send to the organization or 
26.5 	person, by mail or electronic transmission, an affirmation or
26.6 	redetermination.  The affirmation or redetermination shall be
26.7 	final unless, within 30 calendar days after sending of the
26.8 	affirmation or redetermination to the organization or person by
26.9 	mail or electronic transmission, an appeal is filed.
26.10 	Proceedings on the appeal shall be conducted in accordance with
26.11 	section 268.105.
26.12 	(b) No organization or person shall be initially determined
26.13 	an employer, or that services performed for it were in
26.14 	employment or covered employment, for periods more than four
26.15 	years prior to the year in which the determination is made,
26.16 	unless the commissioner finds that there was fraudulent action
26.17 	to avoid liability under this chapter.

26.18 	Sec. 10. Minnesota Statutes 2004, section 268.044,
26.19 	subdivision 2, is amended to read:
26.20 		Subd. 2.Failure to timely file report; late fees.  (a)
26.21 	Any employer that fails to submit the quarterly wage detail
26.22 	report when due shall pay a late fee of $10 per employee,
26.23 	computed based upon the highest of:
26.24 	(1) the number of employees reported on the last wage
26.25 	detail report submitted;
26.26 	(2) the number of employees reported in the corresponding
26.27 	quarter of the prior calendar year; or
26.28 	(3) if no wage detail report has ever been submitted, the
26.29 	number of employees listed at the time of employer registration.
26.30 	The late fee shall be waived if the wage detail report is
26.31 	received within 30 calendar days after a demand for the report
26.32 	is sent to the employer by mail or electronic transmission.  A
26.33 	late fee assessed an employer may not be waived more than once 
26.34 	twice each 12 months.  The amount of the late fee assessed shall
26.35 	not be less than $50 $250.
26.36 	(b) If the wage detail report is not received in a manner
27.1 	and format prescribed by the commissioner within 30 calendar
27.2 	days after demand is sent under paragraph (a), the late fee
27.3 	assessed under paragraph (a) shall double and a renewed demand
27.4 	notice and notice of the increased late fee shall be sent to the
27.5 	employer by mail or electronic transmission.
27.6 	(c) Late fees due under this subdivision may be compromised
27.7 	under section 268.067 where good cause for late submission is
27.8 	found by the commissioner.

27.9 	Sec. 11. Minnesota Statutes 2004, section 268.051,
27.10 	subdivision 7, is amended to read:
27.11 		Subd. 7.Tax rate buydown.  (a) Any taxpaying employer
27.12 	who has been assigned a tax rate based upon an experience
27.13 	rating, and has no amounts past due under this chapter,may,
27.14 	upon the voluntary payment of an amount equivalent to any
27.15 	portion or all of the unemployment benefits used in computing
27.16 	the experience rating plus a surcharge of 25 percent, obtain a
27.17 	cancellation of unemployment benefits used equal to the payment
27.18 	made, less the surcharge.  Upon the payment, the commissioner
27.19 	shall compute a new experience rating for the employer, and
27.20 	compute a new tax rate.
27.21 	(b) Voluntary payments may be made only by electronic
27.22 	payment and must be received within 120 calendar days from the
27.23 	beginning of the calendar year for which the tax rate is
27.24 	effective.

27.25 	Sec. 12. Minnesota Statutes 2004, section 268.052,
27.26 	subdivision 2, is amended to read:
27.27 		Subd. 2.Election by state or political subdivision to be
27.28 	a taxpaying employer.  (a) The state or political
27.29 	subdivision excluding a school district may elect to be a
27.30 	taxpaying employer for any calendar year if a notice of election
27.31 	is filed within 30 calendar days following January 1 of that
27.32 	calendar year.  Upon election, the state or political
27.33 	subdivision shall be assigned the new employer tax rate under
27.34 	section 268.051, subdivision 5, for the calendar year of the
27.35 	election and until it qualifies for an experience rating under
27.36 	section 268.051, subdivision 3.
28.1 	(b) An election shall be for a minimum period of two
28.2 	calendar years following the effective date of the election and
28.3 	continue unless a notice terminating the election is filed not
28.4 	later than 30 calendar days before the beginning of the calendar
28.5 	year.  The termination shall be effective at the beginning of
28.6 	the next calendar year.  Upon election, the commissioner shall
28.7 	establish a reimbursable account for the state or political
28.8 	subdivision.  A termination of election shall be allowed only if
28.9 	the state or political subdivision has, since the beginning of
28.10 	the experience rating period under section 268.051, subdivision
28.11 	3, paid taxes and made voluntary payments under section 268.051,
28.12 	subdivision 7,equal to or more than 125 percent of the
28.13 	unemployment benefits used in computing the experience rating.
28.14 	In addition, any unemployment benefits paid after the experience
28.15 	rating period shall be transferred to the new reimbursable
28.16 	account of the state or political subdivision.  If the amount of
28.17 	taxes and voluntary payments paid since the beginning of the
28.18 	experience rating period exceeds 125 percent of the amount of
28.19 	unemployment benefits paid during the experience rating period,
28.20 	that amount in excess shall be applied against any unemployment
28.21 	benefits paid after the experience rating period.
28.22 	(c) The method of payments to the trust fund under
28.23 	subdivisions 3 and 4 shall apply to all taxes paid by or due
28.24 	from the state or political subdivision that elects to be
28.25 	taxpaying employers under this subdivision.
28.26 	(d) A notice of election or a notice terminating election
28.27 	shall be filed by electronic transmission in a format prescribed
28.28 	by the commissioner.

28.29 	Sec. 13. Minnesota Statutes 2004, section 268.053,
28.30 	subdivision 1, is amended to read:
28.31 		Subdivision 1.Election.  (a) Any nonprofit organization
28.32 	that has employees in covered employment shall pay taxes on a
28.33 	quarterly basis pursuant to section 268.051 unless it elects to
28.34 	make reimbursements to the trust fund the amount of unemployment
28.35 	benefits charged to its reimbursable account under section
28.36 	268.047.
29.1 	The organization may elect to make reimbursements for a
29.2 	period of not less than two calendar years beginning with the
29.3 	date that the organization was determined to be an employer with
29.4 	covered employment by filing a notice of election not later than
29.5 	30 calendar days after the date of the determination.
29.6 	(b) Any nonprofit organization that makes an election will
29.7 	continue to be liable for reimbursements until it files a notice
29.8 	terminating its election not later than 30 calendar days before
29.9 	the beginning of the calendar year the termination is to be
29.10 	effective.
29.11 	(c) A nonprofit organization that has been making
29.12 	reimbursements that files a notice of termination of election
29.13 	shall be assigned the new employer tax rate under section
29.14 	268.051, subdivision 5, for the calendar year of the termination
29.15 	of election and until it qualifies for an experience rating
29.16 	under section 268.051, subdivision 3.
29.17 	(d) Any nonprofit organization that has been paying taxes
29.18 	may elect to make reimbursements by filing no less than 30
29.19 	calendar days before January 1 of any calendar year a notice of
29.20 	election.  Upon election, the commissioner shall establish a
29.21 	reimbursable account for the nonprofit organization.  An
29.22 	election shall be allowed only if the nonprofit organization
29.23 	has, since the beginning of the experience rating period under
29.24 	section 268.051, subdivision 3, paid taxes and made voluntary
29.25 	payments under section 268.051, subdivision 7,equal to or more
29.26 	than 125 percent of the unemployment benefits used in computing
29.27 	the experience rating.  In addition, any unemployment benefits
29.28 	paid after the experience rating period shall be transferred to
29.29 	the new reimbursable account of the nonprofit organization.  If
29.30 	the amount of taxes and voluntary payments paid since the
29.31 	beginning of the experience rating period exceeds 125 percent of
29.32 	the amount of unemployment benefits paid during the experience
29.33 	rating period, that amount in excess shall be applied against
29.34 	any unemployment benefits paid after the experience rating
29.35 	period.  The election shall not be terminable by the
29.36 	organization for that and the next calendar year.
30.1 	(e) The commissioner may for good cause extend the period
30.2 	that a notice of election, or a notice of termination, must be
30.3 	filed and may permit an election to be retroactive.
30.4 	(f) A notice of election or notice terminating election
30.5 	shall be filed by electronic transmission in a format prescribed
30.6 	by the commissioner.

30.7 	Sec. 14. Minnesota Statutes 2004, section 268.057,
30.8 	subdivision 7, is amended to read:
30.9 		Subd. 7.Credit adjustments, refunds.  (a) If an employer
30.10 	makes an application for a credit adjustment of any amount paid
30.11 	under this chapter or section 116L.20 within four years of
30.12 	the year date that the payment was made due, in a manner and
30.13 	format prescribed by the commissioner, and the commissioner
30.14 	determines that the payment or any portion was erroneous, the
30.15 	commissioner shall make an adjustment and issue a credit without
30.16 	interest.  If a credit cannot be used, the commissioner shall
30.17 	refund, without interest, the amount erroneously paid.  The
30.18 	commissioner, on the commissioner's own motion, may make a
30.19 	credit adjustment or refund under this subdivision.
30.20 	Any refund returned to the commissioner shall be considered
30.21 	unclaimed property under chapter 345.
30.22 	(b) If a credit adjustment or refund is denied in whole or
30.23 	in part, a notice of denial shall be sent to the employer by
30.24 	mail or electronic transmission.  Within 30 calendar days after
30.25 	sending of the notice of denial, the employer may protest.
30.26 	Upon receipt of a timely protest, the commissioner shall
30.27 	review the denial and either affirm the denial or redetermine
30.28 	the credit adjustment or refund.  The affirmation of denial or
30.29 	redetermination of the credit adjustment or refund, sent by mail
30.30 	or electronic transmission, shall be final unless an employer
30.31 	files an appeal within 30 calendar days after sending.
30.32 	Proceedings on the appeal shall be conducted in accordance with
30.33 	section 268.105.

30.34 	Sec. 15. Minnesota Statutes 2004, section 268.069,
30.35 	subdivision 1, is amended to read:
30.36 		Subdivision 1.Requirements.  The commissioner shall pay
31.1 	unemployment benefits from the trust fund to an applicant who
31.2 	has met each of the following requirements:
31.3 	(1) the applicant has filed an application for unemployment
31.4 	benefits and established a benefit account in accordance with
31.5 	section 268.07;
31.6 	(2) the applicant is not subject to a disqualification from
31.7 	unemployment benefits under section 268.095because of a quit or
31.8 	discharge;
31.9 	(3) the applicant has met all of the ongoing weekly 
31.10 	eligibility requirements under sections 268.085 and 268.086;
31.11 	(4) the applicant does not have an outstanding overpayment
31.12 	of unemployment benefits, including any penalties or interest,
31.13 	under section 268.18; and
31.14 	(5) the applicant is not subject to a denial of ineligible
31.15 	for unemployment benefits under section 268.182because of a
31.16 	false representation or concealment of facts.

31.17 	Sec. 16. Minnesota Statutes 2004, section 268.07,
31.18 	subdivision 3b, is amended to read:
31.19 		Subd. 3b.Limitations.  (a) A benefit account shall be
31.20 	established effective the Sunday of the calendar week that the
31.21 	application for unemployment benefits was filed.  Upon specific
31.22 	request of an applicant, an application for unemployment
31.23 	benefits may be backdated one calendar week prior to the Sunday
31.24 	of the week the application was actually filed.  An application
31.25 	shall be backdated only if the applicant was unemployed
31.26 	throughout the period of the backdating.  If an individual
31.27 	attempted to file an application for unemployment benefits, but
31.28 	was prevented from filing an application by the department, the
31.29 	benefit account shall be effective the Sunday of the calendar
31.30 	week the individual first attempted to file an application.
31.31 	(b) A benefit account, once established, may later be
31.32 	withdrawn only if:
31.33 	(1) a new application for unemployment benefits is filed
31.34 	and a new benefit account is established at the time of the
31.35 	withdrawal; and
31.36 	(2) the applicant has not served a waiting week under
32.1 	section 268.085, subdivision 1, clause (3) (5).
32.2 	A determination or amended determination pursuant to
32.3 	section 268.101, that was issued before the withdrawal of the
32.4 	benefit account, shall remain in effect and shall not be voided
32.5 	by the withdrawal of the benefit account.  A determination of
32.6 	disqualification requiring subsequent earnings to satisfy the
32.7 	disqualification under section 268.095, subdivision 10, shall
32.8 	apply to the weekly unemployment benefit amount on the new
32.9 	benefit account.
32.10 	(c) An application for unemployment benefits shall not be
32.11 	allowed prior to the Sunday following the expiration of the
32.12 	benefit year on a prior benefit account.  Except as allowed
32.13 	under paragraph (b), a applicant may establish only one benefit
32.14 	account each 52 calendar weeks.
32.15 	(d) All unemployment benefits shall be available from the
32.16 	trust fund only for weeks occurring during the applicant's
32.17 	benefit year.

32.18 	Sec. 17. Minnesota Statutes 2004, section 268.085,
32.19 	subdivision 1, is amended to read:
32.20 		Subdivision 1.Eligibility conditions.  An applicant
32.21 	shall be eligible to receive unemployment benefits for any week
32.22 	if:
32.23 	(1) the applicant has an active benefit account and has
32.24 	filed a continued biweekly request for unemployment benefits for
32.25 	that week pursuant to section 268.086;
32.26 	(2) the week for which unemployment benefits are requested
32.27 	is in the applicant's benefit year;
32.28 	(3) the applicant was unemployed as defined in section
32.29 	268.035, subdivision 26;
32.30 	(2) (4) the applicant was able to work and was available
32.31 	for suitable employment, and was actively seeking suitable
32.32 	employment.  The applicant's weekly unemployment benefit amount
32.33 	shall be reduced one-fifth for each day the applicant is unable
32.34 	to work or is unavailable for suitable employment.  If the
32.35 	computation of the reduced unemployment benefits is not a whole
32.36 	dollar, it shall be rounded down to the next lower whole dollar.
33.1 	This clause shall not apply to an applicant who is in
33.2 	reemployment assistance training, or each day the applicant is
33.3 	on jury duty or serving as an election judge;
33.4 	(3) (5) the applicant has served a waiting period of one
33.5 	week that the applicant is otherwise entitled to some amount of
33.6 	unemployment benefits.  This clause shall not apply if the
33.7 	applicant would have been entitled to federal disaster
33.8 	unemployment assistance because of a disaster in Minnesota, but
33.9 	for the applicant's establishment of a benefit account under
33.10 	section 268.07; and
33.11 	(4) (6) the applicant has been participating in
33.12 	reemployment assistance services, such as job search and resume
33.13 	writing classes, if the applicant has been determined in need of
33.14 	reemployment assistance services by the commissioner, unless
33.15 	there is good cause for the applicant's failure to participate.

33.16 	Sec. 18. Minnesota Statutes 2004, section 268.085,
33.17 	subdivision 2, is amended to read:
33.18 		Subd. 2.Not eligible.  An applicant shall not be
33.19 	eligible to receive unemployment benefits for any week:
33.20 	(1) that occurs before the effective date of a benefit
33.21 	account;
33.22 	(2) that occurs in a period when the applicant is a student
33.23 	in attendance at, or on vacation from a secondary school
33.24 	including the period between academic years or terms;
33.25 	(3) that the applicant is incarcerated or performing court
33.26 	ordered community service.  The applicant's weekly unemployment
33.27 	benefit amount shall be reduced by one-fifth for each day the
33.28 	applicant is incarcerated or performing court ordered community
33.29 	service.  If the computation of the reduced unemployment
33.30 	benefits is not a whole dollar, it shall be rounded down to the
33.31 	next lower whole dollar;
33.32 	(4) that the applicant fails or refuses to provide
33.33 	information on an issue of eligibility required under section
33.34 	268.101, subdivision 1, paragraph (a),or an issue of
33.35 	disqualification required under section 268.101, subdivision 1,
33.36 	paragraph (d);
34.1 	(5) that the applicant is performing services 32 hours or
34.2 	more, in employment, covered employment, noncovered employment,
34.3 	volunteer work,or self-employment regardless of the amount of
34.4 	any earnings; or
34.5 	(6) with respect to which the applicant is receiving, has
34.6 	received, or has filed an application for unemployment benefits
34.7 	under any federal law or the law of any other state.  If the
34.8 	appropriate agency finally determines that the applicant is not
34.9 	entitled to the unemployment benefits, this clause shall not
34.10 	apply.

34.11 	Sec. 19. Minnesota Statutes 2004, section 268.085,
34.12 	subdivision 3, is amended to read:
34.13 		Subd. 3.Payments that delay unemployment benefits.  (a)
34.14 	An applicant shall not be eligible to receive unemployment
34.15 	benefits for any week with respect to which the applicant is
34.16 	receiving, has received, or has filed for payment, equal to or
34.17 	in excess of the applicant's weekly unemployment benefit amount,
34.18 	in the form of:
34.19 	(1) vacation pay paid upon temporary, indefinite, or
34.20 	seasonal separation.  This clause shall not apply to vacation
34.21 	pay paid upon a permanent separation from employment;
34.22 	(2) severance pay, bonus pay, vacation pay,sick pay, and
34.23 	any other money payments, except earnings under subdivision 5,
34.24 	and back pay under subdivision 6, paid by an employer because
34.25 	of, upon, or after separation from employment, but only if the
34.26 	money payment is considered wages at the time of payment under
34.27 	section 268.035, subdivision 29, or United States Code, title
34.28 	26, section 3121, clause (2), of the Federal Insurance
34.29 	Contribution Act.  This clause shall apply to all the weeks of
34.30 	payment and shall be applied to the period immediately following
34.31 	the last day of employment.  The number of weeks of payment
34.32 	shall be determined as follows:;
34.33 	(i) if the payments are made periodically, the total of the
34.34 	payments to be received shall be divided by the applicant's last
34.35 	level of regular weekly pay from the employer; or 
34.36 	(ii) if the payment is made in a lump sum, that sum shall
35.1 	be divided by the applicant's last level of regular weekly pay
35.2 	from the employer.  This clause shall not apply to vacation pay
35.3 	paid by an employer upon permanent separation from employment;
35.4 	(2) (3) pension, retirement, or annuity payments from any
35.5 	plan contributed to by a base period employer including the
35.6 	United States government, except Social Security benefits which
35.7 	are provided for in subdivision 4.  The base period employer
35.8 	contributed to the plan if the contribution is excluded from the
35.9 	definition of wages under section 268.035, subdivision 29,
35.10 	clause (1), or United States Code, title 26, section 3121,
35.11 	clause (2), of the Federal Insurance Contribution Act.
35.12 	If the applicant receives a lump sum pension payment, that
35.13 	sum shall be divided by the applicant's last level of regular
35.14 	weekly pay to determine the number of weeks of payment.  The
35.15 	number of weeks of payment shall be applied to the period
35.16 	immediately following the last day of employment.An applicant
35.17 	shall not be considered to have received the lump sum payment if
35.18 	the applicant immediately deposits that payment in a qualified
35.19 	pension plan or account; or
35.20 	(3) (4) holiday pay.
35.21 	(b) This subdivision shall apply to all the weeks of
35.22 	payment and shall be applied to the period immediately following
35.23 	the last day of employment.  The number of weeks of payment
35.24 	shall be determined as follows:
35.25 	(1) if the payments are made periodically, the total of the
35.26 	payments to be received shall be divided by the applicant's last
35.27 	level of regular weekly pay from the employer; or 
35.28 	(2) if the payment is made in a lump sum, that sum shall be
35.29 	divided by the applicant's last level of regular weekly pay from
35.30 	the employer.
35.31 	(b) (c) If the payment is less than the applicant's weekly
35.32 	unemployment benefit amount, unemployment benefits shall be
35.33 	reduced by the amount of the payment.  If the computation of
35.34 	reduced unemployment benefits is not a whole dollar, it shall be
35.35 	rounded down to the next lower whole dollar.

35.36 	Sec. 20. Minnesota Statutes 2004, section 268.085,
36.1 	subdivision 5, is amended to read:
36.2 		Subd. 5.Deductible earnings.  (a) If the applicant has
36.3 	earnings with respect to any week, from employment, covered
36.4 	employment, noncovered employment, self-employment, or volunteer
36.5 	work, equal to or in excess of the applicant's weekly
36.6 	unemployment benefit amount, the applicant shall be ineligible
36.7 	for unemployment benefits for that week.
36.8 	(b) If the applicant has earnings, with respect to any
36.9 	week, that is less than the applicant's weekly unemployment
36.10 	benefit amount, from employment, covered employment, noncovered
36.11 	employment, self-employment, or volunteer work, that amount over
36.12 	the following shall be deducted from the weekly unemployment
36.13 	benefit amount:
36.14 	(1) 25 percent of earnings or $50, whichever is higher; and
36.15 	(2) $200 for earnings from service in the National Guard or
36.16 	a United States military reserve unit.
36.17 	The resulting unemployment benefit, if not a whole dollar,
36.18 	shall be rounded down to the next lower whole dollar.
36.19 	(c) No deduction shall be made from an applicant's weekly
36.20 	unemployment benefit amount for earnings from direct service as
36.21 	a volunteer firefighter or volunteer ambulance service
36.22 	personnel. This exception to paragraphs (a) and (b) does not
36.23 	apply to on-call or standby pay provided to a volunteer
36.24 	firefighter or volunteer ambulance service personnel.No
36.25 	deduction shall be made for jury duty pay or for pay as an
36.26 	election judge.
36.27 	(d) The applicant may report deductible earnings on
36.28 	continued biweekly requests for unemployment benefits at the
36.29 	next lower whole dollar amount.
36.30 	(e) Deductible earnings shall not include any money
36.31 	considered a deductible payment under subdivision 3, but shall
36.32 	include all other money considered wages and any other money
36.33 	considered earned income under state and federal law for income
36.34 	tax purposes.

36.35 	Sec. 21. Minnesota Statutes 2004, section 268.085,
36.36 	subdivision 12, is amended to read:
37.1 		Subd. 12.Aliens.  (a) An alien shall be ineligible for
37.2 	unemployment benefits for any week the alien is not authorized
37.3 	to work in the United States under federal law.  Information
37.4 	from the Bureau of Citizenship and Immigration and
37.5 	Naturalization Service Services shall be considered conclusive,
37.6 	absent specific evidence that the information was erroneous.
37.7 	Pursuant to the existing agreement between the United States and
37.8 	Canada, this paragraph shall not apply to an applicant who is a
37.9 	Canadian citizen and has returned to and is living in Canada
37.10 	each week unemployment benefits are requested.
37.11 	(b) Unemployment benefits shall not be paid on the basis of
37.12 	wage credits earned by an alien unless the alien (1) was
37.13 	lawfully admitted for permanent residence at the time of the
37.14 	employment, (2) was lawfully present for the purposes of the
37.15 	employment, or (3) was permanently residing in the United States
37.16 	under color of law at the time of the employment.
37.17 	(c) Any information required of applicants applying for
37.18 	unemployment benefits to determine eligibility because of their
37.19 	alien status shall be required from all applicants.

37.20 	Sec. 22. Minnesota Statutes 2004, section 268.086,
37.21 	subdivision 2, is amended to read:
37.22 		Subd. 2.Continued biweekly request for unemployment
37.23 	benefits defined.  A continued biweekly request for unemployment
37.24 	benefits is a certification by an applicant, done on a biweekly
37.25 	basis, that the applicant is unemployed and meets the ongoing
37.26 	eligibility requirements for unemployment benefits under section
37.27 	268.085 for a specific week or two-week period.  A continued
37.28 	biweekly request shall include information on possible issues of
37.29 	eligibility and disqualification in accordance with section
37.30 	268.101, subdivision 1, paragraph (c).

37.31 	Sec. 23. Minnesota Statutes 2004, section 268.086,
37.32 	subdivision 3, is amended to read:
37.33 		Subd. 3.Methods for filing continued biweekly requests
37.34 	for unemployment benefits.  (a) The commissioner shall designate
37.35 	to each applicant one of the following methods for filing a
37.36 	continued biweekly request:
38.1 	(1) by telephone under subdivision 4;
38.2 	(2) by electronic transmission under subdivision 5;
38.3 	(3) (2) by mail under subdivision 6; or
38.4 	(4) (3) by in-person interview under subdivision 7.
38.5 	(b) The method designated by the commissioner shall be the
38.6 	only method allowed for filing a continued biweekly request by
38.7 	that applicant.  An applicant may ask that one of the other
38.8 	allowed methods be designated and the commissioner shall
38.9 	consider inconvenience to the applicant as well as
38.10 	administrative capacity in determining whether to allow an
38.11 	applicant to change the designated method for filing a continued
38.12 	biweekly request for unemployment benefits.

38.13 	Sec. 24. Minnesota Statutes 2004, section 268.095,
38.14 	subdivision 1, is amended to read:
38.15 		Subdivision 1.Quit.  An applicant who quit employment
38.16 	shall be disqualified from all unemployment benefits according
38.17 	to subdivision 10 except when:
38.18 	(1) the applicant quit the employment because of a good
38.19 	reason caused by the employer as defined in subdivision 3;
38.20 	(2) the applicant quit the employment to accept other
38.21 	covered employment that provided substantially better terms and
38.22 	conditions of employment, but the applicant did not work long
38.23 	enough at the second employment to have sufficient subsequent
38.24 	earnings to satisfy the disqualification that would otherwise be
38.25 	imposed under subdivision 10 for quitting the first employment;
38.26 	(3) the applicant quit the employment within 30 calendar
38.27 	days of beginning the employment because the employment was
38.28 	unsuitable for the applicant;
38.29 	(4) the employment was unsuitable for the applicant and the
38.30 	applicant quit to enter reemployment assistance training;
38.31 	(5) the employment was part time and the applicant also had
38.32 	full-time employment in the base period, from which full-time
38.33 	employment the applicant separated because of nondisqualifying
38.34 	reasons, and the wage credits from the full-time employment are
38.35 	sufficient to meet the minimum requirements to establish a
38.36 	benefit account under section 268.07;
39.1 	(6) the applicant quit because the employer notified the
39.2 	applicant that the applicant was going to be laid off due to
39.3 	lack of work within 30 calendar days.  An applicant who quit
39.4 	employment within 30 calendar days of a notified date of layoff
39.5 	due to lack of work shall be disqualified from unemployment
39.6 	benefits through the end of the week that includes the scheduled
39.7 	date of layoff;
39.8 	(7) the applicant quit the employment because the
39.9 	applicant's serious illness or injury made it medically
39.10 	necessary that the applicant quit, provided that the applicant
39.11 	inform the employer of the serious illness or injury and request
39.12 	accommodation and no reasonable accommodation is made available.
39.13 	If the applicant's serious illness is chemical dependency,
39.14 	this exception shall not apply if the applicant was previously
39.15 	diagnosed as chemically dependent or had treatment for chemical
39.16 	dependency, and since that diagnosis or treatment has failed to
39.17 	make consistent efforts to control the chemical dependency; or
39.18 	(8) domestic abuse of the applicant or the applicant's
39.19 	minor child, necessitated the applicant's quitting the
39.20 	employment.  Domestic abuse shall be shown by one or more of the
39.21 	following:
39.22 	(i) a court order for protection or other documentation of
39.23 	equitable relief issued by a court;
39.24 	(ii) a police record documenting the domestic abuse;
39.25 	(iii) documentation that the perpetrator of the domestic
39.26 	abuse has been convicted of the offense of domestic abuse;
39.27 	(iv) medical documentation of domestic abuse; or
39.28 	(v) written statement that the applicant or the applicant's
39.29 	minor child is a victim of domestic abuse, provided by a social
39.30 	worker, member of the clergy, shelter worker, attorney at law,
39.31 	or other professional who has assisted the applicant in dealing
39.32 	with the domestic abuse.
39.33 	Domestic abuse for purposes of this clause shall be defined
39.34 	under section 518B.01.

39.35 	Sec. 25. Minnesota Statutes 2004, section 268.095,
39.36 	subdivision 4, is amended to read:
40.1 		Subd. 4.Discharge.  An applicant who was discharged from
40.2 	employment by an employer shall not be disqualified from any all 
40.3 	unemployment benefits except when according to subdivision 10
40.4 	only if:
40.5 	(1) the applicant was discharged because of employment
40.6 	misconduct as defined in subdivision 6; or
40.7 	(2) the applicant was discharged because of aggravated
40.8 	employment misconduct as defined in subdivision 6a.

40.9 	Sec. 26. Minnesota Statutes 2004, section 268.095,
40.10 	subdivision 7, is amended to read:
40.11 		Subd. 7.Act or omissions after separation. Except as
40.12 	provided for under subdivision 8,An applicant shall not be
40.13 	disqualified from unemployment benefits under this section for
40.14 	any acts or omissions occurring after the applicant's separation
40.15 	from employment with the employer.  A layoff due to lack of work
40.16 	is considered a separation from employment.

40.17 	Sec. 27. Minnesota Statutes 2004, section 268.095,
40.18 	subdivision 8, is amended to read:
40.19 		Subd. 8.Offers of suitable employment.  (a) An applicant
40.20 	shall be disqualified from ineligible for all unemployment
40.21 	benefits for eight calendar weeks if the applicant, without good
40.22 	cause:
40.23 	(1) failed to apply for available, suitable employment of
40.24 	which the applicant was advised by the commissioner or an
40.25 	employer;
40.26 	(2) failed to accept suitable employment when offered; or
40.27 	(3) avoided an offer of suitable employment.
40.28 	(b) "Good cause" is a reason that would cause a reasonable
40.29 	individual who wants suitable employment to fail to apply for,
40.30 	accept, or avoid suitable employment.  Good cause includes:
40.31 	(1) the applicant is employed in other suitable employment;
40.32 	(2) the applicant is in reemployment assistance training;
40.33 	(3) the applicant formerly worked for the employer and the
40.34 	loss of employment occurred prior to the commencement of a labor
40.35 	dispute, was permanent or for an indefinite period, and the
40.36 	applicant failed to apply for or accept the employment because a
41.1 	labor dispute was in progress at the establishment; or
41.2 	(4) the applicant formerly worked for the employer and quit
41.3 	that employment because of a good reason caused by the employer.
41.4 	(c) This subdivision only applies to offers of suitable 
41.5 	employment with a new or a former employer and does not apply to
41.6 	any type of job transfers, position reassignments, or changes in
41.7 	job duties or responsibilities during the course of employment
41.8 	with an employer.
41.9 	(d) The period of ineligibility under this section shall
41.10 	begin the Sunday of the week the applicant failed to apply for,
41.11 	accept, or avoided suitable employment without good cause.
41.12 	(e) This section shall apply to offers of suitable
41.13 	employment that occur prior to the effective date of the benefit
41.14 	account and that occur during the benefit year.
41.15 	(f) This section shall only apply to offers of suitable
41.16 	employment that are considered covered employment under section
41.17 	268.035, subdivision 12.

41.18 	Sec. 28. Minnesota Statutes 2004, section 268.095,
41.19 	subdivision 10, is amended to read:
41.20 		Subd. 10.Disqualification duration.  (a) A
41.21 	disqualification from the payment of all unemployment benefits
41.22 	under subdivisions 1,and 4, and 8 shall be for the duration of
41.23 	the applicant's unemployment and until the end of the calendar
41.24 	week that the applicant had total earnings in subsequent covered
41.25 	employment of eight times the applicant's weekly unemployment
41.26 	benefit amount.
41.27 	(b) Any disqualification imposed under subdivisions 1 and 4
41.28 	shall begin on the Sunday of the week that the applicant became
41.29 	separated from employment. Any disqualification imposed under
41.30 	subdivision 8 shall begin on the Sunday of the week the
41.31 	applicant failed to apply for, accept, or avoided employment.
41.32 	(c) In addition to paragraph (a), if the applicant was
41.33 	discharged from employment because of aggravated employment
41.34 	misconduct, wage credits from that employment shall be canceled.

41.35 	Sec. 29. Minnesota Statutes 2004, section 268.095,
41.36 	subdivision 11, is amended to read:
42.1 		Subd. 11.Application.  (a) This section shall apply to
42.2 	all covered employment, full time or part time, temporary or of
42.3 	limited duration, permanent or of indefinite duration, that
42.4 	occurred in Minnesota during the base period, the period between
42.5 	the end of the base period and the effective date of the benefit
42.6 	account, or the benefit year, except as provided for in
42.7 	subdivision 1, clause (5). Subdivision 8 shall only apply to
42.8 	offers of suitable employment made during the applicant's
42.9 	benefit year.
42.10 	(b) Paragraph (a) shall also apply to employment covered
42.11 	under an unemployment insurance program of any other state or
42.12 	established by an act of Congress.

42.13 	Sec. 30. Minnesota Statutes 2004, section 268.101,
42.14 	subdivision 1, is amended to read:
42.15 		Subdivision 1.Notification.  (a) In an application for
42.16 	unemployment benefits, each applicant shall report the name and
42.17 	the reason for no longer working for the applicant's most recent
42.18 	employer, as well as the names of all employers and the reasons
42.19 	for no longer working for all employers during the six calendar
42.20 	months prior to the date of the application.  If the reason
42.21 	reported for no longer working for any of those employers is
42.22 	other than a layoff due to lack of work, that shall raise an
42.23 	issue of disqualification that the department shall
42.24 	determine. An applicant shall report any offers of employment
42.25 	refused during the eight calendar weeks prior to the date of the
42.26 	application for unemployment benefits and the name of the
42.27 	employer that made the offer.An applicant's failure to report
42.28 	the name of an employer, or giving an incorrect reason for no
42.29 	longer working for an employer, or failing to disclose an offer
42.30 	of employment that was refused,shall be considered a violation
42.31 	of section 268.182, paragraph (b) subdivision 2.
42.32 	In an application, the applicant shall also provide all
42.33 	information necessary to determine the applicant's eligibility
42.34 	for unemployment benefits under section 268.085.  If the
42.35 	applicant fails or refuses to provide information necessary to
42.36 	determine the applicant's eligibility for unemployment benefits
43.1 	under section 268.085, the applicant shall be ineligible for
43.2 	unemployment benefits under section 268.085, subdivision 2,
43.3 	until the applicant provides this required information.
43.4 	(b) Upon establishment of a benefit account, the
43.5 	commissioner shall notify, by mail or electronic transmission,
43.6 	all employers the applicant was required to report on the
43.7 	application and all base period employers and determined
43.8 	successors to those employers under section 268.051, subdivision
43.9 	4 in order to provide the employer an opportunity to raise, in a
43.10 	manner prescribed by the commissioner, any issue of
43.11 	disqualification or any issue of eligibility.  An employer shall
43.12 	be informed of the effect that failure to raise an issue of
43.13 	disqualification within ten calendar days after sending of the
43.14 	notice, as provided for under subdivision 2, paragraph (b), may
43.15 	have on the employer under section 268.047.
43.16 	(c) Each applicant shall report any employment, loss of
43.17 	employment, and offers of employment received refused, during
43.18 	those weeks the applicant filed continued biweekly requests for
43.19 	unemployment benefits pursuant to section 268.086.  Each
43.20 	applicant who stops filing continued biweekly requests during
43.21 	the benefit year and later begins filing continued biweekly
43.22 	requests during that same benefit year shall report the name of
43.23 	any employer the applicant worked for during the period between
43.24 	the filing of continued biweekly requests and the reason the
43.25 	applicant stopped working for the employer.  The applicant shall
43.26 	report any offers of employment refused during the period
43.27 	between the filing of continued biweekly requests for
43.28 	unemployment benefits.  Those employers from which the applicant
43.29 	has reported a loss of employment or an offer of employment 
43.30 	pursuant to this paragraph shall be notified by mail or
43.31 	electronic transmission and provided an opportunity to raise, in
43.32 	a manner prescribed by the commissioner, any issue of
43.33 	disqualification or any issue of eligibility.  An employer shall
43.34 	be informed of the effect that failure to raise an issue may
43.35 	have on the employer under section 268.047.
43.36 	(d) The purpose for requiring the applicant to report the
44.1 	name of employers and the reason for no longer working for those
44.2 	employers, or offers of employment refused,under paragraphs (a)
44.3 	and (c) is for the commissioner to obtain information from an
44.4 	applicant raising all issues that may have the potential of
44.5 	disqualifying the applicant from unemployment benefits under
44.6 	section 268.095, or the applicant being ineligible for
44.7 	unemployment benefits under section 268.085, subdivision 13c.
44.8 	If the reason given by the applicant for no longer working for
44.9 	an employer is other than a layoff due to lack of work, that
44.10 	shall raise an issue of disqualification and the applicant shall
44.11 	be required, as part of the determination process under
44.12 	subdivision 2, paragraph (a), to state all the facts about the
44.13 	cause for no longer working for the employer, if known.  If the
44.14 	applicant fails or refuses to provide this any required 
44.15 	information, the applicant shall be ineligible for unemployment
44.16 	benefits under section 268.085, subdivision 2, until the
44.17 	applicant provides this required information.

44.18 	Sec. 31. Minnesota Statutes 2004, section 268.101,
44.19 	subdivision 2, is amended to read:
44.20 		Subd. 2.Disqualification determination.  (a) The
44.21 	commissioner shall determine any issue of disqualification
44.22 	raised by information required from an applicant under
44.23 	subdivision 1, paragraph (a) or (c), and send to the applicant
44.24 	and employer, by mail or electronic transmission, a
44.25 	determination of disqualification or a determination of
44.26 	nondisqualification, as is appropriate.  The determination shall
44.27 	state the effect on the employer under section 268.047.  A
44.28 	determination shall be made pursuant to this paragraph even if a
44.29 	notified employer has not raised the issue of disqualification.
44.30 	(b) The commissioner shall determine any issue of
44.31 	disqualification raised by an employer and send to the applicant
44.32 	and that employer, by mail or electronic transmission, a
44.33 	determination of disqualification or a determination of
44.34 	nondisqualification as is appropriate.  The determination shall
44.35 	state the effect on the employer under section 268.047.
44.36 	If a base period employer:
45.1 	(1) was not the applicant's most recent employer prior to
45.2 	the application for unemployment benefits;
45.3 	(2) did not employ the applicant during the six calendar
45.4 	months prior to the application for unemployment benefits; and
45.5 	(3) did not raise an issue of disqualification within ten
45.6 	calendar days of notification under subdivision 1, paragraph
45.7 	(b);
45.8 	then any exception under section 268.047, subdivisions 2 and 3,
45.9 	shall begin the Sunday two weeks following the week that the
45.10 	issue of disqualification was raised by the employer.
45.11 	(c) If any time within 24 months from the establishment of
45.12 	a benefit account the commissioner finds that an applicant
45.13 	failed to report any employment, or loss of employment, or
45.14 	offers of employment that were was required to be provided by
45.15 	the applicant under this section, the commissioner shall
45.16 	determine any issue of disqualification on that loss of
45.17 	employment or offer of employment and send to the applicant and
45.18 	involved employer, by mail or electronic transmission, a
45.19 	determination of disqualification or a determination of
45.20 	nondisqualification, as is appropriate.  The determination shall
45.21 	state the effect on the employer under section 268.047.
45.22 	This paragraph shall not prevent the imposition of any
45.23 	penalty under section 268.18, subdivision 2, or 268.182.
45.24 	(d) An issue of disqualification shall be determined based
45.25 	upon that information required of an applicant, any information
45.26 	that may be obtained from an applicant or employer, and
45.27 	information from any other source, without regard to any common
45.28 	law burden of proof.
45.29 	(e) A determination of disqualification or a determination
45.30 	of nondisqualification shall be final unless an appeal is filed
45.31 	by the applicant or notified employer within 30 calendar days
45.32 	after sending.  The determination shall contain a prominent
45.33 	statement indicating the consequences of not appealing.
45.34 	Proceedings on the appeal shall be conducted in accordance with
45.35 	section 268.105.
45.36 	(f) An issue of disqualification for purposes of this
46.1 	section shall include any reason for no longer working for an
46.2 	employer other than a layoff due to lack of work, any question
46.3 	of a disqualification from unemployment benefits under section
46.4 	268.095, any question of an exception to disqualification under
46.5 	section 268.095, any question of effect on an employer under
46.6 	section 268.047, and any question of an otherwise imposed
46.7 	disqualification that an applicant has satisfied under section
46.8 	268.095, subdivision 10.
46.9 	(g) Regardless of the requirements of this subdivision, the
46.10 	commissioner is not required to send to an applicant a
46.11 	determination where the applicant has satisfied any otherwise
46.12 	potential disqualification under section 268.095, subdivision 10.

46.13 	Sec. 32. Minnesota Statutes 2004, section 268.101,
46.14 	subdivision 3a, is amended to read:
46.15 		Subd. 3a.Direct hearing.  Regardless of any provision of
46.16 	the Minnesota Unemployment Insurance Law, the commissioner or an
46.17 	unemployment law judge or a senior unemployment review judge 
46.18 	may, prior to a determination being made under this chapter,
46.19 	refer any issue of disqualification, any issue of eligibility,
46.20 	or any other issue under this chapter, directly for hearing in
46.21 	accordance with section 268.105, subdivision 1.  The status of
46.22 	the issue shall be the same as if a determination had been made
46.23 	and an appeal filed.

46.24 	Sec. 33. Minnesota Statutes 2004, section 268.103,
46.25 	subdivision 2, is amended to read:
46.26 		Subd. 2.applicant's appeal by mail.  (a) The
46.27 	commissioner must allow an applicant to file an appeal to be
46.28 	filed by mail even if an appeal by electronic transmission is
46.29 	allowed.
46.30 	(b) A written statement delivered or mailed to the
46.31 	department that could reasonably be interpreted to mean that an
46.32 	involved applicant or employer is in disagreement with a
46.33 	specific determination or decision shall be considered an
46.34 	appeal.  No specific words need be used for the written
46.35 	statement to be considered an appeal.

46.36 	Sec. 34. Minnesota Statutes 2004, section 268.105, is
47.1 	amended to read:
47.2 	268.105 APPEALS.
47.3 		Subdivision 1.Evidentiary hearing by an unemployment law
47.4 	judge. (a) Upon a timely appeal having been filed, the
47.5 	department shall send, by mail or electronic transmission,a
47.6 	notice of appeal to all involved parties that an appeal has been
47.7 	filed, that a de novo due process evidentiary hearing will be
47.8 	scheduled, and that the parties have certain rights and
47.9 	responsibilities regarding the hearing.  The department shall
47.10 	set a time and place for a de novo due process evidentiary
47.11 	hearing and send notice to any involved applicant and any
47.12 	involved employer, by mail or electronic transmission, not less
47.13 	than ten calendar days prior to the date of the hearing.
47.14 	(b) The evidentiary hearing shall be conducted by an
47.15 	unemployment law judge without regard to any common law burden
47.16 	of proof as an evidence gathering inquiry and not an adversarial
47.17 	proceeding.  The unemployment law judge shall ensure that all
47.18 	relevant facts are clearly and fully developed.  The department
47.19 	shall adopt rules on evidentiary hearings.  The rules need not
47.20 	conform to common law or statutory rules of evidence and other
47.21 	technical rules of procedure.  The department shall have
47.22 	discretion regarding the method by which the evidentiary hearing
47.23 	is conducted.  A report of any employee of the department,
47.24 	except a determination, made in the regular course of the
47.25 	employee's duties, shall be competent evidence of the facts
47.26 	contained in it.
47.27 	(c) After the conclusion of the hearing, upon the evidence
47.28 	obtained, the unemployment law judge shall make findings of fact
47.29 	and decision and send those, by mail or electronic transmission,
47.30 	to all involved parties. When the credibility of an involved
47.31 	party or witness testifying in an evidentiary hearing has a
47.32 	significant effect on the outcome of a decision, the
47.33 	unemployment law judge must set out the reason for crediting or
47.34 	discrediting that testimony.The unemployment law judge's
47.35 	decision is the final department decision unless a further
47.36 	appeal request for reconsideration is filed pursuant to
48.1 	subdivision 2.
48.2 	(d) Only employees of the department who are attorneys 
48.3 	shall serve as unemployment law judges. A senior unemployment
48.4 	review judge The commissioner may personally hear or transfer to
48.5 	another unemployment law judge any proceedings pending before an
48.6 	unemployment law judge. Any proceedings removed to a senior
48.7 	unemployment review judge shall be heard in accordance with this
48.8 	subdivision.
48.9 	Subd. 2. [DE NOVO REVIEW BY A SENIOR UNEMPLOYMENT REVIEW
48.10 	JUDGE.] (a) Except as provided under subdivision 2a, any
48.11 	involved applicant or involved employer may appeal a decision of
48.12 	an unemployment law judge and obtain a de novo review by a
48.13 	senior unemployment review judge by filing with a senior
48.14 	unemployment review judge an appeal within 30 calendar days
48.15 	after the sending of the unemployment law judge's decision.  A
48.16 	senior unemployment review judge within the same period of time
48.17 	may, on a senior unemployment review judge's own motion, order a
48.18 	de novo review of any decision of an unemployment law judge.
48.19 	(b) A senior unemployment review judge shall be an attorney
48.20 	who is an employee of the department.
48.21 	(c) Upon de novo review, a senior unemployment review judge
48.22 	shall, on the basis of that evidence submitted at the
48.23 	evidentiary hearing under subdivision 1, make findings of fact
48.24 	and decision, or remand the matter back to an unemployment law
48.25 	judge for the taking of additional evidence and the making of
48.26 	new findings and decision based on all the evidence.  A senior
48.27 	unemployment review judge shall, independent of the findings of
48.28 	fact and decision of the unemployment law judge, examine the
48.29 	evidence and make those findings of fact as the evidence, in the
48.30 	judgment of the senior unemployment review judge require, and
48.31 	make that decision as the facts found by the senior unemployment
48.32 	review judge require.
48.33 	(d) A senior unemployment review judge may conduct a de
48.34 	novo review without argument by any involved party, or a senior
48.35 	unemployment review judge may allow written argument.  A senior
48.36 	unemployment review judge shall not, except for purposes of
49.1 	deciding whether to remand a matter to an unemployment law judge
49.2 	for a further evidentiary hearing, consider any evidence that
49.3 	was not submitted at the hearing before the unemployment law
49.4 	judge.
49.5 	(e) The senior unemployment review judge shall send, by
49.6 	mail or electronic transmission, to any involved party the
49.7 	senior unemployment review judge's findings of fact and
49.8 	decision.  The decision of the senior unemployment review judge
49.9 	is the final decision of the department.  Unless judicial review
49.10 	is sought under subdivision 7, the decision of the senior
49.11 	unemployment review judge shall become final 30 calendar days
49.12 	after sending.
49.13 		Subd. 2a.Orders by a senior unemployment review judge.
 49.14 	(a) If an applicant or employer files an appeal in a matter
49.15 	where an unemployment law judge affirmed a determination issued
49.16 	under section 268.101, and there is no dispute regarding the
49.17 	determinative facts, a senior unemployment review judge shall
49.18 	have the discretion to decline to conduct a de novo review.  If
49.19 	de novo review is declined, the senior unemployment review judge
49.20 	shall issue an order adopting the unemployment law judge's
49.21 	findings of fact and decision.
49.22 	(b) If an involved party fails, without good cause, to
49.23 	appear and participate at the evidentiary hearing conducted by
49.24 	an unemployment law judge under subdivision 1, and that party
49.25 	files an appeal, a senior unemployment review judge shall have
49.26 	the discretion to decline to conduct a de novo review.  If de
49.27 	novo review is declined, the senior unemployment review judge
49.28 	shall issue an order dismissing the appeal.
49.29 	Submission of a written statement shall not constitute an
49.30 	appearance and participation at an evidentiary hearing for
49.31 	purposes of this paragraph.
49.32 	All involved parties must be notified of this paragraph
49.33 	with the notice of appeal and notice of hearing provided for
49.34 	under subdivision 1.  The senior unemployment review judge shall
49.35 	allow for the submission of a written argument on the issue of
49.36 	good cause before dismissing an appeal under this paragraph.
50.1 	"Good cause" for purposes of this paragraph is a compelling
50.2 	reason that would have prevented a reasonable person acting with
50.3 	due diligence from appearing and participating at the
50.4 	evidentiary hearing.
50.5 	(c) The senior unemployment review judge shall send to any
50.6 	involved party the order issued under this subdivision.  The
50.7 	order may be sent by mail or electronic transmission.  Unless
50.8 	judicial review is sought under subdivision 7, the order of a
50.9 	senior unemployment review judge becomes final 30 calendar days
50.10 	after sending.[REQUEST FOR RECONSIDERATION.] (a) Any involved
50.11 	applicant, involved employer, or the commissioner may, within 30
50.12 	calendar days of the sending of the unemployment law judge's
50.13 	decision under subdivision 1, file a request for reconsideration
50.14 	asking the unemployment law judge to reconsider that decision.
50.15 	Section 268.103 shall apply to a request for reconsideration.
50.16 	If a request for reconsideration is timely filed, the
50.17 	unemployment law judge shall issue an order:
50.18 	(1) modifying the findings of fact and decision issued
50.19 	under subdivision 1;
50.20 	(2) setting aside the findings of fact and decision issued
50.21 	under subdivision 1 and directing that an additional evidentiary
50.22 	hearing be conducted under subdivision 1; or 
50.23 	(3) affirming the findings of fact and decision issued
50.24 	under subdivision 1.
50.25 	(b) Upon a timely request for reconsideration having been
50.26 	filed, the department shall send a notice, by mail or electronic
50.27 	transmission, to all involved parties that a request for
50.28 	reconsideration has been filed.  The notice shall inform the
50.29 	involved parties:
50.30 	(1) of the opportunity to provide comment on the request
50.31 	for reconsideration, and the right under subdivision 5 to obtain
50.32 	a copy of any recorded testimony and exhibits offered or
50.33 	received into evidence at the evidentiary hearing;
50.34 	(2) that providing specific comments as to a perceived
50.35 	factual or legal error in the decision, or a perceived error in
50.36 	procedure during the evidentiary hearing, will assist the
51.1 	unemployment law judge in deciding the request for
51.2 	reconsideration;
51.3 	(3) of the right to obtain any comments and submissions
51.4 	provided by the other involved party regarding the request for
51.5 	reconsideration; and 
51.6 	(4) of the provisions of paragraph (c) regarding additional
51.7 	evidence.
51.8 	This paragraph shall not apply if paragraph (d) is applicable.
51.9 	(c) In deciding a request for reconsideration, the
51.10 	unemployment law judge shall not, except for purposes of
51.11 	determining whether to order an additional evidentiary hearing,
51.12 	consider any evidence that was not submitted at the evidentiary
51.13 	hearing conducted under subdivision 1.
51.14 	The unemployment law judge must order an additional
51.15 	evidentiary hearing if an involved party shows that evidence
51.16 	which was not submitted at the evidentiary hearing:  (1) would
51.17 	likely change the outcome of the decision and there was good
51.18 	cause for not having previously submitted that evidence; or (2)
51.19 	would show that the evidence that was submitted at the
51.20 	evidentiary hearing was likely false and that the likely false
51.21 	evidence had an effect on the outcome of the decision.
51.22 	(d) If the involved applicant or involved employer who
51.23 	filed the request for reconsideration failed to participate in
51.24 	the evidentiary hearing conducted under subdivision 1, an order
51.25 	setting aside the findings of fact and decision and directing
51.26 	that an additional evidentiary hearing be conducted must be
51.27 	issued if the party who failed to participate had good cause for
51.28 	failing to do so.  In the notice of the request for
51.29 	reconsideration, the party who failed to participate shall be
51.30 	informed of the requirement, and provided the opportunity, to
51.31 	show good cause for failing to participate.  If the unemployment
51.32 	law judge determines that good cause for failure to participate
51.33 	has not been shown, the unemployment law judge must state that
51.34 	in the order issued under paragraph (a).
51.35 	Submission of a written statement at the evidentiary
51.36 	hearing under subdivision 1 shall not constitute participation
52.1 	for purposes of this paragraph.
52.2 	All involved parties must be informed of this paragraph
52.3 	with the notice of appeal and notice of hearing provided for in
52.4 	subdivision 1.
52.5 	"Good cause" for purposes of this paragraph is a reason
52.6 	that would have prevented a reasonable person acting with due
52.7 	diligence from participating at the evidentiary hearing.
52.8 	(e) A request for reconsideration shall be decided by the
52.9 	unemployment law judge who issued the findings of fact and
52.10 	decision under subdivision 1 unless that unemployment law
52.11 	judge:  (1) is no longer employed by the department; (2) is on
52.12 	an extended or indefinite leave; (3) has been disqualified from
52.13 	the proceedings on the judge's own motion; or (4) has been
52.14 	removed from the proceedings as provided for under subdivision 1
52.15 	or applicable rule.
52.16 	(f) The unemployment law judge shall send to any involved
52.17 	applicant or involved employer, by mail or electronic
52.18 	transmission, the order issued under this subdivision.  An order
52.19 	modifying the previously issued findings of fact and decision or
52.20 	an order affirming the previously issued findings of fact and
52.21 	decision shall be the final department decision on the matter
52.22 	and shall be final and binding on the involved applicant and
52.23 	involved employer unless judicial review is sought under
52.24 	subdivision 7.
52.25 		Subd. 3.Withdrawal of appeal. (a) Any appeal that is
52.26 	pending before an unemployment law judge or a senior
52.27 	unemployment review judge may be withdrawn by the appealing
52.28 	person, or an authorized representative of that person, upon
52.29 	filing of a notice of withdrawal.
52.30 	(b) The appeal shall, by order, be dismissed if a notice of
52.31 	withdrawal is filed, unless an unemployment law judge or a
52.32 	senior unemployment review judge, by order,directs that further
52.33 	adjudication is required for a proper result.
52.34 	(c) A notice of withdrawal may be filed by mail or by
52.35 	electronic transmission.
52.36 		Subd. 3a.Decisions. (a) If an unemployment law judge's
53.1 	decision or a senior unemployment review judge's decision or
53.2 	order allows unemployment benefits to an applicant, the
53.3 	unemployment benefits shall be paid regardless of any appeal
53.4 	period request for reconsideration or any appeal to the
53.5 	Minnesota Court of Appeals having been filed.
53.6 	(b) If an unemployment law judge's decision or order 
53.7 	modifies or reverses a determination, or prior decision of the
53.8 	unemployment law judge,allowing unemployment benefits to an
53.9 	applicant, any benefits paid pursuant to the determination, or
53.10 	prior decision of the unemployment law judge,is considered an
53.11 	overpayment of those unemployment benefits under section 268.18,
53.12 	subdivision 1.
53.13 	(c) If a senior unemployment review judge's decision
53.14 	modifies or reverses an unemployment law judge's decision
53.15 	allowing unemployment benefits to an applicant, any unemployment
53.16 	benefits paid pursuant to the unemployment law judge's decision
53.17 	is considered an overpayment of those unemployment benefits
53.18 	under section 268.18, subdivision 1.
53.19 	(d) If a senior unemployment review judge affirms an
53.20 	unemployment law judge's decision on an issue of
53.21 	disqualification that order under subdivision 2 allows
53.22 	unemployment benefits to an applicant under section 268.095
53.23 	because of a quit or discharge and the senior unemployment
53.24 	review law judge's decision or order is reversed by the
53.25 	Minnesota Court of Appeals or the Supreme Court of
53.26 	Minnesota, any unemployment benefits paid the applicant shall
53.27 	not be disqualified from considered an overpayment of those 
53.28 	unemployment benefits under section 268.095 268.18,
53.29 	subdivision 10 1.
53.30 	(e) (d) If a senior an unemployment review law judge,
53.31 	pursuant to subdivision 2, remands a matter to an unemployment
53.32 	law judge for orders the taking of additional evidence,
53.33 	the prior unemployment law judge's prior decision shall continue
53.34 	to be enforced until new findings of fact and decision are made
53.35 	by an the unemployment law judge.
53.36 		Subd. 4.Testimonial powers. An unemployment law
54.1 	judge and a senior unemployment review judge may administer
54.2 	oaths and affirmations, take depositions, and issue subpoenas to
54.3 	compel the attendance of witnesses and the production of
54.4 	documents and other personal property considered necessary as
54.5 	evidence in connection with the subject matter of an evidentiary
54.6 	hearing.  The subpoenas shall be enforceable through the
54.7 	district court in the district that the subpoena is issued.
54.8 	Witnesses subpoenaed, other than an involved applicant or
54.9 	involved employer or officers and employees of an involved
54.10 	employer, shall be paid by the department the same witness fees
54.11 	as in a civil action in district court.
54.12 		Subd. 5.Use of evidence; data privacy. (a) All
54.13 	testimony at any evidentiary hearing conducted pursuant to
54.14 	subdivision 1 shall be recorded.  A copy of any recorded
54.15 	testimony and exhibits offered or received into evidence at the
54.16 	hearing shall, upon request, or upon directive of a senior
54.17 	unemployment review judge,be furnished to a party at no cost
54.18 	during the time period for filing an appeal to a senior
54.19 	unemployment review judge a request for reconsideration or while
54.20 	such an appeal a request for reconsideration is pending. If
54.21 	requested, the department shall make available a device for
54.22 	listening to the recording if an appeal is pending before a
54.23 	senior unemployment review judge under subdivision 2.
54.24 	(b) Regardless of any provision of law to the contrary, if
54.25 	recorded testimony and exhibits received into evidence at the
54.26 	evidentiary hearing are not requested during the time period for
54.27 	filing an appeal to a senior unemployment review judge a request
54.28 	for reconsideration, or while such an appeal a request for
54.29 	reconsideration is pending, that testimony and other evidence
54.30 	shall later be made available to an involved party only pursuant
54.31 	to a district court order.  A subpoena shall not be considered a
54.32 	district court order.
54.33 	(c) Testimony obtained under subdivision 1, may not be used
54.34 	or considered for any purpose, including impeachment, in any
54.35 	civil, administrative, or contractual proceeding, except by a
54.36 	local, state, or federal human rights agency with enforcement
55.1 	powers, unless the proceeding is initiated by the department.
55.2 		Subd. 5a.No collateral estoppel. No findings of fact or
55.3 	decision or order issued by an unemployment law judge or a
55.4 	senior unemployment review judge may be held conclusive or
55.5 	binding or used as evidence in any separate or subsequent action
55.6 	in any other forum, be it contractual, administrative, or
55.7 	judicial, except proceedings provided for under this chapter,
55.8 	regardless of whether the action involves the same or related
55.9 	parties or involves the same facts.
55.10 		Subd. 6.Representation; fees. (a) In any proceeding
55.11 	under subdivision 1,or 2, or 2a, an applicant or involved
55.12 	employer may be represented by any agent.
55.13 	(b) Except for services provided by an attorney-at-law, an
55.14 	applicant shall not be charged fees, costs, or disbursements of
55.15 	any kind in a proceeding before an unemployment law judge, a
55.16 	senior unemployment review judge,the Minnesota Court of
55.17 	Appeals, or the Supreme Court of Minnesota.
55.18 		Subd. 7.Judicial review. (a) The Minnesota Court of
55.19 	Appeals shall, by writ of certiorari to the department, review
55.20 	the senior unemployment review law judge's decision under
55.21 	subdivision 2 or order under subdivision 2a, provided a petition
55.22 	for the writ is filed with the court and a copy is served upon
55.23 	the senior unemployment review law judge or the commissioner and
55.24 	any other involved party within 30 calendar days of the sending
55.25 	of the senior unemployment review law judge's decision under
55.26 	subdivision 2 or order under subdivision 2a 2.
55.27 	(b) Any employer petitioning for a writ of certiorari shall
55.28 	pay to the court the required filing fee and upon the service of
55.29 	the writ shall furnish a cost bond to the department in
55.30 	accordance with the Rules of Civil Appellate Procedure.  If the
55.31 	employer requests a written transcript of the testimony received
55.32 	at the evidentiary hearing conducted pursuant to subdivision 1,
55.33 	the employer shall pay to the department the cost of preparing
55.34 	the transcript.  That money shall be credited to the
55.35 	administration account.
55.36 	(c) Upon issuance by the Minnesota Court of Appeals of a
56.1 	writ of certiorari as a result of an applicant's petition, the
56.2 	department shall furnish to the applicant at no cost a written
56.3 	transcript of any testimony received at the evidentiary hearing
56.4 	conducted pursuant to subdivision 1, and, if requested, a copy
56.5 	of all exhibits entered into evidence.  No filing fee or cost
56.6 	bond shall be required of an applicant petitioning the Minnesota
56.7 	Court of Appeals for a writ of certiorari.
56.8 	(d) The Minnesota Court of Appeals may affirm the decision
56.9 	of the unemployment law judge or remand the case for further
56.10 	proceedings; or it may reverse or modify the decision if the
56.11 	substantial rights of the petitioner may have been prejudiced
56.12 	because the findings, inferences, conclusion, or decision are:
56.13 	(1) in violation of constitutional provisions;
56.14 	(2) in excess of the statutory authority or jurisdiction of
56.15 	the department;
56.16 	(3) made upon unlawful procedure;
56.17 	(4) affected by other error of law;
56.18 	(5) unsupported by substantial evidence in view of the
56.19 	entire record as submitted; or 
56.20 	(6) arbitrary or capricious.
56.21 	(e) The department shall be considered the primary
56.22 	responding party to any judicial action involving a senior an 
56.23 	unemployment review law judge's decision or order.  The
56.24 	department may be represented by an attorney who is an employee
56.25 	of the department.
56.26 	
EFFECTIVE DATE. This section applies to unemployment law
56.27 	judge decisions issued on or after 30 days following final
56.28 	enactment of this act.

56.29 	Sec. 35. Minnesota Statutes 2004, section 268.145,
56.30 	subdivision 1, is amended to read:
56.31 		Subdivision 1.Notification.  (a) Upon filing an
56.32 	application for unemployment benefits, the applicant shall be
56.33 	informed that:
56.34 	(1) unemployment benefits are subject to federal and state
56.35 	income tax;
56.36 	(2) there are requirements for filing estimated tax
57.1 	payments;
57.2 	(3) the applicant may elect to have federal income tax
57.3 	withheld from unemployment benefits;
57.4 	(4) if the applicant elects to have federal income tax
57.5 	withheld, the applicant may, in addition, elect to have
57.6 	Minnesota state income tax withheld; and
57.7 	(5) at any time during the benefit year the applicant may
57.8 	change a prior election.
57.9 	(b) If an applicant elects to have federal income tax
57.10 	withheld, the commissioner shall deduct ten percent for federal
57.11 	income tax, rounded down to the next lower whole dollar. If an
57.12 	applicant also elects to have Minnesota state income tax
57.13 	withheld, the commissioner shall make an additional five percent
57.14 	deduction for state income tax, rounded down to the next lower
57.15 	whole dollar.  Any amounts deducted or offset pursuant to
57.16 	sections 268.155, 268.156,268.18, and 268.184 have priority
57.17 	over any amounts deducted under this section.  Federal income
57.18 	tax withholding has priority over state income tax withholding.
57.19 	(c) An election to have income tax withheld shall not be
57.20 	retroactive and shall only apply to unemployment benefits paid
57.21 	after the election.

57.22 	Sec. 36. Minnesota Statutes 2004, section 268.18,
57.23 	subdivision 1, is amended to read:
57.24 		Subdivision 1.Nonfraud overpayment.  (a) Any applicant
57.25 	who (1) by reason of the applicant's own mistake, or (2) because
57.26 	of an error by any employee of the department, or (3) because of
57.27 	a determination or amended determination issued pursuant to
57.28 	section 268.07 or 268.101, or (4) because of an appeal decision
57.29 	under section 268.105, has received any unemployment benefits
57.30 	that the applicant was not entitled to, shall promptly repay the
57.31 	unemployment benefits to the trust fund. The commissioner shall,
57.32 	as soon as the overpayment is discovered, determine the amount
57.33 	due and notify the applicant to repay the unemployment benefits.
57.34 	(b) Unless the applicant files an appeal within 30 calendar
57.35 	days after the sending of the determination of overpayment to
57.36 	the applicant by mail or electronic transmission, the
58.1 	determination shall become final.  Proceedings on the appeal
58.2 	shall be conducted in accordance with section 268.105.  An
58.3 	applicant may not collaterally attack, by way of an appeal to an
58.4 	overpayment determination, any prior determination issued
58.5 	pursuant to section 268.07 or 268.101, or decision issued
58.6 	pursuant to section 268.105, that has become final.
58.7 	(c) If the applicant fails to repay the unemployment
58.8 	benefits determined overpaid under this subdivision, the
58.9 	commissioner may offset from any future unemployment benefits
58.10 	otherwise payable the amount of the overpayment.  Except when
58.11 	the overpayment resulted because the applicant failed to report
58.12 	deductible earnings or deductible or benefit delaying payments,
58.13 	no single offset shall exceed 50 percent of the amount of the
58.14 	payment from which the offset is made.  The overpayment may also
58.15 	be collected by the same methods as delinquent payments from an
58.16 	employer.  A determination of overpayment shall state the
58.17 	methods of collection the commissioner may use to recover the
58.18 	overpayment.
58.19 	(d) If an applicant has been overpaid unemployment benefits
58.20 	under the law of another state, due to a reason other than
58.21 	fraud, and that state certifies that the applicant is liable
58.22 	under its law to repay the unemployment benefits and requests
58.23 	the commissioner to recover the overpayment, the commissioner
58.24 	may offset from future unemployment benefits otherwise payable
58.25 	the amount of overpayment, except that no single offset shall
58.26 	exceed 50 percent of the amount of the payment from which the
58.27 	offset is made.
58.28 	(e) If under paragraph (c) or (d) the reduced unemployment
58.29 	benefits as a result of a 50 percent offset is not a whole
58.30 	dollar amount, it shall be rounded down to the next lower whole
58.31 	dollar.
58.32 	(f) Unemployment benefits paid for weeks more than three
58.33 	years prior to the discovery date of a determination of
58.34 	overpayment issued under this subdivision are shall not be
58.35 	considered overpaid unemployment benefits.

58.36 	Sec. 37. Minnesota Statutes 2004, section 268.18,
59.1 	subdivision 2, is amended to read:
59.2 		Subd. 2.Overpayment due to fraud.  (a) Any applicant who
59.3 	receives unemployment benefits by knowingly misrepresenting,
59.4 	misstating, or failing to disclose any material fact, or who
59.5 	makes a false statement or representation without a good faith
59.6 	belief as to the correctness of the statement or representation,
59.7 	has committed fraud.  After the discovery of facts indicating
59.8 	fraud, the commissioner shall make a determination that the
59.9 	applicant obtained unemployment benefits by fraud and that the
59.10 	applicant must promptly repay the unemployment benefits to the
59.11 	trust fund.  In addition, the commissioner shall assess a
59.12 	penalty equal to 25 percent of the amount fraudulently
59.13 	obtained.  If the applicant had a prior overpayment due to
59.14 	fraud, the commissioner shall, on the present overpayment,
59.15 	assess a penalty equal to 50 percent of the amount fraudulently
59.16 	obtained.  This penalty is in addition to penalties under
59.17 	section 268.182.
59.18 	(b) Unless the applicant files an appeal within 30 calendar
59.19 	days after the sending of the determination of overpayment by
59.20 	fraud to the applicant by mail or electronic transmission, the
59.21 	determination shall become final.  Proceedings on the appeal
59.22 	shall be conducted in accordance with section 268.105.
59.23 	(c) If the applicant fails to repay the unemployment
59.24 	benefits, penalty, and interest assessed, the commissioner shall
59.25 	offset from future unemployment benefits otherwise payable the
59.26 	total amount due.  The total due may also be collected by the
59.27 	same methods as delinquent payments from an employer.  A
59.28 	determination of overpayment by fraud shall state the methods of
59.29 	collection the commissioner may use to recover the overpayment.
59.30 	Money received in repayment of fraudulently obtained
59.31 	unemployment benefits, penalties, and interest shall first be
59.32 	applied to the unemployment benefits overpaid, then to the
59.33 	penalty amount due, then to any interest due.  Payments made
59.34 	toward the penalty and interest shall be credited to the
59.35 	contingent account.
59.36 	(d) If an applicant has been overpaid unemployment benefits
60.1 	under the law of another state because of fraud and that state
60.2 	certifies that the applicant is liable to repay the unemployment
60.3 	benefits and requests the commissioner to recover the
60.4 	overpayment, the commissioner may offset from future
60.5 	unemployment benefits otherwise payable the amount of
60.6 	overpayment.
60.7 	(e) Unemployment benefits paid for weeks more than four
60.8 	years prior to the date of a determination of overpayment by
60.9 	fraud may only be made within four years of the effective date
60.10 	of the benefit account from which the issued under this
60.11 	subdivision shall not be considered overpaid unemployment
60.12 	benefits were fraudulently obtained.

60.13 	Sec. 38. Minnesota Statutes 2004, section 268.18,
60.14 	subdivision 2b, is amended to read:
60.15 		Subd. 2b.Interest.  (a) On any unemployment benefits
60.16 	fraudulently obtained, and any penalty amounts assessed under
60.17 	subdivision 2, the commissioner may assess interest at the rate
60.18 	of 1-1/2 percent per month on any amount that remains unpaid 30
60.19 	calendar days after the date of the determination of overpayment
60.20 	by fraud.  A determination of overpayment by fraud shall state
60.21 	that interest shall be assessed.
60.22 	(b) If this subdivision became effective after the date of
60.23 	the determination, or the determination did not state that
60.24 	interest shall be assessed, interest shall be assessed beginning
60.25 	30 calendar days after notification, by mail or electronic
60.26 	transmission, to the applicant.
60.27 	(c) Interest payments under this section shall be credited
60.28 	to the administration account.

60.29 	Sec. 39. Minnesota Statutes 2004, section 268.182,
60.30 	subdivision 2, is amended to read:
60.31 		Subd. 2.Administrative penalties.  Any individual 
60.32 	applicant who knowingly makes a false statement or
60.33 	representation, who knowingly fails to disclose a material fact,
60.34 	or who makes a false statement or representation without a good
60.35 	faith belief as to the correctness of the statement or
60.36 	representation, in order to obtain or in an attempt to obtain
61.1 	unemployment benefits may be assessed, in addition to any other
61.2 	penalties, an administrative penalty of denial of being
61.3 	ineligible for unemployment benefits for one to 52 13 to 104 
61.4 	weeks that the individual would otherwise be entitled to
61.5 	unemployment benefits.  A denial shall not apply to any week
61.6 	more than two years after the week that the penalty was
61.7 	determined.  A determination of denial ineligibility setting out
61.8 	the weeks the applicant shall be ineligible shall be sent to the
61.9 	individual applicant by mail or electronic transmission.  Unless
61.10 	an appeal is filed within 30 calendar days of sending, the
61.11 	determination shall be final.  Proceeding on the appeal shall be
61.12 	conducted in accordance with section 268.105.

61.13 	Sec. 40. TAX RATE COMPUTATION.
 61.14 	Notwithstanding any provision of Minnesota Statutes,
61.15 	chapter 268, to the contrary, the commissioner may compute, to
61.16 	the nearest 1/100 of a percent, any unemployment tax rate
61.17 	assigned on or after July 1, 2005, regardless of the year or
61.18 	portion of any year for which the tax rate is applicable.

61.19 	Sec. 41. REVISOR'S INSTRUCTION.
 61.20 	(a) The revisor of statutes shall change the name of the
61.21 	Department of Economic Security to the Department of Employment
61.22 	and Economic Development in Minnesota Statutes and Minnesota
61.23 	Rules.
61.24 	(b) The revisor of statutes shall change the headnote for
61.25 	Minnesota Statutes, section 268.095 from "DISQUALIFICATION
61.26 	PROVISIONS" to "DISQUALIFICATION BECAUSE OF A QUIT OR DISCHARGE." 
61.27 	(c) The revisor of statutes shall change the headnote for
61.28 	Minnesota Statutes, section 268.101 from "DETERMINATIONS ON
61.29 	DISQUALIFICATION AND ELIGIBILITY" to "DETERMINATIONS ON ISSUES
61.30 	OF DISQUALIFICATION AND ELIGIBILITY." 
61.31 	(d) The revisor of statutes shall renumber Minnesota
61.32 	Statutes, section 268.095, subdivision 8, as section 268.085,
61.33 	subdivision 13c, and correct cross-references accordingly.
61.34 	(e) The revisor of statutes shall change the term "court
61.35 	order" to "district court order" wherever the term appears in
61.36 	Minnesota Statutes, sections 268.01 to 268.83.

62.1 	Sec. 42. REPEALER.
 62.2 	(a) Minnesota Rules, parts 3310.2926; 3310.5000; 3315.0910,
62.3 	subpart 9; 3315.1301; 3315.1315, subparts 1, 2, and 3;
62.4 	3315.1650; and 3315.2210, are repealed.
62.5 	(b) Minnesota Statutes 2004, section 268.086, subdivision
62.6 	4, is repealed.
62.7 	(c) Laws 1997, chapter 66, section 64, subdivision 1, is
62.8 	repealed.

62.9 	Sec. 43. EFFECTIVE DATE.
 62.10 	Sections 1 to 33, 35 to 40, and 42 are effective July 1,
62.11 	2005.  Section 41 is effective the day following final enactment.