Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 2005, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 112-H.F.No. 898
An act relating to unemployment insurance; conforming
various provisions to federal requirements; making
technical and housekeeping changes; modifying appeal
procedures; amending Minnesota Statutes 2004, sections
268.03, subdivision 1; 268.035, subdivisions 9, 13,
14, 20, 21, 26; 268.042, subdivision 1; 268.043;
268.044, subdivisions 1, 2, 3; 268.045, subdivision 1;
268.051, subdivisions 1, 4, 6, 7, by adding a
subdivision; 268.052, subdivision 2; 268.053,
subdivision 1; 268.057, subdivision 7; 268.065,
subdivision 2; 268.069, subdivision 1; 268.07,
subdivision 3b; 268.085, subdivisions 1, 2, 3, 5, 12;
268.086, subdivisions 2, 3; 268.095, subdivisions 1,
4, 7, 8, 10, 11; 268.101, subdivisions 1, 2, 3a;
268.103, subdivision 2; 268.105; 268.145, subdivision
1; 268.18, subdivisions 1, 2, 2b; 268.182, subdivision
2; 268.184, subdivisions 1, 2, by adding a
subdivision; proposing coding for new law in Minnesota
Statutes, chapter 268; repealing Minnesota Statutes
2004, sections 268.045, subdivisions 2, 3, 4; 268.086,
subdivision 4; Laws 1997, chapter 66, section 64,
subdivision 1; Minnesota Rules, parts 3310.2926;
3310.5000; 3315.0910, subpart 9; 3315.1020; 3315.1301;
3315.1315, subparts 1, 2, 3; 3315.1650; 3315.2210;
3315.3210; 3315.3220.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
FEDERAL CONFORMITY PROVISIONS
Section 1. [268.0435] [SINGLE MEMBER LIMITED LIABILITY
COMPANIES.]
If the only member of a limited liability company is a
corporation, and the limited liability company is disregarded
for purposes of filing federal corporate income tax, all the
workers performing services for the limited liability company
must be reported on the corporation's wage detail report under
section 268.044. A corporation that violates this section shall
be subject to the penalties under section 268.184, subdivision
1a. Penalties shall be credited to the administration account
to be used to ensure integrity in the unemployment insurance
program.
[EFFECTIVE DATE.] This section is effective for wage detail
reports for the calendar quarter starting January 1, 2006.
Sec. 2. Minnesota Statutes 2004, section 268.044,
subdivision 1, is amended to read:
Subdivision 1. [WAGE DETAIL REPORT.] (a) Each employer
that has employees in covered employment shall submit, under the
account provided for in section 268.045 or 268.046, a quarterly
wage detail report by electronic transmission, in a format
prescribed by the commissioner. The report shall include for
each employee in covered employment, the employee's name, Social
Security number, the total wages paid to the employee, and total
number of paid hours worked. For employees exempt from the
definition of employee in section 177.23, subdivision 7, clause
(6), the employer shall report 40 hours worked for each week any
duties were performed by a full-time employee and shall report a
reasonable estimate of the hours worked for each week duties
were performed by a part-time employee. In addition, the wage
detail report shall include the number of employees employed on
the 12th day of each calendar month and, if required by the
commissioner, the report shall be broken down by business
location and type of employment, if section 268.046, subdivision
1, paragraph (b), or subdivision 2, paragraph (b), applies, by
separate unit. If the information required is not submitted in
a manner and format prescribed by the commissioner, it shall not
be considered a wage detail report. The report is due and must
be received by the commissioner on or before the last day of the
month following the end of the calendar quarter. The
commissioner may delay the due date on a specific calendar
quarter in the event the department is unable to accept wage
detail reports electronically.
(b) The employer may report the wages paid to the next
lower whole dollar amount.
(c) An employer need not include the name of the employee
or other required information on the wage detail report if
disclosure is specifically exempted from being reported by
federal law.
(d) A wage detail report must be submitted for each
calendar quarter even though no wages were paid, unless the
employer has notified the commissioner, under section 268.042,
subdivision 1, paragraph (c), of termination of business.
Sec. 3. Minnesota Statutes 2004, section 268.044,
subdivision 3, is amended to read:
Subd. 3. [MISSING OR ERRONEOUS INFORMATION.] (a) Any
employer who that submits the wage detail report, but fails to
include any all employee information or enters erroneous
information, shall be subject to an administrative service fee
of $25 for each employee for whom the information is partially
missing or erroneous.
(b) Any employer that submits the wage detail report, but
fails to include an employee, shall be subject to an
administrative service penalty equal to two percent of the total
wages for each employee for whom the information is completely
missing.
(c) An administrative service fee may be compromised under
section 268.067 or penalty under this subdivision shall be
canceled if the commissioner determines that the failure or
error by the employer was inadvertent occurred because of
ignorance or inadvertence.
Sec. 4. Minnesota Statutes 2004, section 268.045,
subdivision 1, is amended to read:
Subdivision 1. [ACCOUNT FOR EACH EMPLOYER.] The
commissioner shall maintain (1) a tax account for each taxpaying
employer and (2) a reimbursable account for each nonprofit or
government employer that has elected under section 268.052 or
268.053 to be liable for reimbursements if that employer has
employees in covered employment in the current or the prior
calendar year, except as provided in this section 268.046. The
commissioner shall assess the tax account of a taxpaying
employer for all the taxes due under section 268.051 and credit
the tax account with all taxes paid. The commissioner shall
charge the reimbursable account of a nonprofit or government
employer that elects to make reimbursements for any unemployment
benefits determined chargeable to the employer under section
268.047 and shall credit the reimbursable account with the
payments made.
Sec. 5. [268.046] [TAX AND REIMBURSABLE ACCOUNTS ASSIGNED
TO EMPLOYEE LEASING COMPANIES, PROFESSIONAL EMPLOYER
ORGANIZATIONS, OR SIMILAR PERSON.]
Subdivision 1. [TAX ACCOUNTS ASSIGNED.] (a) Any person
that contracts with a taxpaying employer to have that person
obtain the taxpaying employer's workforce and provide workers to
the taxpaying employer for a fee shall, as of the effective date
of the contract, be assigned for the duration of the contract
the taxpaying employer's account under section 268.045. That
tax account must be maintained by the person separate and
distinct from every other tax account held by the person and
identified in a manner prescribed by the commissioner. The tax
account shall, for the duration of the contract, be considered
that person's account for all purposes of this chapter. The
workers obtained from the taxpaying employer and any other
workers provided by that person to the taxpaying employer must,
under section 268.044, be reported on the wage detail report
under that tax account, and that person shall pay any taxes due
at the tax rate computed for that account under section 268.051,
subdivision 2.
(b) Any workers of the taxpaying employer who are not
covered by the contract under paragraph (a) must be reported by
the taxpaying employer as a separate unit on the wage detail
report under the tax account assigned under paragraph (a).
Taxes and any other amounts due on the wages reported by the
taxpaying employer under this paragraph may be paid directly by
the taxpaying employer.
(c) If the taxpaying employer that contracts with a person
under paragraph (a) does not have a tax account at the time of
the execution of the contract, an account must be registered for
the taxpaying employer under section 268.042, and the new
employer tax rate under section 268.051, subdivision 5, must be
assigned. The tax account shall then be assigned to the person
as provided for in paragraph (a).
(d) A person that contracts with a taxpaying employer under
paragraph (a) must, within 30 calendar days of the execution or
termination of a contract, notify the commissioner by electronic
transmission, in a format prescribed by the commissioner, of
that execution or termination. The taxpaying employer's name,
the account number assigned, and any other information required
by the commissioner must be provided by that person.
(e) Any contract subject to paragraph (a) must specifically
inform the taxpaying employer of the assignment of the tax
account under this section and the taxpaying employer's
obligation under paragraph (b). If there is a termination of
the contract, the tax account shall, as of the date of
termination, immediately be assigned to the taxpaying employer.
Subd. 2. [NONPROFIT AND GOVERNMENT REIMBURSABLE ACCOUNTS
ASSIGNED.] (a) Any person that contracts with a nonprofit or
government employer that is a reimbursing employer to have that
person obtain the nonprofit or government employer's workforce
and provide workers to the nonprofit or government employer for
a fee, shall, as of the effective date of the contract, be
assigned for the duration of the contract the nonprofit or
government employer's account under section 268.045. That
reimbursable account must be maintained by the person separate
and distinct from every other account held by the person and
identified in a manner prescribed by the commissioner. That
reimbursable account shall, for the duration of the contract, be
considered that person's account for all purposes of this
chapter. The workers obtained from the nonprofit or government
employer and any other workers provided by that person to the
nonprofit or government employer must, under section 268.044, be
reported on the wage detail report under that reimbursable
account, and that person shall pay any reimbursements due.
(b) Any workers of the nonprofit or government employer who
are not covered by the contract under paragraph (a) must be
reported by the nonprofit or government employer as a separate
unit on the wage detail report under the reimbursable account
assigned under paragraph (a). Reimbursements and any other
amounts due on the wages reported by the nonprofit or government
employer under this paragraph may be paid directly by the
nonprofit or government employer.
(c) If the nonprofit or government employer that contracts
with a person under paragraph (a) does not have an account at
the time of the execution of the contract, an account must be
registered for the nonprofit or government employer under
section 268.042. The reimbursable account shall then be
assigned to the person as provided for in paragraph (a).
(d) A person that contracts with a nonprofit or government
employer under paragraph (a) must, within 30 calendar days of
the execution or termination of a contract, notify the
commissioner of that execution or termination by electronic
transmission, in a format prescribed by the commissioner. The
nonprofit or government employer's name, the account number
assigned, and any other information required by the commissioner
must be provided by that person.
(e) Any contract subject to paragraph (a) must specifically
inform the nonprofit or government employer of the assignment of
the reimbursable account under this section and the nonprofit or
government employer's obligation under paragraph (b). If there
is a termination of the contract, the reimbursable account
shall, as of the date of termination, immediately be assigned to
the nonprofit or government employer.
Subd. 3. [PENALTIES; APPLICATION.] (a) Any person that
violates the requirements of this section and any taxpaying
employer that violates subdivision 1, paragraph (b), or any
nonprofit or government employer that violates subdivision 2,
paragraph (b), shall be subject to the penalties under section
268.184, subdivision 1a. Penalties shall be credited to the
administration account to be used to ensure integrity in the
unemployment insurance program.
(b) Section 268.051, subdivision 4, does not apply to
contracts under this section. This section shall not limit or
prevent the application of section 268.051, subdivision 4, to
any other transactions or acquisitions involving the taxpaying
employer. This section shall not limit or prevent the
application of section 268.051, subdivision 4a.
(c) An assignment of an account upon the execution of a
contract under this section and a termination of a contract with
the corresponding assignment of the account shall not be
considered a separation from employment of any worker covered by
the contract. Nothing under this subdivision shall cause the
person to be liable for any amounts past due under this chapter
from the taxpaying employer or the nonprofit or government
employer.
(d) This section applies to, but is not limited to, persons
registered under section 79.255, but does not apply to persons
that obtain an exemption from registration under section 79.255,
subdivision 9.
[EFFECTIVE DATE.] This section applies to all contracts
executed on and after January 1, 2006.
Sec. 6. Minnesota Statutes 2004, section 268.051,
subdivision 1, is amended to read:
Subdivision 1. [PAYMENTS.] (a) Unemployment insurance
taxes and any additional assessments, fees, or surcharges shall
accrue and become payable by each employer for each calendar
year on the taxable wages that the employer paid to employees in
covered employment, except for:
(1) nonprofit organizations that elect to make
reimbursements as provided in section 268.053; and
(2) the state of Minnesota and political subdivisions that
make reimbursements, unless they elect to pay taxes as provided
in section 268.052.
Except as allowed under section 268.0511, each employer
shall pay taxes quarterly, at the employer's assigned tax
rate under subdivision 6, on the taxable wages paid to each
employee. The commissioner shall compute the tax due from the
wage detail report required under section 268.044 and notify the
employer of the tax due. The taxes and any additional
assessments, fees, or surcharges shall be paid to the trust fund
and must be received by the department on or before the last day
of the month following the end of the calendar quarter.
(b) The tax amount computed, if not a whole dollar, shall
be rounded down to the next lower whole dollar.
(c) If for any reason the wages on the wage detail report
under section 268.044 are adjusted for any quarter, the
commissioner shall recompute the taxes due for that quarter and
assess the employer for any amount due or credit the employer as
appropriate.
Sec. 7. Minnesota Statutes 2004, section 268.051,
subdivision 4, is amended to read:
Subd. 4. [EXPERIENCE RATING HISTORY TRANSFER.] (a) When:
(1) a taxpaying employer acquires all of the organization,
trade or business, or substantially all the assets workforce of
another taxpaying employer,; and
(2) there is 25 percent or more common ownership, directly
or indirectly, or there is substantially common management or
control between the predecessor and successor, the experience
rating history of the predecessor employer shall be transferred
as of the date of acquisition to the successor employer for the
purpose of computing a tax rate.
(b) When a taxpaying employer acquires a distinct severable
portion of the organization, trade, business, or assets that is
less than substantially all of the employing enterprises of
another employer, and there is 25 percent or more common
ownership, directly or indirectly, between the predecessor and
successor, the successor employer shall acquire that percentage
of a predecessor's experience rating equal to that percentage of
the predecessor's employment positions it has obtained, and the
predecessor employer shall retain that percentage of the
experience rating equal to that percentage of the employment
positions that it has retained, if the successor files an
application by electronic transmission, in a format prescribed
by the commissioner, for the transfer of a percentage of the
experience rating of the predecessor within 180 calendar days
from the date of acquisition, that furnishes sufficient
information to substantiate the acquisition and to assign the
appropriate percentage of the experience rating. When:
(1) a taxpaying employer acquires a portion, but less than
all, of the organization, trade or business, or workforce of
another taxpaying employer; and
(2) there is 25 percent or more common ownership or there
is substantially common management or control between the
predecessor and successor, the successor employer shall acquire,
as of the date of acquisition, the experience rating history
attributable to the portion it acquired, and the predecessor
employer shall retain the experience rating history attributable
to the portion that it has retained. If the commissioner
determines that sufficient information is not available to
substantiate that a distinct severable portion was acquired and
to assign the appropriate distinct severable portion of the
experience rating history, the commissioner shall assign the
successor employer that percentage of the predecessor employer's
experience rating history equal to that percentage of the
employment positions it has obtained, and the predecessor
employer shall retain that percentage of the experience rating
history equal to the percentage of the employment positions it
has retained.
(c) The term "common ownership" for purposes of this
subdivision includes ownership by a spouse, parent, grandparent,
child, grandchild, brother, sister, aunt, uncle, niece, nephew,
or first cousin, by birth or by marriage.
(d) Each successor employer that is subject to paragraph
(a) or (b) must notify the commissioner of the acquisition by
electronic transmission, in a format prescribed by the
commissioner, within 30 calendar days of the date of
acquisition. Any successor employer that fails to notify the
commissioner is subject to the penalties under section 268.184,
subdivision 1a, if the successor's experience rating was lower
than the predecessor's experience rating at the time of the
acquisition. Penalties shall be credited to the administration
account to be used to ensure integrity in the unemployment
insurance program.
(d) (e) If the successor employer under paragraphs (a) and
(b) had an experience rating at the time of the acquisition, the
transferred experience rating history of the predecessor shall
be combined with the successor's experience rating history, as
of the date of acquisition, for purposes of
computing recomputing a tax rate.
(e) (f) If there has been a transfer of an experience
rating history under paragraph (a) or (b), employment with a
predecessor employer shall not be considered to have been
terminated if similar employment is offered by the successor
employer and accepted by the employee.
(f) (g) The commissioner, upon the commissioner's own
motion or upon application notification of an employer, or upon
the commissioner's own motion if the employer fails to provide
the required notification, shall determine if an employer is a
successor within the meaning of this subdivision and shall send
the determination to the employer by mail or electronic
transmission. The determination shall be final unless a protest
is filed by the employer within 30 calendar days after sending
the determination. Upon receipt of a protest, the commissioner
shall review all available evidence and determine whether an
error has been made. The commissioner shall either affirm or
make a redetermination on whether the employer is a successor
within the meaning of this subdivision and send the employer, by
mail or electronic transmission, the affirmation or
redetermination. The affirmation or redetermination shall be
final unless an appeal is filed by the employer within 30
calendar days after the sending of the affirmation or
redetermination. Proceedings on the appeal shall be conducted
in accordance with section 268.105.
(g) The commissioner may, as the result of any
determination or decision regarding shall, after determining the
issue of succession or nonsuccession, recompute the tax
rate under subdivision 6 of all employers affected by the
determination or decision for any year, including the year of
the acquisition and subsequent years, that is affected by the
transfer or nontransfer of part or all of the experience
rating. This paragraph does not apply to rates that have become
final before the filing of an application for the transfer of a
severable portion of the experience rating under paragraph (b).
The commissioner shall send the recomputed tax rate to all
affected employers by mail or electronic transmission. Any
affected employer may protest the recomputed tax rate in
accordance with the procedures in subdivision 6, paragraph (c).
(h) Should an employer not have been in operation long
enough to qualify for an experience rating under subdivision 3,
paragraph (a), The "experience rating history" for purposes of
this subdivision shall consist of and subdivision 4a means those
factors set out in subdivision 3, paragraph (b), that normally
make up an experience rating, without the 12-month minimum.
For purposes of this chapter, an "acquisition" means
anything that results in the obtaining by the successor
employer, in any way or manner, of the organization, trade or
business, or workforce of the predecessor employer.
A "distinct severable portion" in paragraph (b) means a
location or unit separately identifiable within the employer's
wage detail report under section 268.044.
(i) If the commissioner finds that a transaction was done,
in whole or in part, to avoid an experience rating or the
transfer of an experience rating, the commissioner may transfer
all or part of the experience rating regardless of the
requirements or limitations of paragraphs (a) and (b). This
shall include the transferring of employees from the payroll of
an employer with a higher experience rating to the payroll of an
employer with a lower experience rating.
(j) Regardless of the ownership, management, or control
requirements of paragraph (a), if there is an acquisition or
merger of a publicly held corporation by or with another
publicly held corporation the experience ratings rating
histories of the corporations shall be combined as of the date
of acquisition or merger for the purpose of computing
recomputing a tax rate.
Sec. 8. Minnesota Statutes 2004, section 268.051, is
amended by adding a subdivision to read:
Subd. 4a. [ACTIONS THAT AVOID TAXES.] (a) If the
commissioner determines that any action was done, in whole or in
part, to avoid:
(1) an experience rating history;
(2) the transfer of an experience rating history; or
(3) the assignment of a tax rate for new employers under
subdivision 5, paragraph (a) or (b), the commissioner, to insure
that the trust fund receives all the taxes that would have been
received had the action not occurred, may, effective the date of
the action, transfer all or part of an experience rating history
and recompute the tax rate, or assign the appropriate new
employer tax rate.
(b) This subdivision shall apply to any action between
persons regardless of whether there is any commonality of
ownership, management, or control between the persons. The
authority granted to the commissioner under this subdivision is
in addition to any other authority granted to the commissioner.
Sec. 9. Minnesota Statutes 2004, section 268.051,
subdivision 6, is amended to read:
Subd. 6. [NOTICE OF TAX RATE.] (a) On or before each
December 15, the commissioner shall notify each employer by mail
or electronic transmission of the employer's tax rate, along
with any additional assessments, fees, or surcharges, for the
following calendar year. The notice shall contain the base tax
rate and the factors used in determining the employer's
experience rating. Unless a protest of the tax rate is made,
the computed tax rate shall be final, except for fraud or
recomputation required under subdivision 4 or 4a, and shall be
the rate at which taxes shall be paid. A recomputed tax rate
under subdivision 4 or 4a shall be the rate applicable for the
quarter that includes the date of acquisition and any quarter
thereafter during the calendar year in which the acquisition
occurred. The tax rate shall not be subject to collateral
attack by way of claim for a credit adjustment or refund, or
otherwise.
(b) If the legislature, subsequent to the sending of the
tax rate, changes any of the factors used to determine the rate,
the earlier notice shall be void. a new tax rate based on the
new factors shall be computed and sent to the employer.
(c) A review of an employer's tax rate may be obtained by
the employer filing a protest within 30 calendar days from the
date the tax rate notice was sent to the employer. Upon receipt
of the protest, the commissioner shall review the tax rate to
determine whether or not there has been any error in computation
or assignment of the tax rate. The commissioner shall either
affirm or make a redetermination of the rate and a notice of the
affirmation or redetermination shall be sent to the employer by
mail or electronic transmission. The affirmation or
redetermination shall be final unless the employer files an
appeal within 30 calendar days after the date the affirmation or
redetermination was sent. Proceedings on the appeal shall be
conducted in accordance with section 268.105.
(d) The commissioner may at any time upon the
commissioner's own motion correct any error in the computation
or the assignment of an employer's tax rate.
Sec. 10. Minnesota Statutes 2004, section 268.065,
subdivision 2, is amended to read:
Subd. 2. [EMPLOYEE LEASING FIRMS COMPANY, PROFESSIONAL
EMPLOYER ORGANIZATION, OR SIMILAR PERSON.] (a) A person whose
work force consists of 50 percent or more of workers provided by
an employee leasing firms company, professional employer
organization, or similar person for a fee, is jointly and
severally liable for the unpaid amounts that are due under this
chapter or section 116L.20 on the wages paid on the contract
with the employee leasing firm company, professional employer
organization, or similar person. "Employee leasing firm" means
an employer that provides its employees to other persons without
severing its employer-employee relationship with the worker for
the services performed for the lessee.
(b) This subdivision applies to, but is not limited to,
persons registered under section 79.255, but does not apply to
agreements with persons that obtain an exemption from
registration under section 79.255, subdivision 9.
Sec. 11. Minnesota Statutes 2004, section 268.184,
subdivision 1, is amended to read:
Subdivision 1. [ADMINISTRATIVE PENALTIES.] (a) If the
commissioner finds that any employer or any employee, officer,
or agent of any employer, is in collusion with any applicant for
the purpose of assisting the applicant to receive unemployment
benefits fraudulently, the employer shall be penalized $500 or
the amount of unemployment benefits determined to be overpaid,
whichever is greater.
(b) If the commissioner finds that any employer or any
employee, officer, or agent of an employer has made (1) a false
statement or representation knowing it to be false, including
reporting employees on a wage detail report under section
268.044 knowing the employees actually are employed by a
different employer, or (2) has made a false statement or
representation without a good faith belief as to correctness of
the statement or representation, or (3) who knowingly fails to
disclose a material fact, to prevent or reduce the payment of
unemployment benefits to any applicant or to reduce or avoid any
payment required from an employer under this chapter or section
116L.20, the employer shall be penalized $500, or 50 percent of
the reduced unemployment benefits or payment required, whichever
is greater.
(c) If the commissioner finds that an employer failed or
refused to honor a subpoena issued under section 268.105,
subdivision 4, or section 268.188, the employer shall be
penalized $500 and any costs of enforcing the subpoena,
including attorney fees.
(d) Penalties under this section subdivision shall be in
addition to any other penalties and subject to the same
collection procedures that apply to past due taxes. Penalties
shall be paid to the department within 30 calendar days of
assessment and credited to the contingent account.
(e) The assessment of the penalty shall be final unless the
employer files an appeal within 30 calendar days after the
sending of notice of the penalty to the employer by mail or
electronic transmission. Proceedings on the appeal shall be
conducted in accordance with section 268.105.
Sec. 12. Minnesota Statutes 2004, section 268.184, is
amended by adding a subdivision to read:
Subd. 1a. [NOTIFICATION AND MISREPORTING PENALTIES.] (a)
If the commissioner finds that any employer or agent of an
employer failed to meet the notification requirements of section
268.051, subdivision 4, the employer shall be assessed a penalty
of $5,000 or two percent of the first full quarterly payroll
acquired, whichever is higher. Payroll is wages paid as defined
in section 268.035, subdivision 30. The penalty under this
paragraph shall be canceled if the commissioner determines that
the failure occurred because of ignorance or inadvertence.
(b) If the commissioner finds that any individual advised
an employer to violate the employer's notification requirements
under section 268.051, subdivision 4, the individual, and that
individual's employer, shall each be assessed the penalty in
paragraph (a).
(c) If the commissioner finds that any person or agent of a
person violated the reporting requirements of section 268.0435
or 268.046, the person shall be assessed a penalty of $5,000 or
two percent of the quarterly payroll reported in violation of
section 268.0435 or 268.046, whichever is higher. Payroll is
wages paid as defined in section 268.035, subdivision 30.
(d) Penalties under this subdivision shall be in addition
to any other penalties and subject to the same collection
procedures that apply to past due amounts from an employer.
Penalties must be paid within 30 calendar days after sending of
the notice of penalty.
(e) The assessment of a penalty shall be final unless the
person assessed files an appeal within 30 calendar days after
sending of the notice of the penalty by mail or electronic
transmission. Proceedings on the appeal shall be conducted in
accordance with section 268.105.
Sec. 13. Minnesota Statutes 2004, section 268.184,
subdivision 2, is amended to read:
Subd. 2. [CRIMINAL PENALTIES.] Any employer or any officer
or agent of an employer or any other individual who:
(1) makes a false statement or representation knowing it to
be false, or who;
(2) knowingly fails to disclose a material fact, including
notification required under section 268.051, subdivision 4; or
(3) knowingly advises or assists an employer in violating
clause (1) or (2), to avoid or reduce any payment required from
an employer under this chapter or section 116L.20, or to prevent
or reduce the payment of unemployment benefits to any applicant,
is guilty of a gross misdemeanor unless the underpayment exceeds
$500, in that case the individual is guilty of a felony.
[EFFECTIVE DATE.] This section is effective August 1, 2005,
and applies to crimes committed on or after that date.
Sec. 14. [MANDATORY FEDERAL IMPLEMENTATION REQUIREMENT.]
The commissioner must implement systems and processes to
detect, investigate, and enforce section 268.051, subdivisions 4
and 4a.
Sec. 15. [RELATION TO FEDERAL LAW.]
This article is enacted to meet the requirements of the
Federal SUTA Dumping Prevention Act of 2004, Public Law 108-295,
amending United States Code, title 42, section 503, and shall be
construed, interpreted, and applied consistent with the
requirements of that federal law, including its definitions.
Sec. 16. [REPEALER.]
(a) Minnesota Rules, parts 3315.1020, 3315.3210, and
3315.3220, are repealed.
(b) Minnesota Statutes 2004, section 268.045, subdivisions
2, 3, and 4, are repealed.
Sec. 17. [EFFECTIVE DATE.]
Except for the sections that include a separate effective
date, this article is effective July 1, 2005.
ARTICLE 2
HOUSEKEEPING PROVISIONS
Section 1. Minnesota Statutes 2004, section 268.03,
subdivision 1, is amended to read:
Subdivision 1. [STATEMENT.] The public purpose of sections
268.029 to 268.23 this chapter is: Economic insecurity due to
involuntary unemployment of workers in Minnesota is a subject of
general concern that requires appropriate action by the
legislature. The public good will be promoted by providing
workers who are unemployed through no fault of their own a
temporary partial wage replacement to assist the unemployed
worker to become reemployed. This program will be known as the
"Minnesota unemployment insurance program."
Sec. 2. Minnesota Statutes 2004, section 268.035,
subdivision 9, is amended to read:
Subd. 9. [CONSTRUCTION/INDEPENDENT CONTRACTOR.] A worker
doing commercial or residential building construction or
improvement, in the public or private sector, performing
services in the course of the trade, business, profession, or
occupation of the employer, shall be considered an employee and
not an "independent contractor" unless the worker meets all the
following conditions:
(1) maintains a separate business with the independent
contractor's own office, equipment, materials, and other
facilities;
(2) holds or has applied for a federal employer
identification number or has filed business or self-employment
income tax returns with the federal Internal Revenue Service
based on that work or service in the previous year;
(3) operates under contracts to perform specific services
or work for specific amounts of money under which the
independent contractor controls the means of performing the
services or work;
(4) incurs the main expenses related to the service or work
that the independent contractor performs under contract;
(5) is responsible for the satisfactory completion of work
or services that the independent contractor contracts to perform
and is liable for a failure to complete the work or service;
(6) receives compensation for work or service performed
under a contract on a commission or per job or competitive bid
basis and not on any other basis;
(7) may realize a profit or suffer a loss under contracts
to perform work or service;
(8) has continuing or recurring business liabilities or
obligations; and
(9) the success or failure of the independent contractor's
business depends on the relationship of business receipts to
expenditures.
Sec. 3. Minnesota Statutes 2004, section 268.035,
subdivision 13, is amended to read:
Subd. 13. [EMPLOYEE.] "Employee" means:
(1) every individual, who is performing, or has performed
services for an employer in employment; or
(2) each individual employed to perform or assist in
performing the work of any agent or employee of the employer
shall be considered to be an employee of that employer whether
the individual was hired or paid directly by that employer or by
the agent or employee, provided the employer had actual or
constructive knowledge of the work.
Sec. 4. Minnesota Statutes 2004, section 268.035,
subdivision 14, is amended to read:
Subd. 14. [EMPLOYER.] "Employer" means any of the
following person which has had one or more employees during the
current or the prior calendar year:
(1) any individual or type of organization, resident or
nonresident, for profit or nonprofit, religious, charitable, or
educational, including any partnership, limited liability
company, trust, estate, or corporation, domestic or foreign, or
the receiver, trustee in bankruptcy, trustee or successor of any
of the foregoing, or the legal representative of a deceased
person;
(2) any government entity, state or federal, foreign or
domestic, Indian tribe, including any subdivision thereof and
any instrumentality thereof owned wholly or in part;
(3) including any organization or person that has elected,
under section 268.042, to be subject to the Minnesota
Unemployment Insurance Law; and
(4) a joint venture composed of one or more employers;.
(5) any nonprofit organization or government agency
providing or authorizing the hiring of homeworkers, personal
care attendants, or other individuals performing similar
services in a private home is the employer of the homeworker,
attendant, or similar worker whether the organization or agency
pays the employee directly or provides funds to the recipient of
the services to pay for the services. This clause does not
apply to the state of Minnesota or any county that provides
federal, state, or local funds to a child care provider either
directly or indirectly through a parent who is a child care
assistance recipient; or
(6) each individual employed to perform or assist in
performing the work of any agent or employee shall be considered
to be employed by that employer whether the individual was hired
or paid directly by that employer or by the agent or employee,
provided the employer had actual or constructive knowledge of
the work.
An employee leasing company, professional employer
organization, or similar person, that has been assigned a tax or
reimbursable account under section 268.046 is an employer for
purposes of this chapter.
Sec. 5. Minnesota Statutes 2004, section 268.035,
subdivision 20, is amended to read:
Subd. 20. [NONCOVERED EMPLOYMENT.] "Noncovered employment"
means:
(1) employment for the United States government or an
instrumentality thereof, including military service;
(2) employment for a state, other than Minnesota, or a
political subdivision or instrumentality thereof;
(3) employment for a foreign government;
(4) employment for an instrumentality wholly owned by a
foreign government, if the employment is of a character similar
to that performed in foreign countries by employees of the
United States government or an instrumentality thereof and the
United States Secretary of State has certified that the foreign
government grants an equivalent exemption to similar employment
performed in the foreign country by employees of the United
States government and instrumentalities thereof;
(5) employment covered under United States Code, title 45,
section 351, the Railroad Unemployment Insurance Act;
(6) employment covered by a reciprocal arrangement between
the commissioner and another state or the federal government
which provides that all employment performed by an individual
for an employer during the period covered by the reciprocal
arrangement is considered performed entirely within another
state;
(7) employment for a church or convention or association of
churches, or an organization operated primarily for religious
purposes that is operated, supervised, controlled, or
principally supported by a church or convention or association
of churches described in United States Code, title 26, section
501(c)(3) of the federal Internal Revenue Code and exempt from
income tax under section 501(a);
(8) employment of a duly ordained or licensed minister of a
church in the exercise of a ministry or by a member of a
religious order in the exercise of duties required by the order,
for Minnesota or a political subdivision or an organization
described in United States Code, title 26, section 501(c)(3) of
the federal Internal Revenue Code and exempt from income tax
under section 501(a);
(9) employment of an individual receiving rehabilitation of
"sheltered" work in a facility conducted for the purpose of
carrying out a program of rehabilitation for individuals whose
earning capacity is impaired by age or physical or mental
deficiency or injury or a program providing "sheltered" work for
individuals who because of an impaired physical or mental
capacity cannot be readily absorbed in the competitive labor
market. This clause applies only to services performed for
Minnesota or a political subdivision or an organization
described in United States Code, title 26, section 501(c)(3) of
the federal Internal Revenue Code and exempt from income tax
under section 501(a) in a facility certified by the
Rehabilitation Services Branch of the department or in a day
training or habilitation program licensed by the Department of
Human Services;
(10) employment of an individual receiving work relief or
work training as part of an unemployment work relief or work
training program assisted or financed in whole or in part by any
federal agency or an agency of a state or political subdivision
thereof. This clause applies only to employment for Minnesota
or a political subdivision or an organization described in
United States Code, title 26, section 501(c)(3) of the federal
Internal Revenue Code and exempt from income tax under section
501(a). This clause shall not apply to programs that require
unemployment benefit coverage for the participants;
(11) employment for Minnesota or a political subdivision as
an elected official, a member of a legislative body, or a member
of the judiciary;
(12) employment as a member of the Minnesota National Guard
or Air National Guard;
(13) employment for Minnesota, a political subdivision, or
instrumentality thereof, as an employee serving only on a
temporary basis in case of fire, flood, tornado, or similar
emergency;
(14) employment as an election official or election worker
for Minnesota or a political subdivision, but only if the
compensation for that employment was less than $1,000 in a
calendar year;
(15) employment for Minnesota that is a major policy making
or advisory position in the unclassified service, including
those positions established pursuant to section 43A.08,
subdivision 1a;
(16) employment for a political subdivision of Minnesota
that is a nontenured major policy making or advisory position;
(17) domestic employment in a private household, local
college club, or local chapter of a college fraternity or
sorority performed for a person, only if the wages paid in any
calendar quarter in either the current or preceding calendar
year to all individuals in domestic employment totaled less than
$1,000.
"Domestic employment" includes all service in the operation
and maintenance of a private household, for a local college
club, or local chapter of a college fraternity or sorority as
distinguished from service as an employee in the pursuit of an
employer's trade or business;
(18) employment of an individual by a son, daughter, or
spouse, and employment of a child under the age of 18 by the
child's father or mother;
(19) employment of an inmate of a custodial or penal
institution;
(20) employment for a school, college, or university by a
student who is enrolled and is regularly attending classes at
the school, college, or university;
(21) employment of an individual who is enrolled as a
student in a full-time program at a nonprofit or public
educational institution that maintains a regular faculty and
curriculum and has a regularly organized body of students in
attendance at the place where its educational activities are
carried on, taken for credit at the institution, that combines
academic instruction with work experience, if the employment is
an integral part of the program, and the institution has so
certified to the employer, except that this clause shall not
apply to employment in a program established for or on behalf of
an employer or group of employers;
(22) employment of university, college, or professional
school students in an internship or other training program with
the city of St. Paul or the city of Minneapolis pursuant to Laws
1990, chapter 570, article 6, section 3;
(23) employment for a hospital by a patient of the
hospital. "Hospital" means an institution that has been
licensed by the Department of Health as a hospital;
(24) employment as a student nurse for a hospital or a
nurses' training school by an individual who is enrolled and is
regularly attending classes in an accredited nurses' training
school;
(25) employment as an intern for a hospital by an
individual who has completed a four-year course in an accredited
medical school;
(26) employment as an insurance salesperson, by other than
a corporate officer, if all the compensation for wages from the
employment is solely by way of commission. The word "insurance"
shall include an annuity and an optional annuity;
(27) employment as an officer of a township mutual
insurance company or farmer's mutual insurance company operating
pursuant to chapter 67A;
(28) employment of a corporate officer, if the officer owns
25 percent or more of the employer corporation, and employment
of a member of a limited liability company, if the member owns
25 percent or more of the employer limited liability company;
(29) employment as a real estate salesperson, by other than
a corporate officer, if all the compensation for wages from the
employment is solely by way of commission;
(30) employment as a direct seller as defined in United
States Code, title 26, section 3508;
(31) employment of an individual under the age of 18 in the
delivery or distribution of newspapers or shopping news, not
including delivery or distribution to any point for subsequent
delivery or distribution;
(32) casual employment performed for an individual, other
than domestic employment under clause (17), that does not
promote or advance that employer's trade or business;
(33) employment in "agricultural employment" unless
considered "covered agricultural employment" under subdivision
11; or
(34) if employment during one-half or more of any pay
period was covered employment, all the employment for the pay
period shall be considered covered employment; but if during
more than one-half of any pay period the employment was
noncovered employment, then all of the employment for the pay
period shall be considered noncovered employment. "Pay period"
means a period of not more than a calendar month for which a
payment or compensation is ordinarily made to the employee by
the employer.
Sec. 6. Minnesota Statutes 2004, section 268.035,
subdivision 21, is amended to read:
Subd. 21. [PERSON.] "Person" means:
(1) an individual, trust or estate, a partnership or a
corporation or any type of organization or entity, resident or
nonresident, for profit or nonprofit, religious, charitable or
educational, including any receiver or trustee in a bankruptcy,
successor of any of the foregoing, or legal representative of a
deceased individual; and
(2) any government entity, state or federal, foreign or
domestic, or Indian tribe, including any subdivision or
instrumentality thereof owned wholly or in part.
Sec. 7. Minnesota Statutes 2004, section 268.035,
subdivision 26, is amended to read:
Subd. 26. [UNEMPLOYED.] An applicant shall be considered
"unemployed": (1) in any week that the applicant performs no
service in employment, covered employment, noncovered
employment, self-employment, or volunteer work, and with respect
to which the applicant has no earnings; or (2) in any week of
less than 32 hours of service in employment, covered employment,
noncovered employment, self-employment, or volunteer work if the
; and (2) any earnings with respect to that week are less than
the applicant's weekly unemployment benefit amount.
Sec. 8. Minnesota Statutes 2004, section 268.042,
subdivision 1, is amended to read:
Subdivision 1. [EMPLOYER REGISTRATION.] (a) Each employer
shall, upon or before the submission of its first wage detail
report under section 268.044, register with the commissioner for
a tax account or a reimbursable account, by electronic
transmission in a format prescribed by the commissioner. The
employer must provide all required information for registration.
(b) Except as provided in subdivision 3, any organization
or person that is or becomes an employer subject to the
Minnesota Unemployment Insurance Law within any calendar year
shall be considered to be subject to this chapter the entire
calendar year.
(c) Upon the termination of business, an employer that has
been assigned a tax account or reimbursable account shall notify
the commissioner by electronic transmission, in a format
prescribed by the commissioner, that the employer no longer has
employees and does not intend or expect to pay wages to any
employees in the next calendar year and into the foreseeable
future. Upon such notification, the commissioner shall not
require the employer to file wage detail reports under section
268.044, subdivision 1, paragraph (d), commencing the calendar
quarter after the notice of termination was received by the
commissioner.
Sec. 9. Minnesota Statutes 2004, section 268.043, is
amended to read:
268.043 [DETERMINATIONS OF COVERAGE.]
(a) The commissioner, upon the commissioner's own motion or
upon application of an organization or a person, shall determine
if that organization or person is an employer or whether
services performed for it constitute employment and covered
employment, or whether the compensation for services constitutes
wages, and shall notify the organization or person of the
determination. The determination shall be final unless the
organization or person, within 30 calendar days after sending of
the determination by mail or electronic transmission, files a
protest. Upon receipt of a protest, the commissioner shall
review all available evidence and determine whether an error has
been made. The commissioner shall send to the organization or
person, by mail or electronic transmission, an affirmation or
redetermination. The affirmation or redetermination shall be
final unless, within 30 calendar days after sending of the
affirmation or redetermination to the organization or person by
mail or electronic transmission, an appeal is filed.
Proceedings on the appeal shall be conducted in accordance with
section 268.105.
(b) No organization or person shall be initially determined
an employer, or that services performed for it were in
employment or covered employment, for periods more than four
years prior to the year in which the determination is made,
unless the commissioner finds that there was fraudulent action
to avoid liability under this chapter.
Sec. 10. Minnesota Statutes 2004, section 268.044,
subdivision 2, is amended to read:
Subd. 2. [FAILURE TO TIMELY FILE REPORT; LATE FEES.] (a)
Any employer that fails to submit the quarterly wage detail
report when due shall pay a late fee of $10 per employee,
computed based upon the highest of:
(1) the number of employees reported on the last wage
detail report submitted;
(2) the number of employees reported in the corresponding
quarter of the prior calendar year; or
(3) if no wage detail report has ever been submitted, the
number of employees listed at the time of employer registration.
The late fee shall be waived if the wage detail report is
received within 30 calendar days after a demand for the report
is sent to the employer by mail or electronic transmission. A
late fee assessed an employer may not be waived more than once
twice each 12 months. The amount of the late fee assessed shall
not be less than $50 $250.
(b) If the wage detail report is not received in a manner
and format prescribed by the commissioner within 30 calendar
days after demand is sent under paragraph (a), the late fee
assessed under paragraph (a) shall double and a renewed demand
notice and notice of the increased late fee shall be sent to the
employer by mail or electronic transmission.
(c) Late fees due under this subdivision may be compromised
under section 268.067 where good cause for late submission is
found by the commissioner.
Sec. 11. Minnesota Statutes 2004, section 268.051,
subdivision 7, is amended to read:
Subd. 7. [TAX RATE BUYDOWN.] (a) Any taxpaying employer
who has been assigned a tax rate based upon an experience
rating, and has no amounts past due under this chapter, may,
upon the voluntary payment of an amount equivalent to any
portion or all of the unemployment benefits used in computing
the experience rating plus a surcharge of 25 percent, obtain a
cancellation of unemployment benefits used equal to the payment
made, less the surcharge. Upon the payment, the commissioner
shall compute a new experience rating for the employer, and
compute a new tax rate.
(b) Voluntary payments may be made only by electronic
payment and must be received within 120 calendar days from the
beginning of the calendar year for which the tax rate is
effective.
Sec. 12. Minnesota Statutes 2004, section 268.052,
subdivision 2, is amended to read:
Subd. 2. [ELECTION BY STATE OR POLITICAL SUBDIVISION TO BE
A TAXPAYING EMPLOYER.] (a) The state or political
subdivision excluding a school district may elect to be a
taxpaying employer for any calendar year if a notice of election
is filed within 30 calendar days following January 1 of that
calendar year. Upon election, the state or political
subdivision shall be assigned the new employer tax rate under
section 268.051, subdivision 5, for the calendar year of the
election and until it qualifies for an experience rating under
section 268.051, subdivision 3.
(b) An election shall be for a minimum period of two
calendar years following the effective date of the election and
continue unless a notice terminating the election is filed not
later than 30 calendar days before the beginning of the calendar
year. The termination shall be effective at the beginning of
the next calendar year. Upon election, the commissioner shall
establish a reimbursable account for the state or political
subdivision. A termination of election shall be allowed only if
the state or political subdivision has, since the beginning of
the experience rating period under section 268.051, subdivision
3, paid taxes and made voluntary payments under section 268.051,
subdivision 7, equal to or more than 125 percent of the
unemployment benefits used in computing the experience rating.
In addition, any unemployment benefits paid after the experience
rating period shall be transferred to the new reimbursable
account of the state or political subdivision. If the amount of
taxes and voluntary payments paid since the beginning of the
experience rating period exceeds 125 percent of the amount of
unemployment benefits paid during the experience rating period,
that amount in excess shall be applied against any unemployment
benefits paid after the experience rating period.
(c) The method of payments to the trust fund under
subdivisions 3 and 4 shall apply to all taxes paid by or due
from the state or political subdivision that elects to be
taxpaying employers under this subdivision.
(d) A notice of election or a notice terminating election
shall be filed by electronic transmission in a format prescribed
by the commissioner.
Sec. 13. Minnesota Statutes 2004, section 268.053,
subdivision 1, is amended to read:
Subdivision 1. [ELECTION.] (a) Any nonprofit organization
that has employees in covered employment shall pay taxes on a
quarterly basis pursuant to section 268.051 unless it elects to
make reimbursements to the trust fund the amount of unemployment
benefits charged to its reimbursable account under section
268.047.
The organization may elect to make reimbursements for a
period of not less than two calendar years beginning with the
date that the organization was determined to be an employer with
covered employment by filing a notice of election not later than
30 calendar days after the date of the determination.
(b) Any nonprofit organization that makes an election will
continue to be liable for reimbursements until it files a notice
terminating its election not later than 30 calendar days before
the beginning of the calendar year the termination is to be
effective.
(c) A nonprofit organization that has been making
reimbursements that files a notice of termination of election
shall be assigned the new employer tax rate under section
268.051, subdivision 5, for the calendar year of the termination
of election and until it qualifies for an experience rating
under section 268.051, subdivision 3.
(d) Any nonprofit organization that has been paying taxes
may elect to make reimbursements by filing no less than 30
calendar days before January 1 of any calendar year a notice of
election. Upon election, the commissioner shall establish a
reimbursable account for the nonprofit organization. An
election shall be allowed only if the nonprofit organization
has, since the beginning of the experience rating period under
section 268.051, subdivision 3, paid taxes and made voluntary
payments under section 268.051, subdivision 7, equal to or more
than 125 percent of the unemployment benefits used in computing
the experience rating. In addition, any unemployment benefits
paid after the experience rating period shall be transferred to
the new reimbursable account of the nonprofit organization. If
the amount of taxes and voluntary payments paid since the
beginning of the experience rating period exceeds 125 percent of
the amount of unemployment benefits paid during the experience
rating period, that amount in excess shall be applied against
any unemployment benefits paid after the experience rating
period. The election shall not be terminable by the
organization for that and the next calendar year.
(e) The commissioner may for good cause extend the period
that a notice of election, or a notice of termination, must be
filed and may permit an election to be retroactive.
(f) A notice of election or notice terminating election
shall be filed by electronic transmission in a format prescribed
by the commissioner.
Sec. 14. Minnesota Statutes 2004, section 268.057,
subdivision 7, is amended to read:
Subd. 7. [CREDIT ADJUSTMENTS, REFUNDS.] (a) If an employer
makes an application for a credit adjustment of any amount paid
under this chapter or section 116L.20 within four years of
the year date that the payment was made due, in a manner and
format prescribed by the commissioner, and the commissioner
determines that the payment or any portion was erroneous, the
commissioner shall make an adjustment and issue a credit without
interest. If a credit cannot be used, the commissioner shall
refund, without interest, the amount erroneously paid. The
commissioner, on the commissioner's own motion, may make a
credit adjustment or refund under this subdivision.
Any refund returned to the commissioner shall be considered
unclaimed property under chapter 345.
(b) If a credit adjustment or refund is denied in whole or
in part, a notice of denial shall be sent to the employer by
mail or electronic transmission. Within 30 calendar days after
sending of the notice of denial, the employer may protest.
Upon receipt of a timely protest, the commissioner shall
review the denial and either affirm the denial or redetermine
the credit adjustment or refund. The affirmation of denial or
redetermination of the credit adjustment or refund, sent by mail
or electronic transmission, shall be final unless an employer
files an appeal within 30 calendar days after sending.
Proceedings on the appeal shall be conducted in accordance with
section 268.105.
Sec. 15. Minnesota Statutes 2004, section 268.069,
subdivision 1, is amended to read:
Subdivision 1. [REQUIREMENTS.] The commissioner shall pay
unemployment benefits from the trust fund to an applicant who
has met each of the following requirements:
(1) the applicant has filed an application for unemployment
benefits and established a benefit account in accordance with
section 268.07;
(2) the applicant is not subject to a disqualification from
unemployment benefits under section 268.095 because of a quit or
discharge;
(3) the applicant has met all of the ongoing weekly
eligibility requirements under sections 268.085 and 268.086;
(4) the applicant does not have an outstanding overpayment
of unemployment benefits, including any penalties or interest,
under section 268.18; and
(5) the applicant is not subject to a denial of ineligible
for unemployment benefits under section 268.182 because of a
false representation or concealment of facts.
Sec. 16. Minnesota Statutes 2004, section 268.07,
subdivision 3b, is amended to read:
Subd. 3b. [LIMITATIONS.] (a) A benefit account shall be
established effective the Sunday of the calendar week that the
application for unemployment benefits was filed. Upon specific
request of an applicant, an application for unemployment
benefits may be backdated one calendar week prior to the Sunday
of the week the application was actually filed. An application
shall be backdated only if the applicant was unemployed
throughout the period of the backdating. If an individual
attempted to file an application for unemployment benefits, but
was prevented from filing an application by the department, the
benefit account shall be effective the Sunday of the calendar
week the individual first attempted to file an application.
(b) A benefit account, once established, may later be
withdrawn only if:
(1) a new application for unemployment benefits is filed
and a new benefit account is established at the time of the
withdrawal; and
(2) the applicant has not served a waiting week under
section 268.085, subdivision 1, clause (3) (5).
A determination or amended determination pursuant to
section 268.101, that was issued before the withdrawal of the
benefit account, shall remain in effect and shall not be voided
by the withdrawal of the benefit account. A determination of
disqualification requiring subsequent earnings to satisfy the
disqualification under section 268.095, subdivision 10, shall
apply to the weekly unemployment benefit amount on the new
benefit account.
(c) An application for unemployment benefits shall not be
allowed prior to the Sunday following the expiration of the
benefit year on a prior benefit account. Except as allowed
under paragraph (b), a applicant may establish only one benefit
account each 52 calendar weeks.
(d) All unemployment benefits shall be available from the
trust fund only for weeks occurring during the applicant's
benefit year.
Sec. 17. Minnesota Statutes 2004, section 268.085,
subdivision 1, is amended to read:
Subdivision 1. [ELIGIBILITY CONDITIONS.] An applicant
shall be eligible to receive unemployment benefits for any week
if:
(1) the applicant has an active benefit account and has
filed a continued biweekly request for unemployment benefits for
that week pursuant to section 268.086;
(2) the week for which unemployment benefits are requested
is in the applicant's benefit year;
(3) the applicant was unemployed as defined in section
268.035, subdivision 26;
(2) (4) the applicant was able to work and was available
for suitable employment, and was actively seeking suitable
employment. The applicant's weekly unemployment benefit amount
shall be reduced one-fifth for each day the applicant is unable
to work or is unavailable for suitable employment. If the
computation of the reduced unemployment benefits is not a whole
dollar, it shall be rounded down to the next lower whole dollar.
This clause shall not apply to an applicant who is in
reemployment assistance training, or each day the applicant is
on jury duty or serving as an election judge;
(3) (5) the applicant has served a waiting period of one
week that the applicant is otherwise entitled to some amount of
unemployment benefits. This clause shall not apply if the
applicant would have been entitled to federal disaster
unemployment assistance because of a disaster in Minnesota, but
for the applicant's establishment of a benefit account under
section 268.07; and
(4) (6) the applicant has been participating in
reemployment assistance services, such as job search and resume
writing classes, if the applicant has been determined in need of
reemployment assistance services by the commissioner, unless
there is good cause for the applicant's failure to participate.
Sec. 18. Minnesota Statutes 2004, section 268.085,
subdivision 2, is amended to read:
Subd. 2. [NOT ELIGIBLE.] An applicant shall not be
eligible to receive unemployment benefits for any week:
(1) that occurs before the effective date of a benefit
account;
(2) that occurs in a period when the applicant is a student
in attendance at, or on vacation from a secondary school
including the period between academic years or terms;
(3) that the applicant is incarcerated or performing court
ordered community service. The applicant's weekly unemployment
benefit amount shall be reduced by one-fifth for each day the
applicant is incarcerated or performing court ordered community
service. If the computation of the reduced unemployment
benefits is not a whole dollar, it shall be rounded down to the
next lower whole dollar;
(4) that the applicant fails or refuses to provide
information on an issue of eligibility required under section
268.101, subdivision 1, paragraph (a), or an issue of
disqualification required under section 268.101, subdivision 1,
paragraph (d);
(5) that the applicant is performing services 32 hours or
more, in employment, covered employment, noncovered employment,
volunteer work, or self-employment regardless of the amount of
any earnings; or
(6) with respect to which the applicant is receiving, has
received, or has filed an application for unemployment benefits
under any federal law or the law of any other state. If the
appropriate agency finally determines that the applicant is not
entitled to the unemployment benefits, this clause shall not
apply.
Sec. 19. Minnesota Statutes 2004, section 268.085,
subdivision 3, is amended to read:
Subd. 3. [PAYMENTS THAT DELAY UNEMPLOYMENT BENEFITS.] (a)
An applicant shall not be eligible to receive unemployment
benefits for any week with respect to which the applicant is
receiving, has received, or has filed for payment, equal to or
in excess of the applicant's weekly unemployment benefit amount,
in the form of:
(1) vacation pay paid upon temporary, indefinite, or
seasonal separation. This clause shall not apply to vacation
pay paid upon a permanent separation from employment;
(2) severance pay, bonus pay, vacation pay, sick pay, and
any other money payments, except earnings under subdivision 5,
and back pay under subdivision 6, paid by an employer because
of, upon, or after separation from employment, but only if the
money payment is considered wages at the time of payment under
section 268.035, subdivision 29, or United States Code, title
26, section 3121, clause (2), of the Federal Insurance
Contribution Act. This clause shall apply to all the weeks of
payment and shall be applied to the period immediately following
the last day of employment. The number of weeks of payment
shall be determined as follows:;
(i) if the payments are made periodically, the total of the
payments to be received shall be divided by the applicant's last
level of regular weekly pay from the employer; or
(ii) if the payment is made in a lump sum, that sum shall
be divided by the applicant's last level of regular weekly pay
from the employer. This clause shall not apply to vacation pay
paid by an employer upon permanent separation from employment;
(2) (3) pension, retirement, or annuity payments from any
plan contributed to by a base period employer including the
United States government, except Social Security benefits which
are provided for in subdivision 4. The base period employer
contributed to the plan if the contribution is excluded from the
definition of wages under section 268.035, subdivision 29,
clause (1), or United States Code, title 26, section 3121,
clause (2), of the Federal Insurance Contribution Act.
If the applicant receives a lump sum pension payment, that
sum shall be divided by the applicant's last level of regular
weekly pay to determine the number of weeks of payment. The
number of weeks of payment shall be applied to the period
immediately following the last day of employment. An applicant
shall not be considered to have received the lump sum payment if
the applicant immediately deposits that payment in a qualified
pension plan or account; or
(3) (4) holiday pay.
(b) This subdivision shall apply to all the weeks of
payment and shall be applied to the period immediately following
the last day of employment. The number of weeks of payment
shall be determined as follows:
(1) if the payments are made periodically, the total of the
payments to be received shall be divided by the applicant's last
level of regular weekly pay from the employer; or
(2) if the payment is made in a lump sum, that sum shall be
divided by the applicant's last level of regular weekly pay from
the employer.
(b) (c) If the payment is less than the applicant's weekly
unemployment benefit amount, unemployment benefits shall be
reduced by the amount of the payment. If the computation of
reduced unemployment benefits is not a whole dollar, it shall be
rounded down to the next lower whole dollar.
Sec. 20. Minnesota Statutes 2004, section 268.085,
subdivision 5, is amended to read:
Subd. 5. [DEDUCTIBLE EARNINGS.] (a) If the applicant has
earnings with respect to any week, from employment, covered
employment, noncovered employment, self-employment, or volunteer
work, equal to or in excess of the applicant's weekly
unemployment benefit amount, the applicant shall be ineligible
for unemployment benefits for that week.
(b) If the applicant has earnings, with respect to any
week, that is less than the applicant's weekly unemployment
benefit amount, from employment, covered employment, noncovered
employment, self-employment, or volunteer work, that amount over
the following shall be deducted from the weekly unemployment
benefit amount:
(1) 25 percent of earnings or $50, whichever is higher; and
(2) $200 for earnings from service in the National Guard or
a United States military reserve unit.
The resulting unemployment benefit, if not a whole dollar,
shall be rounded down to the next lower whole dollar.
(c) No deduction shall be made from an applicant's weekly
unemployment benefit amount for earnings from direct service as
a volunteer firefighter or volunteer ambulance service
personnel. This exception to paragraphs (a) and (b) does not
apply to on-call or standby pay provided to a volunteer
firefighter or volunteer ambulance service personnel. No
deduction shall be made for jury duty pay or for pay as an
election judge.
(d) The applicant may report deductible earnings on
continued biweekly requests for unemployment benefits at the
next lower whole dollar amount.
(e) Deductible earnings shall not include any money
considered a deductible payment under subdivision 3, but shall
include all other money considered wages and any other money
considered earned income under state and federal law for income
tax purposes.
Sec. 21. Minnesota Statutes 2004, section 268.085,
subdivision 12, is amended to read:
Subd. 12. [ALIENS.] (a) An alien shall be ineligible for
unemployment benefits for any week the alien is not authorized
to work in the United States under federal law. Information
from the Bureau of Citizenship and Immigration and
Naturalization Service Services shall be considered conclusive,
absent specific evidence that the information was erroneous.
Pursuant to the existing agreement between the United States and
Canada, this paragraph shall not apply to an applicant who is a
Canadian citizen and has returned to and is living in Canada
each week unemployment benefits are requested.
(b) Unemployment benefits shall not be paid on the basis of
wage credits earned by an alien unless the alien (1) was
lawfully admitted for permanent residence at the time of the
employment, (2) was lawfully present for the purposes of the
employment, or (3) was permanently residing in the United States
under color of law at the time of the employment.
(c) Any information required of applicants applying for
unemployment benefits to determine eligibility because of their
alien status shall be required from all applicants.
Sec. 22. Minnesota Statutes 2004, section 268.086,
subdivision 2, is amended to read:
Subd. 2. [CONTINUED BIWEEKLY REQUEST FOR UNEMPLOYMENT
BENEFITS DEFINED.] A continued biweekly request for unemployment
benefits is a certification by an applicant, done on a biweekly
basis, that the applicant is unemployed and meets the ongoing
eligibility requirements for unemployment benefits under section
268.085 for a specific week or two-week period. A continued
biweekly request shall include information on possible issues of
eligibility and disqualification in accordance with section
268.101, subdivision 1, paragraph (c).
Sec. 23. Minnesota Statutes 2004, section 268.086,
subdivision 3, is amended to read:
Subd. 3. [METHODS FOR FILING CONTINUED BIWEEKLY REQUESTS
FOR UNEMPLOYMENT BENEFITS.] (a) The commissioner shall designate
to each applicant one of the following methods for filing a
continued biweekly request:
(1) by telephone under subdivision 4;
(2) by electronic transmission under subdivision 5;
(3) (2) by mail under subdivision 6; or
(4) (3) by in-person interview under subdivision 7.
(b) The method designated by the commissioner shall be the
only method allowed for filing a continued biweekly request by
that applicant. An applicant may ask that one of the other
allowed methods be designated and the commissioner shall
consider inconvenience to the applicant as well as
administrative capacity in determining whether to allow an
applicant to change the designated method for filing a continued
biweekly request for unemployment benefits.
Sec. 24. Minnesota Statutes 2004, section 268.095,
subdivision 1, is amended to read:
Subdivision 1. [QUIT.] An applicant who quit employment
shall be disqualified from all unemployment benefits according
to subdivision 10 except when:
(1) the applicant quit the employment because of a good
reason caused by the employer as defined in subdivision 3;
(2) the applicant quit the employment to accept other
covered employment that provided substantially better terms and
conditions of employment, but the applicant did not work long
enough at the second employment to have sufficient subsequent
earnings to satisfy the disqualification that would otherwise be
imposed under subdivision 10 for quitting the first employment;
(3) the applicant quit the employment within 30 calendar
days of beginning the employment because the employment was
unsuitable for the applicant;
(4) the employment was unsuitable for the applicant and the
applicant quit to enter reemployment assistance training;
(5) the employment was part time and the applicant also had
full-time employment in the base period, from which full-time
employment the applicant separated because of nondisqualifying
reasons, and the wage credits from the full-time employment are
sufficient to meet the minimum requirements to establish a
benefit account under section 268.07;
(6) the applicant quit because the employer notified the
applicant that the applicant was going to be laid off due to
lack of work within 30 calendar days. An applicant who quit
employment within 30 calendar days of a notified date of layoff
due to lack of work shall be disqualified from unemployment
benefits through the end of the week that includes the scheduled
date of layoff;
(7) the applicant quit the employment because the
applicant's serious illness or injury made it medically
necessary that the applicant quit, provided that the applicant
inform the employer of the serious illness or injury and request
accommodation and no reasonable accommodation is made available.
If the applicant's serious illness is chemical dependency,
this exception shall not apply if the applicant was previously
diagnosed as chemically dependent or had treatment for chemical
dependency, and since that diagnosis or treatment has failed to
make consistent efforts to control the chemical dependency; or
(8) domestic abuse of the applicant or the applicant's
minor child, necessitated the applicant's quitting the
employment. Domestic abuse shall be shown by one or more of the
following:
(i) a court order for protection or other documentation of
equitable relief issued by a court;
(ii) a police record documenting the domestic abuse;
(iii) documentation that the perpetrator of the domestic
abuse has been convicted of the offense of domestic abuse;
(iv) medical documentation of domestic abuse; or
(v) written statement that the applicant or the applicant's
minor child is a victim of domestic abuse, provided by a social
worker, member of the clergy, shelter worker, attorney at law,
or other professional who has assisted the applicant in dealing
with the domestic abuse.
Domestic abuse for purposes of this clause shall be defined
under section 518B.01.
Sec. 25. Minnesota Statutes 2004, section 268.095,
subdivision 4, is amended to read:
Subd. 4. [DISCHARGE.] An applicant who was discharged from
employment by an employer shall not be disqualified from any all
unemployment benefits except when according to subdivision 10
only if:
(1) the applicant was discharged because of employment
misconduct as defined in subdivision 6; or
(2) the applicant was discharged because of aggravated
employment misconduct as defined in subdivision 6a.
Sec. 26. Minnesota Statutes 2004, section 268.095,
subdivision 7, is amended to read:
Subd. 7. [ACT OR OMISSIONS AFTER SEPARATION.] Except as
provided for under subdivision 8, An applicant shall not be
disqualified from unemployment benefits under this section for
any acts or omissions occurring after the applicant's separation
from employment with the employer. A layoff due to lack of work
is considered a separation from employment.
Sec. 27. Minnesota Statutes 2004, section 268.095,
subdivision 8, is amended to read:
Subd. 8. [OFFERS OF SUITABLE EMPLOYMENT.] (a) An applicant
shall be disqualified from ineligible for all unemployment
benefits for eight calendar weeks if the applicant, without good
cause:
(1) failed to apply for available, suitable employment of
which the applicant was advised by the commissioner or an
employer;
(2) failed to accept suitable employment when offered; or
(3) avoided an offer of suitable employment.
(b) "Good cause" is a reason that would cause a reasonable
individual who wants suitable employment to fail to apply for,
accept, or avoid suitable employment. Good cause includes:
(1) the applicant is employed in other suitable employment;
(2) the applicant is in reemployment assistance training;
(3) the applicant formerly worked for the employer and the
loss of employment occurred prior to the commencement of a labor
dispute, was permanent or for an indefinite period, and the
applicant failed to apply for or accept the employment because a
labor dispute was in progress at the establishment; or
(4) the applicant formerly worked for the employer and quit
that employment because of a good reason caused by the employer.
(c) This subdivision only applies to offers of suitable
employment with a new or a former employer and does not apply to
any type of job transfers, position reassignments, or changes in
job duties or responsibilities during the course of employment
with an employer.
(d) The period of ineligibility under this section shall
begin the Sunday of the week the applicant failed to apply for,
accept, or avoided suitable employment without good cause.
(e) This section shall apply to offers of suitable
employment that occur prior to the effective date of the benefit
account and that occur during the benefit year.
(f) This section shall only apply to offers of suitable
employment that are considered covered employment under section
268.035, subdivision 12.
Sec. 28. Minnesota Statutes 2004, section 268.095,
subdivision 10, is amended to read:
Subd. 10. [DISQUALIFICATION DURATION.] (a) A
disqualification from the payment of all unemployment benefits
under subdivisions 1, and 4, and 8 shall be for the duration of
the applicant's unemployment and until the end of the calendar
week that the applicant had total earnings in subsequent covered
employment of eight times the applicant's weekly unemployment
benefit amount.
(b) Any disqualification imposed under subdivisions 1 and 4
shall begin on the Sunday of the week that the applicant became
separated from employment. Any disqualification imposed under
subdivision 8 shall begin on the Sunday of the week the
applicant failed to apply for, accept, or avoided employment.
(c) In addition to paragraph (a), if the applicant was
discharged from employment because of aggravated employment
misconduct, wage credits from that employment shall be canceled.
Sec. 29. Minnesota Statutes 2004, section 268.095,
subdivision 11, is amended to read:
Subd. 11. [APPLICATION.] (a) This section shall apply to
all covered employment, full time or part time, temporary or of
limited duration, permanent or of indefinite duration, that
occurred in Minnesota during the base period, the period between
the end of the base period and the effective date of the benefit
account, or the benefit year, except as provided for in
subdivision 1, clause (5). Subdivision 8 shall only apply to
offers of suitable employment made during the applicant's
benefit year.
(b) Paragraph (a) shall also apply to employment covered
under an unemployment insurance program of any other state or
established by an act of Congress.
Sec. 30. Minnesota Statutes 2004, section 268.101,
subdivision 1, is amended to read:
Subdivision 1. [NOTIFICATION.] (a) In an application for
unemployment benefits, each applicant shall report the name and
the reason for no longer working for the applicant's most recent
employer, as well as the names of all employers and the reasons
for no longer working for all employers during the six calendar
months prior to the date of the application. If the reason
reported for no longer working for any of those employers is
other than a layoff due to lack of work, that shall raise an
issue of disqualification that the department shall
determine. An applicant shall report any offers of employment
refused during the eight calendar weeks prior to the date of the
application for unemployment benefits and the name of the
employer that made the offer. An applicant's failure to report
the name of an employer, or giving an incorrect reason for no
longer working for an employer, or failing to disclose an offer
of employment that was refused, shall be considered a violation
of section 268.182, paragraph (b) subdivision 2.
In an application, the applicant shall also provide all
information necessary to determine the applicant's eligibility
for unemployment benefits under section 268.085. If the
applicant fails or refuses to provide information necessary to
determine the applicant's eligibility for unemployment benefits
under section 268.085, the applicant shall be ineligible for
unemployment benefits under section 268.085, subdivision 2,
until the applicant provides this required information.
(b) Upon establishment of a benefit account, the
commissioner shall notify, by mail or electronic transmission,
all employers the applicant was required to report on the
application and all base period employers and determined
successors to those employers under section 268.051, subdivision
4 in order to provide the employer an opportunity to raise, in a
manner prescribed by the commissioner, any issue of
disqualification or any issue of eligibility. An employer shall
be informed of the effect that failure to raise an issue of
disqualification within ten calendar days after sending of the
notice, as provided for under subdivision 2, paragraph (b), may
have on the employer under section 268.047.
(c) Each applicant shall report any employment, loss of
employment, and offers of employment received refused, during
those weeks the applicant filed continued biweekly requests for
unemployment benefits pursuant to section 268.086. Each
applicant who stops filing continued biweekly requests during
the benefit year and later begins filing continued biweekly
requests during that same benefit year shall report the name of
any employer the applicant worked for during the period between
the filing of continued biweekly requests and the reason the
applicant stopped working for the employer. The applicant shall
report any offers of employment refused during the period
between the filing of continued biweekly requests for
unemployment benefits. Those employers from which the applicant
has reported a loss of employment or an offer of employment
pursuant to this paragraph shall be notified by mail or
electronic transmission and provided an opportunity to raise, in
a manner prescribed by the commissioner, any issue of
disqualification or any issue of eligibility. An employer shall
be informed of the effect that failure to raise an issue may
have on the employer under section 268.047.
(d) The purpose for requiring the applicant to report the
name of employers and the reason for no longer working for those
employers, or offers of employment refused, under paragraphs (a)
and (c) is for the commissioner to obtain information from an
applicant raising all issues that may have the potential of
disqualifying the applicant from unemployment benefits under
section 268.095, or the applicant being ineligible for
unemployment benefits under section 268.085, subdivision 13c.
If the reason given by the applicant for no longer working for
an employer is other than a layoff due to lack of work, that
shall raise an issue of disqualification and the applicant shall
be required, as part of the determination process under
subdivision 2, paragraph (a), to state all the facts about the
cause for no longer working for the employer, if known. If the
applicant fails or refuses to provide this any required
information, the applicant shall be ineligible for unemployment
benefits under section 268.085, subdivision 2, until the
applicant provides this required information.
Sec. 31. Minnesota Statutes 2004, section 268.101,
subdivision 2, is amended to read:
Subd. 2. [DISQUALIFICATION DETERMINATION.] (a) The
commissioner shall determine any issue of disqualification
raised by information required from an applicant under
subdivision 1, paragraph (a) or (c), and send to the applicant
and employer, by mail or electronic transmission, a
determination of disqualification or a determination of
nondisqualification, as is appropriate. The determination shall
state the effect on the employer under section 268.047. A
determination shall be made pursuant to this paragraph even if a
notified employer has not raised the issue of disqualification.
(b) The commissioner shall determine any issue of
disqualification raised by an employer and send to the applicant
and that employer, by mail or electronic transmission, a
determination of disqualification or a determination of
nondisqualification as is appropriate. The determination shall
state the effect on the employer under section 268.047.
If a base period employer:
(1) was not the applicant's most recent employer prior to
the application for unemployment benefits;
(2) did not employ the applicant during the six calendar
months prior to the application for unemployment benefits; and
(3) did not raise an issue of disqualification within ten
calendar days of notification under subdivision 1, paragraph
(b);
then any exception under section 268.047, subdivisions 2 and 3,
shall begin the Sunday two weeks following the week that the
issue of disqualification was raised by the employer.
(c) If any time within 24 months from the establishment of
a benefit account the commissioner finds that an applicant
failed to report any employment, or loss of employment, or
offers of employment that were was required to be provided by
the applicant under this section, the commissioner shall
determine any issue of disqualification on that loss of
employment or offer of employment and send to the applicant and
involved employer, by mail or electronic transmission, a
determination of disqualification or a determination of
nondisqualification, as is appropriate. The determination shall
state the effect on the employer under section 268.047.
This paragraph shall not prevent the imposition of any
penalty under section 268.18, subdivision 2, or 268.182.
(d) An issue of disqualification shall be determined based
upon that information required of an applicant, any information
that may be obtained from an applicant or employer, and
information from any other source, without regard to any common
law burden of proof.
(e) A determination of disqualification or a determination
of nondisqualification shall be final unless an appeal is filed
by the applicant or notified employer within 30 calendar days
after sending. The determination shall contain a prominent
statement indicating the consequences of not appealing.
Proceedings on the appeal shall be conducted in accordance with
section 268.105.
(f) An issue of disqualification for purposes of this
section shall include any reason for no longer working for an
employer other than a layoff due to lack of work, any question
of a disqualification from unemployment benefits under section
268.095, any question of an exception to disqualification under
section 268.095, any question of effect on an employer under
section 268.047, and any question of an otherwise imposed
disqualification that an applicant has satisfied under section
268.095, subdivision 10.
(g) Regardless of the requirements of this subdivision, the
commissioner is not required to send to an applicant a
determination where the applicant has satisfied any otherwise
potential disqualification under section 268.095, subdivision 10.
Sec. 32. Minnesota Statutes 2004, section 268.101,
subdivision 3a, is amended to read:
Subd. 3a. [DIRECT HEARING.] Regardless of any provision of
the Minnesota Unemployment Insurance Law, the commissioner or an
unemployment law judge or a senior unemployment review judge
may, prior to a determination being made under this chapter,
refer any issue of disqualification, any issue of eligibility,
or any other issue under this chapter, directly for hearing in
accordance with section 268.105, subdivision 1. The status of
the issue shall be the same as if a determination had been made
and an appeal filed.
Sec. 33. Minnesota Statutes 2004, section 268.103,
subdivision 2, is amended to read:
Subd. 2. [APPLICANT'S APPEAL BY MAIL.] (a) The
commissioner must allow an applicant to file an appeal to be
filed by mail even if an appeal by electronic transmission is
allowed.
(b) A written statement delivered or mailed to the
department that could reasonably be interpreted to mean that an
involved applicant or employer is in disagreement with a
specific determination or decision shall be considered an
appeal. No specific words need be used for the written
statement to be considered an appeal.
Sec. 34. Minnesota Statutes 2004, section 268.105, is
amended to read:
268.105 [APPEALS.]
Subdivision 1. [EVIDENTIARY HEARING BY AN UNEMPLOYMENT LAW
JUDGE.] (a) Upon a timely appeal having been filed, the
department shall send, by mail or electronic transmission, a
notice of appeal to all involved parties that an appeal has been
filed, that a de novo due process evidentiary hearing will be
scheduled, and that the parties have certain rights and
responsibilities regarding the hearing. The department shall
set a time and place for a de novo due process evidentiary
hearing and send notice to any involved applicant and any
involved employer, by mail or electronic transmission, not less
than ten calendar days prior to the date of the hearing.
(b) The evidentiary hearing shall be conducted by an
unemployment law judge without regard to any common law burden
of proof as an evidence gathering inquiry and not an adversarial
proceeding. The unemployment law judge shall ensure that all
relevant facts are clearly and fully developed. The department
shall adopt rules on evidentiary hearings. The rules need not
conform to common law or statutory rules of evidence and other
technical rules of procedure. The department shall have
discretion regarding the method by which the evidentiary hearing
is conducted. A report of any employee of the department,
except a determination, made in the regular course of the
employee's duties, shall be competent evidence of the facts
contained in it.
(c) After the conclusion of the hearing, upon the evidence
obtained, the unemployment law judge shall make findings of fact
and decision and send those, by mail or electronic transmission,
to all involved parties. When the credibility of an involved
party or witness testifying in an evidentiary hearing has a
significant effect on the outcome of a decision, the
unemployment law judge must set out the reason for crediting or
discrediting that testimony. The unemployment law judge's
decision is the final department decision unless a further
appeal request for reconsideration is filed pursuant to
subdivision 2.
(d) Only employees of the department who are attorneys
shall serve as unemployment law judges. A senior unemployment
review judge The commissioner may personally hear or transfer to
another unemployment law judge any proceedings pending before an
unemployment law judge. Any proceedings removed to a senior
unemployment review judge shall be heard in accordance with this
subdivision.
Subd. 2. [DE NOVO REVIEW BY A SENIOR UNEMPLOYMENT REVIEW
JUDGE.] (a) Except as provided under subdivision 2a, any
involved applicant or involved employer may appeal a decision of
an unemployment law judge and obtain a de novo review by a
senior unemployment review judge by filing with a senior
unemployment review judge an appeal within 30 calendar days
after the sending of the unemployment law judge's decision. A
senior unemployment review judge within the same period of time
may, on a senior unemployment review judge's own motion, order a
de novo review of any decision of an unemployment law judge.
(b) A senior unemployment review judge shall be an attorney
who is an employee of the department.
(c) Upon de novo review, a senior unemployment review judge
shall, on the basis of that evidence submitted at the
evidentiary hearing under subdivision 1, make findings of fact
and decision, or remand the matter back to an unemployment law
judge for the taking of additional evidence and the making of
new findings and decision based on all the evidence. A senior
unemployment review judge shall, independent of the findings of
fact and decision of the unemployment law judge, examine the
evidence and make those findings of fact as the evidence, in the
judgment of the senior unemployment review judge require, and
make that decision as the facts found by the senior unemployment
review judge require.
(d) A senior unemployment review judge may conduct a de
novo review without argument by any involved party, or a senior
unemployment review judge may allow written argument. A senior
unemployment review judge shall not, except for purposes of
deciding whether to remand a matter to an unemployment law judge
for a further evidentiary hearing, consider any evidence that
was not submitted at the hearing before the unemployment law
judge.
(e) The senior unemployment review judge shall send, by
mail or electronic transmission, to any involved party the
senior unemployment review judge's findings of fact and
decision. The decision of the senior unemployment review judge
is the final decision of the department. Unless judicial review
is sought under subdivision 7, the decision of the senior
unemployment review judge shall become final 30 calendar days
after sending.
Subd. 2a. [ORDERS BY A SENIOR UNEMPLOYMENT REVIEW JUDGE.]
(a) If an applicant or employer files an appeal in a matter
where an unemployment law judge affirmed a determination issued
under section 268.101, and there is no dispute regarding the
determinative facts, a senior unemployment review judge shall
have the discretion to decline to conduct a de novo review. If
de novo review is declined, the senior unemployment review judge
shall issue an order adopting the unemployment law judge's
findings of fact and decision.
(b) If an involved party fails, without good cause, to
appear and participate at the evidentiary hearing conducted by
an unemployment law judge under subdivision 1, and that party
files an appeal, a senior unemployment review judge shall have
the discretion to decline to conduct a de novo review. If de
novo review is declined, the senior unemployment review judge
shall issue an order dismissing the appeal.
Submission of a written statement shall not constitute an
appearance and participation at an evidentiary hearing for
purposes of this paragraph.
All involved parties must be notified of this paragraph
with the notice of appeal and notice of hearing provided for
under subdivision 1. The senior unemployment review judge shall
allow for the submission of a written argument on the issue of
good cause before dismissing an appeal under this paragraph.
"Good cause" for purposes of this paragraph is a compelling
reason that would have prevented a reasonable person acting with
due diligence from appearing and participating at the
evidentiary hearing.
(c) The senior unemployment review judge shall send to any
involved party the order issued under this subdivision. The
order may be sent by mail or electronic transmission. Unless
judicial review is sought under subdivision 7, the order of a
senior unemployment review judge becomes final 30 calendar days
after sending. [REQUEST FOR RECONSIDERATION.] (a) Any involved
applicant, involved employer, or the commissioner may, within 30
calendar days of the sending of the unemployment law judge's
decision under subdivision 1, file a request for reconsideration
asking the unemployment law judge to reconsider that decision.
Section 268.103 shall apply to a request for reconsideration.
If a request for reconsideration is timely filed, the
unemployment law judge shall issue an order:
(1) modifying the findings of fact and decision issued
under subdivision 1;
(2) setting aside the findings of fact and decision issued
under subdivision 1 and directing that an additional evidentiary
hearing be conducted under subdivision 1; or
(3) affirming the findings of fact and decision issued
under subdivision 1.
(b) Upon a timely request for reconsideration having been
filed, the department shall send a notice, by mail or electronic
transmission, to all involved parties that a request for
reconsideration has been filed. The notice shall inform the
involved parties:
(1) of the opportunity to provide comment on the request
for reconsideration, and the right under subdivision 5 to obtain
a copy of any recorded testimony and exhibits offered or
received into evidence at the evidentiary hearing;
(2) that providing specific comments as to a perceived
factual or legal error in the decision, or a perceived error in
procedure during the evidentiary hearing, will assist the
unemployment law judge in deciding the request for
reconsideration;
(3) of the right to obtain any comments and submissions
provided by the other involved party regarding the request for
reconsideration; and
(4) of the provisions of paragraph (c) regarding additional
evidence.
This paragraph shall not apply if paragraph (d) is applicable.
(c) In deciding a request for reconsideration, the
unemployment law judge shall not, except for purposes of
determining whether to order an additional evidentiary hearing,
consider any evidence that was not submitted at the evidentiary
hearing conducted under subdivision 1.
The unemployment law judge must order an additional
evidentiary hearing if an involved party shows that evidence
which was not submitted at the evidentiary hearing: (1) would
likely change the outcome of the decision and there was good
cause for not having previously submitted that evidence; or (2)
would show that the evidence that was submitted at the
evidentiary hearing was likely false and that the likely false
evidence had an effect on the outcome of the decision.
(d) If the involved applicant or involved employer who
filed the request for reconsideration failed to participate in
the evidentiary hearing conducted under subdivision 1, an order
setting aside the findings of fact and decision and directing
that an additional evidentiary hearing be conducted must be
issued if the party who failed to participate had good cause for
failing to do so. In the notice of the request for
reconsideration, the party who failed to participate shall be
informed of the requirement, and provided the opportunity, to
show good cause for failing to participate. If the unemployment
law judge determines that good cause for failure to participate
has not been shown, the unemployment law judge must state that
in the order issued under paragraph (a).
Submission of a written statement at the evidentiary
hearing under subdivision 1 shall not constitute participation
for purposes of this paragraph.
All involved parties must be informed of this paragraph
with the notice of appeal and notice of hearing provided for in
subdivision 1.
"Good cause" for purposes of this paragraph is a reason
that would have prevented a reasonable person acting with due
diligence from participating at the evidentiary hearing.
(e) A request for reconsideration shall be decided by the
unemployment law judge who issued the findings of fact and
decision under subdivision 1 unless that unemployment law
judge: (1) is no longer employed by the department; (2) is on
an extended or indefinite leave; (3) has been disqualified from
the proceedings on the judge's own motion; or (4) has been
removed from the proceedings as provided for under subdivision 1
or applicable rule.
(f) The unemployment law judge shall send to any involved
applicant or involved employer, by mail or electronic
transmission, the order issued under this subdivision. An order
modifying the previously issued findings of fact and decision or
an order affirming the previously issued findings of fact and
decision shall be the final department decision on the matter
and shall be final and binding on the involved applicant and
involved employer unless judicial review is sought under
subdivision 7.
Subd. 3. [WITHDRAWAL OF APPEAL.] (a) Any appeal that is
pending before an unemployment law judge or a senior
unemployment review judge may be withdrawn by the appealing
person, or an authorized representative of that person, upon
filing of a notice of withdrawal.
(b) The appeal shall, by order, be dismissed if a notice of
withdrawal is filed, unless an unemployment law judge or a
senior unemployment review judge, by order, directs that further
adjudication is required for a proper result.
(c) A notice of withdrawal may be filed by mail or by
electronic transmission.
Subd. 3a. [DECISIONS.] (a) If an unemployment law judge's
decision or a senior unemployment review judge's decision or
order allows unemployment benefits to an applicant, the
unemployment benefits shall be paid regardless of any appeal
period request for reconsideration or any appeal to the
Minnesota Court of Appeals having been filed.
(b) If an unemployment law judge's decision or order
modifies or reverses a determination, or prior decision of the
unemployment law judge, allowing unemployment benefits to an
applicant, any benefits paid pursuant to the determination, or
prior decision of the unemployment law judge, is considered an
overpayment of those unemployment benefits under section 268.18,
subdivision 1.
(c) If a senior unemployment review judge's decision
modifies or reverses an unemployment law judge's decision
allowing unemployment benefits to an applicant, any unemployment
benefits paid pursuant to the unemployment law judge's decision
is considered an overpayment of those unemployment benefits
under section 268.18, subdivision 1.
(d) If a senior unemployment review judge affirms an
unemployment law judge's decision on an issue of
disqualification that order under subdivision 2 allows
unemployment benefits to an applicant under section 268.095
because of a quit or discharge and the senior unemployment
review law judge's decision or order is reversed by the
Minnesota Court of Appeals or the Supreme Court of
Minnesota, any unemployment benefits paid the applicant shall
not be disqualified from considered an overpayment of those
unemployment benefits under section 268.095 268.18,
subdivision 10 1.
(e) (d) If a senior an unemployment review law judge,
pursuant to subdivision 2, remands a matter to an unemployment
law judge for orders the taking of additional evidence,
the prior unemployment law judge's prior decision shall continue
to be enforced until new findings of fact and decision are made
by an the unemployment law judge.
Subd. 4. [TESTIMONIAL POWERS.] An unemployment law
judge and a senior unemployment review judge may administer
oaths and affirmations, take depositions, and issue subpoenas to
compel the attendance of witnesses and the production of
documents and other personal property considered necessary as
evidence in connection with the subject matter of an evidentiary
hearing. The subpoenas shall be enforceable through the
district court in the district that the subpoena is issued.
Witnesses subpoenaed, other than an involved applicant or
involved employer or officers and employees of an involved
employer, shall be paid by the department the same witness fees
as in a civil action in district court.
Subd. 5. [USE OF EVIDENCE; DATA PRIVACY.] (a) All
testimony at any evidentiary hearing conducted pursuant to
subdivision 1 shall be recorded. A copy of any recorded
testimony and exhibits offered or received into evidence at the
hearing shall, upon request, or upon directive of a senior
unemployment review judge, be furnished to a party at no cost
during the time period for filing an appeal to a senior
unemployment review judge a request for reconsideration or while
such an appeal a request for reconsideration is pending. If
requested, the department shall make available a device for
listening to the recording if an appeal is pending before a
senior unemployment review judge under subdivision 2.
(b) Regardless of any provision of law to the contrary, if
recorded testimony and exhibits received into evidence at the
evidentiary hearing are not requested during the time period for
filing an appeal to a senior unemployment review judge a request
for reconsideration, or while such an appeal a request for
reconsideration is pending, that testimony and other evidence
shall later be made available to an involved party only pursuant
to a district court order. A subpoena shall not be considered a
district court order.
(c) Testimony obtained under subdivision 1, may not be used
or considered for any purpose, including impeachment, in any
civil, administrative, or contractual proceeding, except by a
local, state, or federal human rights agency with enforcement
powers, unless the proceeding is initiated by the department.
Subd. 5a. [NO COLLATERAL ESTOPPEL.] No findings of fact or
decision or order issued by an unemployment law judge or a
senior unemployment review judge may be held conclusive or
binding or used as evidence in any separate or subsequent action
in any other forum, be it contractual, administrative, or
judicial, except proceedings provided for under this chapter,
regardless of whether the action involves the same or related
parties or involves the same facts.
Subd. 6. [REPRESENTATION; FEES.] (a) In any proceeding
under subdivision 1, or 2, or 2a, an applicant or involved
employer may be represented by any agent.
(b) Except for services provided by an attorney-at-law, an
applicant shall not be charged fees, costs, or disbursements of
any kind in a proceeding before an unemployment law judge, a
senior unemployment review judge, the Minnesota Court of
Appeals, or the Supreme Court of Minnesota.
Subd. 7. [JUDICIAL REVIEW.] (a) The Minnesota Court of
Appeals shall, by writ of certiorari to the department, review
the senior unemployment review law judge's decision under
subdivision 2 or order under subdivision 2a, provided a petition
for the writ is filed with the court and a copy is served upon
the senior unemployment review law judge or the commissioner and
any other involved party within 30 calendar days of the sending
of the senior unemployment review law judge's decision under
subdivision 2 or order under subdivision 2a 2.
(b) Any employer petitioning for a writ of certiorari shall
pay to the court the required filing fee and upon the service of
the writ shall furnish a cost bond to the department in
accordance with the Rules of Civil Appellate Procedure. If the
employer requests a written transcript of the testimony received
at the evidentiary hearing conducted pursuant to subdivision 1,
the employer shall pay to the department the cost of preparing
the transcript. That money shall be credited to the
administration account.
(c) Upon issuance by the Minnesota Court of Appeals of a
writ of certiorari as a result of an applicant's petition, the
department shall furnish to the applicant at no cost a written
transcript of any testimony received at the evidentiary hearing
conducted pursuant to subdivision 1, and, if requested, a copy
of all exhibits entered into evidence. No filing fee or cost
bond shall be required of an applicant petitioning the Minnesota
Court of Appeals for a writ of certiorari.
(d) The Minnesota Court of Appeals may affirm the decision
of the unemployment law judge or remand the case for further
proceedings; or it may reverse or modify the decision if the
substantial rights of the petitioner may have been prejudiced
because the findings, inferences, conclusion, or decision are:
(1) in violation of constitutional provisions;
(2) in excess of the statutory authority or jurisdiction of
the department;
(3) made upon unlawful procedure;
(4) affected by other error of law;
(5) unsupported by substantial evidence in view of the
entire record as submitted; or
(6) arbitrary or capricious.
(e) The department shall be considered the primary
responding party to any judicial action involving a senior an
unemployment review law judge's decision or order. The
department may be represented by an attorney who is an employee
of the department.
[EFFECTIVE DATE.] This section applies to unemployment law
judge decisions issued on or after 30 days following final
enactment of this act.
Sec. 35. Minnesota Statutes 2004, section 268.145,
subdivision 1, is amended to read:
Subdivision 1. [NOTIFICATION.] (a) Upon filing an
application for unemployment benefits, the applicant shall be
informed that:
(1) unemployment benefits are subject to federal and state
income tax;
(2) there are requirements for filing estimated tax
payments;
(3) the applicant may elect to have federal income tax
withheld from unemployment benefits;
(4) if the applicant elects to have federal income tax
withheld, the applicant may, in addition, elect to have
Minnesota state income tax withheld; and
(5) at any time during the benefit year the applicant may
change a prior election.
(b) If an applicant elects to have federal income tax
withheld, the commissioner shall deduct ten percent for federal
income tax, rounded down to the next lower whole dollar. If an
applicant also elects to have Minnesota state income tax
withheld, the commissioner shall make an additional five percent
deduction for state income tax, rounded down to the next lower
whole dollar. Any amounts deducted or offset pursuant to
sections 268.155, 268.156, 268.18, and 268.184 have priority
over any amounts deducted under this section. Federal income
tax withholding has priority over state income tax withholding.
(c) An election to have income tax withheld shall not be
retroactive and shall only apply to unemployment benefits paid
after the election.
Sec. 36. Minnesota Statutes 2004, section 268.18,
subdivision 1, is amended to read:
Subdivision 1. [NONFRAUD OVERPAYMENT.] (a) Any applicant
who (1) by reason of the applicant's own mistake, or (2) because
of an error by any employee of the department, or (3) because of
a determination or amended determination issued pursuant to
section 268.07 or 268.101, or (4) because of an appeal decision
under section 268.105, has received any unemployment benefits
that the applicant was not entitled to, shall promptly repay the
unemployment benefits to the trust fund. The commissioner shall,
as soon as the overpayment is discovered, determine the amount
due and notify the applicant to repay the unemployment benefits.
(b) Unless the applicant files an appeal within 30 calendar
days after the sending of the determination of overpayment to
the applicant by mail or electronic transmission, the
determination shall become final. Proceedings on the appeal
shall be conducted in accordance with section 268.105. An
applicant may not collaterally attack, by way of an appeal to an
overpayment determination, any prior determination issued
pursuant to section 268.07 or 268.101, or decision issued
pursuant to section 268.105, that has become final.
(c) If the applicant fails to repay the unemployment
benefits determined overpaid under this subdivision, the
commissioner may offset from any future unemployment benefits
otherwise payable the amount of the overpayment. Except when
the overpayment resulted because the applicant failed to report
deductible earnings or deductible or benefit delaying payments,
no single offset shall exceed 50 percent of the amount of the
payment from which the offset is made. The overpayment may also
be collected by the same methods as delinquent payments from an
employer. A determination of overpayment shall state the
methods of collection the commissioner may use to recover the
overpayment.
(d) If an applicant has been overpaid unemployment benefits
under the law of another state, due to a reason other than
fraud, and that state certifies that the applicant is liable
under its law to repay the unemployment benefits and requests
the commissioner to recover the overpayment, the commissioner
may offset from future unemployment benefits otherwise payable
the amount of overpayment, except that no single offset shall
exceed 50 percent of the amount of the payment from which the
offset is made.
(e) If under paragraph (c) or (d) the reduced unemployment
benefits as a result of a 50 percent offset is not a whole
dollar amount, it shall be rounded down to the next lower whole
dollar.
(f) Unemployment benefits paid for weeks more than three
years prior to the discovery date of a determination of
overpayment issued under this subdivision are shall not be
considered overpaid unemployment benefits.
Sec. 37. Minnesota Statutes 2004, section 268.18,
subdivision 2, is amended to read:
Subd. 2. [OVERPAYMENT DUE TO FRAUD.] (a) Any applicant who
receives unemployment benefits by knowingly misrepresenting,
misstating, or failing to disclose any material fact, or who
makes a false statement or representation without a good faith
belief as to the correctness of the statement or representation,
has committed fraud. After the discovery of facts indicating
fraud, the commissioner shall make a determination that the
applicant obtained unemployment benefits by fraud and that the
applicant must promptly repay the unemployment benefits to the
trust fund. In addition, the commissioner shall assess a
penalty equal to 25 percent of the amount fraudulently
obtained. If the applicant had a prior overpayment due to
fraud, the commissioner shall, on the present overpayment,
assess a penalty equal to 50 percent of the amount fraudulently
obtained. This penalty is in addition to penalties under
section 268.182.
(b) Unless the applicant files an appeal within 30 calendar
days after the sending of the determination of overpayment by
fraud to the applicant by mail or electronic transmission, the
determination shall become final. Proceedings on the appeal
shall be conducted in accordance with section 268.105.
(c) If the applicant fails to repay the unemployment
benefits, penalty, and interest assessed, the commissioner shall
offset from future unemployment benefits otherwise payable the
total amount due. The total due may also be collected by the
same methods as delinquent payments from an employer. A
determination of overpayment by fraud shall state the methods of
collection the commissioner may use to recover the overpayment.
Money received in repayment of fraudulently obtained
unemployment benefits, penalties, and interest shall first be
applied to the unemployment benefits overpaid, then to the
penalty amount due, then to any interest due. Payments made
toward the penalty and interest shall be credited to the
contingent account.
(d) If an applicant has been overpaid unemployment benefits
under the law of another state because of fraud and that state
certifies that the applicant is liable to repay the unemployment
benefits and requests the commissioner to recover the
overpayment, the commissioner may offset from future
unemployment benefits otherwise payable the amount of
overpayment.
(e) Unemployment benefits paid for weeks more than four
years prior to the date of a determination of overpayment by
fraud may only be made within four years of the effective date
of the benefit account from which the issued under this
subdivision shall not be considered overpaid unemployment
benefits were fraudulently obtained.
Sec. 38. Minnesota Statutes 2004, section 268.18,
subdivision 2b, is amended to read:
Subd. 2b. [INTEREST.] (a) On any unemployment benefits
fraudulently obtained, and any penalty amounts assessed under
subdivision 2, the commissioner may assess interest at the rate
of 1-1/2 percent per month on any amount that remains unpaid 30
calendar days after the date of the determination of overpayment
by fraud. A determination of overpayment by fraud shall state
that interest shall be assessed.
(b) If this subdivision became effective after the date of
the determination, or the determination did not state that
interest shall be assessed, interest shall be assessed beginning
30 calendar days after notification, by mail or electronic
transmission, to the applicant.
(c) Interest payments under this section shall be credited
to the administration account.
Sec. 39. Minnesota Statutes 2004, section 268.182,
subdivision 2, is amended to read:
Subd. 2. [ADMINISTRATIVE PENALTIES.] Any individual
applicant who knowingly makes a false statement or
representation, who knowingly fails to disclose a material fact,
or who makes a false statement or representation without a good
faith belief as to the correctness of the statement or
representation, in order to obtain or in an attempt to obtain
unemployment benefits may be assessed, in addition to any other
penalties, an administrative penalty of denial of being
ineligible for unemployment benefits for one to 52 13 to 104
weeks that the individual would otherwise be entitled to
unemployment benefits. A denial shall not apply to any week
more than two years after the week that the penalty was
determined. A determination of denial ineligibility setting out
the weeks the applicant shall be ineligible shall be sent to the
individual applicant by mail or electronic transmission. Unless
an appeal is filed within 30 calendar days of sending, the
determination shall be final. Proceeding on the appeal shall be
conducted in accordance with section 268.105.
Sec. 40. [TAX RATE COMPUTATION.]
Notwithstanding any provision of Minnesota Statutes,
chapter 268, to the contrary, the commissioner may compute, to
the nearest 1/100 of a percent, any unemployment tax rate
assigned on or after July 1, 2005, regardless of the year or
portion of any year for which the tax rate is applicable.
Sec. 41. [REVISOR'S INSTRUCTION.]
(a) The revisor of statutes shall change the name of the
Department of Economic Security to the Department of Employment
and Economic Development in Minnesota Statutes and Minnesota
Rules.
(b) The revisor of statutes shall change the headnote for
Minnesota Statutes, section 268.095 from "DISQUALIFICATION
PROVISIONS" to "DISQUALIFICATION BECAUSE OF A QUIT OR DISCHARGE."
(c) The revisor of statutes shall change the headnote for
Minnesota Statutes, section 268.101 from "DETERMINATIONS ON
DISQUALIFICATION AND ELIGIBILITY" to "DETERMINATIONS ON ISSUES
OF DISQUALIFICATION AND ELIGIBILITY."
(d) The revisor of statutes shall renumber Minnesota
Statutes, section 268.095, subdivision 8, as section 268.085,
subdivision 13c, and correct cross-references accordingly.
(e) The revisor of statutes shall change the term "court
order" to "district court order" wherever the term appears in
Minnesota Statutes, sections 268.01 to 268.83.
Sec. 42. [REPEALER.]
(a) Minnesota Rules, parts 3310.2926; 3310.5000; 3315.0910,
subpart 9; 3315.1301; 3315.1315, subparts 1, 2, and 3;
3315.1650; and 3315.2210, are repealed.
(b) Minnesota Statutes 2004, section 268.086, subdivision
4, is repealed.
(c) Laws 1997, chapter 66, section 64, subdivision 1, is
repealed.
Sec. 43. [EFFECTIVE DATE.]
Sections 1 to 33, 35 to 40, and 42 are effective July 1,
2005. Section 41 is effective the day following final enactment.
Presented to the governor May 24, 2005
Signed by the governor May 26, 2005, 9:10 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes