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Key: (1) language to be deleted (2) new language

                              CHAPTER 3-S.F.No. 18 
                  An act relating to unemployment insurance; modifying 
                  provisions to increase the solvency of the trust fund; 
                  making policy and technical changes; amending 
                  Minnesota Statutes 2002, sections 268.035, 
                  subdivisions 15, 23; 268.044, subdivision 1, by adding 
                  a subdivision; 268.051, subdivisions 1, 2, 3, 5, 6, by 
                  adding a subdivision; 268.052, subdivision 1; 268.057, 
                  subdivision 5; 268.067; 268.07, subdivision 2; 
                  268.085, subdivision 3; 268.086, subdivision 2; 
                  268.095, subdivisions 1, 2, 6, 11; 268.105, 
                  subdivision 7; 268.18, subdivisions 1, 4; proposing 
                  coding for new law in Minnesota Statutes, chapter 268; 
                  repealing Minnesota Rules, part 3315.1015, subpart 4. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                   ARTICLE 1 
                                    SOLVENCY 
           Section 1.  Minnesota Statutes 2002, section 268.051, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PAYMENTS.] (a) Taxes and any additional 
        assessments, fees, or surcharges shall accrue and become payable 
        by each employer for each calendar year that the employer paid 
        wages to employees in covered employment, except for:  
           (1) nonprofit organizations that elect to make payments in 
        lieu of taxes 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.  
        Each employer shall pay taxes quarterly, at the employer's 
        assigned tax rate, on the taxable wages paid to each employee.  
        The taxes and any additional assessments, fees, or surcharges 
        shall be paid to the trust fund on or before the last day of the 
        month following the end of the calendar quarter. 
           (b) The tax total payment due may be paid in an amount to 
        the nearest whole dollar. 
           (c) When the tax total payment due for any calendar quarter 
        is less than $1, the tax it shall be disregarded. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 2.  Minnesota Statutes 2002, section 268.051, 
        subdivision 2, is amended to read: 
           Subd. 2.  [COMPUTATION OF TAX RATES; ADDITIONAL 
        ASSESSMENTS.] (a) For each calendar year the commissioner shall 
        compute the tax rate of each taxpaying employer that qualifies 
        for an experience rating by adding the base tax rate to the 
        employer's experience rating. 
           (b) The base tax rate shall be six-tenths of one percent if 
        the amount in the fund is less than $200,000,000 on June 30 of 
        the prior calendar year; or five-tenths of one percent if the 
        fund is more than $200,000,000 but less than $225,000,000; or 
        four-tenths of one percent if the fund is more than $225,000,000 
        but less than $250,000,000; or three-tenths of one percent if 
        the fund is more than $250,000,000 but less than $275,000,000; 
        or two-tenths of one percent if the fund is $275,000,000 but 
        less than $300,000,000; or one-tenth of one percent if the fund 
        is $300,000,000 or more. 
           (b) The base tax rate for the calendar year and any 
        additional assessments under this subdivision shall be 
        determined based upon the amount in the trust fund on March 31 
        of the prior year as a percentage of total wages paid in covered 
        employment.  The base tax rate shall be: 
           (1) one-tenth of one percent if the trust fund is equal to 
        or more than 0.75 percent; 
           (2) two-tenths of one percent if the trust fund is less 
        than 0.75 percent but equal to or more than 0.65 percent; 
           (3) three-tenths of one percent if the trust fund is less 
        than 0.65 percent but equal to or more than 0.55 percent; or 
           (4) four-tenths of one percent if the trust fund is less 
        than 0.55 percent. 
           (c) There shall be a "falling fund adjustment" to the base 
        tax rate for the calendar year if the amount in the trust fund 
        on March 31 of the prior year is less than 0.75 percent of total 
        wages paid in covered employment and: 
           (1) the amount in the trust fund on March 31 of the prior 
        year is ten percent or more below the amount in the trust fund 
        on March 31 of the year prior to that; or 
           (2) the amount in the trust fund on March 31 of the prior 
        year is greater than the amount in the trust fund on June 30 of 
        that same year. 
        If a "falling fund adjustment" is applicable, then the base tax 
        rate shall be 0.1 percent greater than otherwise provided for 
        under paragraph (b). 
           (d) In addition to the base tax rate under paragraph (b), 
        there shall be an additional assessment for the calendar year on 
        all quarterly unemployment taxes due from every taxpaying 
        employer if the amount in the trust fund on March 31 of the 
        prior year is less than .55 percent of total wages paid in 
        covered employment.  The assessment shall be as follows: 
           (1) a five percent assessment if the trust fund is less 
        than 0.55 percent but equal to or more than 0.45 percent; 
           (2) a ten percent assessment if the trust fund is less than 
        0.45 percent but equal to or more than 0.35 percent; or 
           (3) a 14 percent assessment if the trust fund is less than 
        0.35 percent. 
           (c) (e) For the purposes of this subdivision the trust fund 
        shall not include any money borrowed from the federal 
        unemployment trust fund pursuant to section 268.194, subdivision 
        6. 
           (f) For the purposes of this subdivision, total wages paid 
        in covered employment shall be those wages paid to all employees 
        in covered employment during the calendar year prior to the 
        March 31 date used in paragraph (b). 
           (g) The commissioner may compute any assessment under this 
        subdivision, and any assessment under subdivision 8, as a 
        percentage of the employer's experience rating and the base tax 
        rate, rounded to the nearest hundredth of a percent. 
           On tax rate notices sent under subdivision 6, any 
        assessments under this subdivision may be combined with any 
        special assessments for interest on federal loans provided for 
        in subdivision 8 into a single combined assessment. 
           [EFFECTIVE DATE.] Paragraph (c) is effective January 1, 
        2005.  The remainder of this section is effective the day 
        following final enactment. 
           Sec. 3.  Minnesota Statutes 2002, section 268.051, 
        subdivision 3, is amended to read: 
           Subd. 3.  [COMPUTATION OF A TAXPAYING EMPLOYER'S EXPERIENCE 
        RATING.] (a) For each calendar year, the commissioner shall 
        compute an experience rating for each taxpaying employer who has 
        been subject to this chapter paying unemployment taxes for at 
        least the 12 calendar months prior to July 1 of the prior 
        calendar year.  
           (b) The experience rating shall be the ratio obtained by 
        dividing 125 percent of the total unemployment benefits required 
        under section 268.047 to be used in computing the employer's tax 
        rate during the 60 48 calendar months ending on June 30 of the 
        prior calendar year, by the employer's total taxable payroll for 
        that same period. 
           (c) For purposes of paragraph (b), only that taxable 
        payroll upon which taxes have been paid on or before September 
        30 of the prior calendar year may be used in computing an 
        employer's experience rating. 
           (d) The experience rating shall be computed to the nearest 
        one-tenth of a percent, to a maximum of 8.9 percent.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 4.  Minnesota Statutes 2002, section 268.051, 
        subdivision 5, is amended to read: 
           Subd. 5.  [TAX RATE FOR NEW EMPLOYERS.] (a) Each new 
        taxpaying employer that does not qualify for an experience 
        rating under subdivision 3, paragraph (a), except new employers 
        in a high experience rating industry, shall be assigned, for a 
        calendar year, a tax rate the higher of (1) one percent, or (2) 
        the state's average cost rate.  For purposes of this paragraph, 
        the state's average cost tax rate shall be computed annually by 
        dividing the total amount of unemployment benefits paid all 
        applicants during the 60 48 calendar months prior to July 1 of 
        each ending on June 30 of the prior calendar year by the total 
        taxable wages of all taxpaying employers during the same period, 
        plus the applicable base tax rate.  This rate for new employers 
        shall be applicable for the calendar year following the 
        computation date.  
           (b) Each new taxpaying employer in a high experience rating 
        industry that does not qualify for an experience rating under 
        subdivision 3, paragraph (a), shall be assigned, for a calendar 
        year, a tax rate of 8.0 percent, plus the applicable base tax 
        rate.  
           An employer is considered to be in a high experience rating 
        industry if: 
           (1) the employer is engaged in residential, commercial, or 
        industrial construction, including general contractors; 
           (2) the employer is engaged in sand, gravel, or limestone 
        mining; 
           (3) the employer is engaged in the manufacturing of 
        concrete, concrete products, or asphalt; or 
           (4) the employer is engaged in road building, repair, or 
        resurfacing, including bridge and tunnels and residential and 
        commercial driveways and parking lots.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 5.  Minnesota Statutes 2002, section 268.051, 
        subdivision 6, is amended to read: 
           Subd. 6.  [NOTICE OF TAX RATE.] (a) 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, as determined for any calendar year.  The 
        notice shall contain the tax rate and the factors used in 
        determining the employer's experience rating.  Unless a protest 
        of the rate is made, the assigned rate shall be final except for 
        fraud and shall be the rate at which taxes shall be paid.  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, in a manner prescribed by the commissioner, 
        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 clerical error or error in 
        computation.  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.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 6.  Minnesota Statutes 2002, section 268.051, is 
        amended by adding a subdivision to read: 
           Subd. 9.  [ASSESSMENTS, FEES, AND SURCHARGES; 
        TREATMENT.] Any assessment, fee, or surcharge imposed under the 
        Minnesota Unemployment Insurance Law shall be treated the same 
        as, and considered as, a tax.  Any assessment, fee, or surcharge 
        shall be subject to the same collection procedures that apply to 
        past due taxes. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 7.  Minnesota Statutes 2002, section 268.07, 
        subdivision 2, is amended to read: 
           Subd. 2.  [BENEFIT ACCOUNT REQUIREMENTS AND WEEKLY 
        UNEMPLOYMENT BENEFIT AMOUNT AND MAXIMUM AMOUNT OF UNEMPLOYMENT 
        BENEFITS.] (a) To establish a benefit account, an applicant must 
        have: 
           (1) high quarter wage credits of at least $1,000; and 
           (2) wage credits, in other than the high quarter, of at 
        least $250.  
           (b) If an applicant has established a benefit account, the 
        weekly unemployment benefit amount available during the benefit 
        year shall be the higher of: 
           (1) 50 percent of the applicant's average weekly wage 
        during the base period, to a maximum of 66-2/3 percent of the 
        state's average weekly wage; or 
           (2) 50 percent of the applicant's average weekly wage 
        during the high quarter, to a maximum of 50 45 percent of the 
        state's average weekly wage. 
           The applicant's average weekly wage under clause (1) shall 
        be computed by dividing the total wage credits by 52.  The 
        applicant's average weekly wage under clause (2) shall be 
        computed by dividing the high quarter wage credits by 13.  
           (c) The state's maximum weekly unemployment benefit amount 
        and the applicant's weekly unemployment benefit amount and 
        maximum amount of unemployment benefits shall be rounded down to 
        the next lowest whole dollar.  
           (d) The maximum amount of unemployment benefits available 
        on any benefit account shall be the lower of: 
           (1) 33-1/3 percent of the applicant's total wage credits; 
        or 
           (2) 26 times the applicant's weekly unemployment benefit 
        amount.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 8.  Minnesota Statutes 2002, section 268.085, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DEDUCTIBLE 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 in an amount equal to or in excess of the applicant's 
        weekly unemployment benefit amount in the form of: 
           (1) 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 that are, 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 first four 
        weeks of payment and to one-half of the total number of any 
        additional weeks of payment.  This clause 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) 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) holiday pay. 
           (b) If the deductible 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 lowest dollar. 
           [EFFECTIVE DATE.] This section is effective for benefit 
        accounts established August 3, 2003, and thereafter. 
           Sec. 9.  [MAXIMUM BENEFIT AMOUNT.] 
           Notwithstanding Minnesota Statutes, section 268.07, 
        subdivision 2, paragraph (b), clause (2), the maximum amount of 
        weekly unemployment benefits available based upon the high 
        quarter calculation shall not be less than $350. 
           [EFFECTIVE DATE.] This section is effective the day 
        following enactment and sunsets September 1, 2006. 

                                   ARTICLE 2 
                          POLICY AND TECHNICAL CHANGES 
           Section 1.  Minnesota Statutes 2002, section 268.035, 
        subdivision 15, is amended to read: 
           Subd. 15.  [EMPLOYMENT.] "Employment" means service 
        performed by: 
           (1) an individual who is considered an employee under the 
        common law of employer-employee and not considered an 
        independent contractor; 
           (2) an officer of a corporation; 
           (3) a member of a limited liability company who has less 
        than a 25 percent ownership share and is considered an employee 
        under the common law of employer-employee; or 
           (4) an individual who performs services for a person for 
        compensation, as: 
           (i) an agent-driver or commission-driver engaged in 
        distributing meat products, vegetable products, fruit products, 
        beverages, or laundry or dry cleaning services; or 
           (ii) a traveling or city salesperson, other than as an 
        agent-driver or commission-driver, engaged full-time in the 
        solicitation on behalf of the person, of orders from 
        wholesalers, retailers, contractors, or operators of hotels, 
        restaurants, or other similar establishments for merchandise for 
        resale or supplies for use in their business operations. 
           This clause shall apply only if the contract of service 
        provides that substantially all of the services are to be 
        performed personally by the individual, and the services are 
        part of a continuing relationship with the person for whom the 
        services are performed, and the individual does not have a 
        substantial investment in facilities used in connection with the 
        performance of the services, other than facilities for 
        transportation. 
           Sec. 2.  Minnesota Statutes 2002, section 268.035, 
        subdivision 23, is amended to read: 
           Subd. 23.  [STATE'S AVERAGE ANNUAL AND AVERAGE WEEKLY 
        WAGE.] (a) On or before June 30 of each year, the commissioner 
        shall calculate the state's average annual wage and the state's 
        average weekly wage in the following manner: 
           (1) The sum of the total monthly covered employment 
        reported by all employers for the prior calendar year shall be 
        divided by 12 to calculate the average monthly covered 
        employment. 
           (2) The sum of the total wages paid for all covered 
        employment reported by all employers for the prior calendar year 
        shall be divided by the average monthly covered employment to 
        calculate the state's average annual wage. 
           (3) The state's average annual wage shall be divided by 52 
        to calculate the state's average weekly wage. 
           (b) For purposes of calculating the amount of taxable 
        wages, the state's average annual wage shall apply to the 
        calendar year following the calculation. 
           (c) For purposes of calculating the state's maximum weekly 
        unemployment benefit amount payable available on any benefit 
        account under section 268.07, subdivision 2, the state's average 
        weekly wage shall apply to the 12-month one-year period 
        beginning the first Sunday in August 1 of the calendar year of 
        the calculation. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 3.  Minnesota Statutes 2002, section 268.044, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [WAGE DETAIL REPORT.] (a) Each employer 
        that has employees in covered employment shall provide the 
        commissioner with file a quarterly wage detail report, in a 
        manner and 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.  If the information required is not filed 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 
        filed on or before the last day of the month following the end 
        of the calendar quarter. 
           (b) The employer may report the wages paid to the nearest 
        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 by federal law. 
           Sec. 4.  Minnesota Statutes 2002, section 268.044, is 
        amended by adding a subdivision to read: 
           Subd. 1a.  [ELECTRONIC TRANSMISSION OF REPORT 
        REQUIRED.] Each employer that has 50 or more employees to report 
        for a calendar quarter under subdivision 1 must file the 
        quarterly wage detail report by electronic transmission in a 
        format prescribed by the commissioner.  The commissioner shall 
        have the discretion to accept wage detail reports by magnetic 
        media, in a format prescribed by the commissioner.  Wage detail 
        reports from an employer with 50 or more employees to report for 
        a calendar quarter that are filed by any other means may be 
        returned to the employer, and reports returned shall be 
        considered as not filed and the penalties under subdivision 2 
        may be imposed. 
           Sec. 5.  Minnesota Statutes 2002, section 268.052, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PAYMENTS.] In lieu of taxes payable on a 
        quarterly basis, the state of Minnesota or its political 
        subdivisions shall pay into reimburse the trust fund the amount 
        of unemployment benefits charged to its reimbursable account 
        under section 268.047.  Payments Reimbursements in the amount of 
        unemployment benefits charged to the reimbursable account during 
        a calendar quarter shall be made on or before the last day of 
        the month following the month that the notice of unemployment 
        benefits paid is sent pursuant to section 268.047, subdivision 
        5.  Past due payments in lieu of taxes reimbursements shall be 
        subject to the same interest charges and collection procedures 
        that apply to past due taxes. 
           Sec. 6.  Minnesota Statutes 2002, section 268.057, 
        subdivision 5, is amended to read: 
           Subd. 5.  [INTEREST ON PAST DUE TAXES.] If any taxes or 
        payments in lieu of taxes to the fund, reimbursements, fees, 
        assessments, surcharges, or any penalties under section 268.184, 
        are not paid on the date due the unpaid balance shall bear 
        interest at the rate of one and one-half percent per month or 
        any part thereof.  Taxes or Any payments in lieu of taxes 
        received by mail postmarked on a day following the date due 
        shall be considered to have been paid on the due date if there 
        is substantial evidence that the payment was actually deposited 
        in the United States mail properly addressed to the department 
        with postage prepaid thereon on or before the due date.  
        Interest collected shall be credited to the contingent account.  
        Interest may be waived by rules adopted by the 
        commissioner under section 268.067. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 7.  Minnesota Statutes 2002, section 268.067, is 
        amended to read: 
           268.067 [COMPROMISE.] 
           (a) The commissioner may compromise in whole or in part any 
        action, determination, or decision that affects only an employer 
        and not an applicant, and that has occurred during the prior 24 
        months.  This paragraph may apply if it is determined by a court 
        of law, or a confession of judgment, that an applicant, while 
        employed, wrongfully took from the employer $500 or more, in 
        money or property. 
           (b) The commissioner may at any time compromise delinquent 
        employer taxes, payments in lieu of taxes reimbursements, 
        interest, penalties, and costs. 
           (c) Any compromise shall be by written order signed by an 
        attorney who is a classified employee of the department 
        designated by the commissioner for that purpose. 
           (d) Any compromise order must set out all the terms and the 
        reason for the order and must be in the best interest of the 
        state of Minnesota. 
           Sec. 8.  Minnesota Statutes 2002, section 268.07, 
        subdivision 2, is amended to read: 
           Subd. 2.  [BENEFIT ACCOUNT REQUIREMENTS AND WEEKLY 
        UNEMPLOYMENT BENEFIT AMOUNT AND MAXIMUM AMOUNT OF UNEMPLOYMENT 
        BENEFITS.] (a) To establish a benefit account, an applicant must 
        have: 
           (1) high quarter wage credits of at least $1,000; and 
           (2) wage credits, in other than the high quarter, of at 
        least $250.  
           (b) If an applicant has established a benefit account, the 
        weekly unemployment benefit amount available during the benefit 
        year shall be the higher of: 
           (1) 50 percent of the applicant's average weekly wage 
        during the base period, to a maximum of 66-2/3 percent of the 
        state's average weekly wage; or 
           (2) 50 percent of the applicant's average weekly wage 
        during the high quarter, to a maximum of 50 percent of the 
        state's average weekly wage. 
           The applicant's average weekly wage under clause (1) shall 
        be computed by dividing the total wage credits by 52.  The 
        applicant's average weekly wage under clause (2) shall be 
        computed by dividing the high quarter wage credits by 13.  
           (c) The state's maximum weekly unemployment benefit amount 
        and the an applicant's weekly unemployment benefit amount and 
        maximum amount of unemployment benefits available shall be 
        rounded down to the next lowest whole dollar.  The state's 
        maximum weekly benefit amount, computed in accordance with 
        section 268.035, subdivision 23, shall apply to a benefit 
        account established effective on or after the first Sunday in 
        August.  Once established, an applicant's weekly unemployment 
        benefit amount shall not be affected by the first Sunday in 
        August change in the state's maximum weekly unemployment benefit 
        amount.  
           (d) The maximum amount of unemployment benefits available 
        on any benefit account shall be the lower of: 
           (1) 33-1/3 percent of the applicant's total wage credits; 
        or 
           (2) 26 times the applicant's weekly unemployment benefit 
        amount.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 9.  [268.084] [PERSONAL IDENTIFICATION NUMBER; 
        PRESUMPTION.] 
           (a) Each applicant shall be issued a personal 
        identification number (PIN) for the purpose of filing continued 
        biweekly requests for unemployment benefits, accessing 
        information, and engaging in other transactions with the 
        department. 
           (b) If a PIN assigned to an applicant is used in the filing 
        of a continued biweekly request for unemployment benefits under 
        section 268.086 or any other type of transaction, the applicant 
        shall be presumed to have been the individual using that PIN and 
        presumed to have received any unemployment benefit payment 
        issued.  This presumption may be rebutted by a preponderance of 
        the evidence showing that the applicant assigned the PIN was not 
        the individual who used that PIN in the transaction. 
           (c) The commissioner shall notify each applicant of this 
        section. 
           Sec. 10.  Minnesota Statutes 2002, 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 weekly or 
        biweekly basis as prescribed by the commissioner, on that the 
        applicant's 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 disqualification in accordance with section 268.101, 
        subdivision 1, paragraph (c). 
           Sec. 11.  Minnesota Statutes 2002, section 268.095, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [QUIT.] An applicant who quit employment 
        shall be disqualified from all unemployment benefits except when:
           (1) the applicant quit the employment because of a good 
        reason caused by the employer; 
           (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 other employment to have sufficient subsequent 
        earnings to satisfy the disqualification that would otherwise be 
        imposed; 
           (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 had 
        full-time employment in the base period, that the applicant 
        separated from because of nondisqualifying reasons, 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 
        made reasonable efforts to remain in that employment in spite of 
        the serious illness or injury. 
           Reasonable efforts to remain in that employment are those a 
        reasonable individual would make if interested in remaining with 
        the employer and require 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, 
        the applicant has not made reasonable efforts to remain in that 
        employment this exception shall not apply if the applicant 
        has was previously been diagnosed as chemically dependent, or 
        has previously 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) documentation or certification written statement that 
        the applicant or the applicant's minor child is a victim of the 
        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. 12.  Minnesota Statutes 2002, section 268.095, 
        subdivision 2, is amended to read: 
           Subd. 2.  [QUIT DEFINED.] (a) A quit from employment occurs 
        when the decision to end the employment was, at the time the 
        employment ended, the employee's.  
           (b) An employee who has been notified that the employee 
        will be discharged in the future, who chooses to end the 
        employment while employment in any capacity is still available, 
        shall be considered to have quit the employment. 
           (c) An employee who seeks to withdraw a previously 
        submitted notice of quitting shall be considered to have quit 
        the employment if the employer does not agree that the notice 
        may be withdrawn. 
           (d) An applicant who, without good cause, fails to 
        affirmatively request an additional job assignment within five 
        calendar days after completion of a suitable temporary job 
        assignment from a staffing service employer, (1) fails without 
        good cause to affirmatively request an additional job 
        assignment, or (2) refuses without good cause an additional 
        suitable job assignment offered, shall be considered to have 
        quit employment. 
           This paragraph shall apply only if, at the time of 
        beginning of employment with the staffing service employer, the 
        applicant signed and was provided a copy of a separate document 
        written in clear and concise language that informed the 
        applicant of this paragraph and that unemployment benefits may 
        be affected. 
           For purposes of this paragraph, "good cause" shall be a 
        reason that is significant and would compel an average, 
        reasonable worker, who would otherwise want an additional 
        temporary job assignment with the staffing service employer, (1) 
        to fail to contact the staffing service employer, or (2) to 
        refuse an offered assignment.  The applicant shall be considered 
        to have good cause if the temporary job assignment just 
        completed was not suitable employment for the applicant. 
           For purposes of this paragraph, a "staffing service 
        employer" is an employer whose business involves employing 
        individuals directly for the purpose of furnishing temporary 
        help job assignment workers to clients of the staffing service. 
           Sec. 13.  Minnesota Statutes 2002, section 268.095, 
        subdivision 6, is amended to read: 
           Subd. 6.  [EMPLOYMENT MISCONDUCT DEFINED.] (a) Employment 
        misconduct means: 
           (1) any intentional, negligent, or indifferent conduct, on 
        the job or off the job, (1) that disregards evinces a serious 
        violation of the standards of behavior that an the employer has 
        the right to reasonably expect of the employee or disregards the 
        employee's duties and obligations to the employer;, or (2) 
        negligent or indifferent conduct, on the job or off the job, 
        that demonstrates a substantial lack of concern for the 
        employment. 
           (b) Inefficiency, inadvertence, simple unsatisfactory 
        conduct, a single incident that does not have a significant 
        adverse impact on the employer, conduct an average reasonable 
        employee would have engaged in under the circumstances, poor 
        performance because of inability or incapacity, good faith 
        errors in judgment if judgment was required, or absence because 
        of illness or injury with proper notice to the employer, are not 
        employment misconduct. 
           (c) Any conduct in violation of paragraph (a), clause (1) 
        or (2), (b) Conduct that was a direct result of the applicant's 
        chemical dependency is not employment misconduct if unless the 
        applicant has was previously been diagnosed 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. 
           (c) Conduct that was a result of the applicant, or the 
        applicant's minor child, being a victim of domestic abuse as 
        defined under section 518B.01, is not employment misconduct.  
        Domestic abuse shall be shown as provided for in section 
        268.095, subdivision 1, clause (8). 
           (d) A driving offense in violation of sections 169A.20, 
        169A.31, or 169A.50 to 169A.53 that interferes with or adversely 
        affects the employment is employment misconduct. 
           (e) The definition of employment misconduct provided by 
        this subdivision shall be exclusive.  
           Sec. 14.  Minnesota Statutes 2002, 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. 15.  Minnesota Statutes 2002, section 268.105, 
        subdivision 7, is amended to read: 
           Subd. 7.  [JUDICIAL REVIEW.] (a) The Minnesota court of 
        appeals shall, by writ of certiorari to the commissioner, review 
        the decision of the commissioner provided a petition for the 
        writ is filed with the court and a copy is served upon the 
        commissioner and any other involved party within 30 calendar 
        days of the mailing of the commissioner's decision.  
           (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 commissioner 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 commissioner the cost of preparing 
        the transcript. 
           (c) Upon issuance by the Minnesota court of appeals of a 
        writ of certiorari as a result of an applicant's petition, the 
        commissioner shall furnish to the applicant at no cost a written 
        transcript of the 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 commissioner shall be considered the primary 
        responding party to any judicial action involving the 
        commissioner's decision.  The commissioner may be represented by 
        an attorney who is a classified an employee of the department 
        designated by the commissioner for that purpose. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 16.  Minnesota Statutes 2002, section 268.18, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [NONFRAUD OVERPAYMENT DUE TO ERROR.] (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, redetermination, 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.  If the applicant fails to repay the 
        unemployment benefits, The commissioner shall, as soon as the 
        erroneous payment overpayment is discovered, determine the 
        amount due and notify the applicant in writing to repay the 
        unemployment benefits. 
           (b) Unless the applicant files an appeal within 30 calendar 
        days after the mailing of the determination of overpayment to 
        the applicant's last known address, 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 taxes.  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 because of an error, 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) Unemployment benefits paid for weeks more than three 
        years prior to the discovery of error overpayment under this 
        subdivision are not overpaid unemployment benefits. 
           Sec. 17.  Minnesota Statutes 2002, section 268.18, 
        subdivision 4, is amended to read: 
           Subd. 4.  [CANCELLATION OF OVERPAYMENTS.] (a) If 
        unemployment benefits paid because of an error determined 
        overpaid under subdivision 1 are not repaid or offset from 
        subsequent unemployment benefits as provided for in subdivision 
        1 within six years after the date of the determination of 
        overpayment, the commissioner shall cancel the overpayment 
        balance, and no administrative or legal proceedings shall be 
        used to enforce collection of those amounts. 
           (b) If unemployment benefits paid as a result of 
        fraud determined overpaid under subdivision 2 including 
        penalties and interest are not repaid or offset from subsequent 
        unemployment benefits as provided for in subdivision 2 within 
        ten years after the date of the determination of overpayment by 
        fraud, the commissioner shall cancel the overpayment balance and 
        any penalties and interest due, and no administrative or legal 
        proceeding shall be used to enforce collection of those amounts. 
           (c) The commissioner may cancel at any time any 
        overpayment, including penalties and interest, that the 
        commissioner determines is uncollectible due to death or 
        bankruptcy. 
           Sec. 18.  [GATE PILOT PROJECT.] 
           The commissioner of economic security may implement a pilot 
        project involving unemployment benefit applicants who are 
        participating in the Growing America Through Entrepreneurship, 
        (GATE) program, a joint initiative of the Small Business 
        Administration and the United States Department of Labor, to 
        help create, support, and expand small business opportunities in 
        diverse communities.  The commissioner may waive all or part of 
        the ongoing eligibility requirements under Minnesota Statutes, 
        sections 268.085 and 268.086 for GATE participants.  
           A maximum of 200 unemployment benefit applicants may be 
        involved in this pilot project at any one time. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 19.  [SUNSET.] 
           Section 18 expires on June 30, 2008. 
           Sec. 20.  [REVISOR'S INSTRUCTION.] 
           (a) The revisor of statutes shall change the term 
        "unemployment insurance benefits program" to "unemployment 
        insurance program" throughout Minnesota Statutes. 
           (b) The revisor of statutes shall change the term "payments 
        in lieu of taxes" to "reimbursements" in Minnesota Statutes, 
        sections 268.01 to 268.23. 
           (c) The revisor of statutes shall change the term 
        "continued request" to "continued biweekly request" in Minnesota 
        Statutes, sections 268.029 to 268.23. 
           (d) The revisor of statutes shall change the term 
        "unemployment insurance program law" to "unemployment insurance 
        law" in Minnesota Statutes, sections 268.029 to 268.23. 
           (e) The revisor of statutes shall change the term 
        "unemployment insurance program trust fund" to "unemployment 
        insurance trust fund" in Minnesota Statutes, sections 268.029 to 
        268.23. 
           (f) The revisor of statutes shall change the term 
        "experience rating record" to "experience rating" in Minnesota 
        Statutes, sections 268.029 to 268.23. 
           (g) The revisor of statutes shall change the term "this 
        subdivision shall be exclusive" to "this subdivision shall be 
        exclusive and no other definition shall apply" in Minnesota 
        Statutes, sections 268.029 to 268.23. 
           (h) The revisor of statutes shall change the term 
        "applicants" to "unemployment benefit applicants" in Minnesota 
        Statutes, section 268.26. 
           (i) The revisor of statutes shall change the term 
        "benefits" to "unemployment benefits" in Minnesota Statutes, 
        sections 268.07, subdivision 3, paragraph (b); 268.101, 
        subdivision 1; and 268.18, subdivision 3a. 
           (j) The revisor of statutes shall change the term 
        "disqualified from" to "ineligible for" and change the term 
        "disqualified" to "ineligible" in Minnesota Statutes, section 
        268.095, subdivision 12. 
           (k) The revisor of statutes shall renumber each section of 
        Minnesota Statutes listed in column A with the number listed in 
        column B.  The revisor shall also make necessary cross-reference 
        changes consistent with the renumbering. 
         Column A                     Column B
         268.095, subd. 12            268.085, subd. 13b
         268.035, subd. 18            268.035, subd. 25a
           (l) The revisor of statutes shall change the term "fund" to 
        "trust fund" in Minnesota Statutes, sections 268.029 to 268.23. 
           Sec. 21.  [REPEALER.] 
           Minnesota Rules, part 3315.1015, subpart 4, is repealed. 
           Presented to the governor May 27, 2003 
           Signed by the governor May 30, 2003, 3:47 p.m.

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