1.1 	A bill for an act
1.2 	relating to unemployment insurance; making federal conformity, policy, and 
1.3 	other housekeeping changes;amending Minnesota Statutes 2010, sections 
1.4 	268.035, subdivision 12d; 268.042, subdivision 1; 268.044, subdivision 1; 
1.5 	268.046, subdivision 3; 268.047, subdivision 4; 268.051, subdivision 4; 268.085, 
1.6 	subdivisions 5, 11, 15; 268.095, subdivision 6; 268.103, subdivision 1; 268.18, 
1.7 	subdivisions 2, 2b, 4, 4a; 268.192, by adding a subdivision; 268.194, subdivision 
1.8 	1; Minnesota Statutes 2011 Supplement, sections 268.035, subdivision 20; 
1.9 	268.051, subdivision 5; 268.115, subdivision 1; 268.184, subdivisions 1, 1a.
1.10 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.11 	ARTICLE 1
1.12 	FEDERAL CONFORMITY

1.13 	Section 1. Minnesota Statutes 2010, section 268.047, subdivision 4, is amended to read:
1.14 		Subd. 4.Limitation on exceptions. (a) Regardless of subdivisions 2 and 3, an 
1.15 	exception under those subdivisions will be limited in accordance with according to section 
1.16 	268.101, subdivision 2, paragraph (b).
1.17 	(b) Regardless of subdivision 2, clause (8), an exception under that clause does 
1.18 	not apply if the overpaid unemployment benefits resulted because the employer or any 
1.19 	employee, officer, or agent of the employer:
1.20 	(1) failed to respond timely or adequately to a request for information under section 
1.21 	268.101, subdivision 1, paragraph (b); and
1.22 	(2) has established a pattern of failing to respond timely or adequately to requests for 
1.23 	information under section 268.101, subdivision 1, paragraph (b).
1.24 	The employer must pay the trust fund the amount of the overpaid unemployment 
1.25 	benefits that will be used in computing the future tax rate of taxpaying employers or 
2.1 	charged to the reimbursable account of a nonprofit or government employer under 
2.2 	subdivision 1. The procedure for required payment is under section 268.184, subdivision 1.
2.3 	This paragraph is enacted to conform to the requirements of Public Law 112-40, 
2.4 	section 252. A "pattern" for purposes of this paragraph is a prior failure to respond three 
2.5 	or more times in the most recent six months.

2.6 	EFFECTIVE DATE. This section is effective for determinations issued on or 
2.7 	after July 1, 2013.

2.8 	Sec. 2. Minnesota Statutes 2010, section 268.18, subdivision 2, is amended to read:
2.9 		Subd. 2.Overpayment because of fraud. (a) Any applicant who receives 
2.10 	unemployment benefits by knowingly misrepresenting, misstating, or failing to disclose 
2.11 	any material fact, or who makes a false statement or representation without a good faith 
2.12 	belief as to the correctness of the statement or representation, has committed fraud. After 
2.13 	the discovery of facts indicating fraud, the commissioner must make a determination 
2.14 	that the applicant obtained unemployment benefits by fraud and that the applicant must 
2.15 	promptly repay the unemployment benefits to the trust fund. In addition, the commissioner 
2.16 	must assess a penalty equal to 40 percent of the amount fraudulently obtained. This 
2.17 	penalty is in addition to penalties under section 268.182.
2.18 	(b) Unless the applicant files an appeal within 20 calendar days after the sending 
2.19 	of the determination of overpayment by fraud to the applicant by mail or electronic 
2.20 	transmission, the determination is final. Proceedings on the appeal are conducted in 
2.21 	accordance with section 268.105.
2.22 	(c) If the applicant fails to repay the unemployment benefits, penalty, and interest 
2.23 	assessed, the total due may be collected by the methods allowed under state and federal 
2.24 	law. A determination of overpayment by fraud must state the methods of collection the 
2.25 	commissioner may use to recover the overpayment. Money received in repayment of 
2.26 	fraudulently obtained unemployment benefits, penalties, and interest is first applied to the 
2.27 	unemployment benefits overpaid, then to the penalty amount due, then to any interest due. 
2.28 	62.5 percent of the payments made toward the penalty are credited to the contingent 
2.29 	account and 37.5 percent credited to the administration account trust fund.
2.30 	(d) If an applicant has been overpaid unemployment benefits under the law of 
2.31 	another state because of fraud and that state certifies that the applicant is liable to repay 
2.32 	the unemployment benefits and requests the commissioner to recover the overpayment, 
2.33 	the commissioner may offset from future unemployment benefits otherwise payable the 
2.34 	amount of overpayment.
3.1 	(e) Regardless of the limitations in section 268.101, subdivision 2, paragraph 
3.2 	(d), unemployment benefits paid for weeks more than four years before the date of a 
3.3 	determination of overpayment by fraud issued under this subdivision are not considered 
3.4 	overpaid unemployment benefits.

3.5 	EFFECTIVE DATE. The amendments to paragraph (c) are effective for any 
3.6 	money credited on or after July 1, 2013. The amendments to paragraph (e) are effective 
3.7 	July 1, 2012.

3.8 	Sec. 3. Minnesota Statutes 2011 Supplement, section 268.184, subdivision 1, is 
3.9 	amended to read:
3.10 		Subdivision 1.Administrative penalties. (a) The commissioner must penalize 
3.11 	an employer if that employer or any employee, officer, or agent of that employer, is 
3.12 	in collusion with any applicant for the purpose of assisting the applicant to receive 
3.13 	unemployment benefits fraudulently. The penalty is $500 or the amount of unemployment 
3.14 	benefits determined to be overpaid, whichever is greater.
3.15 	(b) The commissioner must penalize an employer if that employer or any employee, 
3.16 	officer, or agent of that employer (1) made a false statement or representation knowing it 
3.17 	to be false, (2) made a false statement or representation without a good faith belief as to 
3.18 	correctness of the statement or representation, (3) knowingly failed to disclose a material 
3.19 	fact, or (4) made an offer of employment to an applicant when, in fact, the employer 
3.20 	had no employment available, but.
3.21 	(c) The penalty required is imposed only if the employer's action:
3.22 	(i) (1) was taken to prevent or reduce the payment of unemployment benefits to 
3.23 	any applicant;
3.24 	(ii) (2) was taken to reduce or avoid any payment required from an employer under 
3.25 	this chapter or section 116L.20; or
3.26 	(iii) (3) caused an overpayment of unemployment benefits to an applicant.
3.27 	The penalty is the greater of $500, or 50 percent of:
3.28 	(i) the amount of the overpaid or unemployment benefits;
3.29 	(ii) the amount of the reduced unemployment benefits; or
3.30 	(iii) the amount of the payment required, whichever is greater from the employer.
3.31 	(c) (d) The commissioner must penalize an employer if that employer failed or 
3.32 	refused to honor a subpoena issued under section 268.105, subdivision 4, or section 
3.33 	268.188. The penalty is $500 and any costs of enforcing the subpoena, including attorney 
3.34 	fees.
4.1 	(d) (e) Penalties under this subdivision are in addition to any other penalties and 
4.2 	subject to the same collection procedures that apply to past due taxes. Penalties must be 
4.3 	paid within 30 calendar days of assessment issuing the determination of penalty and 
4.4 	credited to the contingent account trust fund.
4.5 	(e) (f) The determination of the penalty is final unless the employer files an appeal 
4.6 	within 20 calendar days after the sending of the determination of the penalty to the 
4.7 	employer by mail or electronic transmission. Proceedings on the appeal are conducted in 
4.8 	accordance with section 268.105.

4.9 	EFFECTIVE DATE. This section is effective July 1, 2012, except the amendments 
4.10 	to the new paragraph (e) are effective for penalties imposed on or after July 1, 2013.

4.11 	ARTICLE 2
4.12 	POLICY

4.13 	Section 1. Minnesota Statutes 2010, section 268.046, subdivision 3, is amended to read:
4.14 		Subd. 3.Penalties; application. (a) Any person that violates the requirements 
4.15 	of this section and any taxpaying employer that violates subdivision 1, paragraph (b), 
4.16 	or any nonprofit or government employer that violates subdivision 2, paragraph (b), is 
4.17 	subject to the penalties under section 268.184, subdivision 1a. Penalties are credited to 
4.18 	the administration account to be used to ensure integrity in the unemployment insurance 
4.19 	program trust fund.
4.20 	(b) Section 268.051, subdivision 4, does not apply to contracts under this section. 
4.21 	This section does not limit or prevent the application of section 268.051, subdivision 4, to 
4.22 	any other transactions or acquisitions involving the taxpaying employer. This section does 
4.23 	not limit or prevent the application of section 268.051, subdivision 4a.
4.24 	(c) An assignment of an account upon the execution of a contract under this section 
4.25 	and a termination of a contract with the corresponding assignment of the account is not 
4.26 	considered a separation from employment of any worker covered by the contract. Nothing 
4.27 	under this subdivision causes the person to be liable for any amounts past due under this 
4.28 	chapter from the taxpaying employer or the nonprofit or government employer.
4.29 	(d) This section applies to, but is not limited to, persons registered under section 
4.30 	79.255, but does not apply to persons that obtain an exemption from registration under 
4.31 	section 79.255, subdivision 9.

4.32 	EFFECTIVE DATE. This section is effective July 1, 2013.

4.33 	Sec. 2. Minnesota Statutes 2010, section 268.051, subdivision 4, is amended to read:
5.1 		Subd. 4.Experience rating history transfer. (a) The experience rating history of 
5.2 	the predecessor employer is transferred to the successor employer when:
5.3 	(1) a taxpaying employer acquires all of the organization, trade or business, or 
5.4 	workforce of another taxpaying employer; and
5.5 	(2) there is 25 percent or more common ownership or there is substantially common 
5.6 	management or control between the predecessor and successor, the experience rating 
5.7 	history of the predecessor employer is transferred to the successor employer.
5.8 	(b) A portion of the experience rating history of the predecessor employer is 
5.9 	transferred to the successor employer when:
5.10 	(1) a taxpaying employer acquires a portion, but less than all, of the organization, 
5.11 	trade or business, or workforce of another taxpaying employer; and
5.12 	(2) there is 25 percent or more common ownership or there is substantially common 
5.13 	management or control between the predecessor and successor, the successor employer 
5.14 	acquires, as of the date of acquisition, the experience rating history attributable to the 
5.15 	portion it acquired, and the predecessor employer retains the experience rating history 
5.16 	attributable to the portion that it has retained. If the commissioner determines that 
5.17 	sufficient information is not available to substantiate that a distinct severable portion 
5.18 	was acquired and to assign the appropriate distinct severable portion of the experience 
5.19 	rating history, the commissioner must assign the successor employer that percentage 
5.20 	of the predecessor employer's experience rating history equal to that percentage of 
5.21 	the employment positions it has obtained, and the predecessor employer retains that 
5.22 	percentage of the experience rating history equal to the percentage of the employment 
5.23 	positions it has retained.
5.24 	(c) The term "common ownership" for purposes of this subdivision includes 
5.25 	ownership by a spouse, parent, grandparent, child, grandchild, brother, sister, aunt, uncle, 
5.26 	niece, nephew, or first cousin, by birth or by marriage.
5.27 	(d) Each successor employer that is subject to paragraph (a) or (b) must notify the 
5.28 	commissioner of the acquisition by electronic transmission, in a format prescribed by the 
5.29 	commissioner, within 30 calendar days of the date of acquisition. Any successor employer 
5.30 	that fails to notify the commissioner is subject to the penalties under section 268.184, 
5.31 	subdivision 1a, if the successor's assigned tax rate under subdivision 2 or 5 was lower than 
5.32 	the predecessor's assigned tax rate at the time of the acquisition. Payments made toward 
5.33 	the penalties are credited to the administration account to be used to ensure integrity in the 
5.34 	unemployment insurance program trust fund.
5.35 	(e) If the successor employer under paragraphs (a) and (b) had an experience rating 
5.36 	at the time of the acquisition, the transferred experience rating history of the predecessor 
6.1 	is combined with the successor's experience rating history for purposes of recomputing 
6.2 	a tax rate.
6.3 	(f) If there has been a transfer of an experience rating history under paragraph (a) or 
6.4 	(b), employment with a predecessor employer is not considered to have been terminated if 
6.5 	similar employment is offered by the successor employer and accepted by the employee.
6.6 	(g) The commissioner, upon notification of an employer, or upon the commissioner's 
6.7 	own motion if the employer fails to provide the required notification, must determine if an 
6.8 	employer is a successor within the meaning of this subdivision. The commissioner must, 
6.9 	after determining the issue of succession or nonsuccession, recompute the tax rate under 
6.10 	subdivision 6 of all employers affected. The commissioner must send the recomputed tax 
6.11 	rate to all affected employers by mail or electronic transmission. Any affected employer 
6.12 	may appeal the recomputed tax rate in accordance with the procedures in subdivision 6, 
6.13 	paragraph (c).
6.14 	(h) The "experience rating history" for purposes of this subdivision and subdivision 
6.15 	4a means the amount of unemployment benefits paid and the taxable wages that are being 
6.16 	used and would be used in computing the current and any future experience rating.
6.17 	For purposes of this chapter, an "acquisition" means anything that results in the 
6.18 	obtaining by the successor employer, in any way or manner, of the organization, trade or 
6.19 	business, or workforce of the predecessor employer.
6.20 	A "distinct severable portion" in paragraph (b) means a location or unit separately 
6.21 	identifiable within the employer's wage detail report under section 268.044.
6.22 	(i) Regardless of the ownership, management, or control requirements of paragraph 
6.23 	(a), if there is an acquisition or merger of a publicly held corporation by or with another 
6.24 	publicly held corporation the experience rating histories of the corporations are combined 
6.25 	as of the date of acquisition or merger for the purpose of recomputing a tax rate.

6.26 	EFFECTIVE DATE. This section is effective July 1, 2012, except that the 
6.27 	amendments to paragraph (d) are effective July 1, 2013.

6.28 	Sec. 3. Minnesota Statutes 2011 Supplement, section 268.051, subdivision 5, is 
6.29 	amended to read:
6.30 		Subd. 5.Tax rate for new employers. (a) Each new taxpaying employer that does 
6.31 	not qualify for an experience rating under subdivision 3, except new employers in a high 
6.32 	experience rating industry, must be assigned, for a calendar year, a tax rate the higher of 
6.33 	(1) one percent, or (2) the tax rate computed, to the nearest 1/100 of a percent, by dividing 
6.34 	the total amount of unemployment benefits paid all applicants during the 48 calendar 
6.35 	months ending on June 30 of the prior calendar year by the total taxable wages of all 
7.1 	taxpaying employers during the same period, plus the applicable base tax rate and any 
7.2 	additional assessments under subdivision 2, paragraph (c).
7.3 	(b) Each new taxpaying employer in a high experience rating industry that does not 
7.4 	qualify for an experience rating under subdivision 3, must be assigned, for a calendar year, 
7.5 	a tax rate the higher of (1) that assigned under paragraph (a), or (2) the tax rate, computed 
7.6 	to the nearest 1/100 of a percent, by dividing the total amount of unemployment benefits 
7.7 	paid to all applicants from high experience rating industry employers during the 48 
7.8 	calendar months ending on June 30 of the prior calendar year by the total taxable wages 
7.9 	of all high experience rating industry employers during the same period, to a maximum 
7.10 	provided for under subdivision 3, paragraph (b), plus the applicable base tax rate and any 
7.11 	additional assessments under subdivision 2, paragraph (c).
7.12 	(c) An employer is considered to be in a high experience rating industry if:
7.13 	(1) the employer is engaged in residential, commercial, or industrial construction, 
7.14 	including general contractors;
7.15 	(2) the employer is engaged in sand, gravel, or limestone mining;
7.16 	(3) the employer is engaged in the manufacturing of concrete, concrete products, 
7.17 	or asphalt; or
7.18 	(4) the employer is engaged in road building, repair, or resurfacing, including bridge 
7.19 	and tunnels and residential and commercial driveways and parking lots.
7.20 	(d) Regardless of any law to the contrary, a taxpaying employer must be assigned a 
7.21 	tax rate under this subdivision if:
7.22 	(1) the employer registers for a tax account under section 268.042 and for each of 
7.23 	the five calendar quarters after registering files a "no wages paid" report on wage detail 
7.24 	under section 268.044; or
7.25 	(2) the employer has filed 14 consecutive quarterly "no wages paid" reports on 
7.26 	wage detail under section 268.044.
7.27 	(d) (e) The commissioner must send to the new employer, by mail or electronic 
7.28 	transmission, a determination of tax rate assigned. An employer may appeal the 
7.29 	determination of a tax rate in accordance with the procedures in subdivision 6, paragraph 
7.30 	(c).

7.31 	EFFECTIVE DATE. This section is effective July 1, 2012.

7.32 	Sec. 4. Minnesota Statutes 2010, section 268.085, subdivision 5, is amended to read:
7.33 		Subd. 5.Deductible earnings. (a) If the applicant has earnings, including holiday 
7.34 	pay, with respect to any week, from employment, covered employment, noncovered 
7.35 	employment, self-employment, or volunteer work, equal to or in excess of the applicant's 
8.1 	weekly unemployment benefit amount, the applicant is ineligible for unemployment 
8.2 	benefits for that week.
8.3 	(b) If the applicant has earnings, with respect to any week, that is less than 
8.4 	the applicant's weekly unemployment benefit amount, from employment, covered 
8.5 	employment, noncovered employment, self-employment, or volunteer work, 55 50 percent 
8.6 	of the earnings are deducted from the weekly unemployment benefit amount.
8.7 	(c) No deduction is made from an applicant's weekly unemployment benefit amount 
8.8 	for earnings from service in the National Guard or a United States military reserve unit or 
8.9 	from direct service as a volunteer firefighter or volunteer ambulance service personnel. 
8.10 	This exception to paragraphs (a) and (b) does not apply to on-call or standby pay provided 
8.11 	to a volunteer firefighter or volunteer ambulance service personnel. No deduction is made 
8.12 	for jury duty pay or for pay as an election judge.
8.13 	(d) The applicant may report deductible earnings on continued requests for 
8.14 	unemployment benefits at the next lower whole dollar amount.
8.15 	(e) Deductible earnings does not include any money considered a deductible 
8.16 	payment under subdivision 3, but includes all compensation considered wages under 
8.17 	section 268.035, subdivision 29, and any other compensation considered earned income 
8.18 	under state and federal law for income tax purposes.

8.19 	EFFECTIVE DATE. This section is effective for deductions occurring on or after 
8.20 	July 1, 2013.

8.21 	Sec. 5. Minnesota Statutes 2010, section 268.18, subdivision 2b, is amended to read:
8.22 		Subd. 2b.Interest. (a) On any unemployment benefits fraudulently obtained, and 
8.23 	any penalty amounts assessed under subdivision 2, the commissioner must assess interest 
8.24 	at the rate of 1-1/2 percent per month on any amount that remains unpaid beginning 
8.25 	30 calendar days after the date of the determination of overpayment by fraud. A 
8.26 	determination of overpayment by fraud must state that interest will be assessed.
8.27 	(b) If the determination did not state that interest will be assessed, interest is assessed 
8.28 	beginning 30 calendar days after notification, by mail or electronic transmission, to the 
8.29 	applicant that interest is now assessed.
8.30 	(c) Interest payments under this section are credited to the administration account
8.31 	trust fund.

8.32 	EFFECTIVE DATE. This section is effective for payments received on or after 
8.33 	July 1, 2013.

9.1 	Sec. 6. Minnesota Statutes 2010, section 268.18, subdivision 4, is amended to read:
9.2 		Subd. 4.Cancellation of overpayments. (a) If unemployment benefits overpaid 
9.3 	under subdivision 1 are not repaid or offset from subsequent unemployment benefits 
9.4 	as provided for in subdivision 1 within six years after the date of the determination or 
9.5 	decision holding the applicant overpaid, the commissioner must cancel the overpayment 
9.6 	balance, and no administrative or legal proceedings may be used to enforce collection 
9.7 	of those amounts.
9.8 	(b) If unemployment benefits determined overpaid under subdivision 2 including 
9.9 	penalties and interest are not repaid within 15 ten years after the date of the determination 
9.10 	of overpayment by fraud, the commissioner must cancel the overpayment balance and 
9.11 	any penalties and interest due, and no administrative or legal proceeding may be used to 
9.12 	enforce collection of those amounts.
9.13 	(c) The commissioner may cancel at any time any overpayment, including penalties 
9.14 	and interest, that the commissioner determines is uncollectible because of death or 
9.15 	bankruptcy.

9.16 	EFFECTIVE DATE. This section is effective July 1, 2012, and applies retroactively 
9.17 	to all existing overpayments.

9.18 	Sec. 7. Minnesota Statutes 2010, section 268.192, is amended by adding a subdivision 
9.19 	to read:
9.20 		Subd. 1a.Agreements not allowed. An employer may not make an agreement that 
9.21 	in exchange for the employer agreeing not to contest the payment of unemployment 
9.22 	benefits, including agreeing not to provide information to the department, an employee 
9.23 	will:
9.24 	(1) quit the employment;
9.25 	(2) take a leave of absence;
9.26 	(3) leave the employment temporarily or permanently; or
9.27 	(4) withdraw a grievance or appeal of a termination.
9.28 	An agreement that violates this subdivision has no effect under this chapter.

9.29 	EFFECTIVE DATE. This section is effective July 1, 2012.

9.30 	ARTICLE 3
9.31 	HOUSEKEEPING

9.32 	Section 1. Minnesota Statutes 2010, section 268.035, subdivision 12d, is amended to 
9.33 	read:
10.1 		Subd. 12d.Electronic transmission. "Electronic transmission" means 
10.2 	a communication that is sent by electronic, digital, magnetic, wireless, optical, 
10.3 	electromagnetic or similar capabilities, and, when permitted by the commissioner, a 
10.4 	telephone communication online, by telephone, or by facsimile transmission.

10.5 	Sec. 2. Minnesota Statutes 2011 Supplement, section 268.035, subdivision 20, is 
10.6 	amended to read:
10.7 		Subd. 20.Noncovered employment. "Noncovered employment" means:
10.8 	(1) employment for the United States government or an instrumentality thereof, 
10.9 	including military service;
10.10 	(2) employment for a state, other than Minnesota, or a political subdivision or 
10.11 	instrumentality thereof;
10.12 	(3) employment for a foreign government;
10.13 	(4) employment for an instrumentality wholly owned by a foreign government, 
10.14 	if the employment is of a character similar to that performed in foreign countries by 
10.15 	employees of the United States government or an instrumentality thereof and the United 
10.16 	States Secretary of State has certified that the foreign government grants an equivalent 
10.17 	exemption to similar employment performed in the foreign country by employees of the 
10.18 	United States government and instrumentalities thereof;
10.19 	(5) employment covered under United States Code, title 45, section 351, the 
10.20 	Railroad Unemployment Insurance Act;
10.21 	(6) employment covered by a reciprocal arrangement between the commissioner and 
10.22 	another state or the federal government that provides that all employment performed by an 
10.23 	individual for an employer during the period covered by the reciprocal arrangement is 
10.24 	considered performed entirely within another state;
10.25 	(7) employment for a church or convention or association of churches, or an 
10.26 	organization operated primarily for religious purposes that is operated, supervised, 
10.27 	controlled, or principally supported by a church or convention or association of churches 
10.28 	described in United States Code, title 26, section 501(c)(3) of the federal Internal Revenue 
10.29 	Code and exempt from income tax under section 501(a);
10.30 	(8) employment of a duly ordained or licensed minister of a church in the exercise of 
10.31 	a ministry or by a member of a religious order in the exercise of duties required by the 
10.32 	order, for Minnesota or a political subdivision or an organization described in United 
10.33 	States Code, title 26, section 501(c)(3) of the federal Internal Revenue Code and exempt 
10.34 	from income tax under section 501(a);
11.1 	(9) employment of an individual receiving rehabilitation of "sheltered" work in 
11.2 	a facility conducted for the purpose of carrying out a program of rehabilitation for 
11.3 	individuals whose earning capacity is impaired by age or physical or mental deficiency 
11.4 	or injury or a program providing "sheltered" work for individuals who because of an 
11.5 	impaired physical or mental capacity cannot be readily absorbed in the competitive labor 
11.6 	market. This clause applies only to services performed for Minnesota or a political 
11.7 	subdivision or an organization described in United States Code, title 26, section 501(c)(3) 
11.8 	of the federal Internal Revenue Code and exempt from income tax under section 501(a) 
11.9 	in a facility certified by the Rehabilitation Services Branch of the department or in a day 
11.10 	training or habilitation program licensed by the Department of Human Services;
11.11 	(10) employment of an individual receiving work relief or work training as part of 
11.12 	an unemployment work relief or work training program assisted or financed in whole or 
11.13 	in part by any federal agency or an agency of a state or political subdivision thereof. 
11.14 	This clause applies only to employment for Minnesota or a political subdivision or an 
11.15 	organization described in United States Code, title 26, section 501(c)(3) of the federal 
11.16 	Internal Revenue Code and exempt from income tax under section 501(a). This clause does 
11.17 	not apply to programs that require unemployment benefit coverage for the participants;
11.18 	(11) employment for Minnesota or a political subdivision as an elected official, a 
11.19 	member of a legislative body, or a member of the judiciary;
11.20 	(12) employment as a member of the Minnesota National Guard or Air National 
11.21 	Guard;
11.22 	(13) employment for Minnesota, a political subdivision, or instrumentality thereof, 
11.23 	as an employee serving only on a temporary basis in case of fire, flood, tornado, or 
11.24 	similar emergency;
11.25 	(14) employment as an election official or election worker for Minnesota or a 
11.26 	political subdivision, but only if the compensation for that employment was less than 
11.27 	$1,000 in a calendar year;
11.28 	(15) employment for Minnesota that is a major policy-making or advisory position 
11.29 	in the unclassified service, including those positions established under section 43A.08, 
11.30 	subdivision 1a;
11.31 	(16) employment for Minnesota in an unclassified position established under section 
11.32 	43A.08, subdivision 1a;
11.33 	(16) (17) employment for a political subdivision of Minnesota that is a nontenured 
11.34 	major policy making or advisory position;
11.35 	(17) (18) domestic employment in a private household, local college club, or local 
11.36 	chapter of a college fraternity or sorority performed for a person, only if the wages paid 
12.1 	in any calendar quarter in either the current or prior calendar year to all individuals in 
12.2 	domestic employment totaled less than $1,000.
12.3 	"Domestic employment" includes all service in the operation and maintenance of a 
12.4 	private household, for a local college club, or local chapter of a college fraternity or 
12.5 	sorority as distinguished from service as an employee in the pursuit of an employer's 
12.6 	trade or business;
12.7 	(18) (19) employment of an individual by a son, daughter, or spouse, and 
12.8 	employment of a child under the age of 18 by the child's father or mother;
12.9 	(19) (20) employment for a personal care assistance provider agency by of an 
12.10 	individual who provides direct care to an immediate family member of a recipient who 
12.11 	provides the direct care to the recipient funded through the personal care assistance 
12.12 	program under section 256B.0659;
12.13 	(20) (21) employment of an inmate of a custodial or penal institution;
12.14 	(21) (22) employment for a school, college, or university by a student who is 
12.15 	enrolled and whose primary relation to the school, college, or university is as a student. 
12.16 	This does not include an individual whose primary relation to the school, college, or 
12.17 	university is as an employee who also takes courses;
12.18 	(22) (23) employment of an individual who is enrolled as a student in a full-time 
12.19 	program at a nonprofit or public educational institution that maintains a regular faculty 
12.20 	and curriculum and has a regularly organized body of students in attendance at the place 
12.21 	where its educational activities are carried on, taken for credit at the institution, that 
12.22 	combines academic instruction with work experience, if the employment is an integral 
12.23 	part of the program, and the institution has so certified to the employer, except that this 
12.24 	clause does not apply to employment in a program established for or on behalf of an 
12.25 	employer or group of employers;
12.26 	(23) (24) employment of university, college, or professional school students in an 
12.27 	internship or other training program with the city of St. Paul or the city of Minneapolis 
12.28 	under Laws 1990, chapter 570, article 6, section 3;
12.29 	(24) (25) employment for a hospital by a patient of the hospital. "Hospital" means 
12.30 	an institution that has been licensed by the Department of Health as a hospital;
12.31 	(25) (26) employment as a student nurse for a hospital or a nurses' training school by 
12.32 	an individual who is enrolled and is regularly attending classes in an accredited nurses' 
12.33 	training school;
12.34 	(26) (27) employment as an intern for a hospital by an individual who has completed 
12.35 	a four-year course in an accredited medical school;
13.1 	(27) (28) employment as an insurance salesperson, by other than a corporate 
13.2 	officer, if all the wages from the employment is solely by way of commission. The word 
13.3 	"insurance" includes an annuity and an optional annuity;
13.4 	(28) (29) employment as an officer of a township mutual insurance company or 
13.5 	farmer's mutual insurance company operating under chapter 67A;
13.6 	(29) (30) employment of a corporate officer, if the officer directly or indirectly, 
13.7 	including through a subsidiary or holding company, owns 25 percent or more of the 
13.8 	employer corporation, and employment of a member of a limited liability company, if the 
13.9 	member directly or indirectly, including through a subsidiary or holding company, owns 
13.10 	25 percent or more of the employer limited liability company;
13.11 	(30) (31) employment as a real estate salesperson, by other than a corporate officer, 
13.12 	if all the wages from the employment is solely by way of commission;
13.13 	(31) (32) employment as a direct seller as defined in United States Code, title 26, 
13.14 	section 3508;
13.15 	(32) (33) employment of an individual under the age of 18 in the delivery or 
13.16 	distribution of newspapers or shopping news, not including delivery or distribution to any 
13.17 	point for subsequent delivery or distribution;
13.18 	(33) (34) casual employment performed for an individual, other than domestic 
13.19 	employment under clause (17) (18), that does not promote or advance that employer's 
13.20 	trade or business;
13.21 	(34) (35) employment in "agricultural employment" unless considered "covered 
13.22 	agricultural employment" under subdivision 11; or
13.23 	(35) (36) if employment during one-half or more of any pay period was covered 
13.24 	employment, all the employment for the pay period is considered covered employment; 
13.25 	but if during more than one-half of any pay period the employment was noncovered 
13.26 	employment, then all of the employment for the pay period is considered noncovered 
13.27 	employment. "Pay period" means a period of not more than a calendar month for which a 
13.28 	payment or compensation is ordinarily made to the employee by the employer.

13.29 	Sec. 3. Minnesota Statutes 2010, section 268.042, subdivision 1, is amended to read:
13.30 		Subdivision 1.Employer registration. (a) Each employer must, upon or before 
13.31 	the submission of its first wage detail report under section 268.044, register with the 
13.32 	commissioner for a tax account or a reimbursable account, by electronic transmission 
13.33 	in a format prescribed by the commissioner. The employer must provide all required 
13.34 	information for registration, including the actual physical street and city address of the 
13.35 	employer.
14.1 	(b) Within 30 calendar days, each employer must notify the commissioner by 
14.2 	electronic transmission, in a format prescribed, of a change in legal entity, of the 
14.3 	transfer, sale, or acquisition of a business conducted in Minnesota, in whole or in part, 
14.4 	if the transaction results in the creation of a new or different employer or affects the 
14.5 	establishment of employer accounts, the assignment of tax rates, or the transfer of 
14.6 	experience rating history.
14.7 	(c) Except as provided in subdivision 3, any person that is or becomes an employer 
14.8 	subject to the Minnesota Unemployment Insurance Law because of the application of 
14.9 	section 268.035, subdivision 20, clause (14), (17), or (34), within any calendar year is 
14.10 	considered to be subject to this chapter the entire calendar year.
14.11 	(d) Within 30 calendar days of the termination of business, an employer that has 
14.12 	been assigned a tax account or reimbursable account must notify the commissioner by 
14.13 	electronic transmission, in a format prescribed by the commissioner, if that the employer 
14.14 	no longer has employees and does not intend or expect to pay wages to any employees in 
14.15 	covered employment during the current or the next calendar year and into the foreseeable 
14.16 	future. Upon notification, the employer is no longer required to file wage detail reports 
14.17 	under section 268.044, subdivision 1, paragraph (d), and the employer's account must 
14.18 	be terminated.
14.19 	(e) An employer that has its account terminated business regains its previous tax 
14.20 	account under section 268.045, with the experience rating history of that account, if the 
14.21 	employer again commences business and again pays wages in covered employment if:
14.22 	(1) less than 14 calendar quarters have elapsed in which no wages were paid for 
14.23 	covered employment;
14.24 	(2) the experience rating history regained contains taxable wages; and
14.25 	(3) the experience rating history has not been transferred to a successor under 
14.26 	section 268.051, subdivision 4.

14.27 	Sec. 4. Minnesota Statutes 2010, section 268.044, subdivision 1, is amended to read:
14.28 		Subdivision 1.Wage detail report. (a) Each employer must submit, under the 
14.29 	account provided for in section 268.045 or 268.046, a quarterly wage detail report 
14.30 	by electronic transmission, in a format prescribed by the commissioner. The report 
14.31 	must include for each employee in covered employment during the calendar quarter, 
14.32 	the employee's name, Social Security number, the total wages paid to the employee, 
14.33 	and total number of paid hours worked. For employees exempt from the definition of 
14.34 	employee in section 177.23, subdivision 7, clause (6), the employer must report 40 hours 
14.35 	worked for each week any duties were performed by a full-time employee and must 
15.1 	report a reasonable estimate of the hours worked for each week duties were performed 
15.2 	by a part-time employee. In addition, the wage detail report must include the number of 
15.3 	employees employed during the payroll period that includes the 12th day of each calendar 
15.4 	month and, if required by the commissioner, the report must be broken down by business 
15.5 	location and, if section 268.046, subdivision 1, paragraph (b), or subdivision 2, paragraph 
15.6 	(b), applies, by separate unit. The report is due and must be received by the commissioner 
15.7 	on or before the last day of the month following the end of the calendar quarter. The 
15.8 	commissioner may delay the due date on a specific calendar quarter in the event the 
15.9 	department is unable to accept wage detail reports electronically.
15.10 	(b) The employer may report the wages paid to the next lower whole dollar amount.
15.11 	(c) An employer need not include the name of the employee or other required 
15.12 	information on the wage detail report if disclosure is specifically exempted from being 
15.13 	reported by federal law.
15.14 	(d) A wage detail report must be submitted for each calendar quarter even though 
15.15 	no wages were paid, unless the employer has notified the commissioner, under section 
15.16 	268.042, subdivision 1, paragraph (c), of termination of business.

15.17 	Sec. 5. Minnesota Statutes 2010, section 268.085, subdivision 11, is amended to read:
15.18 		Subd. 11.Athletes and coaches. (a) Unemployment benefits must not be paid to 
15.19 	an applicant on the basis of any wage credits from employment that consists of coaching 
15.20 	or participating in sports or athletic events or training or preparing to participate for any 
15.21 	week during the period between two successive sport seasons, or similar periods, if:
15.22 	(1) the applicant was so employed in the prior season or similar period, and
15.23 	(2) there is a reasonable assurance that the applicant will be so employed in the 
15.24 	following season or similar period.
15.25 	(b) This subdivision applies to a coach employed by an educational institution whose 
15.26 	only employment with the educational institution is as a coach. Subdivision 7 applies to a 
15.27 	coach who has other employment with an educational institution in addition to coaching 
15.28 	at the educational institution. Employment with multiple educational institutions, or 
15.29 	employment coaching multiple sports, must be aggregated for purposes of application 
15.30 	of this subdivision.

15.31 	Sec. 6. Minnesota Statutes 2010, section 268.085, subdivision 15, is amended to read:
15.32 		Subd. 15.Available for suitable employment defined. (a) "Available for suitable 
15.33 	employment" means an applicant is ready and, willing, and able to accept suitable 
15.34 	employment. The attachment to the work force must be genuine. An applicant may 
16.1 	restrict availability to suitable employment, but there must be no other restrictions, 
16.2 	either self-imposed or created by circumstances, temporary or permanent, that prevent 
16.3 	accepting suitable employment.
16.4 	(b) Unless the applicant is in reemployment assistance training, to be considered 
16.5 	"available for suitable employment," a student who has regularly scheduled classes must 
16.6 	be willing to discontinue classes to accept suitable employment when:
16.7 	(1) class attendance restricts the applicant from accepting suitable employment; and
16.8 	(2) the applicant is unable to change the scheduled class or make other arrangements 
16.9 	that excuse the applicant from attending class.
16.10 	(c) An applicant who is absent from the labor market area for personal reasons, other 
16.11 	than to search for work, is not "available for suitable employment."
16.12 	(d) An applicant who has restrictions on the hours of the day or days of the week 
16.13 	that the applicant can or will work, that are not normal for the applicant's usual occupation 
16.14 	or other suitable employment, is not "available for suitable employment." An applicant 
16.15 	must be available for daytime employment, if suitable employment is performed during 
16.16 	the daytime, even though the applicant previously worked the night shift.

16.17 	Sec. 7. Minnesota Statutes 2010, section 268.095, subdivision 6, is amended to read:
16.18 		Subd. 6.Employment misconduct defined. (a) Employment misconduct means 
16.19 	any intentional, negligent, or indifferent conduct, on the job or off the job that displays 
16.20 	clearly:
16.21 	(1) a serious violation of the standards of behavior the employer has the right to 
16.22 	reasonably expect of the employee; or
16.23 	(2) a substantial lack of concern for the employment.
16.24 	(b) Regardless of paragraph (a), the following is not employment misconduct:
16.25 	(1) conduct that was a consequence of the applicant's mental illness or impairment;
16.26 	(2) conduct that was a consequence of the applicant's inefficiency or inadvertence;
16.27 	(3) simple unsatisfactory conduct;
16.28 	(4) conduct an average reasonable employee would have engaged in under the 
16.29 	circumstances;
16.30 	(5) conduct that was a consequence of the applicant's inability or incapacity;
16.31 	(6) good faith errors in judgment if judgment was required;
16.32 	(7) absence because of illness or injury of the applicant, with proper notice to the 
16.33 	employer;
16.34 	(8) absence, with proper notice to the employer, in order to provide necessary care 
16.35 	because of the illness, injury, or disability of an immediate family member of the applicant;
17.1 	(9) conduct that was a consequence of the applicant's chemical dependency, unless 
17.2 	the applicant was previously diagnosed chemically dependent or had treatment for 
17.3 	chemical dependency, and since that diagnosis or treatment has failed to make consistent 
17.4 	efforts to control the chemical dependency; or
17.5 	(10) conduct that was a consequence of the applicant, or an immediate family 
17.6 	member of the applicant, being a victim of domestic abuse as defined under section 
17.7 	518B.01. Domestic abuse must be shown as provided for in subdivision 1, clause (9).
17.8 	(c) Regardless of paragraph (b), clause (9), conduct in violation of sections 169A.20, 
17.9 	169A.31, or 169A.50 to 169A.53 that interferes with or adversely affects the employment 
17.10 	is employment misconduct.
17.11 	(d) If the conduct for which the applicant was discharged involved only a single 
17.12 	incident, that is an important fact that must be considered in deciding whether the conduct 
17.13 	rises to the level of employment misconduct under paragraph (a). This paragraph does 
17.14 	not require that a determination under section 268.101 or decision under section 268.105 
17.15 	contain a specific acknowledgment or explanation that this paragraph was considered.
17.16 	(e) The definition of employment misconduct provided by this subdivision is 
17.17 	exclusive and no other definition applies.

17.18 	Sec. 8. Minnesota Statutes 2010, section 268.103, subdivision 1, is amended to read:
17.19 		Subdivision 1.In commissioner's discretion. (a) The commissioner may allow 
17.20 	an appeal to be filed by electronic transmission. If the commissioner allows an appeal to 
17.21 	be filed by electronic transmission, that must be clearly set out on the determination or 
17.22 	decision subject to appeal.
17.23 	(b) The commissioner may restrict the manner and format under which an appeal 
17.24 	by electronic transmission may be filed. Restrictions to a specific telephone facsimile 
17.25 	transmission number or electronic address must be clearly set out on the determination or 
17.26 	decision subject to appeal.
17.27 	(c) All information requested by the commissioner when an appeal is filed by 
17.28 	electronic transmission must be supplied or the communication does not constitute an 
17.29 	appeal.
17.30 	(d) Subject to subdivision 2, this section applies to requests for reconsideration 
17.31 	under section 268.105, subdivision 2.

17.32 	Sec. 9. Minnesota Statutes 2011 Supplement, section 268.115, subdivision 1, is 
17.33 	amended to read:
18.1 		Subdivision 1.Definitions. The terms used in this section subdivision have, for 
18.2 	purposes of the Minnesota Unemployment Insurance Law, the following meaning:
18.3 	(1) "Extended unemployment benefit period" means a period that lasts for a 
18.4 	minimum of 13 weeks and that:
18.5 	(i) begins with the third week after there is a state "on" indicator; and
18.6 	(ii) ends with the third week after there is a state "off" indicator.
18.7 	No extended unemployment benefit period may begin before the 14th week 
18.8 	following the end of a prior extended unemployment benefit period.
18.9 	(2) There is a "state 'on' indicator" for a week if:
18.10 	(i) for that week and the prior 12 weeks, the rate of insured unemployment:
18.11 	(a) equaled or exceeded 120 percent of the average of the rates for the corresponding 
18.12 	13-week period ending in each of the prior two calendar years, and was five percent or 
18.13 	more; or
18.14 	(b) equaled or exceeded six percent; or
18.15 	(ii) The United States Secretary of Labor determines that the average rate of 
18.16 	seasonally adjusted total unemployment in Minnesota for the most recent three months 
18.17 	for which data is published equals or exceeds 6.5 percent and this rate equals or exceeds 
18.18 	110 percent of the rate of the corresponding three-month period in either of the prior 
18.19 	two calendar years.
18.20 	(3) There is a "state 'off' indicator" for a week if:
18.21 	(i) under clause (2)(i), for that week and the prior 12 weeks, the requirements for a 
18.22 	"state 'on' indicator" are not satisfied; or
18.23 	(ii) under clause (2)(ii) the requirements for a "state 'on' indicator" are not satisfied.
18.24 	(4) "Rate of insured unemployment," means the percentage derived by dividing the 
18.25 	average weekly number of applicants filing continued requests for regular unemployment 
18.26 	benefits in the most recent 13-week period by the average monthly covered employment 
18.27 	for the first four of the most recent six completed calendar quarters before the end of 
18.28 	that 13-week period.
18.29 	(5) "Regular unemployment benefits" means unemployment benefits available to 
18.30 	an applicant other than extended unemployment benefits and additional unemployment 
18.31 	benefits.
18.32 	(6) "Eligibility period" for an applicant means the period consisting of the weeks 
18.33 	remaining in the applicant's benefit year within the extended unemployment benefit period 
18.34 	and, if the benefit year ends within the extended unemployment benefit period, any weeks 
18.35 	in the extended unemployment benefit period.
18.36 	(7) "Exhaustee" means an applicant who, in the eligibility period:
19.1 	(i) the benefit year having not expired has received the maximum amount of regular 
19.2 	unemployment benefits that were available under section 268.07; or
19.3 	(ii) the benefit year having expired, has insufficient wage credits to establish a new 
19.4 	benefit account; and or
19.5 	(iii) has no right to any type of unemployment benefits under any other state or 
19.6 	federal laws and is not receiving unemployment benefits under the law of Canada.

19.7 	Sec. 10. Minnesota Statutes 2010, section 268.18, subdivision 4a, is amended to read:
19.8 		Subd. 4a.Court fees; collection fees. (a) If the commissioner is required to pay any 
19.9 	court fees in an attempt to enforce collection of overpaid unemployment benefits, penalties, 
19.10 	or interest, the commissioner may add the amount of the court fees to the total amount due.
19.11 	(b) If an applicant who has been determined overpaid unemployment benefits 
19.12 	because of fraud seeks to have any portion of the debt discharged under the federal 
19.13 	bankruptcy code, and the commissioner files an objection in bankruptcy court to the 
19.14 	discharge, the commissioner may add the commissioner's cost of any court fees to the debt 
19.15 	if the bankruptcy court does not discharge the debt.
19.16 	(c) If the Internal Revenue Service assesses the commissioner a fee for offsetting 
19.17 	from a federal tax refund the amount of any fraud overpayment, including penalties and 
19.18 	interest, the amount of the fee may be added to the total amount due. The offset amount 
19.19 	must be put in the trust fund and that amount credited to the total amount due from the 
19.20 	applicant.

19.21 	Sec. 11. Minnesota Statutes 2011 Supplement, section 268.184, subdivision 1a, 
19.22 	is amended to read:
19.23 		Subd. 1a.Notification and misreporting penalties. (a) If the commissioner finds 
19.24 	that any employer or agent of an employer failed to meet the notification requirements of 
19.25 	section 268.051, subdivision 4, the employer must be assessed a penalty of $5,000 or two 
19.26 	percent of the first full quarterly payroll acquired, whichever is higher. Payroll is wages 
19.27 	paid as defined in section 268.035, subdivision 30. The penalty under this paragraph 
19.28 	must be canceled if the commissioner determines that the failure occurred because of 
19.29 	ignorance or inadvertence.
19.30 	(b) If the commissioner finds that any individual advised an employer to violate the 
19.31 	employer's notification requirements under section 268.051, subdivision 4, the individual, 
19.32 	and that individual's employer, must each be assessed the penalty in paragraph (a).
19.33 	(c) If the commissioner finds that any person or agent of a person violated the 
19.34 	reporting requirements of section 268.0435 or268.046, the person must be assessed a 
20.1 	penalty of $5,000 or two percent of the quarterly payroll reported in violation of section 
20.2 	268.0435 or268.046, whichever is higher. Payroll is wages paid as defined in section 
20.3 	268.035, subdivision 30.
20.4 	(d) Penalties under this subdivision are in addition to any other penalties and subject 
20.5 	to the same collection procedures that apply to past due amounts from an employer. 
20.6 	Penalties must be paid within 30 calendar days after sending of the determination of 
20.7 	penalty.
20.8 	(e) The determination of a penalty is final unless the person assessed files an appeal 
20.9 	within 20 calendar days after sending of the determination of the penalty by mail or 
20.10 	electronic transmission. Proceedings on the appeal are conducted in accordance with 
20.11 	section 268.105.

20.12 	Sec. 12. Minnesota Statutes 2010, section 268.194, subdivision 1, is amended to read:
20.13 		Subdivision 1.Establishment. There is established as a special state trust fund, 
20.14 	separate and apart from all other public money or funds of this state, an unemployment 
20.15 	insurance trust fund, that is administered by the commissioner exclusively for the payment 
20.16 	of unemployment benefits. This trust fund consists of:
20.17 	(1) all taxes collected;
20.18 	(2) interest earned upon any money in the trust fund;
20.19 	(3) reimbursements paid by nonprofit organizations and the state and political 
20.20 	subdivisions;
20.21 	(4) tax rate buydown payments under section 268.051, subdivision 7;
20.22 	(5) any money received as a loan from the federal unemployment trust fund in 
20.23 	accordance with United States Code, title 42, section 1321, of the Social Security Act;
20.24 	(6) any other money received under a reciprocal unemployment benefit arrangement 
20.25 	with the federal government or any other state;
20.26 	(7) money recovered on overpaid unemployment benefits except, if allowed by 
20.27 	federal law, five percent of any recovered amount is credited to the administration account;
20.28 	(8) all money recovered on losses sustained by the trust fund credited to the account 
20.29 	under this chapter;
20.30 	(9) all money received from the contingent account under section 268.199;
20.31 	(10) (9) all money credited to the account of Minnesota in the federal unemployment 
20.32 	trust fund under United States Code, title 42, section 1103, of the Social Security Act, 
20.33 	also known as the Reed Act; and
20.34 	(11) (10) all money received for the trust fund from any other source.

21.1 	Sec. 13. REVISOR'S INSTRUCTION.
 21.2 	The revisor of statutes shall:
21.3 	(1) change "determination of a penalty" and "determination of the penalty" to 
21.4 	"determination of penalty" wherever it appears in Minnesota Statutes, chapter 268;
21.5 	(2) change "the United States Citizenship and Immigration Services" to "the United 
21.6 	States Immigration and Customs Enforcement" wherever it appears in Minnesota Statutes, 
21.7 	chapter 268;
21.8 	(3) renumber Minnesota Statutes, section 268.184, subdivision 1, paragraph (a), as 
21.9 	Minnesota Statutes, section 268.184, subdivision 1b, reletter the remaining paragraphs, 
21.10 	and make any cross-reference changes; and
21.11 	(4) make any cross-reference changes needed resulting from the renumbering in 
21.12 	section 2.

21.13 	Sec. 14. EFFECTIVE DATE.
 21.14 	Unless otherwise specified, this article is effective July 1, 2012.