There is a newer version of the New York Consolidated Laws
2006 New York Code - Experience Rating.
§ 581. Experience rating. 1. Meaning of terms. As used in this
section:
(a) "Computation date" means December thirty-first of any year.
(b) "Payroll year" means the period beginning on October first of a
year and ending on September thirtieth of the next following year.
(c) "Qualified employer" means any employer whose account reflects his
or her experience with respect to unemployment throughout not less than
the four consecutive completed calendar quarters ending on the
computation date and who has paid some remuneration in the payroll year
preceding the computation date and filed all contribution returns
prescribed by the commissioner for the three payroll years preceding the
computation date on or before such date, or has had an amount of
contributions due and/or an amount of wages paid determined by the
commissioner pursuant to section five hundred seventy-one of this
article. If an employer has ceased to be liable for contributions and
the employer's account balance is not subject to transfer under the
provisions of subdivision four of this section, such account balance
shall be transferred to the general account on the computation date
coinciding with or immediately following the date on which the
employer's liability ceased and shall not thereafter be available to
such employer in the event that the employer again becomes liable for
contributions.
(d) "Employer's account" (1) means an account in the fund reflecting
an employer's experience with respect to contribution payments and
experience rating charges under this article. The commissioner shall
maintain such an account for every employer liable for contributions
under this article; but nothing in this article shall be construed to
grant any employer or any of his employees prior claims or rights to the
amount paid by him into the fund and credited to his employer's account,
or to any other account, including the general account, either on his
own behalf or on behalf of his employees. All moneys in such fund, from
whatever source derived and to whatever account credited, shall be
pooled and available to pay benefits to any individual entitled thereto
under this article.
(2) Any contributions due but not paid within sixty days of the due
date prescribed by regulation of the commissioner shall, when paid, not
be credited to an employer's account, but shall be credited to the
general account, unless such payment was made prior to determination and
demand by the commissioner pursuant to section five hundred seventy-one
of this article.
(3) Payments in lieu of contributions equal to benefits charged in
the last three months of a calendar year shall be credited to the
employer's account as of the computation date occurring in that year if
paid within the time prescribed by the commissioner.
(4) Any employer may at any time make payments to his account in the
fund in excess of the requirements of this article. Such payments made
during the period from April first through March thirty-first of the
following year shall be credited to the employer's account as of the
computation date occurring within such period.
(5) For the purpose of determining the size of fund index, all
payments in lieu of contributions and voluntary, excess contribution
payments made by employers shall be included in the fund balance on the
computation date next following the date of payments. Such excess
contributions shall be irrevocable and not subject to refund or credit
after acceptance by the commissioner and deposit in the fund.
(e) "Experience rating charge" means a debit to an employer's account
reflecting a payment of benefits.
(1) Whenever benefits are paid to a claimant, experience rating
charges shall be debited to the appropriate account. The commissioner
shall notify each employer not more frequently than monthly as to each
experience rating charge which is being made to the employer's account.
Such notice shall be a determination of the propriety of such charge and
of the payment of benefits on which such charge was based.
(2) Benefits payable to any claimant with respect to the claimant's
then current benefit year shall be charged, when paid, to the account of
the last employer prior to the filing of a valid original claim in an
amount equal to seven times the claimant's benefit rate. Thereafter,
such charges shall be made to the account of each employer in the base
period used to establish the valid original claim in the same proportion
that the remuneration paid by each employer to the claimant during that
base period bears to the remuneration paid by all employers to the
claimant during that base period except as provided below:
(i) In those instances where the claimant may not utilize wages paid
to establish entitlement based upon subdivision ten of section five
hundred ninety of this article and an educational institution is the
claimant's last employer prior to the filing of the claim for benefits,
or the claimant performed services in such educational institution in
such capacity while employed by an educational service agency which is
the claimant's last employer prior to the filing of the claim for
benefits, such employer shall not be liable for benefit charges for the
first twenty-eight effective days of benefits paid as otherwise provided
by this section. Under such circumstances, benefits paid shall be
charged to the general account. In addition, wages paid during the base
period by such educational institutions, or for services in such
educational institutions for claimants employed by an educational
service agency shall not be considered base period wages during periods
that such wages may not be used to gain entitlement to benefits pursuant
to subdivision ten of section five hundred ninety of this article.
(ii) In those instances where the claimant may not utilize wages paid
to establish entitlement based upon subdivision eleven of section five
hundred ninety of this article and an educational institution is the
claimant's last employer prior to the filing of the claim for benefits,
or the claimant performed services in such educational institution in
such capacity while employed by an educational service agency which is
the claimant's last employer prior to the filing of the claim for
benefits, such employer shall not be liable for benefit charges for the
first twenty-eight effective days of benefits paid as otherwise provided
by this section. Under such circumstances, benefits paid will be charged
to the general account. In addition, wages paid during the base period
by such educational institutions, or for services in such educational
institutions for claimants employed by an educational service agency
shall not be considered base period wages during periods that such wages
may not be used to gain entitlement to benefits pursuant to subdivision
eleven of section five hundred ninety of this article. However, in those
instances where a claimant was not afforded an opportunity to perform
services for the educational institution for the next academic year or
term after reasonable assurance was provided, such employer shall be
liable for benefit charges as provided for in this paragraph for any
retroactive payments made to the claimant.
(iii) In those instances where the federal government is the
claimant's last employer prior to the filing of the claim for benefits
and such employer is not a base-period employer, payments equaling the
first twenty-eight effective days of benefits as otherwise prescribed by
this section shall be charged to the general account. In those instances
where the federal government is the claimant's last employer prior to
the filing of the claim for benefits and a base-period employer, such
employer shall be liable for charges for all benefits paid on such claim
in the same proportion that the remuneration paid by such employer
during the base period bears to the remuneration paid by all employers
during the base period. In addition, benefit payment charges for the
first twenty-eight effective days of benefits other than those
chargeable to the federal government as prescribed above shall be made
to the general account.
(iv) In those instances where a combined wage claim is filed pursuant
to interstate reciprocal agreements and the claimant's last employer
prior to the filing of the claim is an out-of-state employer and such
employer is not a base-period employer, benefit payments equaling the
first twenty-eight effective days of benefits as otherwise prescribed by
this section shall be charged to the general account. In those instances
where the out-of-state employer is the last employer prior to the filing
of the claim for benefits and a base-period employer such employer shall
be liable for charges for all benefits paid on such claim in the same
proportion that the remuneration paid by such employer during the base
period bears to the remuneration paid by all employers during the base
period. In addition, benefit payment charges for the twenty-eight
effective days of benefits other than those chargeable to the
out-of-state employer as prescribed above shall be made to the general
account.
(3) An employer's account shall not be charged, and the charges shall
instead be made to the general account, for benefits paid to a claimant
after the expiration of a period of disqualification from benefits
following a final determination that the claimant lost employment with
the employer through misconduct or voluntary separation of employment
without good cause within the meaning of section five hundred
ninety-three of this article and the charges are attributable to
remuneration paid during the claimant's base period of employment with
such employer prior to the claimant's loss of employment with such
employer through misconduct or voluntary separation of employment
without good cause.
(4) An employer's account shall not be charged, and the charges shall
instead be made to the general account, for benefits paid to a claimant
based on base period employment while the claimant was an inmate of a
correctional institution and enrolled in a work release program,
provided that the employment was terminated solely because the inmate
was required to relocate to another area as a condition of parole or the
inmate voluntarily relocated to another area immediately upon being
released or paroled from such correctional institution.
(5) If an employer who employed the claimant in the four weeks
immediately preceding the filing of a valid original claim demonstrates
that the employer has continuously employed the claimant without
significant interruption and substantially to the same extent and in the
same manner as during the weeks immediately preceding the filing of a
valid original claim in which the claimant was employed by such
employer, the account of such employer shall not be charged with
benefits paid to such claimant for any weeks of such continuing
employment, and such experience rating charges shall be made to the
general account. The provisions set forth in the foregoing sentence
shall apply with respect to an employer liable for payments in lieu of
contributions, but if the secretary of labor of the United States finds
that their application to such employer does not meet the requirements
of the federal unemployment tax act, such provisions shall not
thereafter apply to such employer, unless and until such finding has
been set aside pursuant to a final decision issued in accordance with
such judicial review proceedings as may be instituted and completed
under the provisions of section thirty-three hundred ten of the federal
unemployment tax act.
(6) An employer's account shall not be debited to the extent that the
federal government reimburses the fund for benefits paid.
If on any computation date an employer's account registers a negative
balance, an amount equivalent to the excess of the negative balance over
twenty-one per centum of the employer's payroll in the payroll year
preceding such date shall be transferred as a charge to the general
account, except that this provision shall not apply to any negative
balance, or that portion thereof, which results from benefits charged
with respect to which the employer is liable for payments in lieu of
contributions.
(f) "Employer's account percentage" means the status of an employer's
account on any computation date. It is the balance remaining in the
account, after contributions have been credited and experience rating
charges have been debited to it, stated as percentage of his average
payroll for the last five payroll years preceding the computation date
or for all quarters if the employer has been liable for contributions
for fewer than twenty-one quarters. Such percentage shall be computed to
two decimal places and the remaining fraction if any, disregarded. If,
however, the number of consecutive completed calendar quarters ending on
the computation date during which the employer has been liable for
contributions hereunder is twenty-one or less the employer's account
percentage, if it is positive, shall be multiplied by that figure
assigned to the employer designated as "employer's benefit equalization
factor" which is listed below on the same horizontal line on which the
number of quarters of employer liability appears, and the product
resulting therefrom shall constitute the employer's account percentage.
Number of quarters Employer's benefit
of employer liability equalization factor
5 ...................................... 3.00
6 ...................................... 2.50
7 ...................................... 2.05
8 ...................................... 1.75
9 ...................................... 1.55
10 ..................................... 1.40
11 ..................................... 1.25
12 ..................................... 1.12
13 ..................................... 1.04
14 through 21........................... 1.00
(g) "Size of fund index" means the lesser of the following two
percentages:
(1) the percentage obtained by dividing the moneys in the fund as of a
computation date by the total of all payrolls for the payroll year
preceding such date; or (2) the percentage obtained by dividing such
moneys by the average of the totals of all payrolls for the five
consecutive payroll years preceding such date. Such percentage shall be
computed to one decimal place and the remaining fraction, if any,
disregarded.
(h) "Payroll" means all wages paid by an employer to his employees.
2. Rates of contribution.
(a) Each qualified employer's rate of contribution shall be the
percentage shown in the column headed by the size of the fund index as
of the computation date and on the same line with his or her negative or
positive employer's account percentage, except that if within the three
payroll years preceding the computation date any part of a negative
balance has been transferred from any employer's account as a charge to
the general account pursuant to the provisions of paragraph (e) of
subdivision one of this section such employer's rate of contribution
shall be the maximum contribution rate as shown in the column headed by
the size of fund index;
Size of Fund Index
Employer's
Account
Percentage Less 0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0%
Than but but but but but but but but but but or
0% less less less less less less less less less less more
than than than than than than than than than than
0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0%
Negative
21.0%
or more 8.90 8.70 8.50 8.30 8.10 7.30 6.90 6.50 6.20 6.10 6.00 5.90
20.5%
or more
but less
than 21.0% 8.80 8.60 8.40 8.20 8.00 7.20 6.80 6.40 6.10 6.00 5.90 5.80
20.0%
or more
but less
than 20.5% 8.70 8.50 8.30 8.10 7.90 7.10 6.70 6.30 6.00 5.90 5.80 5.70
19.5%
or more
but less
than 20.0% 8.60 8.40 8.20 8.00 7.80 7.00 6.60 6.20 5.90 5.80 5.70 5.60
19.0%
or more
but less
than 19.5% 8.50 8.30 8.10 7.90 7.70 6.90 6.50 6.10 5.80 5.70 5.60 5.50
18.5%
or more
but less
than 19.0% 8.40 8.20 8.00 7.80 7.60 6.80 6.40 6.00 5.70 5.60 5.50 5.40
18.0%
or more
but less
than 18.5% 8.30 8.10 7.90 7.70 7.50 6.70 6.30 5.90 5.60 5.50 5.40 5.30
17.5%
or more
but less
than 18.0% 8.20 8.00 7.80 7.60 7.40 6.60 6.20 5.80 5.50 5.40 5.30 5.20
17.0%
or more
but less
than 17.5% 8.10 7.90 7.70 7.50 7.30 6.50 6.10 5.70 5.40 5.30 5.20 5.10
16.5%
or more
but less
than 17.0% 8.00 7.80 7.60 7.40 7.20 6.40 6.00 5.60 5.30 5.20 5.10 5.00
16.0%
or more
but less
than 16.5% 7.90 7.70 7.50 7.30 7.10 6.30 5.90 5.50 5.20 5.10 5.00 4.90
15.5%
or more
but less
than 16.0% 7.80 7.60 7.40 7.20 7.00 6.20 5.80 5.40 5.10 5.00 4.90 4.80
15.0%
or more
but less
than 15.5% 7.70 7.50 7.30 7.10 6.90 6.10 5.70 5.30 5.00 4.90 4.80 4.70
14.5%
or more
but less
than 15.0% 7.60 7.40 7.20 7.00 6.80 6.00 5.60 5.20 4.90 4.80 4.70 4.60
14.0%
or more
but less
than 14.5% 7.50 7.30 7.10 6.90 6.70 5.90 5.50 5.10 4.80 4.70 4.60 4.50
13.5%
or more
but less
than 14.0% 7.40 7.20 7.00 6.80 6.60 5.80 5.40 5.00 4.70 4.60 4.50 4.40
13.0%
or more
but less
than 13.5% 7.30 7.10 6.90 6.70 6.50 5.70 5.30 4.90 4.60 4.50 4.40 4.30
12.5%
or more
but less
than 13.0% 7.20 7.00 6.80 6.60 6.40 5.60 5.20 4.80 4.50 4.40 4.30 4.20
12.0%
or more
but less
than 12.5% 7.10 6.90 6.70 6.50 6.30 5.50 5.10 4.70 4.40 4.30 4.20 4.10
11.5%
or more
but less
than 12.0% 7.00 6.80 6.60 6.40 6.20 5.40 5.00 4.60 4.30 4.20 4.10 4.00
11.0%
or more
but less
than 11.5% 6.90 6.70 6.50 6.30 6.10 5.30 4.90 4.50 4.20 4.10 4.00 3.90
10.5%
or more
but less
than 11.0% 6.80 6.60 6.40 6.20 6.00 5.20 4.80 4.40 4.10 4.00 3.90 3.80
10.0%
or more
but less
than 10.5% 6.70 6.50 6.30 6.10 5.90 5.10 4.70 4.30 4.00 3.90 3.80 3.70
9.5%
or more
but less
than 10.0% 6.60 6.40 6.20 6.00 5.80 5.00 4.60 4.20 3.90 3.80 3.70 3.60
9.0%
or more
but less
than 9.5% 6.50 6.30 6.10 5.90 5.70 4.90 4.50 4.10 3.80 3.70 3.60 3.50
8.5%
or more
but less
than 9.0% 6.40 6.20 6.00 5.80 5.60 4.80 4.40 4.00 3.70 3.60 3.50 3.40
8.0%
or more
but less
than 8.5% 6.30 6.10 5.90 5.70 5.50 4.70 4.30 3.90 3.60 3.50 3.40 3.30
7.0%
or more
but less
than 8.0% 6.20 6.00 5.80 5.60 5.40 4.60 4.20 3.80 3.50 3.40 3.30 3.20
6.0%
or more
but less
than 7.0% 6.10 5.90 5.70 5.50 5.30 4.50 4.10 3.70 3.40 3.30 3.20 3.10
5.0%
or more
but less
than 6.0% 6.00 5.80 5.60 5.40 5.20 4.40 4.00 3.60 3.30 3.20 3.10 3.00
4.0%
or more
but less
than 5.0% 5.90 5.70 5.50 5.30 5.10 4.30 3.90 3.50 3.20 3.10 3.00 2.90
3.0%
or more
but less
than 4.0% 5.60 5.40 5.20 5.00 4.80 4.20 3.80 3.40 3.10 3.00 2.90 2.80
2.0%
or more
but less
than 3.0% 5.50 5.30 5.10 4.90 4.70 4.10 3.70 3.30 3.00 2.90 2.80 2.70
1.0%
or more
but less
than 2.0% 5.40 5.20 5.00 4.80 4.60 4.00 3.60 3.20 2.90 2.80 2.70 2.60
Less
than 1.0% 5.20 5.00 4.80 4.60 4.40 3.80 3.40 3.00 2.70 2.60 2.50 2.40
Positive
Less
than 1.0% 4.10 3.90 3.70 3.50 3.30 2.90 2.50 2.10 1.90 1.80 1.70 1.60
1.0%
or more
but less
than 2.0% 4.00 3.80 3.60 3.40 3.20 2.80 2.40 2.00 1.80 1.70 1.60 1.50
2.0%
or more
but less
than 3.0% 3.90 3.70 3.50 3.30 3.10 2.70 2.30 1.90 1.70 1.60 1.50 1.40
3.0%
or more
but less
than 4.0% 3.80 3.60 3.40 3.20 3.00 2.60 2.20 1.80 1.60 1.50 1.40 1.30
4.0%
or more
but less
than 5.0% 3.70 3.50 3.30 3.10 2.90 2.50 2.10 1.70 1.50 1.40 1.30 1.20
5.0%
or more
but less
than 5.5% 3.60 3.40 3.20 3.00 2.80 2.40 2.00 1.60 1.40 1.30 1.20 1.10
5.5%
or more but
less than
5.75% 3.50 3.30 3.10 2.90 2.70 2.30 1.90 1.50 1.30 1.20 1.10 1.00
5.75%
or more
but less
than 6.0% 3.40 3.20 3.00 2.80 2.60 2.20 1.80 1.40 1.20 1.10 1.00 0.90
6.0%
or more but
less than
6.25% 3.30 3.10 2.90 2.70 2.50 2.10 1.70 1.30 1.10 1.00 0.90 0.80
6.25%
or more
but less
than 6.5% 3.20 3.00 2.80 2.60 2.40 2.00 1.60 1.20 1.00 0.90 0.80 0.70
6.5%
or more but
less than
6.75% 3.10 2.90 2.70 2.50 2.30 1.90 1.50 1.10 0.90 0.80 0.70 0.60
6.75%
or more
but less
than 7.0% 3.00 2.80 2.60 2.40 2.20 1.80 1.40 1.00 0.80 0.70 0.60 0.50
7.0%
or more but
less than
7.25% 2.90 2.70 2.50 2.30 2.10 1.70 1.30 0.90 0.70 0.60 0.50 0.40
7.25%
or more
but less
than 7.5% 2.80 2.60 2.40 2.20 2.00 1.60 1.20 0.80 0.60 0.50 0.40 0.30
7.5%
or more but
less than
7.75% 2.70 2.50 2.30 2.10 1.90 1.50 1.10 0.70 0.50 0.40 0.30 0.20
7.75%
or more
but less
than 8.0% 2.60 2.40 2.20 2.00 1.80 1.40 1.00 0.60 0.40 0.30 0.20 0.10
8.0%
or more but
less than
8.25% 2.50 2.30 2.10 1.90 1.70 1.30 0.90 0.50 0.30 0.20 0.10 0.00
8.25%
or more
but less
than 8.5% 2.40 2.20 2.00 1.80 1.60 1.20 0.80 0.40 0.20 0.10 0.00 0.00
8.5%
or more but
less than
8.75% 2.30 2.10 1.90 1.70 1.50 1.10 0.70 0.30 0.10 0.00 0.00 0.00
8.75%
or more
but less
than 9.0% 2.20 2.00 1.80 1.60 1.40 1.00 0.60 0.20 0.00 0.00 0.00 0.00
9.0%
or more but
less than
9.25% 2.10 1.90 1.70 1.50 1.30 0.90 0.50 0.10 0.00 0.00 0.00 0.00
9.25%
or more
but less
than 9.5% 2.00 1.80 1.60 1.40 1.20 0.80 0.40 0.00 0.00 0.00 0.00 0.00
9.5%
or more but
less than
9.75% 1.90 1.70 1.50 1.30 1.10 0.70 0.30 0.00 0.00 0.00 0.00 0.00
9.75%
or more but
less than
10.0% 1.80 1.60 1.40 1.20 1.00 0.60 0.20 0.00 0.00 0.00 0.00 0.00
10.0%
or more but
less than
10.25% 1.70 1.50 1.30 1.10 0.90 0.50 0.10 0.00 0.00 0.00 0.00 0.00
10.25%
or more but
less than
10.5% 1.60 1.40 1.20 1.00 0.80 0.40 0.00 0.00 0.00 0.00 0.00 0.00
10.5%
or more but
less than
10.75% 1.50 1.30 1.10 0.90 0.70 0.30 0.00 0.00 0.00 0.00 0.00 0.00
10.75%
or more but
less than
11.0% 1.40 1.20 1.00 0.80 0.60 0.20 0.00 0.00 0.00 0.00 0.00 0.00
11.0%
or more but
less than
11.25% 1.30 1.10 0.90 0.70 0.50 0.10 0.00 0.00 0.00 0.00 0.00 0.00
11.25%
or more but
less than
11.5% 1.20 1.00 0.80 0.60 0.40 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.5%
or more but
less than
11.75% 1.10 0.90 0.70 0.50 0.30 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.75%
or more but
less than
12.0% 1.00 0.80 0.60 0.40 0.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12.0% or
more 0.90 0.70 0.50 0.30 0.10 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(aa) (i) If a qualified employer, with a minimum of seventeen quarters
of liability, has an account percentage which is negative on any
computation date and the total wages paid by such employer in the
preceding payroll year, is greater than or equal to eighty percent of
the previous three payroll year's average total wages paid by the
employer, then such employer's account percentage for the subsequent
year shall be improved by four percentage points for purposes of
determining the employer's rate of contribution. However, in no event
shall the resulting rate of contribution after such adjustment be less
than 6.1 percent. Such adjustment to the employer's account percentage
shall be applicable only to the employer's current rate of contribution
and the application of such adjustment shall be redetermined annually.
(ii) The terms "qualified employer", "employer's account percentage",
"computation date", "wages", "payroll year" and "rate of contribution"
shall have the meaning prescribed pursuant to article eighteen of this
chapter.
(b) Penalty for failure to file required returns. (1) In the case of a
failure by an employer to file a quarterly combined withholding wage
reporting and unemployment insurance return required by paragraph four
of subsection (a) of section six hundred seventy-four of the tax law,
there shall be imposed a penalty of five percent of the amount of
contributions required to be shown on such return (including the amount
of any assessment or modification made pursuant to this section) if the
failure is for not more than one month with an additional five percent
penalty for each additional month or fraction thereof during which such
failure continues, not exceeding twenty-five percent in the aggregate.
(2) The penalty provided for failure to file a return under this
paragraph shall not be less than one hundred dollars for each
occurrence.
(3) For purposes of this paragraph, the amount of contributions
required to be shown on such return shall be reduced by the amount of
any part of the contributions due which is paid on or before the date
the return is required to be filed and by the amount of any credit to
the contributions due which may be claimed upon such return.
(4) For other penalties relating to failure to file the quarterly
combined withholding, wage reporting and unemployment insurance return,
see paragraph one of subsection (v) of section six hundred eighty-five
of the tax law.
(5) The penalties imposed and collected pursuant to this paragraph
shall be credited to the unemployment insurance control fund established
pursuant to section five hundred fifty-two-b of this article.
(c) The rate for any employer who has not qualified under the
provisions of paragraph (c) of subdivision one of this section solely
because he has not been liable for contributions during at least the
five completed calendar quarters ending on the computation date, or
because he has not paid any remuneration in the payroll year preceding
the computation date, shall be equal to the rate which applies pursuant
to paragraph (a) of this subdivision to an employer who has a positive
account percentage of less than one percentum, except that the rate for
such employer shall in no event exceed three and four-tenths per centum.
(d) The rates established in accordance with the provisions of this
subdivision shall apply with respect to wages paid in the four
consecutive calendar quarters immediately following the computation
date.
3. Joint accounts. Any two or more qualified employers engaged in the
same or a related trade, occupation, profession or enterprise, or having
a common financial interest may apply to the commissioner to establish a
joint account or to merge their several individual accounts in a joint
account. The commissioner shall prescribe rules and regulations for the
establishment, maintenance and dissolution of joint accounts. A joint
account shall be maintained as if it constituted a single employer's
account. Rules established by the commissioner pursuant to the
provisions of this subdivision shall be promulgated only after notice
and public hearing.
4. Transfers of accounts. (a) Where an employer subsequent to July
first, nineteen hundred fifty-one, transfers his or its organization,
trade or business in whole or in part, the transferee shall take over
and continue the employer's account, including its balance and all other
aspects of its experience under this article, in proportion to the
payroll or employees assignable to the transferred organization, trade
or business determined for the purpose of this article by the
commissioner. The account taken over by the transferee shall remain
chargeable with respect to benefits based on employment in the
transferred organization, trade or business, and all such employment
shall be deemed employment performed for the transferee.
(b) The rate of contribution applicable to the accounts of the
transferee and the transferring employer with respect to the calendar
year in which the transfer occurred shall be respectively determined or
redetermined as of the computation date in the preceding calendar year,
and such rates shall apply from the date of the transfer to the end of
the calendar year in which the transfer occurred. The rate of
contribution applicable to the accounts of the transferee and the
transferring employer with respect to the calendar year following the
calendar year in which the transfer occurred shall be respectively
determined or redetermined as of the computation date in the same
calendar year. The commissioner shall allocate to the transferee's
account for each period in question the proportion of the transferring
employer's payroll, which the commissioner determines to be properly
assignable to the organization, trade or business transferred.
(c) No transfer shall be deemed to have occurred if the commissioner
on his own motion or on application of any interested party finds that
all of the following conditions exist:
(1) the transferee has not assumed any of the transferring employer's
obligations, and
(2) the transferee has not acquired any of the transferring employer's
good will, and
(3) the transferee has not continued or resumed the business of the
transferring employer either in the same establishment or elsewhere, and
(4) the transferee has not employed substantially the same employees
as those the transferring employer had employed in connection with the
organization, trade, business, or part thereof transferred.
(d) No transfer shall be deemed to have occurred unless either the
transferring employer or the transferee has given notice of the transfer
to the commissioner prior to the termination of the calendar year
following the calendar year in which the transfer occurred.
5. Interstate transfer of experience. An employer who transfers all or
a segregable part of his operations from another state to this state
shall be deemed to be a qualified employer within the meaning of this
section as of the computation date next following the transfer,
provided:
(a) that he has paid wages subject to the federal unemployment tax act
for eighteen consecutive completed calendar quarters immediately
preceding the computation date;
(b) that he notifies the commissioner of the transfer of operations
prior to the computation date;
(c) that he certifies to the commissioner all information with respect
to the transferred operations which the commissioner determines to be
necessary; and
(d) that he certifies to the commissioner at such times as the
commissioner prescribes all information which the commissioner
determines to be necessary with respect to benefits paid subsequent to
the transfer and prior to each computation date on the basis of wages
paid in such other state.
Wages, remuneration, contributions and benefits resulting in
experience rating charges in connection with the transferred operations
shall be deemed to have been paid in this state for the purposes of this
section.
In computing such employer's balance applicable to the transferred
operations, the commissioner shall consider only the fourteen most
recently elapsed calendar quarters prior to the computation date. Any
balance set up under this subdivision shall be debited to the general
account; and benefits subsequently paid based on wages paid in such
other state shall be charged to the employer's account and credited to
the general account.
6. Corrections and modifications. Corrections or modifications of an
employer's payroll, experience rating charges, or any other pertinent
factor shall not be taken into account for the purpose of a
determination or redetermination of the employer's contribution rate,
unless such corrections or modifications were established on or before
the computation date; except that they shall be taken into account
whenever established if the employer filed false returns with intent to
defraud or, with respect to payroll, failed to file returns prior to the
computation date such that an amount of contributions due from such
employer and/or an amount of wages paid by such employer was required to
be determined by the commissioner pursuant to section five hundred
seventy-one of this article and such corrections or modifications result
in a rate higher than the contribution rate determined by the
commissioner or, with respect to experience rating charges, if they
result from a referee, appeal board, or court decision.
7. Certain transfers. Notwithstanding any other provision of law, the
following shall apply regarding assignment of rates and transfers of
experience:
(a)(1) If an employer transfers its organization, trade or business,
or a portion thereof, to another employer and, at the time of the
transfer, there is at least ten percent common ownership, management or
control of the two employers, then the unemployment experience
attributable to the transferred organization, trade or business shall be
transferred to the employer to whom such organization, trade or business
is so transferred. In addition to the provisions of this subdivision,
the transfer provisions of paragraphs (a), (b) and (d) of subdivision
four of this section shall apply to such transfers. For purposes of this
subdivision "organization, trade or business" shall include the
employer's workforce.
(2) If, following a transfer of experience under subparagraph one of
this paragraph, the commissioner determines that a substantial purpose
of the transfer of the organization, trade or business was to obtain a
reduced liability for contributions, then the experience rating accounts
of the employers involved shall be combined into a single account and a
single rate shall be assigned to such account.
(b) Whenever a person is not an employer liable for contributions
under this article at the time it acquires the organization, trade or
business of an employer, the unemployment experience of the acquired
business shall not be transferred to such person if the commissioner
finds that such person acquired the business solely or primarily for the
purpose of obtaining a lower rate of contributions. Instead, such person
shall be assigned a rate in accordance with paragraph (c) of subdivision
two of this section. In determining whether the organization, trade or
business was acquired solely or primarily for the purpose of obtaining a
lower rate of contributions, the commissioner shall evaluate factors
that include, but are not limited to the following:
(1) the cost of acquiring the organization, trade or business;
(2) whether the person continued the business enterprise of the
acquired business;
(3) how long such business enterprise was continued; or
(4) whether a substantial number of new employees were hired for
performance of duties unrelated to the business activity conducted prior
to acquisition.
(c)(1) If a person knowingly violates or attempts to violate
paragraphs (a) or (b) of this subdivision, then such person shall be
liable for the greater penalty of ten percent of such person's total
taxable wages in the last completed payroll year or ten thousand
dollars. Any such penalty shall be deposited in the control fund
established under section five hundred fifty-two-b of this article.
(2) If a person knowingly advises another person to violate or attempt
to violate paragraph (a) or (b) of this subdivision, then such advisor
shall be subject to a civil penalty of ten thousand dollars. Any such
penalty shall be deposited in the control fund established under section
five hundred fifty-two-b of this article.
(3) For purposes of this subdivision, the term "knowingly" means
having actual knowledge of or acting with deliberate ignorance or
reckless disregard for the prohibition involved.
(4) For purposes of this subdivision, the term "violates or attempts
to violate" includes, but is not limited to, intent to evade,
misrepresentation or wilful nondisclosure.
(5) In addition to the penalties imposed by subparagraphs one and two
of this paragraph, any violation of this subdivision shall be a class E
felony and is punishable by a term of imprisonment as prescribed in
section 70.00 of the penal law.
(d) The commissioner shall establish procedures to identify the
transfer or acquisition of a business for purposes of this subdivision.
(e) For purposes of this subdivision the term "person" has the meaning
given such term by section 7701 (a)(1) of the Internal Revenue Code of
1986, and shall also include an employer as defined in this article.
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