THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY GORDNER, APRIL 28, 2011

SENATOR GORDNER, LABOR AND INDUSTRY, AS AMENDED, MAY 10, 2011   

AN ACT

Amending the act of December 5, 1936 (2nd Sp.Sess., 1937

P.L.2897, No.1), entitled "An act establishing a system of

unemployment compensation to be administered by the

Department of Labor and Industry and its existing and newly

created agencies with personnel (with certain exceptions)

selected on a civil service basis; requiring employers to

keep records and make reports, and certain employers to pay

contributions based on payrolls to provide moneys for the

payment of compensation to certain unemployed persons;

providing procedure and administrative details for the

determination, payment and collection of such contributions

and the payment of such compensation; providing for

cooperation with the Federal Government and its agencies;

creating certain special funds in the custody of the State

Treasurer; and prescribing penalties," further providing for

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relief from charges and for establishment and maintenance of

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employer's reserve accounts; providing for automatic relief

from charges; further providing for qualifications required

to secure compensation, for rate and amount of compensation,

for definitions and for rules of procedure; and providing for

shared-work program and for applicability.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  The act of December 5, 1936 (2nd Sp.Sess., 1937

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P.L.2897, No.1), known as the Unemployment Compensation Law, is

amended by adding a section to read:

Section 1.  Section 213 of the act of December 5, 1936 (2nd

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Sp.Sess., 1937 P.L.2897, No.1), known as the Unemployment

Compensation Law, added December 9, 2002 (P.L.1330, No.156), is

amended to read:

Section 213.  Relief from Charges for Certain Employers.--(a)  

An employer that makes payments in lieu of contributions

pursuant to Article X, XI or XII shall be relieved of charges in

accordance with section [302(a)] 302.1 and regulations of the

department, for compensation paid on applications for benefits

effective during a calendar year, if the employer satisfies the

following requirements:

(1)  The employer pays a nonrefundable solvency fee under

subsection (b) for the calendar year within thirty (30) days

after notice of the fee is sent to the employer's last known

address. The department may for good cause extend the period

within which the fee must be paid.

(2)  All reports required by this act and regulations of the

department for calendar quarters through the second calendar

quarter of the preceding calendar year are filed.

(b)  An employer's solvency fee for a calendar year shall be

the monetary amount determined by multiplying the solvency fee

rate for the year by the amount of wages paid, without regard to

the exclusion in section 4(x)(1), by the employer in the four

consecutive calendar quarters ending on June 30 of the preceding

calendar year, provided that an employer's solvency fee for a

year shall not be less than twenty-five dollars ($25).

(1)  For calendar years 2003, 2004 and 2005, the solvency fee

rate shall be three ten thousandths (.0003).

(2)  In 2005 the secretary shall redetermine the solvency fee

rate. The secretary shall redetermine the rate so that the

unrounded rate yields solvency fees approximately equal to the

amount of compensation for which charges are relieved under this

section. For purposes of redetermining the rate, the secretary

shall use the amount of compensation for which charges are

relieved under this section paid during 2003 and 2004 and the

amount of wages paid, without regard to the exclusion in section

4(x)(1), during the same time period by employers who paid a

solvency fee under this section. The rate as redetermined shall

take effect for the next calendar year and shall remain in

effect for three years.

(3)  Beginning in 2008 and each fifth year thereafter, the

secretary shall redetermine the solvency fee rate. The secretary

shall redetermine the rate so that the unrounded rate yields

solvency fees approximately equal to the amount of compensation

for which charges are relieved under this section. For purposes

of redetermining the rate, the secretary shall use the amount of

compensation for which charges are relieved under this section

paid during the five calendar years immediately preceding the

year in which the redetermination occurs and the amount of wages

paid, without regard to the exclusion in section 4(x)(1), during

the same time period by employers who paid a solvency fee under

this section. The rate as redetermined shall take effect for the

next calendar year and shall remain in effect for five years.

(4)  If the solvency fee rate redetermined under paragraphs

(2) and (3) is not a multiple of one-hundredth of one per cent,

it shall be rounded to the next higher multiple of one-hundredth

of one per cent.

(c)  Solvency fees paid by employers under this section shall

be deposited in the Unemployment Compensation Fund. Compensation

for which charges are relieved under this section shall not be

used in the calculation of the State adjustment factor under

section 301.1(e).

(d)  The provisions of this section shall constitute the

exclusive means by which an employer who makes payments in lieu

of contributions pursuant to Article X, XI or XII may be excused

from reimbursing the Unemployment Compensation Fund for

compensation paid to an individual that is based on wages paid

by the employer or that portion of the individual's compensation

determined in accordance with section 1108.

(e)  A group account under section 1109 shall constitute an

employer for purposes of this section.

Section 2.  Section 302 of the act, amended March 24, 1964

(Sp.Sess., P.L.53, No.1), July 6, 1977 (P.L.41, No.22), July 21,

1983 (P.L.68, No.30), December 19, 1996 (P.L.1476, No.189) and

December 9, 2002 (P.L.1330, No.156), is amended to read:

Section 302.  Establishment and Maintenance of Employer's

Reserve Accounts.--The department shall establish and maintain

for each employer a separate employer's reserve account in the

following manner:

(a)  [(1)  Such account shall be credited with all

contributions paid by such employer for periods subsequent to

June thirtieth, one thousand nine hundred forty-eight. Such

account shall be charged with an amount determined by

multiplying the wages of compensated employes of such employer

for the twelve month period ended June thirtieth, one thousand

nine hundred forty-nine, by the state experience heretofore used

in determining rates of contributions for the year one thousand

nine hundred forty-nine. Subsequent to January 1, 1984, such] An

employer's account shall be charged with all compensation,

including dependents' allowances, paid to each individual who

received from such employer wage credits constituting the base

of such compensation, in the proportion that such wage credits

with such employer bears to the total wage credits received by

such individual from all employers[: Provided, That if the

department finds that such individual was separated from his

most recent work for such employer due to being discharged for

willful misconduct connected with such work, or due to his

leaving such work without good cause attributable to his

employment, or due to his being separated from such work under

conditions which would result in disqualification for benefits

under the provisions of section 3 or section 402(e.1),

thereafter no compensation paid to such individual with respect

to any week of unemployment occurring subsequent to such

separation, which is based upon wages paid by such employer with

respect to employment prior to such separation, shall be charged

to such employer's account under the provisions of this

subsection (a); provided, such employer has filed a notice with

the department in accordance with its rules and regulations and

within the time limits prescribed therein; and provided if the

department finds that such individual's unemployment is directly

caused by a major natural disaster declared by the President

pursuant to section 102(1) of the Disaster Relief Act of 1970

(P.L.91-606) and such individual would have been eligible for

disaster unemployment assistance as provided in section 240 of

that act with respect to such unemployment but for the receipt

of unemployment compensation, no compensation paid to such

individual with respect to any week of unemployment occurring

due to such natural disaster, to a maximum of the eight weeks

immediately following the President's declaration of emergency,

shall be charged to the employer's account under the provisions

of this subsection.

(2)  Notwithstanding the provisions of paragraph (1) of this

subsection, if the department finds that an individual

subsequent to separation from his work is engaged in part-time

work for a base year employer, other than a base year employer

from whom he has separated, compensation paid to such individual

with respect to any week of unemployment occurring subsequent to

such separation and while such part-time work continues without

material change, shall not be charged to the account of such

part-time employer; provided, such part-time employer has filed

a notice with the department in accordance with its rules and

regulations and within the time limits prescribed therein.

(2.1)  Notwithstanding the provisions of paragraph (1) of

this subsection, if the department finds that an individual was

separated from his most recent work for such employer due to a

cessation of business of eighteen months or less caused by a

disaster, compensation paid to such individual with respect to

any week of unemployment occurring subsequent to such separation

shall not be charged to the account of such employer; provided,

such employer has filed a notice with the department in

accordance with its rules and regulations and within the time

limits prescribed therein.

(3)  The findings and determinations of the department under

this subsection (a) shall be subject to appeal in the manner

provided in this act for appeals from determinations of

compensation: Provided, That where the individual's eligibility

for compensation has been finally determined under the

provisions of Article V of this act, such determination shall

not be subject to attack in proceedings under this section.

(4)  The reserve account of any employer who pays

contributions under this section shall not be charged with

respect to benefits paid to any individual whose base period

wages include wages for previously uncovered services as defined

in section 401(g) to the extent that the unemployment insurance

fund is reimbursed for such benefits pursuant to section 121 of

Public Law 94-566].

(b)  Any employer, at any time, may voluntarily pay into the

Unemployment Compensation Fund an amount in excess of the

contributions required to be paid under the provisions of this

act, and such amount shall be forthwith credited to his reserve

account. His rate of contribution shall be computed or

recomputed, as the case may be, with such amount included in the

calculation. To affect such employer's rate of contribution for

any year, such amount shall be paid not later than thirty days

following the mailing of notice of his rate of contribution for

such year: Provided, That for good cause, such time may be

extended by the department: And provided further, That such

amount, when paid as aforesaid, shall not be refunded or used as

a credit in the payment of contributions in whole or in part.

In no event shall any such amount be included in the computation

or recomputation for any year unless it is paid within one

hundred twenty days after the beginning of such year.

(c)  (1)  For the purpose of determining any employer's rate

of contribution for any year, the phrase "balance in an

employer's reserve account" as used in sections 301, 301.1 and

301.2 of this act shall mean the amount ascertained as of the

computation date by subtracting the amounts charged to his

reserve account from the amounts credited thereto including

voluntary contributions. If, as of the computation date, the

amounts charged to his reserve account exceed the amounts

credited by an amount equivalent to more than twenty per centum

(20%) of his average annual payroll, the employer may elect,

subject to the provisions of section 301.1(f) of this act to

have his reserve account balance adjusted to a negative balance

equal to twenty per centum (20%) of his average annual payroll.

This subsection as amended shall apply to elections made after

December 31, 1986.

(2)  Notwithstanding the provisions of section 301.1(f) and

paragraph (1) of this subsection, for elections made on or after

January 1, 1984 and before May 1, 1986, if the amounts charged

to the employer's reserve account exceed the amounts credited by

an amount equivalent to more than ten per centum (10%) of his

average annual payroll, the department, after determining his

Reserve Ratio Factor shall, upon the election of the employer,

adjust his reserve account balance to a negative balance equal

to ten per centum (10%) of his average annual payroll. With

respect to future adjustments of negative balance accounts, the

secretary shall, upon the election of the employer, make

adjustments as follows:

(i)  In relation to adjustments made for the second time

after January 1, 1984 and before May 1, 1986, if the amounts

charged to his reserve account exceed the amounts credited by an

amount equivalent to more than fifteen per centum (15%) of his

average annual payroll, the department shall, upon the election

of the employer, adjust the reserve account balance to a

negative balance equal to fifteen per centum (15%) of his

average annual payroll.

(ii)  In relation to adjustments made for the third time

after January 1, 1984 and before May 1, 1986, if the amounts

charged to his reserve account exceed the amounts credited by an

amount equivalent to more than twenty per centum (20%) of his

average annual payroll, the department shall, upon the election

of the employer, adjust his reserve account balance to a

negative balance equal to twenty per centum (20%) of his average

annual payroll.

(d)  The department shall terminate the reserve account of

any employer who has not paid contributions for a period of four

consecutive twelve month periods, ending June thirtieth in any

year.

(e)  Nothing contained in this act shall be construed to

grant to any employer any claim or right of withdrawal with

respect to any amount allocated to him from, or paid by him

into, the Unemployment Compensation Fund, except as provided in

section three hundred eleven hereof.

Section 3.  The act is amended by adding a section to read:

Section 302.1.  Relief from Charges.--Notwithstanding any

other provisions of this act assigning charges for compensation

paid to employes, the department shall relieve an employer of

charges for compensation in accordance with this section and

section 213 of this act.

(a)  Circumstances allowing relief:

(1)  If an individual was separated from his most recent work

for an employer due to being discharged for willful misconduct

connected with that work, or due to his leaving that work

without good cause attributable to his employment, or due to his

being separated from such work under conditions which would

result in disqualification for benefits under the provisions of

section 3 or section 402(e.1), the employer shall be relieved of

charges for compensation paid to the individual with respect to

any week of unemployment occurring subsequent to such

separation. Relief from charges under this paragraph terminates

if the employe returns to work for the employer.

(2)  If an individual's unemployment is directly caused by a

major natural disaster declared by the President of the United

States pursuant to section 102(1) of the Disaster Relief Act of

1970 (Public Law 91-606, 42 U.S.C. § 4401 et seq.) and the

individual would have been eligible for disaster unemployment

assistance as provided in section 240 of the Disaster Relief Act

of 1970 with respect to that unemployment but for the receipt of

unemployment compensation, an employer shall be relieved of

charges for compensation paid to such individual with respect to

any week of unemployment occurring due to the natural disaster,

to a maximum of the eight weeks immediately following the

declaration of emergency by the President of the United States.

(3)  If an individual subsequent to separation from his work

is engaged in part-time work for a base year employer, other

than a base year employer from whom he has separated, the part-

time employer shall be relieved of charges for compensation paid

to the individual with respect to any week of unemployment

occurring subsequent to the separation and while such part-time

work continues without material change.

(4)  If the department finds that an individual was separated

from his most recent work for an employer due to a cessation of

business of eighteen months or less caused by a disaster, the

employer may be relieved of charges for compensation paid to

such individual with respect to any week of unemployment

occurring subsequent to that separation. Relief from charges

under this paragraph terminates if the employe returns to work

for the employer.

(b)  Requests for relief from charges:

(1)  Except as provided in subsection (c), in order to be

granted relief from charges for compensation an employer must

file a request with the department in the manner provided, and

containing all information required, by the department's

regulations.

(2)  If an employer is requesting relief from charges on the

basis of a separation that occurs on or before the date the

claimant files an application for benefits or on the basis of

continuing part-time work, the following shall apply:

(i)  If the request is filed within thirty (30) fifteen (15) 

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days after the date of the earliest notice issued by the

department under section 501(a) indicating that the claimant is

eligible under section 401(a) and relief is granted, relief

shall begin with the earliest week for which the claimant is

eligible for benefits pursuant to the claimant's application for

benefits.

(ii)  If the request is not filed within the time period

provided in subparagraph (i), relief, if granted by the

department, shall begin with the earliest week ending fifteen

(15) or more days subsequent to the date the request is filed.

(3)  If an employer is requesting relief from charges on the

basis of a separation that occurs after the claimant files an

application for benefits, the following shall apply:

(i)  If the request is filed within thirty (30) fifteen (15) 

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days after the date of the earliest notice issued by the

department indicating that the claimant is claiming benefits

subsequent to the separation and relief is granted, relief shall 

begin with the earliest week for which the claimant is eligible

for benefits following the last day worked.

(ii)  If the request is not filed within the time period

provided in subparagraph (i), relief, if granted by the

department, shall begin with the earliest week ending fifteen

(15) or more days subsequent to the date the request is filed.

(c)  Relief from charges without a request:

(1)  If a claimant is determined ineligible for benefits

under section 3 or section 402(b), (e) or (e.1) pursuant to a

notice of determination that has become final, the department

shall grant relief from charges in accordance with subsection

(a)(1) to the employer from whom the claimant was separated,

beginning with the earliest week for which the claimant is

eligible for benefits following the week or weeks governed by

the notice of determination.

(2)  If a claimant is determined eligible for benefits under

section 402(b) pursuant to a notice of determination that has

become final, the department shall grant or deny relief from

charges in accordance with subsection (a)(1) to the employer

from whom the claimant was separated, beginning with the

earliest week governed by the notice of determination, in

accordance with the following:

(i)  The department shall grant relief from charges if the

claimant left work for the employer without good cause

attributable to the claimant's employment.

(ii)  The department shall deny relief from charges if the

claimant left work for the employer with good cause attributable

to the claimant's employment.

(3)  Relief from charges granted to an employer remains in

effect for the purpose of benefits paid to the claimant pursuant

to a subsequent application for benefits if the relief has not

terminated in accordance with the provisions of this section.

(d)  Employer information:

(1)  An employer that is granted relief from charges on the

basis of a claimant's separation from employment shall notify

the department within fifteen (15) days if the claimant returns

to work for the employer. The employer shall include with the

notification the claimant's name and Social Security number, the

employer's name and account number and the date when

reemployment commenced.

(2)  An employer that is granted relief from charges on the

basis of continuing part-time work shall notify the department

within fifteen (15) days if the employment situation of the

claimant changes. The employer shall include with the

notification the claimant's name and Social Security number and

the employer's name and account number.

(e)  General provisions:

(1)  Where the individual's eligibility for compensation has

been finally determined under the provisions of Article V, such

determination shall not be subject to attack in proceedings

under this section.

(2)  The findings and determinations of the department under

this section shall be subject to appeal in the manner provided

in this act for appeals from determinations of compensation.

Section 2.  The addition of section 302.1 of the act shall

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apply to initial claims filed on or after January 1, 2012.

Section 3.  This act shall take effect in 60 days.

Section 4.  Section 401(b) of the act, amended July 9, 1976

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(P.L.842, No.147), is amended to read:

Section 401.  Qualifications Required to Secure

Compensation.--Compensation shall be payable to any employe who

is or becomes unemployed, and who--

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(b)  [Has registered for work at, and thereafter continued to

report to an employment office in accordance with such

regulations as the secretary may prescribe, except that the

secretary may by regulation waive or alter either or both of the

requirements of this clause as to individuals attached to

regular jobs and as to such other types of cases or situations

with respect to which he finds that compliance with such

requirements would be oppressive or would be inconsistent with

the purposes of the act: Provided, however, That no such

regulation shall conflict with section four hundred and one (c)

of this act;] (1)  Is making an active search for suitable

employment. The requirements for "active search" shall be

established by the department and shall include, at a minimum,

all of the following:

(i)  Registration by a claimant for employment search

services offered by the Pennsylvania CareerLink system or its

successor agency within thirty (30) days after initial

application for benefits.

(ii)  Posting a resume on the system's database, unless the

claimant is seeking work in an employment sector in which

resumes are not commonly used.

(iii)  Applying for positions that offer employment and wages

similar to those the claimant had prior to his unemployment and

which are within a forty-five (45) minute commuting distance.

(2)  The Pennsylvania CareerLink system or its successor

agency shall provide documentation, as the secretary deems

appropriate, to the Pennsylvania Unemployment Compensation

Service Center system so the system can conduct the necessary

cross reference checks.

(3)  For the purposes of paragraph (1), the department may

determine that a claimant has made an active search for suitable

work if the claimant's efforts include actions comparable to

those traditional actions in their trade or occupation by which

jobs have been found by others in the community and labor market

in which the claimant is seeking employment.

(4)  The requirements of this subsection do not apply to any

week in which the claimant is in training approved under section

236(a)(1) of the Trade Act of 1974 (Public Law 93-618, 19 U.S.C.

§ 2101 et seq.) or any week in which the claimant is required to

participate in reemployment services under section 402(j).

(5)  The requirements of this subsection shall not apply to a

claimant who is laid off for lack of work and advised by the

employer of the date on which the claimant will return to work.

(6)  The department may waive or alter the requirements of

this subsection in cases or situations with respect to which the

secretary finds that compliance with such requirements would be

oppressive or which would be inconsistent with the purposes of

this act.

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Section 5.  Section 404 introductory paragraph, (d) and (e)

(2) of the act, amended October 19, 1988 (P.L.818, No.109) and

December 16, 2005 (P.L.437, No.80), are amended to read:

Section 404.  Rate and Amount of Compensation.--Compensation

shall be paid to each eligible employe in accordance with the

following provisions of this section except that compensation

payable with respect to weeks ending in benefit years which

begin prior to the first day of January [1989] 2012 shall be

paid on the basis of the provisions of this section in effect at

the beginning of such benefit years.

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(d)  (1)  Notwithstanding any other provisions of this

section each eligible employe who is unemployed with respect to

any week ending subsequent to July 1, 1980 shall be paid, with

respect to such week, compensation in an amount equal to his

weekly benefit rate less the total of (i) the remuneration, if

any, paid or payable to him with respect to such week for

services performed which is in excess of his partial benefit

credit [and], (ii) vacation pay, if any, which is in excess of

his partial benefit credit, except when paid to an employe who

is permanently or indefinitely separated from his employment[.]

and (iii) the amount of severance pay that is attributed to the

week.

(1.1)  For purposes of clause (1)(iii), all of the following

apply:

(i)  "Severance pay" means one or more payments made by an

employer to an employe on account of separation from the service

of the employer, regardless of whether the employer is legally

bound by contract, statute or otherwise to make such payments.

The term does not include payments for pension, retirement or

accrued leave or payments of supplemental unemployment benefits.

(ii)  The amount of severance pay attributed pursuant to

subclause (iii) shall be an amount not less than zero determined

by subtracting one-half of the average annual wage as calculated

under subsection (e) as of June 30 immediately preceding the

calendar year in which the claimant's benefit year begins from

the total amount of severance pay paid or payable to the

claimant by the employer.

(iii)  Severance pay is attributed as follows:

(A)  Severance pay is attributed to the day, days, week or

weeks immediately following the employe's separation.

(B)  The number of days or weeks to which severance pay is

attributed is determined by dividing the total amount of

severance pay by the regular full-time daily or weekly wage of

the claimant.

(C)  The amount of severance pay attributed to each day or

week equals the regular full-time daily or weekly wage of the

claimant.

(D)  When the attribution of severance pay is made on the

basis of the number of days, the pay shall be attributed to the

customary working days in the calendar week.

(2)  (i)  In addition to the deductions provided for in

clause (1), for any week with respect to which an individual is

receiving a pension, including a governmental or other pension,

retirement or retired pay, annuity or any other similar periodic

payment, under a plan maintained or contributed to by a base

period or chargeable employer, the weekly benefit amount payable

to such individual for such week shall be reduced, but not below

zero, by the pro-rated weekly amount of the pension as

determined under subclause (ii).

(ii)  If the pension is entirely contributed to by the

employer, then one hundred per centum (100%) of the pro-rated

weekly amount of the pension shall be deducted. Except as set

forth in clause (4), if the pension is contributed to by the

individual, in any amount, then fifty per centum (50%) of the

pro-rated weekly amount of the pension shall be deducted.

(iii)  No deduction shall be made under this clause by reason

of the receipt of a pension if the services performed by the

individual during the base period or remuneration received for

such services for such employer did not affect the individual's

eligibility for, or increase the amount of, such pension,

retirement or retired pay, annuity or similar payment.

(3)  The provisions of this subsection shall be applicable

whether or not such vacation pay, retirement pension or

annuities or wages are legally required to be paid. If such

retirement pension or annuity payments deductible under the

provisions of this subsection are received on other than a

weekly basis, the amount thereof shall be allocated and pro-

rated in accordance with the rules and regulations of the

department. Vacation pay or other remuneration deductible under

the provisions of this subsection shall be pro-rated on the

basis of the employe's normal full-time weekly wage and as so

pro-rated shall be allocated to such period or periods of

unemployment as shall be determined by rules and regulations of

the department. Such compensation, if not a multiple of one

dollar ($1), shall be computed to the next lower multiple of one

dollar ($1).

(4)  No deductions shall be made under this subsection for

pensions paid under the Social Security Act (Public Law 74-271,

42 U.S.C. § 301 et seq.), or the Railroad Retirement Act of 1974

(Public Law 93-445, 88 Stat. 1305), if the pension is

contributed to by the individual in any amount.

(e)  * * *

(2)  (i)  The Table Specified for the Determination of Rate

and Amount of Benefits shall be extended or contracted annually,

automatically by regulations promulgated by the secretary in

accordance with the following procedure: for calendar year one

thousand nine hundred seventy-two and for all subsequent

calendar years, to a point where the maximum weekly benefit rate

[equals] shall equal sixty-six and two-thirds per centum of the

average weekly wage for the [twelve-month] thirty-six-month 

period ending June 30 preceding each calendar year. If the

maximum weekly benefit rate is not a multiple of one dollar

($1), it shall be [increased by one dollar ($1) and then]

rounded to the next lower multiple of one dollar ($1): Provided,

however, That effective with benefit years beginning the first

Sunday at least thirty days after the effective date of this

amendatory act, the per centum stated in this paragraph for

establishing the maximum weekly benefit rate shall be sixty-two

and two-thirds per centum for the remainder of calendar year one

thousand nine hundred seventy-four, sixty-four and two-thirds

per centum for the calendar year one thousand nine hundred

seventy-five, and sixty-six and two-thirds per centum for the

calendar year one thousand nine hundred seventy-six and for all

subsequent calendar years.

The Table Specified for the Determination of Rate and Amount

of Benefits as so extended or contracted shall be effective only

for those claimants whose benefit years begin on or after the

first day of January of such calendar year.

(ii)  For the purpose of determining the maximum weekly

benefit rate, the Pennsylvania average weekly wage in covered

employment shall be computed on the basis of the total wages

reported (irrespective of the limit on the amount of wages

subject to contributions) for the [twelve-month] thirty-six-

month period ending June 30 and this amount shall be divided by

the average monthly number of covered workers (determined by

dividing the total covered employment reported for the same

[fiscal year by twelve] thirty-six-month period by thirty-six)

to determine the average annual wage. The average annual wage

thus obtained shall be divided by fifty-two and the average

weekly wage thus determined rounded to the nearest cent. If the

maximum weekly benefit rate as determined under subclause (i) is

less than the maximum weekly benefit rate established for

calendar year 2011, the maximum weekly benefit rate will be

frozen until the calendar year in which the new maximum weekly

benefit rate as determined under subclause (i) exceeds the

maximum weekly benefit rate for calendar year 2011.

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Section 6.  Section 401-A(b) and (c) of the act, amended

August 4, 2009 (P.L.114, No.30), are amended to read:

Section 401-A.  Definitions.--As used in this article:

* * *

(b)  (1)  There is a "State 'on' indicator" for this State

for a week if the Secretary of Labor and Industry determines in

accordance with the regulations of the United States Secretary

of Labor, that for the period consisting of such week and the

immediately preceding twelve weeks, the rate of insured

unemployment (not seasonally adjusted) under this act:

(i)  (A)  equaled or exceeded one hundred twenty per centum

of the average of such rates for the corresponding thirteen-week

period ending in each of the preceding two calendar years, or

(B)  with respect to compensation for weeks of unemployment

beginning after December 17, 2010, and ending on or before

December 31, 2011, equaled or exceeded one hundred twenty per

centum of the average of such rates for the corresponding

thirteen-week period ending in each of the preceding three

calendar years, and

(ii)  equaled or exceeded five per centum: Provided, That

with respect to benefits for weeks of unemployment beginning

with the passage of this amendment but no earlier than April 3,

1977, the determination of whether there has been a State "on"

or "off" indicator beginning or ending any extended benefit

period shall be made under this paragraph as if (A) this

paragraph did not contain subparagraph (i) thereof, and (B) the

per centum rate indicated in this paragraph were six, except

that, notwithstanding any such provision of this paragraph, any

week for which there would otherwise be a State "on" indicator

shall continue to be such a week and shall not be determined to

be a week for which there is a State "off" indicator.

(2)  There is a "State 'off' indicator" for this State for a

week if the Secretary of Labor and Industry determines in

accordance with the regulations of the United States Secretary

of Labor, that for the period consisting of such week and the

immediately preceding twelve weeks, the rate of insured

unemployment (not seasonally adjusted) under this act:

(i)  was less than one hundred twenty per centum of the

average of such rates for the corresponding thirteen-week period

ending in each of the preceding two calendar years, if paragraph

(1)(i)(A) applies or, the preceding three calendar years, if

paragraph (1)(i)(B) applies, or

(ii)  was less than five per centum.

(3)  Notwithstanding the provisions of this subsection, any

week for which there would otherwise be a State "on" indicator

shall continue to be such a week and shall not be determined to

be a week for which there is a State "off" indicator.

(c)  (1)  There is a "State 'on' indicator" for this State

for a week if:

(i)  the average rate of total unemployment in this State,

seasonally adjusted, for the period consisting of the most

recent three months for which data for all states are published

before the close of such week equals or exceeds six and one-half

per centum; and

(ii)  (A)  the average rate of total unemployment in this

State, seasonally adjusted, for the three-month period referred

to in subparagraph (i) equals or exceeds one hundred ten per

centum of such average rate for either, or both, of the

corresponding three-month periods ending in the two preceding

calendar years, or

(B)  with respect to compensation for weeks of unemployment

beginning after December 17, 2010, and ending on or before

December 31, 2011, the average rate of total unemployment in

this State, seasonally adjusted, for the three-month period

referred to in subparagraph (i) equals or exceeds one hundred

ten per centum of such average rate for any, or all, of the

corresponding three-month periods ending in the three preceding

calendar years.

(2)  There is a State "off" indicator for this State for a

week if the requirements of paragraph (1)(i) or (ii) are not

satisfied.

(3)  This subsection shall be applicable only with respect to

weeks of unemployment for which one hundred per centum Federal

sharing of extended benefits is available under section 2005(a)

of the American Recovery and Reinvestment Act of 2009 (Public

Law 111-5, 123 Stat. 115), without regard to the extension of

Federal sharing for certain claims as provided under section

2005(c) of the American Recovery and Reinvestment Act of 2009,

or under a subsequently enacted provision of Federal law.

(4)  Notwithstanding the provisions of this subsection, any

week for which there would otherwise be a State "on" indicator

shall continue to be such a week and shall not be determined to

be a week for which there is a State "off" indicator.

(5)  For purposes of this subsection, determinations of the

rate of total unemployment for any period, and of any seasonal

adjustment, shall be made by the United States Secretary of

Labor.

* * *

Section 7.  Section 505 of the act, amended April 23, 1942

(Sp.Sess., P.L.60, No.23), is amended to read:

Section 505.  Rules of Procedure.--The manner in which

appeals shall be taken, the reports thereon required from the

department, the claimant and employers, and the conduct of

hearings and appeals, shall be in accordance with rules of

procedure prescribed by the board whether or not such rules

conform to common law or statutory rules of evidence and other

technical rules of procedure. Rules established by the board

shall permit either party to a hearing to testify via telephone,

without regard to distance of hearing location from either

party.

When the same or substantially similar evidence is relevant

and material to the matter in issue in applications and claims

filed by more than one individual or in multiple applications

and claims filed by a single individual the same time and place

for considering each such application and claim may be fixed,

hearings thereon jointly conducted, a single record of the

proceedings made and evidence introduced with respect to any

application or claim considered as introduced with respect to

all of such applications or claims: Provided, That in the

judgment of the board or referee having jurisdiction of the

proceeding such consideration will not be prejudicial to any

party.

Section 8.  The act is amended by adding an article to read:

ARTICLE XIII

SHARED-WORK PROGRAM

Section 1301.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Affected unit."  A department, shift or other organizational

unit of two or more employees that is designated by an employer

to participate in a shared-work plan.

"Approved shared-work plan."  An employer's shared-work plan

which meets the requirements of section 1303 and which the

department approves in writing.

"Fringe benefit."  Health insurance, a retirement benefit

received under a pension plan, a paid vacation day, a paid

holiday, sick leave and any other similar employee benefit

provided by an employer.

"Participating employee."  An employee in the affected unit

whose hours of work are reduced by the reduction percentage

under the shared-work plan.

"Participating employer."  An employer who has a shared-work

plan in effect.

"Reduction percentage."  The percentage by which each

participating employee's normal weekly hours of work are reduced

under a shared-work plan in accordance with section 1303(b).

"Shared-work plan."  A plan for reducing unemployment under

which participating employees of an affected unit share the work

remaining after reduction in their normal weekly hours of work.

Section 1302.  Application to approve plan.

(a)  Requirements.--An employer that meets all of the

following requirements may apply to the department for approval

of a shared-work plan:

(1)  The employer has filed all quarterly reports and

other reports required under this act and has paid all

contribution, reimbursement, interest and penalty due through

the date of the employer's application.

(2)  If the employer is contributory, the employer's

reserve account balance as of the most recent computation

date preceding the date of the employer's application is a

positive number.

(3)  The employer has paid wages for the 12 consecutive

calendar quarters preceding the date of the employer's

application.

(b)  Application.--An application under this section shall be

made in the manner prescribed by the department and contain all

information required by the department, including the following:

(1)  The employer's assurance that it will provide

reports to the department relating to the operation of its

shared-work plan at the times and in the manner prescribed by

the department and containing all information required by the

department, including the number of hours worked each week by

participating employees.

(2)  The employer's assurance that it will not hire new

employees in, or transfer employees to, the affected unit

during the effective period of the shared-work plan.

(3)  The employer's assurance that it will not lay off

participating employees during the effective period of the

shared-work plan, or reduce participating employees' hours of

work by more than the reduction percentage during the

effective period of the shared-work plan, except in cases of

holidays, designated vacation periods, equipment maintenance 

or similar circumstances.

(4)  A list of the week or weeks within the requested

effective period of the plan during which participating

employees are anticipated to work fewer hours than the number

of hours determined under section 1303(a)(5) due to

circumstances included in paragraph (3).

(5)  The employer's certification that the implementation

of a shared-work plan is in lieu of temporary layoffs that

would affect at least 10% of the employees in the affected

unit and would result in an equivalent reduction in work

hours.

(6)  The employer's assurance that it will abide by all

terms and conditions of this article.

(c)  Multiple plans.--An employer may apply to the department

for approval of more than one shared-work plan.

Section 1303.  Plan requirements.

(a)  General rule.--The department may approve a shared-work

plan only if the plan meets all of the following requirements:

(1)  The shared-work plan applies to one affected unit.

(2)  All employees in the affected unit are participating

employees, except that the following employees may not be

participating employees:

(i)  An employee who has been employed in the

affected unit for less than three months prior to the

date the employer applies for approval of the shared-work

plan.

(ii)  An employee whose hours of work per week

determined under paragraph (5) is 40 or more hours.

(3)  There are no fewer than two participating employees,

determined without regard to corporate officers.

(4)  The participating employees are identified by name

and Social Security number.

(5)  The number of hours a participating employee will

work each week during the effective period of the plan is

determined by the following formula:

employee's normal weekly hours of 

work x (100% - reduction percentage)

(6)  As a result of a decrease in the number of hours

worked by each participating employee, there is a

corresponding reduction in wages.

(7)  If any participating employee is covered by a

collective bargaining agreement, the plan is approved in

writing by the collective bargaining representative.

(8)  The plan does not affect the fringe benefits of any

participating employee not covered by a collective bargaining

agreement.

(9)  The effective period of the plan is not more than 52

consecutive weeks.

(10)  The effective period of the plan combined with

effective periods of the participating employer's prior plans

does not equal more than 104 weeks out of a 156-week period.

(11)  The reduction percentage satisfies the requirements

of subsection (b).

(b)  Reduction percentage.--The reduction percentage under an

approved shared-work plan shall meet all of the following

requirements:

(1)  The reduction percentage shall be no less than 20%

and no more than 40%.

(2)  The reduction percentage shall be the same for all

participating employees.

(3)  The reduction percentage shall not change during the

period of the shared-work plan unless the plan is modified in

accordance with section 1308.

Section 1304.  Approval or disapproval of shared-work plan.

The department shall approve or disapprove a shared-work plan

no later than 15 days after the date the employer's shared-work

plan application that meets the requirements of section 1302(b)

is received by the department. The department's decision shall

be made in writing and, if the shared-work plan is disapproved,

shall include the reasons for the disapproval.

Section 1305.  Effective period of plan.

(a)  Number of weeks.--A shared-work plan is effective for

the number of consecutive weeks indicated in the employer's

application, or a lesser number of weeks as approved by the

department, unless sooner terminated in accordance with section

1309.

(b)  Start date.--The effective period of the shared-work

plan shall begin with the first calendar week following the date

on which the department approves the plan.

Section 1306.  Criteria for compensation.

(a)  General rule.--Compensation shall be payable to a

participating employee for a week within the effective period of

an approved shared-work plan during which the employee works the

number of hours determined under section 1303(a)(5) for the

participating employer on the same terms, in the same amount and

subject to the same conditions that would apply to the

participating employee without regard to this article, except as 

follows:

(1)  A participating employee shall not be required to be

unemployed within the meaning of section 4(u) or file claims

for compensation under section 401(c).

(2)  Notwithstanding section 404(d)(1), a participating

employee shall be paid compensation in an amount equal to the

product of his weekly benefit rate and the reduction

percentage, rounded to the next lower whole dollar amount.

(3)  The department shall not deny compensation to a

participating employee for any week during the effective

period of the shared-work plan by reason of the application

of any provision of this act relating to active search for

work or refusal to apply for or accept work other than work

offered by the participating employer.

(4)  A participating employee satisfies the requirements

of section 401(d)(1) if the employee is able to work and is

available for the employee's normal weekly hours of work with

the participating employer.

(b)  Equivalent remuneration.--For purposes of subsection

(a), if a participating employee works fewer hours than the

number of hours determined under section 1303(a)(5) for the

participating employer during a week within the effective period

of the approved shared-work plan, but receives remuneration

equal to remuneration the employee would have received if the

employee had worked the number of hours determined under section

1303(a)(5), the employee will be deemed to have worked the

number of hours determined under section 1303(a)(5) during that

week.

(c)  Inapplicability of article.--A participating employee's

eligibility for compensation for a week within the effective

period of an approved shared-work plan shall be determined

without regard to this article under any of the following

circumstances:

(1)  The employee works fewer hours than the number of

hours determined under section 1303(a)(5) for the

participating employer during the week and subsection (b)

does not apply.

(2)  The employee works more hours than the number of

hours determined under section 1303(a)(5) for the

participating employer during the week.

(3)  The employee receives remuneration for the week from

the participating employer for hours in excess of the number

of hours determined under section 1303(a)(5).

Section 1307.  Participating employer responsibilities.

(a)  Filing claims.--The department shall establish a

schedule of consecutive two-week periods within the effective

period of the shared-work plan. The department may, as

necessary, include one-week periods in the schedule and revise

the schedule. At the end of each scheduled period, the

participating employer shall file claims for compensation for

the week or weeks within the period on behalf of the

participating employees. The claims shall be filed no later than

the last day of the week immediately following the period,

unless an extension of time is granted by the department for

good cause. The claims shall be filed in the manner prescribed

by the department and shall contain all information required by

the department to determine the eligibility of the participating

employees for compensation.

(b)  Benefit charges.--Notwithstanding any other provision of

this act, compensation paid to participating employees for weeks

within the effective period of an approved shared-work plan will

be charged to the participating employer.

Section 1308.  Modification of plan.

An employer may apply to the department for approval to

modify a shared-work plan to meet changed conditions. The

department shall reevaluate the plan and may approve the

modified plan if it meets the requirements for approval under

section 1304. If the modifications cause the shared-work plan to

fail to meet the requirements for approval, the department shall

disapprove the proposed modifications.

Section 1309.  Termination of plan.

(a)  General rule.--The secretary may terminate a shared-work

plan for good cause.

(b)  Good cause.--For purposes of subsection (a), good cause

includes any of the following:

(1)  The plan is not being executed according to its

approved terms and conditions.

(2)  The participating employer fails to comply with the

assurances given in the plan.

(3)  The participating employer or a participating

employee violates any criteria on which approval of the plan

was based.

(c)  Termination by employer.--The employer may terminate a

shared-work plan by written notice to the department.

Section 1310.  Department discretion.

The decision to approve or disapprove a shared-work plan, to

approve or disapprove a modification of a shared-work plan or to

terminate a shared-work plan will be made within the

department's discretion. Such decisions are not subject to the

appeal provisions of Article V.

Section 1311.  Publication of notice.

The department shall transmit to the Legislative Reference

Bureau for publication in the Pennsylvania Bulletin notice that

the provisions of this article have been approved by the

department as required under section 3304(a)(4)(E) of the

Federal Unemployment Tax Act (Public Law 86-778, 26 U.S.C. §

3304(a)(4)(E)) and section 303(a)(5) of the Social Security Act

(49 Stat. 620, 42 U.S.C. § 503(a)(5)).

Section 1312.  Severability.

Notwithstanding any other section of this act, if any

provision or provisions of this article cause the department to

withhold approval of this article as required under section

3304(a)(4)(E) of the Federal Unemployment Tax Act (Public Law

86-778, 26 U.S.C. § 3304(a)(4)(E)) and section 303(a)(5) of the

Social Security Act (49 Stat. 620, 42 U.S.C. § 503(a)(5)), the

department is authorized to permanently suspend the provision or

provisions.

Section 1313.  Expiration.

This article shall expire five years from its effective date.

Section 9.  This act shall apply as follows:

(1)  The amendment or addition of sections 213, 302 and

302.1, other than section 302.1(c), shall apply to charges

for compensation corresponding to benefit years that begin on

and after the effective date of sections 213, 302 and 302.1

of the act.

(2)  The addition of section 302.1(c)(1) and (2) of the

act shall apply to notices of determination regarding

eligibility for benefits that are issued on or after the date

of implementation of the Department of Labor and Industry's

system to provide relief from charges without an employer

request, as announced by the Secretary of Labor and Industry

in a notice published in the Pennsylvania Bulletin. The

addition of section 302.1(c)(3) shall apply to relief from

charges that is granted on or after such implementation date.

(3)  The amendment of section 401(b) shall apply to

benefit years that begin on after January 1, 2012.

(4)  The amendment of section 404, other than the

amendment of section 404(d)(1) and the addition of section

404(d)(1.1), shall apply to the determination of the maximum

weekly benefit rate for benefit years that begin on or after

January 1, 2012.

(5)  The amendment or addition of section 404(d)(1) and

(1.1) shall apply to benefit years that begin on or after the

effective date of section 404(d)(1) and (1.1).

Section 10.  The amendment of section 401-A(b) and (c) shall

apply retroactively to December 18, 2010.

Section 11.  This act shall take effect as follows:

(1)  The amendment of section 401(b) shall take effect

January 1, 2012.

(2)  The amendment of section 404 introductory paragraph

and subsection (e)(2) shall take effect immediately.

(3)  This section shall take effect immediately.

(4)  The addition of Article XIII of the act shall take

effect upon publication in the Pennsylvania Bulletin of the

notice required under section 1311 of the act or July 1,

2011, whichever occurs later.

(5)  The remainder of this act shall take effect in 60

days.