AN ACT

 

1Amending the act of December 5, 1936 (2nd Sp.Sess., 1937 
2P.L.2897, No.1), entitled "An act establishing a system of 
3unemployment compensation to be administered by the 
4Department of Labor and Industry and its existing and newly 
5created agencies with personnel (with certain exceptions) 
6selected on a civil service basis; requiring employers to 
7keep records and make reports, and certain employers to pay 
8contributions based on payrolls to provide moneys for the 
9payment of compensation to certain unemployed persons; 
10providing procedure and administrative details for the 
11determination, payment and collection of such contributions 
12and the payment of such compensation; providing for 
13cooperation with the Federal Government and its agencies; 
14creating certain special funds in the custody of the State 
15Treasurer; and prescribing penalties," further providing for 
16contributions by employees and for trigger rate 
17redeterminations; and providing for regular contributions by 
18employees.

19The General Assembly of the Commonwealth of Pennsylvania
20hereby enacts as follows:

21Section 1.  Sections 301.4 and 301.8(b) of the act of 
22December 5, 1936 (2nd Sp.Sess., 1937 P.L.2897, No.1), known as 
23the Unemployment Compensation Law, amended June 12, 2012
24(P.L.577, No.60), are amended to read:

1Section 301.4.  Contributions by Employes.--(a) 
2Notwithstanding any other provision of this act, each employe
3shall pay contributions at a rate of zero per centum (0.0%) for
4calendar year 1989 and at a rate as set forth in section 301.7
5for each calendar year thereafter of all wages paid for
6"employment" as defined by the act without regard to the
7limitation specified in section 4(x)(1) of this act.

8(b)  Each employer subject to this act shall be responsible
9for withholding and shall withhold, in trust, such contributions
10from the wages of his employes at the time such wages are paid,
11and shall report and transmit such deductions to the department
12for deposit into the Unemployment Compensation Fund [and], the 
13Reemployment Fund and the Administration Fund pursuant to the 
14allocation prescribed in subsection (e), in accordance with
15rules and procedures established by the department.

16(c)  Any employer who is an individual, or any officer or
17agent of any employer, who violates the trust provision of this
18section, fails to withhold, hold in trust or fails to transmit
19to the department all contributions withheld from the wages of
20his employes in accordance with the rules and procedure
21established by the department shall be subject to the provisions
22of clause (2) of subsection (a) of section 301 and sections 308,
23308.1, 308.2, 308.3 and 309 of this act.

24(d)  This section shall not be deemed to affect or impair the
25operation of any State statute or ordinance or resolution of a
26political subdivision which levies or collects any wage tax or
27similar tax. Contributions made pursuant to this section are not
28intended to reduce or otherwise affect any tax on wages or
29similar tax.

30(e)  Contributions paid under this section shall be allocated

1by the department between the Unemployment Compensation Fund
2[and], the Reemployment Fund and the Administration Fund as
3follows:

4[(1)  Ninety-five per centum (95%) of the contributions on
5wages paid from January 1, 2013, through September 30, 2017,
6shall be deposited into the Unemployment Compensation Fund and
7five per centum (5%) of such contributions shall be deposited
8into the Reemployment Fund to the extent the contributions are
9paid on or before December 31, 2017.

10(2)  One hundred per centum (100%) of the contributions on
11wages paid from January 1, 2013, through September 30, 2017,
12shall be deposited into the Unemployment Compensation Fund to
13the extent the contributions are paid on or after January 1,
142018.

15(3)  One hundred per centum (100%) of the contributions on
16wages paid on or after October 1, 2017, shall be deposited into
17the Unemployment Compensation Fund.]

18(1)  Ninety-five per centum (95%) of the contributions shall
19be deposited into the Unemployment Compensation Fund.

20(2)  Five per centum (5%) of such contributions shall be
21deposited as follows:

22(i)  Not less than ten million dollars ($10,000,000) shall
23annually be deposited into the Administration Fund with the
24remaining contributions deposited into the Reemployment Fund to
25the extent that contributions are paid on or before December 31,
262017.

27(ii)  Commencing January 1, 2018, the contributions shall be
28deposited into the Administration Fund to the extent that such
29contributions are paid on or after January 1, 2018.

30(iii)  Contributions deposited into the Administration Fund

1under subparagraphs (i) and (ii) shall be prioritized for costs
2to improve the efficiency of the unemployment compensation
3service center system, including costs of increased staffing,
4training for temporary or intermittent positions to ensure a
5ready work force as needed, and necessary upgrades to telephone
6and electronic service center and claims filing systems.

7Section 301.8.  Trigger Rate Redeterminations.--* * *

8(b)  (1)  For calendar years 2013 through the year determined 
9under paragraph (4), if the trigger percentage as of July 1 of 
10the preceding calendar year is less than two hundred fifty per 
11centum (250%), the rates determined under paragraph (2) shall 
12apply. For calendar years following the year determined under 
13paragraph (4), if the trigger percentage as of July 1 of the 
14preceding calendar year is less than two hundred fifty per 
15centum (250%), the rates determined under paragraph (3) shall 
16apply.

17(2)  (i)  The secretary shall redetermine the rates such that
18the surcharge assessed under section 301.5 shall yield one
19hundred million dollars ($100,000,000), the additional
20contribution under section 301.2 shall yield two hundred twenty-
21five million dollars ($225,000,000), the employe tax under
22section 301.4 shall yield one hundred sixty-six million six
23hundred sixty-six thousand six hundred sixty-six dollars
24($166,666,666), and the benefit reduction under section 404(e)
25(4) shall yield fifty-two million dollars ($52,000,000).

26(ii)  For calendar years 2018 through the year determined
27under paragraph (4), notwithstanding the dollar limitation in
28subparagraph (i), the employe tax rate applicable under section
29301.4 and redetermined under this paragraph shall not be set at
30a rate less than eight-hundredths of one per centum (0.08%).

1(3)  (i)  The secretary shall redetermine the rates such that
2the surcharge assessed under section 301.5 shall yield one
3hundred thirty-eight million dollars ($138,000,000), the
4additional contribution under section 301.2 shall yield the sum
5of three hundred ten million dollars ($310,000,000) plus the
6amount determined under paragraph (5), the employe tax under
7section 301.4 shall yield two hundred thirty million dollars
8($230,000,000), and the benefit reduction under section 404(e)
9(4) shall yield seventy-two million dollars ($72,000,000).

10(ii)  Notwithstanding the dollar limitation in subparagraph
11(i), the employe tax rate applicable under section 301.4 and
12redetermined under this paragraph shall not be set at a rate
13less than eight-hundredths of one per centum (0.08%).

14(4)  The calendar year determined under this paragraph shall
15be the earliest calendar year subsequent to 2012 on December 31
16of which all of the following apply:

17(i)  There is no unpaid balance of Federal advances under
18Title XII of the Social Security Act (58 Stat. 790, 42 U.S.C. §
191321, et seq.) or interest thereon.

20(ii)  There are no outstanding bond obligations under Article
21XIV of this act and no bond administrative expenses under
22Article XIV of this act and no such obligations and no such
23expenses will be due in the following year.

24(5)  The amount determined under this paragraph shall be the
25sum of:

26(i)  twenty per centum (20%) of the amount paid from the
27Unemployment Compensation Fund pursuant to section 1407(c)
28during the sixty (60) consecutive calendar months ending on June
2930 of the year in which the redetermination occurs, plus

30(ii)  twenty per centum (20%) of that portion of the amount

1paid from the Unemployment Compensation Fund pursuant to section
21407(c) during the immediately preceding sixty (60) consecutive
3calendar months that is not recovered by additional
4contributions paid for calendar years through the calendar year
5in which the redetermination occurs.

6* * *

7Section 2.  The act is amended by adding a section to read:

8Section 301.9.  Regular Contributions by Employes.--(a) 
9Notwithstanding any other provision of this act, for every
10calendar year in which the employe tax under section 301.4 is
11not effective, each employe shall contribute eight-hundredths of
12one percent (0.08%) of all wages paid for employment without
13regard to the limitation specified in section 4(x)(1).

14(b)  Each employer subject to this act shall be responsible
15for withholding and shall withhold, in trust, such contributions
16from the wages of his employes at the time such wages are paid,
17and shall report and transmit such deductions to the department
18for deposit into the Unemployment Compensation Fund and the
19Administration Fund pursuant to the allocation prescribed in
20subsection (e), in accordance with rules and procedures
21established by the department.

22(c)  Any employer who is an individual, or any officer or
23agent of any employer, who violates the trust provision of this
24section, fails to withhold, hold in trust or fails to transmit
25to the department all contributions withheld from the wages of
26an employer's employes in accordance with the rules and
27procedure established by the department shall be subject to the
28provisions of sections 301(a)(2), 308, 308.1, 308.2, 308.3 and
29309.

30(d)  This section shall not be deemed to affect or impair the

1operation of any State statute or ordinance or resolution of a
2political subdivision which levies or collects any wage tax or
3similar tax. Contributions made pursuant to this section are not
4intended to reduce or otherwise affect any tax on wages or
5similar tax.

6(e)  Contributions paid under this section shall be allocated
7by the department between the Unemployment Compensation Fund and
8the Administration Fund as follows:

9(1)  Sixty per centum (60%) of the contributions shall be
10deposited into the Unemployment Compensation Fund.

11(2)  Forty per centum (40%) of such contributions shall be
12deposited into the Administration Fund. This money shall be
13prioritized for costs to improve the efficiency of the
14unemployment compensation service center system, including costs
15of increased staffing, training for temporary or intermittent
16positions to ensure a ready work force as needed, and necessary
17upgrades to telephone and electronic service center and claims
18filing systems.

19Section 3.  This act applies as follows:

20(1)  The amendment of section 301.4 of the act shall apply to
21contributions on wages paid on or after January 1, 2013.

22(2)  The amendment of section 301.8(b) of the act shall apply
23to the redetermination of employee contribution rates to occur
24under section 301.8 beginning in 2017 and each fifth year
25thereafter for purposes of contribution rates for calendar year
262018 and thereafter, respectively.

27Section 4.  This act shall take effect immediately.