CHAPTER 167 HOUSE BILL No. 3032 An Act concerning the employment security law; amending K.S.A. 1997 Supp. 44-710 and
repealing the existing section; also repealing K.S.A. 1997 Supp. 44-710j. Be it enacted by the Legislature of the State of Kansas:

Section 1. K.S.A. 1997 Supp. 44-710 is hereby amended to read as
follows: 44-710. (a) Payment. Contributions shall accrue and become pay-
able by each contributing employer for each calendar year in which the
contributing employer is subject to the employment security law with
respect to wages paid for employment. Such contributions shall become
due and be paid by each contributing employer to the secretary for the
employment security fund in accordance with such rules and regulations
as the secretary may adopt and shall not be deducted, in whole or in part,
from the wages of individuals in such employer's employ. In the payment
of any contributions, a fractional part of $.01 shall be disregarded unless
it amounts to $.005 or more, in which case it shall be increased to $.01.
Should contributions for any calendar quarter be less than $1, no payment
shall be required.

(b) Rates and base of contributions. (1) Except as provided in para-
graph (2) of this subsection, each contributing employer shall pay contri-
butions on wages paid by the contributing employer during each calendar
year with respect to employment as provided in K.S.A. 44-710a and
amendments thereto.

(2) (A) If the congress of the United States either amends or repeals
the Wagner-Peyser act, the federal unemployment tax act, the federal
social security act, or subtitle C of chapter 23 of the federal internal
revenue code of 1986, or any act or acts supplemental to or in lieu thereof,
or any part or parts of any such law, or if any such law, or any part or
parts thereof, are held invalid with the effect that appropriations of funds
by congress and grants thereof to the state of Kansas for the payment of
costs of administration of the employment security law are no longer
available for such purposes, or (B) if employers in Kansas subject to the
payment of tax under the federal unemployment tax act are granted full
credit against such tax for contributions or taxes paid to the secretary of
human resources, then, and in either such case, beginning with the year
in which the unavailability of federal appropriations and grants for such
purpose occurs or in which such change in liability for payment of such
federal tax occurs and for each year thereafter, the rate of contributions
of each contributing employer shall be equal to the total of .5% and the
rate of contributions as determined for such contributing employer under
K.S.A. 44-710a and amendments thereto. The amount of contributions
which each contributing employer becomes liable to pay under this par-
agraph (2) over the amount of contributions which such contributing em-
ployer would be otherwise liable to pay shall be credited to the employ-
ment security administration fund to be disbursed and paid out under the
same conditions and for the same purposes as other moneys are author-
ized to be paid from the employment security administration fund, except
that, if the secretary determines that as of the first day of January of any
year there is an excess in the employment security administration fund
over the amount required to be disbursed during such year, an amount
equal to such excess as determined by the secretary shall be transferred
to the employment security fund.

(c) Charging of benefit payments. (1) The secretary shall maintain a
separate account for each contributing employer, and shall credit the
contributing employer's account with all the contributions paid on the
contributing employer's own behalf. Nothing in the employment security
law shall be construed to grant any employer or individuals in such em-
ployer's service prior claims or rights to the amounts paid by such em-
ployer into the employment security fund either on such employer's own
behalf or on behalf of such individuals. Benefits paid shall be charged
against the accounts of each base period employer in the proportion that
the base period wages paid to an eligible individual by each such employer
bears to the total wages in the base period. Benefits shall be charged to
contributing employers' accounts and rated governmental employers' ac-
counts upon the basis of benefits paid during each twelve-month period
ending on the computation date.

(2) (A) Benefits paid in benefit years established by valid new claims
shall not be charged to the account of a contributing employer or rated
governmental employer who is a base period employer if the examiner
finds that claimant was separated from the claimant's most recent em-
ployment with such employer under any of the following conditions: (i)
Discharged for misconduct or gross misconduct connected with the in-
dividual's work; or (ii) leaving work voluntarily without good cause attrib-
utable to the claimant's work or the employer.

(B) Where base period wage credits of a contributing employer or
rated governmental employer represent part-time employment and the
claimant continues in that part-time employment with that employer dur-
ing the period for which benefits are paid, then that employer's account
shall not be charged with any part of the benefits paid if the employer
provides the secretary with information as required by rules and regula-
tions. For the purposes of this subsection (c)(2)(B), ``part-time employ-
ment'' means any employment when an individual works concurrently for
two or more employers and also works less than full-time for at least one
of those employers because the individual's services are not required for
the customary, scheduled full-time hours prevailing at the work place or
the individual does not customarily work the regularly scheduled full-time
hours due to personal choice or circumstances.

(C) No contributing employer or rated governmental employer's ac-
count shall be charged with any extended benefits paid in accordance
with the employment security law, except for weeks of unemployment
beginning after December 31, 1978, all contributing governmental em-
ployers and governmental rated employers shall be charged an amount
equal to all extended benefits paid.

(D) No contributing employer or rated governmental employer's ac-
count will be charged for benefits paid a claimant while pursuing an ap-
proved training course as defined in subsection (s) of K.S.A. 44-703 and
amendments thereto.

(E) No contributing employer or rated governmental employer's ac-
count shall be charged with respect to the benefits paid to any individual
whose base period wages include wages for services not covered by the
employment security law prior to January 1, 1978, to the extent that the
employment security fund is reimbursed for such benefits pursuant to
section 121 of public law 94-566 (90 Stat. 2673).

(F) With respect to weeks of unemployment beginning after Decem-
ber 31, 1977, wages for insured work shall include wages paid for previ-
ously uncovered services. For the purposes of this subsection (c)(2)(F),
the term ``previously uncovered services'' means services which were not
covered employment, at any time during the one-year period ending De-
cember 31, 1975, except to the extent that assistance under title II of the
federal emergency jobs and unemployment assistance act of 1974 was
paid on the basis of such services, and which:

(i) Are agricultural labor as defined in subsection (w) of K.S.A. 44-
703 and amendments thereto or domestic service as defined in subsection
(aa) of K.S.A. 44-703 and amendments thereto, or

(ii) are services performed by an employee of this state or a political
subdivision thereof, as provided in subsection (i)(3)(E) of K.S.A. 44-703
and amendments thereto, or

(iii) are services performed by an employee of a nonprofit educational
institution which is not an institution of higher education.

(3) The examiner shall notify any base period employer whose ac-
count will be charged with benefits paid following the filing of a valid
new claim and a determination by the examiner based on all information
relating to the claim contained in the records of the division of employ-
ment. Such notice shall become final and benefits charged to the base
period employer's account in accordance with the claim unless within 10
calendar days from the date the notice was sent, the base period employer
requests in writing that the examiner reconsider the determination and
furnishes any required information in accordance with the secretary's
rules and regulations. In a similar manner, a notice of an additional claim
followed by the first payment of benefits with respect to the benefit year,
filed by an individual during a benefit year after a period in such year
during which such individual was employed, shall be given to any base
period employer of the individual who has requested such a notice within
10 calendar days from the date the notice of the valid new claim was sent
to such base period employer. For purposes of this subsection (c)(3), if
the required information is not submitted or postmarked within a re-
sponse time limit of 10 days after the base period employer notice was
sent, the base period employer shall be deemed to have waived its stand-
ing as a party to the proceedings arising from the claim and shall be barred
from protesting any subsequent decisions about the claim by the secre-
tary, a referee, the board of review or any court, except that the base
period employer's response time limit may be waived or extended by the
examiner or upon appeal, if timely response was impossible due to ex-
cusable neglect. The examiner shall notify the employer of the reconsid-
ered determination which shall be subject to appeal, or further reconsid-
eration, in accordance with the provisions of K.S.A. 44-709 and
amendments thereto.

(4) Time, computation and extension. In computing the period of
time for a base period employer response or appeals under this section
from the examiner's or the special examiner's determination or from the
referee's decision, the day of the act, event or default from which the
designated period of time begins to run shall not be included. The last
day of the period shall be included unless it is a Saturday, Sunday or legal
holiday, in which event the period runs until the end of the next day
which is not a Saturday, Sunday or legal holiday.

(d) Pooled fund. All contributions and payments in lieu of contribu-
tions and benefit cost payments to the employment security fund shall
be pooled and available to pay benefits to any individual entitled thereto
under the employment security law, regardless of the source of such con-
tributions or payments in lieu of contributions or benefit cost payments.

(e) Election to become reimbursing employer; payment in lieu of con-
tributions. (1) Any governmental entity for which services are performed
as described in subsection (i)(3)(E) of K.S.A. 44-703 and amendments
thereto or any nonprofit organization or group of nonprofit organizations
described in section 501(c)(3) of the federal internal revenue code of 1986
which is exempt from income tax under section 501(a) of such code, that
becomes subject to the employment security law may elect to become a
reimbursing employer under this subsection (e)(1) and agree to pay the
secretary for the employment security fund an amount equal to the
amount of regular benefits and 1/2 of the extended benefits paid that are
attributable to service in the employ of such reimbursing employer, ex-
cept that each reimbursing governmental employer shall pay an amount
equal to the amount of regular benefits and extended benefits paid for
weeks of unemployment beginning after December 31, 1978, to individ-
uals for weeks of unemployment which begin during the effective period
of such election.

(A) Any employer identified in this subsection (e)(1) may elect to
become a reimbursing employer for a period encompassing not less than
four complete calendar years if such employer files with the secretary a
written notice of such election within the thirty-day period immediately
following January 1 of any calendar year or within the thirty-day period
immediately following the date on which a determination of subjectivity
to the employment security law is issued, whichever occurs later.

(B) Any employer which makes an election to become a reimbursing
employer in accordance with subparagraph (A) of this subsection (e)(1)
will continue to be liable for payments in lieu of contributions until such
employer files with the secretary a written notice terminating its election
not later than 30 days prior to the beginning of the calendar year for
which such termination shall first be effective.

(C) Any employer identified in this subsection (e)(1) which has re-
mained a contributing employer and has been paying contributions under
the employment security law for a period subsequent to January 1, 1972,
may change to a reimbursing employer by filing with the secretary not
later than 30 days prior to the beginning of any calendar year a written
notice of election to become a reimbursing employer. Such election shall
not be terminable by the employer for four complete calendar years.

(D) The secretary may for good cause extend the period within which
a notice of election, or a notice of termination, must be filed and may
permit an election to be retroactive but not any earlier than with respect
to benefits paid after January 1 of the year such election is received.

(E) The secretary, in accordance with such rules and regulations as
the secretary may adopt, shall notify each employer identified in subsec-
tion (e)(1) of any determination which the secretary may make of its status
as an employer and of the effective date of any election which it makes
to become a reimbursing employer and of any termination of such elec-
tion. Such determinations shall be subject to reconsideration, appeal and
review in accordance with the provisions of K.S.A. 44-710b and amend-
ments thereto.

(2) Reimbursement reports and payments. Payments in lieu of con-
tributions shall be made in accordance with the provisions of paragraph
(A) of this subsection (e)(2) by all reimbursing employers except the state
of Kansas. Each reimbursing employer shall report total wages paid dur-
ing each calendar quarter by filing quarterly wage reports with the sec-
retary which shall become due on or before the 25th day of the first month
following the last month of the calendar quarter or in accordance with
such rules and regulations as the secretary may adopt be filed by the last
day of the month following the close of each calendar quarter. Wage re-
ports are deemed filed as of the date they are placed in the United States
mail.

(A) At the end of each calendar quarter, or at the end of any other
period as determined by the secretary, the secretary shall bill each re-
imbursing employer, except the state of Kansas, (i) an amount to be paid
which is equal to the full amount of regular benefits plus 1/2 of the amount
of extended benefits paid during such quarter or other prescribed period
that is attributable to service in the employ of such reimbursing employer;
and (ii) for weeks of unemployment beginning after December 31, 1978,
each reimbursing governmental employer shall be certified an amount to
be paid which is equal to the full amount of regular benefits and extended
benefits paid during such quarter or other prescribed period that is at-
tributable to service in the employ of such reimbursing governmental
employer.

(B) Payment of any bill rendered under paragraph (A) of this sub-
section (e)(2) shall be made not later than 30 days after such bill was
mailed to the last known address of the reimbursing employer, or oth-
erwise was delivered to such reimbursing employer, unless there has been
an application for review and redetermination in accordance with para-
graph (D) of this subsection (e)(2).

(C) Payments made by any reimbursing employer under the provi-
sions of this subsection (e)(2) shall not be deducted or deductible, in
whole or in part, from the remuneration of individuals in the employ of
such employer.

(D) The amount due specified in any bill from the secretary shall be
conclusive on the reimbursing employer, unless, not later than 15 days
after the bill was mailed to the last known address of such employer, or
was otherwise delivered to such employer, the reimbursing employer files
an application for redetermination in accordance with K.S.A. 44-710b and
amendments thereto.

(E) Past due payments of amounts certified by the secretary under
this section shall be subject to the same interest, penalties and actions
required by K.S.A. 44-717 and amendments thereto. If any reimbursing
employer is delinquent in making payments of amounts certified by the
secretary under this section, the secretary may terminate such employer's
election to make payments in lieu of contributions as of the beginning of
the next calendar year and such termination shall be effective for such
next calendar year and the calendar year thereafter so that the termination
is effective for two complete calendar years.

(F) In the discretion of the secretary, any employer who elects to
become liable for payments in lieu of contributions and any reimbursing
employer who is delinquent in filing reports or in making payments of
amounts certified by the secretary under this section shall be required
within 60 days after the effective date of such election, in the case of an
eligible employer so electing, or after the date of notification to the de-
linquent employer under this subsection (e)(2)(F), in the case of a delin-
quent employer, to execute and file with the secretary a surety bond,
except that the employer may elect, in lieu of a surety bond, to deposit
with the secretary money or securities as approved by the secretary. The
amount of the bond or deposit required by this subsection (e)(2)(F) shall
not exceed 5.4% of the organization's taxable wages paid for employment
by the eligible employer during the four calendar quarters immediately
preceding the effective date of the election or the date of notification, in
the case of a delinquent employer. If the employer did not pay wages in
each of such four calendar quarters, the amount of the bond or deposit
shall be as determined by the secretary. Upon the failure of an employer
to comply with this subsection (e)(2)(F) within the time limits imposed
or to maintain the required bond or deposit, the secretary may terminate
the election of such eligible employer or delinquent employer, as the case
may be, to make payments in lieu of contributions, and such termination
shall be effective for the current and next calendar year.

(G) The state of Kansas shall make reimbursement payments quar-
terly at a fiscal year rate which shall be based upon: (i) The available
balance in the state's reimbursing account as of December 31 of each
calendar year; (ii) the historical unemployment experience of all covered
state agencies during prior years; (iii) the estimate of total covered wages
to be paid during the ensuing calendar year; (iv) the applicable fiscal year
rate of the claims processing and auditing fee under K.S.A. 75-3798 and
amendments thereto; and (v) actuarial and other information furnished
to the secretary by the secretary of administration. In accordance with
K.S.A. 75-3798 and amendments thereto, the claims processing and au-
diting fees charged to state agencies shall be deducted from the amounts
collected for the reimbursement payments under this paragraph (G) prior
to making the quarterly reimbursement payments for the state of Kansas.
The fiscal year rate shall be expressed as a percentage of covered total
wages and shall be the same for all covered state agencies. The fiscal year
rate for each fiscal year will be certified in writing by the secretary to the
secretary of administration on July 15 of each year and such certified rate
shall become effective on the July 1 immediately following the date of
certification. A detailed listing of benefit charges applicable to the state's
reimbursing account shall be furnished quarterly by the secretary to the
secretary of administration and the total amount of charges deducted
from previous reimbursing payments made by the state. On January 1 of
each year, if it is determined that benefit charges exceed the amount of
prior reimbursing payments, an upward adjustment shall be made there-
for in the fiscal year rate which will be certified on the ensuing July 15.
If total payments exceed benefit charges, all or part of the excess may be
refunded, at the discretion of the secretary, from the fund or retained in
the fund as part of the payments which may be required for the next fiscal
year.

(3) Allocation of benefit costs. The reimbursing account of each re-
imbursing employer shall be charged the full amount of regular benefits
and 1/2 of the amount of extended benefits paid except that each reim-
bursing governmental employer's account shall be charged the full
amount of regular benefits and extended benefits paid for weeks of un-
employment beginning after December 31, 1978, to individuals whose
entire base period wage credits are from such employer. When benefits
received by an individual are based upon base period wage credits from
more than one employer then the reimbursing employer's or reimbursing
governmental employer's account shall be charged in the same ratio as
base period wage credits from such employer bear to the individual's total
base period wage credits. Notwithstanding any other provision of the
employment security law, no reimbursing employer's or reimbursing gov-
ernmental employer's account shall be charged for payments of extended
benefits which are wholly reimbursed to the state by the federal govern-
ment.

(A) Proportionate allocation (when fewer than all reimbursing base
period employers are liable). If benefits paid to an individual are based
on wages paid by one or more reimbursing employers and on wages paid
by one or more contributing employers or rated governmental employers,
the amount of benefits payable by each reimbursing employer shall be
an amount which bears the same ratio to the total benefits paid to the
individual as the total base period wages paid to the individual by such
employer bears to the total base period wages paid to the individual by
all of such individual's base period employers.

(B) Proportionate allocation (when all base period employers are re-
imbursing employers). If benefits paid to an individual are based on wages
paid by two or more reimbursing employers, the amount of benefits pay-
able by each such employer shall be an amount which bears the same
ratio to the total benefits paid to the individual as the total base period
wages paid to the individual by such employer bear to the total base
period wages paid to the individual by all of such individual's base period
employers.

(4) Group accounts. Two or more reimbursing employers may file a
joint application to the secretary for the establishment of a group account
for the purpose of sharing the cost of benefits paid that are attributable
to service in the employment of such reimbursing employers. Each such
application shall identify and authorize a group representative to act as
the group's agent for the purposes of this subsection (e)(4). Upon ap-
proval of the application, the secretary shall establish a group account for
such employers effective as of the beginning of the calendar quarter in
which the secretary receives the application and shall notify the group's
representative of the effective date of the account. Such account shall
remain in effect for not less than four years and thereafter such account
shall remain in effect until terminated at the discretion of the secretary
or upon application by the group. Upon establishment of the account,
each member of the group shall be liable for payments in lieu of contri-
butions with respect to each calendar quarter in the amount that bears
the same ratio to the total benefits paid in such quarter that are attrib-
utable to service performed in the employ of all members of the group
as the total wages paid for service in employment by such member in
such quarter bear to the total wages paid during such quarter for service
performed in the employ of all members of the group. The secretary shall
adopt such rules and regulations as the secretary deems necessary with
respect to applications for establishment, maintenance and termination
of group accounts that are authorized by this subsection (e)(4), for ad-
dition of new members to, and withdrawal of active members from such
accounts, and for the determination of the amounts that are payable un-
der this subsection (e)(4) by members of the group and the time and
manner of such payments.

Sec. 2. K.S.A. 1997 Supp. 44-710 and 44-710j are hereby repealed.

Sec. 3. This act shall take effect and be in force from and after its
publication in the statute book.

Approved May 13, 1998

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