Stricken language would be deleted from and underlined language would be added to present law.
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State of Arkansas As Engrossed: H2/22/23 1
94th General Assembly A Bill 2
Regular Session, 2023 HOUSE BILL 1430 3
4
By: Representatives Lundstrum, Beaty Jr., Bentley, Burkes, C. Cooper, 5
Duffield, Haak, D. Hodges, Ladyman, Long, Maddox, McCollum, Pilkington, Ray, 6
R. Scott Richardson, Rye, Underwood, Unger 7
By: Senators K. Hammer, M. McKee, D. Wallace 8
9
10
For An Act To Be Entitled 11
AN ACT TO AMEND THE DIVISION OF WORKFORC E SERVICES 12
LAW; TO MODIFY THE D EFINITION OF "WAGES" IN CERTAIN 13
CIRCUMSTANCES UNDER THE DIVISION OF WORK FORCE 14
SERVICES LAW; TO RED UCE THE MAXIMUM POTE NTIAL 15
UNEMPLOYMENT COMPENS ATION BENEFITS; TO R EGULATE 16
EMPLOYER CONTRIBUTIONS UNDER THE DIVISION O F 17
WORKFORCE SERVICES L AW; TO REVISE THE ST ABILIZATION 18
TAX RATE; TO AMEND T HE LAW CONCERNING TH E 19
UNEMPLOYMENT COMPENS ATION FUND, THE DIVI SION OF 20
WORKFORCE SERVICES T RAINING TRUST FUND, AND THE 21
UNEMPLOYMENT INSURAN CE ADMINISTRATION FUND; TO 22
DECLARE AN EMERGENCY ; AND FOR OTHER PURP OSES. 23
24
25
Subtitle 26
TO AMEND THE DIVISION OF WORKFORCE 27
SERVICES LAW; AND TO DECLARE AN 28
EMERGENCY. 29
30
31
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 32
33
SECTION 1. Arkansas Code § 11 -10-215(a)(2)(A)(i), concerning the 34
definition of "wages" and the taxable wage base under the Division of 35
Workforce Services Law, is amended to add additional subdivisions to read as 36 As Engrossed: H2/22/23 HB1430
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follows: 1
(f) For a calendar year begi nning on or after 2
January 1, 2024, "wages" shall not include remuneration that exceeds the 3
lesser of: 4
(1) Seven thousand dollars ($7,000) but 5
only if as of June 30 of the most recently completed state fiscal year the 6
balance of the unemployment insu rance trust fund is in excess of six hundred 7
million dollars ($600,000,000); or 8
(2) The amount calculated under 9
subdivisions (a)(2)(A)(i)(d)(1) -(3) of this section. 10
(g) For any calendar year beginning after 11
December 31, 2023, when calculating the amount to determine remuneration 12
constituting wages, then the amount that is included as wages shall not 13
exceed the sum of two thousand dollars ($2,000) and the amount applicable to 14
the immediately preceding calendar year. 15
16
SECTION 2. Arkansas Code § 11-10-504(a), concerning the maximum 17
potential benefits payable in a benefit year, is amended to read as follows: 18
(a)(1) For initial claims filed on or after January 1, 2018, the 19
maximum potential benefits of an insured worker in a benefit year shall be 20
the amount equal to the lesser of: 21
(1)(A) Sixteen (16) times his or her weekly benefit 22
amount; or 23
(2)(B) One-third (⅓) of his or her wages for insured work 24
in his or her base period. 25
(2) For initial claims filed on or after January 1, 2024, the 26
maximum potential benefits of an insured worker in a benefit year shall be 27
the amount equal to the lesser of: 28
(A) Twelve (12) times his or her weekly benefit amount; or 29
(B) One-third (1/3) of his or her wages for insured work 30
in his or her base period. 31
32
SECTION 3. Arkansas Code § 11 -10-704 is amended to read as follows: 33
11-10-704. Future rates — Experience rates generally. 34
(a) The Director of the Division of Workforce Services shall, for each 35
calendar year, classify employers in accordance with their actual experience 36 As Engrossed: H2/22/23 HB1430
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in the payment of contributions on their own behalf and with respect to 1
regular benefits charged against their accounts, with a view to fixing the 2
contribution rates as will reflect their experience. 3
(b)(1) The Except as provided in subsection (c) of this section, the 4
director shall determine the contribution rates of each employer in 5
accordance with the requirements of this section and § 11 -10-705:. 6
(1)(2)(A) Each employer's rate shall be two and nine -tenths 7
percent (2.9%) except as otherwise provided in the other provisions of this 8
subchapter. 9
(A)(i)(B)(i)(a) No employer's rate shall be les s than two 10
and nine-tenths percent (2.9%) unless and until there shall have been three 11
(3) years immediately preceding the computation date throughout which an 12
individual in the employer's employ could have received benefits if eligible. 13
(b) Provided, however, an employer who, at the 14
time of establishing an account, is in business in another state or states 15
and who is not currently doing business in Arkansas may elect to receive a 16
beginning contribution rate of two and nine -tenths percent (2.9%) or a 17
contribution rate based on the rate schedule at § 11 -10-705(b)(1), whichever 18
is lower, but in no event less than one percent (1%), provided: 19
(a)(1) The employer has been in 20
operation in the other state or states for at least three (3) year s 21
immediately preceding the date of becoming a liable employer in Arkansas, 22
throughout which an individual in the employer's employ could have received 23
benefits if eligible; 24
(b)(2) The employer must provide the 25
authenticated account history from information accumulated from operations in 26
the other state or all the other states to compute a current Arkansas rate; 27
and 28
(c)(3) The employer's business 29
operations established in Ar kansas are of the same nature as conducted in the 30
other state or states, as defined by the North American Industry 31
Classification System. 32
(ii)(a) The election authorized in subdivision 33
(b)(1)(A)(i)(b)(1)(B)(i) of this section must be made in writing wi thin 34
thirty (30) days after receiving notice of Arkansas liability. 35
(b) A two-and-nine-tenths-percent rate will be 36 As Engrossed: H2/22/23 HB1430
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assigned unless a timely election has been made. 1
(iii) If the election is made timely, the employer's 2
account will receive the rate elected for the remainder of that rate year. 3
The rate assigned for the next and subsequent years will be determined by the 4
condition of the account on the computation date. 5
(B)(C) However, any employer having no covered employment 6
under this chapter f or any calendar year shall have a rate equal to his or 7
her most recently determined contribution rate until the employer has one (1) 8
full year of benefit risk experience immediately preceding the computation 9
date. 10
(2)(A)(3)(A) Notwithstanding any other provisions of §§ 11-10-11
701 — 11-10-715, if the director determines that an employer has willfully 12
submitted false information which is material with respect to the employment 13
or separation from employment of any claimant, employee, or former employee, 14
for the purpose of preventing regular benefit charges to the employer's 15
account, the employer shall be assessed a penalty equivalent to twice the 16
amount of the claimant's maximum potential benefit amount. 17
(B) This charge penalty shall be charged against th e 18
employer's account for experience rating purposes, regardless of whether or 19
not the employer is a base -period employer and irrespective of the identity 20
or number of base-period employers. 21
(3)(4) An employer who changes from reimbursement to the 22
contributory method of financing shall be considered a new or newly covered 23
employer and can be entitled to an experience rate only when the new or newly 24
covered employer has met the requirements of this subsection. 25
(4)(5) Each employer's rate beginning Janua ry 1 for each twelve -26
month period shall be determined on the basis of the employer's record 27
through June 30 of the previous calendar year. 28
(c)(1) The director shall determine the contribution rates of each 29
employer according to the requirements of this s ection and § 11-10-705. 30
(2)(A) For any calendar year beginning on or after January 1, 31
2024, each employer's rate shall be one and nine -tenths percent (1.9%) except 32
as otherwise provided in this subchapter. 33
(B)(i)(a) An employer's rate shall not be l ess than one 34
and nine-tenths percent (1.9%) unless and until there have been three (3) 35
years immediately preceding the computation date throughout which an 36 As Engrossed: H2/22/23 HB1430
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individual in the employer's employ could have received benefits, if 1
eligible. 2
(b) Provided, however, an employer who, at the 3
time of establishing an account, is in business in another state or states 4
and who is not currently doing business in Arkansas may elect to receive a 5
beginning contribution rate of one and nine -tenths percent (1.9%) or a 6
contribution rate based on the rate schedule in § 11 -10-705(b)(1), whichever 7
is lower, but in no event less than one percent (1%), provided: 8
(1) The employer has been in operation 9
in the other state or states for at least three (3) years immediately 10
preceding the date of becoming a liable employer in Arkansas, throughout 11
which an individual in the employer's employ could have received benefits, if 12
eligible; 13
(2) The employer must provide the 14
authenticated account history from information accumul ated from operations in 15
the other state or states to compute a current Arkansas rate; and 16
(3) The employer's business operations 17
established in Arkansas are of the same nature as conducted in the other 18
state or states, as defined by the North Americ an Industry Classification 19
System. 20
(ii)(a) The election authorized in subdivision 21
(c)(2)(B)(i) of this section must be made in writing within thirty (30) days 22
after receiving notice of Arkansas liability. 23
(b) A one-and-nine-tenths-percent rate will be 24
assigned unless a timely election has been made. 25
(iii)(a) If the election is timely made, the 26
employer's account will receive the rate elected for the remainder of that 27
rate year. 28
(b) The rate assigned for the next and 29
subsequent years will be determined by the condition of the account on the 30
computation date. 31
(C)(1) However, any employer having no covered employment 32
under this chapter for any calendar year shall have a rate equal to his or 33
her most recently determined contribution r ate until the employer has one (1) 34
full year of benefit risk experience immediately preceding the computation 35
date. 36 As Engrossed: H2/22/23 HB1430
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(2)(A) Notwithstanding any other provisions of §§ 11 -10-701 — 1
11-10-715, if the director determines that an employer has willfully 2
submitted false information that is material with respect to the employment 3
or separation from employment of any claimant, employee, or former employee, 4
for the purpose of preventing regular benefit charges to the employer's 5
account, the employer shall be assess ed a penalty equivalent to twice the 6
amount of the claimant's maximum potential benefit amount. 7
(B) This penalty shall be charged against the employer's 8
account for experience rating purposes, regardless of whether or not the 9
employer is a base-period employer and irrespective of the identity or number 10
of base-period employer. 11
(3) An employer who changes from reimbursement to the 12
contributory method of financing shall be considered a new or newly covered 13
employer and can be entitled to an experience rate only when the new or newly 14
covered employer has met the requirements of this subsection. 15
(4) Each employer's rate beginning January 1 for each twelve -16
month period shall be determined on the basis of the employer's record 17
through June 30 of the prev ious calendar year. 18
19
SECTION 4. Arkansas Code § 11 -10-705(a)(2), concerning the computation 20
of employer contribution rates, is amended to read as follows: 21
(2) The record of an employer shall include, for the purpose of 22
computing an employer's contribution rate, any payment, except a payment that 23
represents a stabilization tax an administration assessment payment or a 24
payment that represents an extended bene fit tax payment, made by the employer 25
on or before July 31 on wages paid by the employer on or before June 30 of 26
the calendar year. 27
28
SECTION 5. Arkansas Code § 11 -10-705(b), concerning computation of 29
employer contribution rates, is amended to add an addi tional subdivision to 30
read as follows: 31
(3)(A) Notwithstanding any other provision of this chapter, for 32
any calendar year beginning on and after January 1, 2024, an employer that 33
has been assigned a contribution rate of six percent (6%) under this chapte r 34
and that has had such a rate for the four (4) preceding calendar years will 35
be assigned an additional contribution assessment of two percent (2%). 36 As Engrossed: H2/22/23 HB1430
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(B) After four (4) consecutive years of being assessed an 1
additional contribution of two percent (2%) u nder subdivision (b)(3)(A) of 2
this section, this additional contribution assessment shall increase to four 3
percent (4%). 4
5
SECTION 6. Arkansas Code § 11 -10-705(b)(2), concerning the computation 6
of employer contribution rates, is repealed. 7
(2)(A) Notwithstanding any other provision of this chapter, for 8
any calendar year beginning on and after January 1, 2008, an employer that 9
has been assigned a contribution rate of six percent (6%) under this chapter 10
and that has had such a rate for the two (2) precedin g calendar years will be 11
assigned an additional contribution assessment of two percent (2%). 12
(B) After two (2) consecutive years of being assessed an 13
additional contribution of two percent (2%) under subdivision (b)(2)(A) of 14
this section, this addition al contribution assessment shall increase to four 15
percent (4%). 16
(C) For calendar years beginning January 1, 2014, and 17
thereafter, after two (2) consecutive years of being assessed an additional 18
contribution of four percent (4%) under subdivision (b)(2) (B) of this 19
section, the additional contribution assessment shall increase to six percent 20
(6%). 21
(D) For calendar years beginning January 1, 2014, and 22
thereafter, after two (2) consecutive years of being assessed an additional 23
contribution of six percent (6%) under subdivision (b)(2)(C) of this section, 24
the additional contribution assessment shall increase to eight percent (8%). 25
26
SECTION 7. Arkansas Code § 11 -10-706 is amended to read as follows: 27
11-10-706. Future rates — Stabilization tax Administrative assessment . 28
(a)(1) Each Effective July 1, 2023, each employer shall be required to 29
pay a stabilization tax an administrative assessment on wages paid by the 30
employer with respect to employment. 31
(2) This stabilization tax administrative asses sment shall not 32
be credited to the separate account of each employer. 33
(b)(1) The stabilization tax For the period July 1, 2023, through June 34
30, 2024, the administrative assessment shall be determined as follows: 35
twelve and one-half hundredths of one per cent (0.125%). 36 As Engrossed: H2/22/23 HB1430
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(1)(2) If the assets of the Unemployment Compensation Fund on 1
the computation date are equal to or greater than two percent (2%) but less 2
than two and one-half percent (2.5%) of total payrolls for employment during 3
the preceding calendar year, the stabilization tax For the period beginning 4
on and after July 1, 2024, the administrative assessment shall be one-tenth 5
of one percent (0.1%) ;. 6
(2) If the assets of the Unemployment Compensation Fund on the 7
computation date are greater than one and one-half percent (1.5%) but less 8
than two percent (2%) of total payrolls for employment during the preceding 9
calendar year, the stabilization tax shall be two -tenths of one percent 10
(0.2%); 11
(3) If the assets of the Unemployment Compensation Fund on the 12
computation date are greater than one percent (1%) but less than one and one -13
half percent (1.5%) of total payrolls for employment during the preceding 14
calendar year, the stabilization tax shall be three -tenths of one percent 15
(0.3%); 16
(4) If the assets of the Unemployment Compensation Fund on the 17
computation date are greater than one -half of one percent (0.5%) but less 18
than one percent (1%) of total payrolls for employment during the preceding 19
calendar year, the stabilization tax shall be four -tenths of one percent 20
(0.4%); 21
(5) If the assets of the Unemployment Compensation Fund on the 22
computation date are less than one -half of one percent (0.5%) of total 23
payrolls for employment during the preceding calendar year, the stabilization 24
tax shall be seven-tenths of one percent (0.7%); 25
(6) If the assets of the Unemployment Compensation Fund on the 26
computation date are less than four -tenths of one percent (0.4%) of total 27
payrolls for employment during the preceding calendar year, the stabilization 28
tax shall be one and one-tenth percent (1.1%) for the calendar year 1993, 29
nine-tenths of one percent (0.9%) for the calendar year 1994, and eight -30
tenths of one percent (0.8%) for the calendar year 1995 and thereafter; and 31
(7) For the rate year beginning January 1, 2022, and ending 32
December 31, 2022, the stabilization tax shall be the lesser of: 33
(A) The amount determined according to subdivisions 34
(b)(1)-(6) of this section; or 35
(B) Two-tenths of one percent (0.2%). 36 As Engrossed: H2/22/23 HB1430
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(c) Each employer eligible for an experience rating under § 11 -10-705 1
shall have the employer's contribution rate reduced by one -tenth of one 2
percent (0.1%) for any rate year when the assets of the Unemployment 3
Compensation Fund on the computation date are greater than five percent (5%) 4
of total payrolls for employment during the preceding calendar year. 5
(d) Employers who have elected to reimburse the Unemployment 6
Compensation Fund in lieu of contributions under § 11 -10-404 or § 11-10-713 7
shall be excluded from the provisions of §§ 11 -10-703 — 11-10-708 or any 8
experience rate computation. 9
(e)(1) The provisions of this section shall not be effective for any 10
rate year when the assets of the Unemployment Compensation Fund, excluding 11
contributions not yet paid, on the computation date equal or exceed two and 12
one-half percent (2.5%) but are less than five percent (5%) of total payrolls 13
for employment during the preceding calendar year. 14
(2) For the purposes of §§ 11 -10-703 — 11-10-708, total payrolls 15
shall exclude payrolls of employers who h ave elected to reimburse the 16
Unemployment Compensation Fund in lieu of contributions under § 11 -10-404 or 17
§ 11-10-713. 18
(3)(A) For the purposes of §§ 11 -10-703 — 11-10-708, the assets 19
of the Unemployment Compensation Fund as of the computation date shall 20
include only contributions which were paid on or before June 30, the 21
computation date. 22
(B) Provided, however, for the purposes of this section, 23
the computation date is defined as September 30 of the calendar year 24
preceding the tax year. 25
(C) It shall include any accounts receivable from the 26
United States for its share of extended benefit payments which have been paid 27
from the Unemployment Compensation Fund and any accounts receivable from 28
employers who have elected to reimburse the Unemployment Comp ensation Fund 29
for benefits paid under § 11 -10-404 or § 11-10-713. 30
(D) However, it shall exclude the assets of the 31
Unemployment Compensation Fund Extended Benefits Account and shall be reduced 32
by any outstanding advances owed to the United States Govern ment. 33
(f)(1)(A)(c)(1) However, Each fiscal year, sixty percent (60%) of the 34
proceeds of the stabilization tax in the amount of two and one -half 35
hundredths of one percent (0.025%) of taxable wages collected during the 36 As Engrossed: H2/22/23 HB1430
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period July 1, 2007, through June 30, 2023 administrative assessment, up to 1
six million dollars ($6,000,000) , shall be deposited and credited to the 2
Division of Workforce Services Training Trust Fund, there to be used for 3
worker training Unemployment Insurance Administration Fund, there to be used 4
for personal services and operating expenses of the unemployment insurance 5
program necessary for the proper administration of the Division of Workforce 6
Services Law, § 11-10-101 et seq., as determined by the Director of the 7
Division of Workforce Serv ices. 8
(B) The total amount deposited into the Division of 9
Workforce Services Training Trust Fund in any one (1) fiscal year shall not 10
exceed two million five hundred thousand dollars ($2,500,000). 11
(2)(A) However, the proceeds of the stabilization ta x in the 12
amount of two and one -half hundredths of one percent (0.025%) of taxable 13
wages collected during the period July 1, 2007, through June 30, 2023, shall 14
be deposited and credited to the Division of Workforce Services Unemployment 15
Insurance Administra tion Fund, there to be used for personal services and 16
operating expenses of the unemployment insurance program necessary for the 17
proper administration of the Division of Workforce Services Law, § 11 -10-101 18
et seq., as determined by the Director of the Divi sion of Workforce Services 19
After collection of the proceeds of the administrative assessment specified 20
in subdivision (c)(1) of this section, only for the period from July 1, 2023, 21
through June 30, 2024, the remaining proceeds, if any, of the administrativ e 22
assessment shall be deposited and credited to the Division of Workforce 23
Services Unemployment Insurance Administration Fund, there to be used solely 24
for the purpose of modernizing information technology systems and hardware 25
utilized in the administration of the unemployment insurance program . 26
(B)(i) The total amount deposited into the Division of 27
Workforce Services Unemployment Insurance Administration Fund in any one (1) 28
fiscal year shall not exceed two million five hundred thousand dollars 29
($2,500,000) The maximum amount to be deposited and credited under this 30
subdivision (c)(2)(A) shall not exceed the difference between thirty -five 31
million dollars ($35,000,000) and the amounts deposited and credited in 32
previous state fiscal years to the Division of Workforce Services 33
Unemployment Insurance Administration Fund for the purpose of modernizing 34
information technology systems and hardware utilized in the administration of 35
the unemployment insurance program . 36 As Engrossed: H2/22/23 HB1430
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(ii) If the amount deposited into the Divisio n of 1
Workforce Services Unemployment Insurance Administration Fund under 2
subdivision (f)(2)(B)(i) of this section is not sufficient to meet the 3
administrative needs under the Division of Workforce Services Law, § 11 -10-4
101 et seq., the Division of Workforc e Services may deposit up to an 5
additional three million five hundred thousand dollars ($3,500,000) in any 6
one (1) fiscal year to the Division of Workforce Services Unemployment 7
Insurance Administration Fund upon approval by the Chief Fiscal Officer of 8
the State. 9
(C)(i)(3) However, Each fiscal year, after collection of 10
the proceeds of the stabilization tax administrative assessment specified in 11
subdivisions (f)(2)(A) and (B) (c)(1) and (2) of this section, the remaining 12
proceeds, if any, of the stabilization tax administrative assessment in an 13
additional amount of fifteen-hundredths of one percent (0.15%) of taxable 14
wages collected during the period April 1, 2021, through December 31, 2023, 15
up to two million five hundred thousand dollars ($2,500,000) shall be 16
deposited and credited to the Division of Workforce Services Unemployment 17
Insurance Administration Fund, there to be used solely for the purpose of 18
modernizing information technology systems and hardware utilized in the 19
administration of the unemploy ment insurance program Training Trust Fund, 20
there to be used for worker training . 21
(ii) The aggregate amount to be transferred into the 22
Division of Workforce Services Unemployment Insurance Administration Fund 23
under this subdivision (f)(2)(C) shall not exceed thirty-five million dollars 24
($35,000,000) and shall be reduced by the amount, if any, received from the 25
United States Government for the purpose of modernizing information 26
technology systems and hardware utilized in the administration of the 27
unemployment insurance program. 28
(4) Each fiscal year, after collection of the proceeds of the 29
administrative assessment specified under subdivisions (c)(1) -(c)(3) of this 30
section, the remaining proceeds, if any, of the administrative assessment 31
shall be deposited and credited to the Unemployment Compensation Fund. 32
(3)(5) The director shall report to the Legislative Council on a 33
quarterly basis as to any and all uses of the Division of Workforce Services 34
Training Trust Fund and the Division of Workforce Services Unemployment 35
Insurance Administration Fund. 36 As Engrossed: H2/22/23 HB1430
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1
SECTION 8. Arkansas Code § 11 -10-801(b)(10), concerning the 2
Unemployment Compensation Fund, is amended to read as follows: 3
(10) All moneys received from the stabilization tax 4
administrative assessment under § 11-10-706(c)(4), except the proceeds of § 5
11-10-706(f); and 6
7
SECTION 9. Arkansas Code § 19 -5-1131(b)(1), concerning the Division of 8
Workforce Services Training Trust Fund, is amended to read as follows: 9
(b)(1) The fund shall consist of the proceeds of the stabilization tax 10
administrative assessment specified in § 11-10-706(f) § 11-10-706(c)(3), any 11
interest accruing on these revenues, and any other f unds made available by 12
the General Assembly. 13
14
SECTION 10. Arkansas Code § 19 -5-1232(b)(1), concerning the Division 15
of Workforce Services Unemployment Insurance Administration Fund, is amended 16
to read as follows: 17
(b)(1) The fund shall consist of the pro ceeds of the stabilization tax 18
administrative assessment as specified in § 11-10-706(f) § 11-10-706(c)(3), 19
any interest accruing on these revenues, and any other funds made available 20
by the General Assembly. 21
22
SECTION 11. EMERGENCY CLAUSE. It is found an d determined by the 23
General Assembly that the Arkansas Unemployment Trust Fund is adequately 24
funded to satisfy the state's obligation to pay benefits to unemployed 25
Arkansans; that the current unemployment stabilization tax contributions paid 26
by Arkansas employers are in excess of the amounts needed to fund the state's 27
unemployment insurance program and create an unnecessary expense for 28
employers that hinders the employment of Arkansans; and that this act is 29
immediately necessary to remove obstacles to the e mployment of Arkansans and 30
promote economic opportunity within the state. Therefore, an emergency is 31
declared to exist, and this act being immediately necessary for the 32
preservation of the public peace, health, and safety shall become effective 33
on: 34
(1) The date of its approval by the Governor; 35
(2) If the bill is neither approved nor vetoed by the Governor, 36 As Engrossed: H2/22/23 HB1430
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the expiration of the period of time during which the Governor may veto the 1
bill; or 2
(3) If the bill is vetoed by the Governor and the vet o is 3
overridden, the date the last house overrides the veto. 4
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