Stricken language would be deleted from and underlined language would be added to present law.
Act 740 of the Regular Session
*ANS355* 04-01-2025 12:40:00 ANS355
State of Arkansas As Engrossed: S4/1/25 1
95th General Assembly A Bill 2
Regular Session, 2025 SENATE BILL 560 3
4
By: Senator J. English 5
By: Representative Tosh 6
7
For An Act To Be Entitled 8
AN ACT TO DECREASE THE BASE CONTRIBUTION RATE; TO 9
INCREASE THE ADMINISTRATIVE ASSESSMENT RATE; TO 10
INCREASE FUNDING FOR THE SKILLED WORKFORCE IN THIS 11
STATE; TO AMEND THE DIVISION OF WORKFORCE SERVICES 12
TRAINING TRUST FUND; AND FOR OTHER PURPOSES. 13
14
15
Subtitle 16
TO DECREASE THE BASE CONTRIBUTION RATE; 17
TO INCREASE THE ADMINISTRATIVE 18
ASSESSMENT RATE; TO INCREASE FUNDING FOR 19
THE SKILLED WORKFORCE IN THIS STATE; AND 20
TO AMEND THE DIVISION OF WORKFORCE 21
SERVICES TRAINING TRUST FUND. 22
23
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 24
25
SECTION 1. Arkansas Code § 11 -10-704(c), concerning contribution rates 26
of each employer, is amended to read as follows: 27
(c)(1) The director shall determine the contribution rates of each 28
employer according to the requirements of this section and § 11 -10-705. 29
(2)(A) For any calendar year beginning on or after January 1, 30
2024, each employer's rate shall be one and nine -tenths percent (1.9%) except 31
as otherwise provided in this subchapter. 32
(B)(i)(a) An employer's rate shall not be less than one 33
and nine-tenths percent (1.9%) unless and until there have been three (3) 34
years immediately preceding the computation date throughout which an 35
individual in the employer's employ could have received benefits, if 36 As Engrossed: S4/1/25 SB560
2 04-01-2025 12:40:00 ANS355
eligible. 1
(b) Provided, however, an employer who, at the 2
time of establishing an account, is in business in another state or states 3
and who is not currently doing business in Arkansas may elect to receive a 4
beginning contribution rate of one and nine -tenths percent (1.9%) or a 5
contribution rate based on the rate schedule in § 11 -10-705(b)(1), whichever 6
is lower, but in no event less than one percent (1%), provided: 7
(1) The employer has been in operation 8
in the other state or states for at least three (3) years immediately 9
preceding the date of becoming a liable employer in Arkansas, throughout 10
which an individual in the employer's employ could have received benefits, if 11
eligible; 12
(2) The employer must provide the 13
authenticated account history from information accumulated from operations in 14
the other state or states to compute a current Arkansas rate; and 15
(3) The employer's business operations 16
established in Arkansas are of the same nature as conducted in the other 17
state or states, as defined by the North American Industry Classification 18
System. 19
(ii)(a) The election authorized in subdivision 20
(c)(2)(B)(i) of this section must be made in writing within thirty (30) days 21
after receiving notice of Arkansas liability. 22
(b) A one-and-nine-tenths-percent rate 23
will be assigned unless a timely election has been made. 24
(iii)(a) If the election is timely made, the 25
employer's account will receive the rate elected for the remainder of that 26
rate year. 27
(b) The rate assigned for the next and 28
subsequent years will be determined by the condition of the account on the 29
computation date. 30
(C) However, any employer having no covered employment 31
under this chapter for any calendar year shall have a rate equal to his or 32
her most recently determined contribution rate until the employer has one (1) 33
full year of benefit risk experience immediately preceding the computation 34
date. 35
(3)(A) For any calendar year beginning on or after January 1, 36 As Engrossed: S4/1/25 SB560
3 04-01-2025 12:40:00 ANS355
2026, each employer's rate shall be one and eighth -tenths percent (1.8%) 1
except as otherwise provided in this subchapter. 2
(B)(i)(a) An employer's rate shall not be less than one 3
and eighth-tenths percent (1.8%) unless and until there have been three (3) 4
years immediately preceding the computation date throughout which an 5
individual in the employer's employ could have received benefits, if 6
eligible. 7
(b) Provided, however, an employer who, at the 8
time of establishing an account, is in business in another state or states 9
and who is not currently doing business in Arkansas may elect to receive a 10
beginning contribution rate of one and eighth -tenths percent (1.8%) or a 11
contribution rate based on the rate schedule in § 11 -10-705(b)(1), whichever 12
is lower, but in no event less than one percent (1%), provided: 13
(1) The employer has been in operation 14
in the other state or states for at least three (3) years immediately 15
preceding the date of becoming a liable employer in Arkansas, throughout 16
which an individual in the employer's employ could have received benefits, if 17
eligible; 18
(2) The employer must provide the 19
authenticated account history from information accumulated from operations in 20
the other state or states to compute a current Arkansas rate; and 21
(3) The employer's business operations 22
established in Arkansas are of the same nature as conducted in the other 23
state or states, as defined by the North American Industry Classification 24
System. 25
(ii)(a) The election authorized in subdivision 26
(c)(3)(B)(i) of this section must be made in writing within thirty (30) days 27
after receiving notice of Arkansas liability. 28
(b) A one-and-eighth-tenths-percent (1.8%) 29
rate will be assigned unless a timely election has been made. 30
(iii)(a) If the election is timely made, the 31
employer's account will receive the rate elected for the remainder of that 32
rate year. 33
(b) The rate assigned for the next and 34
subsequent years will be determined by the condition of the account on the 35
computation date. 36 As Engrossed: S4/1/25 SB560
4 04-01-2025 12:40:00 ANS355
(C) However, an employer having no covered employment 1
under this chapter for any calendar year shall have a rate equal to his or 2
her most recently determined contribution rate until the employer has one (1) 3
full year of benefit risk experience immediately preceding the computation 4
date. 5
(4)(A) Notwithstanding any other provisions of §§ 11 -10-701 — 6
11-10-715, if the director determines that an employer has willfully 7
submitted false information that is material with respect to the employment 8
or separation from employment of any claimant, employee, or former employee, 9
for the purpose of preventing regular benefit charges to the employer's 10
account, the employer shall be assessed a penalty equivalent to twice the 11
amount of the claimant's maximum potential benefit amount. 12
(B) This penalty shall be charged against the employer's 13
account for experience rating purposes, regardless of whether or not the 14
employer is a base-period employer and irrespective of the identity or number 15
of the base-period employer. 16
(4)(5) An employer who changes from reimbursement to the 17
contributory method of financing shall be considered a new or newly covered 18
employer and can be entitled to an experience rate only when the new or newly 19
covered employer has met the requirements of this subsection. 20
(5)(6) Each employer's rate beginning January 1 for each twelve -21
month period shall be determined on the basis of the employer's record 22
through June 30 of the previous calendar year. 23
24
SECTION 2. Arkansas Code § 11 -10-705(b)(1)(B), concerning the reserve 25
ratio schedule table under the Workers' Compensation Law, is amended to read 26
as follows: 27
(B) The reserve ratio in the following schedule is 28
determined by dividing the difference in contributions paid and regular 29
benefits charged by the annual taxable payroll: 30
CONTRIBUTION RESERVE RATIO 31
RATE 32
0.1%(0.0%) 9.95% or more 33
0.3%(0.2%) 9.35% but less than 9.95% 34
0.5%(0.4%) 8.85% but less than 9.35% 35
0.8%(0.7%) 8.65% but less than 8.85% 36 As Engrossed: S4/1/25 SB560
5 04-01-2025 12:40:00 ANS355
1.2%(1.1%) 8.35% but less than 8.65% 1
1.6%(1.5%) 7.95% but less than 8.35% 2
2.0%(1.9%) 7.35% but less than 7.95% 3
2.4%(2.3%) 6.75% but less than 7.35% 4
2.8%(2.7%) 5.45% but less than 6.75% 5
3.2%(3.1%) 2.45% but less than 5.45% 6
4.0%(3.9%) 1.35% but less than 2.45% 7
5.0%(4.9%) Less than 1.35% with a positive 8
reserve balance 9
6.0%(5.9%) Less than 0.00% 10
11
SECTION 3. Arkansas Code § 11 -10-706 is amended to read as follows: 12
11-10-706. Future rates — Administrative assessment. 13
(a)(1) Effective July 1, 2023, each employer shall be required to pay 14
an administrative assessment on wages paid by the employer with respect to 15
employment. 16
(2) This administrative assessment shall not be credited to the 17
separate account of each employer. 18
(b)(1) For the period July 1, 2023, through June 30, 2024, the 19
administrative assessment shall be twelve and one -half hundredths of one 20
percent (0.125%). 21
(2) For the period beginning on and after July 1, 2024, the 22
administrative assessment shall be one -tenth of one percent (0.1%). 23
(3) For the period beginning on and after January 1, 2026, the 24
administrative assessment shall be two -tenths of one percent (0.2%). 25
(c)(1) Each fiscal year, sixty percent (60%) of the proceeds of the 26
administrative assessment, up to six million dollars ($6,000,000), shall be 27
deposited and credited to the Division of Workforce Services Unemployment 28
Insurance Administration Fund, there to be used for personal services and 29
operating expenses of the unemployment insurance program necessary for the 30
proper administration of the Division of Workforce Services Law, § 11 -10-101 31
et seq., as determined by the Director of the Division of Workforce Services. 32
(2)(A) After collection of the proceeds of the administrative 33
assessment specified in subdivision (c)(1) of this section, only for the 34
period from July 1, 2023, through June 30, 2024, the remaining proceeds, if 35
any, of the administrative assessment shall be deposited and credited to the 36 As Engrossed: S4/1/25 SB560
6 04-01-2025 12:40:00 ANS355
Division of Workforce Services Unemployment Insurance Administration Fund, 1
there to be used solely for the purpose of modernizing information technology 2
systems and hardware utilized in the administration of the unemployment 3
insurance program. 4
(B) The maximum amount to be deposited and credited under 5
subdivision (c)(2)(A) of this section shall not exceed the difference between 6
thirty-five million dollars ($35,000,000) and the amounts deposited and 7
credited in previous state fiscal years to the Division of Workforce Services 8
Unemployment Insurance Administration Fund for the purpose of modernizing 9
information technology systems and hardware utilized in the administration of 10
the unemployment insurance program. 11
(3)(2) Each fiscal year, after collection of the proceeds of the 12
administrative assessment specified in subdivisions (c)(1) and (2) 13
subdivision (c)(1) of this section, the remaining proceeds, if any, of the 14
administrative assessment in an amount up to two million five hundred 15
thousand dollars ($2,500,000) shall be deposited and credited to the Division 16
of Workforce Services Training Trust Fund, there to be used for personal 17
services, operating expenses, construction, grants, and worker training. 18
(4) Each fiscal year, after collection of the proceeds of the 19
administrative assessment specified under subdivisions (c)(1) -(3) of this 20
section, the remaining proceeds, if any, of the administrative assessment 21
shall be deposited and credited to the Unemployment Compensation Fund. 22
(5)(3) The director shall report to the Legislative Council on a 23
quarterly basis as to any uses of the Division of Workforce Services Training 24
Trust Fund and the Division of Workforce Services Unemployment Insurance 25
Administration Fund. 26
27
SECTION 4. Arkansas Code § 19 -5-1131(b)(2), concerning the uses of the 28
Division of Workforce Services Training Trust Fund, is amended to read as 29
follows: 30
(2) The fund shall be used for personal services, operating 31
expenses, construction, grants, and worker training under rules promulgated 32
by the Director of the Division of Workforce Services. 33
34
/s/J. English 35
APPROVED: 4/17/25 36