84R3603 MAW-F
By: West S.B. No. 1642
A BILL TO BE ENTITLED
AN ACT
relating to the transfer of compensation experience for purposes of
the Texas Unemployment Compensation Act.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 204.081, Labor Code, is amended to read
as follows:
Sec. 204.081. DEFINITIONS. (a) In this subchapter:
(1) "Compensation experience" includes the period
that benefit wage credits or benefits have been chargeable and any
other factor under Subchapter A, B, C, or D necessary to the
computation of experience rating under those subchapters.
(2) "Person" means an individual, trust, estate,
partnership, association, company, or corporation.
(3) "Substantially common management or control"
exists if, after the acquisition of the organization, trade, or
business of an employing unit, the predecessor employing unit
continues to:
(A) own or manage the organization that conducts
the organization, trade, or business;
(B) own or manage the assets necessary to conduct
the organization, trade, or business;
(C) control through security or lease
arrangements the assets necessary to conduct the organization,
trade, or business; or
(D) direct the internal affairs or conduct of the
organization, trade, or business.
(4) "Substantially common ownership" exists if, on the
date of an acquisition of the organization, trade, or business of an
employing unit, a shareholder, officer, or other owner of a legal or
equitable interest in the predecessor employing unit, or the spouse
or a person within the first degree of consanguinity or affinity, as
determined under Chapter 573, Government Code, of the shareholder,
officer, or other owner:
(A) is a shareholder, officer, or other owner of
a legal or equitable interest in the successor employing unit; or
(B) holds an option to purchase a legal or
equitable interest in the successor employing unit.
(5) "Transfer of trade or business" includes the
transfer of part or all of an employer's workforce to another
employer if, as the result of the transfer, the transferring
employer no longer performs trade or business with respect to the
transferred workforce and the employer to whom the workforce is
transferred performs trade or business with respect to the
workforce.
(6) "Knowingly" means having actual knowledge of or
acting with deliberate ignorance of or reckless disregard for the
prohibition involved.
(b) For purposes of Subsection (a)(4), following a partial
acquisition of an organization, trade, or business of an employing
unit, substantially common ownership does not exist solely because
the predecessor employing unit has the right to repossess the part
acquired by the successor employing unit in the event of the
successor's failure to complete a condition of the acquisition.
SECTION 2. Section 204.085, Labor Code, is amended by
adding Subsections (a-1) and (e) to read as follows:
(a-1) In the case of a partial acquisition for which the
transfer of compensation experience is required under Section
204.083, the commission shall require the predecessor employer and
successor employer to jointly submit, not later than the second
anniversary of the date the partial acquisition was completed,
information necessary for making the determination described by
Subsection (a). The period for which the required information must
be submitted is the lesser of:
(1) four years; or
(2) the length of time the predecessor employer was
liable for the payment of a tax under this subtitle.
(e) The commission shall include information about the
availability of a partial transfer of compensation experience under
this subchapter:
(1) with the information provided by the commission to
each new employer; and
(2) on any form, including in electronic format,
required to be submitted by an employer to report a change of
status.
SECTION 3. Sections 204.081(b) and 204.085(a-1), Labor
Code, as added by this Act, apply only to a partial acquisition of
an organization, trade, or business of an employing unit that
occurs on or after the effective date of this Act. An acquisition
that occurs before the effective date of this Act is governed by the
law in effect on the date the acquisition occurred, and the former
law is continued in effect for that purpose.
SECTION 4. This Act takes effect September 1, 2015.