§ 25-4-51 — Rates of Contributions, Etc., by Employers
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(a) Contributions. Except as hereinafter provided and subject to the provisions of Section 25-4-54, every employer shall pay contributions, or payments in lieu of contributions, equal to the percentages of wages payable or paid as hereinafter set out, with respect to employment by him.
(1) With respect to employment during calendar years after December 31, 1975, every employer who has been liable to the provisions of this chapter during a period of time sufficient to have his rate of contribution determined under the experience rating provisions of Section 25-4-54 shall pay contributions at the rate prescribed thereby.
(2) With respect to employment after December 31, 1975, every employer who has not been liable to the provisions of this chapter for a sufficient length of time to have his rate determined under the experience rating provisions of Section 25-4-54 shall pay contributions at the rate of 2.70 percent of such wages paid by him with respect to such employment.
(3) With respect to employment after December 31, 1971, any nonprofit organization which, pursuant to the provisions of subdivision (8) of subsection (a) of Section 25-4-8, is or becomes subject to this chapter after December 31, 1971, shall pay contributions under the provisions of subdivisions (1) and (2) of this subsection (a) of this section and Section 25-4-54, unless it elects in accordance with paragraph a. of this subdivision to pay to the secretary for the fund an amount equal to the amount of regular benefits and one half of the extended benefits paid, that is attributable to service in the employ of such employer, to individuals for weeks of unemployment which begin during the effective period of such election.
a. Any nonprofit organization which becomes subject to this chapter on January 1, 1972, by virtue of its employment during calendar year 1971, may elect to become liable for payments in lieu of contributions for a period of not less than nine consecutive calendar quarters beginning with January 1, 1972, provided it files with the secretary a written notice of its election within the 30-day period immediately following such date. Any nonprofit organization which becomes subject to this chapter by virtue of its employment subsequent to calendar year 1971, may elect to become liable for payments in lieu of contributions for a period of not less than six consecutive calendar quarters, ending on the thirtieth day of September, by filing a written notice of its election with the secretary not later than 30 days immediately following the date on which the conditions rendering such organization subject were fulfilled.
b. Any nonprofit organization which makes an election in accordance with paragraph a. of this subdivision will continue to be liable for payments in lieu of contributions until it files with the secretary a written notice terminating its election. Any such termination shall be effective at the end of a calendar year. Said notice shall be filed not later than the first day of December preceding the effective date of such termination.
c. Any nonprofit organization which has been paying contributions under this chapter for a period of at least one calendar year subsequent to January 1, 1972, may change to a reimbursable basis by filing with the secretary not later than the first day of December preceding the beginning of any calendar year a written notice of election to become liable for payments in lieu of contributions. Such election shall not be terminable by the organization during that and the next calendar year and may be terminated only at the end of a calendar year.
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 December 31, 1971.
e. The secretary shall notify each nonprofit organization of any determination which he makes of its status as an employer and of the effective date of any election which it makes and of any termination of such election and of benefits paid in accordance with such regulations as he may prescribe. Such notice and determination shall be subject to the provisions for review and finality as set out in subdivision (4) of subsection (c) of Section 25-4-54.
f. Any nonprofit organization which elects to make payments in lieu of contributions shall pay to the secretary for the fund such amounts and in such manner and at such time as is set out in subsection (b) of this section.
g. When two or more nonprofit organizations, as defined in subdivision (3) of subsection (a) of Section 25-4-10, merge or one nonprofit organization is acquired by another such organization, the method of payment for the surviving entity shall be that method elected by such surviving entity under the provisions of this section and in effect at the time of the merger or acquisition. Such method shall remain in effect until such time as it is changed as provided in paragraphs b. and c. of this subdivision.
h.1. Notices of payment and reporting delinquency to Indian tribes or their tribal units shall include information that failure to make full payment within the prescribed time frame will cause any of the following:
(i) The Indian tribe to be liable for taxes under FUTA.
(ii) The Indian tribe to lose the option to make payment in lieu of contributions.
(iii) The Indian tribe to be excepted from the definition of “employer,” as provided herein, and services in the employ of the Indian tribe, as herein excepted from the definition of “employment.”
2. Extended benefits paid that are attributable to service in the employ of an Indian tribe and not reimbursed by the federal government shall be financed in their entirety by the Indian tribe.
(4)a. With respect to employment after December 31, 1971, and prior to January 1, 1978, any hospital or institution of higher education operated by this state or any of its instrumentalities which, pursuant to the provisions of subdivision (a)(7) of Section 25-4-8, is or becomes subject to this chapter after December 31, 1971, and prior to January 1, 1978, shall pay to the secretary for the fund an amount equal to the amount of regular benefits and one-half of the extended benefits paid, that is attributable to service in the employ of such employer to individuals for weeks of unemployment which begin after December 31, 1971, at the rate and in such manner and at such time as was prescribed in subdivision (2) of subsection (b) of this section prior to January 1, 1978. For the purpose of this subdivision, the governing body of any state hospital or institution of higher education may, with the approval of the secretary, determine the number of individual accounts for the institutions under its authority.
b. With respect to employment after December 31, 1977, any governmental entity as defined in paragraph (a)(2)b. of Section 25-4-10, electing or required to make payments in lieu of contributions, shall, pursuant to the provisions of subdivision (2) of subsection (b) of this section, pay to the secretary for the fund an amount which:
1. Prior to January 1, 1979, is equal to the amount of regular benefits and one-half of the extended benefits paid, and
2. After December 31, 1978, is equal to the amount of regular and extended benefits paid and that is attributable to services after December 31, 1977, in the employ of such entity to individuals for weeks of unemployment which begin on or after January 1, 1979.
(5)a. With respect to employment after December 31, 1971, and prior to January 1, 1978, any political subdivision of this state (or any two or more political subdivisions) which elects, under the provisions of Section 25-4-131, to become subject to this chapter, shall pay to the secretary for the fund an amount equal to the amount of regular benefits and prior to January 1, 1979, one-half, and thereafter all, of the extended benefits paid, that is attributable to service in the employ of such employer, to individuals for weeks of unemployment which begin after December 31, 1971, at the rate and in such manner and at such time as was set out in subdivision (2) of subsection (b) of this section prior to January 1, 1978.
b. With respect to employment after December 31, 1977, any governmental entity, other than the state, defined in paragraph (a)(2)b. of Section 25-4-10, shall pay contributions as provided in subdivision (2) of this subsection and Section 25-4-54, unless the governing body of such entity elects under the provisions of subparagraph 1 of this paragraph b. to pay to the secretary for the fund an amount equal to the amount as is prescribed in subdivision (4) of this subsection, and at the rate and in such manner and at such time as set out in subdivision (2) of subsection (b) of this section.
1. Any governmental entity, other than the state, as defined in paragraph (a)(2)b of Section 25-4-10, which becomes subject to this chapter on January 1, 1978, may elect to become liable for payments in lieu of contributions for a period of not less than eight consecutive calendar quarters beginning with January 1, 1978, provided it files with the secretary a written notice of its election, officially adopted by the governing body of such entity, within the 30-day period immediately following such date. Any such entity which becomes subject to this chapter subsequent to January 1, 1978, may elect to become liable for payments in lieu of contributions for a period of not less than six, ending on the thirtieth day of September, consecutive quarters by filing with the secretary a written notice by the governing body of such entity of its election not later than 30 days immediately following the date on which it becomes such an entity. Such election shall remain in effect until the governing body files with the secretary a written notice terminating its election. Any such termination shall be effective at the end of the calendar year during which such notice is made and its acceptance by the secretary occurs. Said notice shall be filed not later than the first day of December preceding the effective date of such termination.
2. Any governmental entity which has been paying contributions under this chapter for a period of at least one calendar year subsequent to January 1, 1978, may, effective as of the beginning of any calendar year thereafter, change to a reimbursing basis by filing with the secretary not later than the first day of December preceding the beginning of such calendar year a written notice by the governing body thereof of its election to become liable for payments in lieu of contributions. Such election shall not be terminable by the governmental entity during that and the next calendar year and may be terminated only at the end of a calendar year.
3. The written notice of election or termination of election of method of payment shall be accompanied by a certified copy of the minutes of the meeting of the appropriate governing body during which the action to elect or terminate was taken.
(6)a. Any contributions or payments in lieu of contributions which are or may become due to be paid as required by this chapter which are attributable to wages paid by any governmental entity described in paragraph c. of subdivision (a)(2) of Section 25-4-10 shall, upon termination in any manner or cessation of employment by such entity, be paid by the state Comptroller as provided for in paragraph c. of subdivision (a)(2) of Section 25-4-10.
b. Any contributions or payments in lieu of contributions which are or may become due to be paid as required by this chapter which are attributable to wages paid by any governmental entity described in paragraph d. of subdivision (a)(2) of Section 25-4-10 shall, upon termination or cessation of employment by such entity, be paid by the political subdivision or subdivisions that allowed or caused the creation of such entity.
(b) Payments in lieu of contributions. Payments in lieu of contributions shall be made in accordance with the provisions of subdivisions (1) and (2) of this subsection.
(1) Each nonprofit organization or group of such organizations which has elected to make payments in lieu of contributions shall at the end of each calendar quarter, or at the end of any other period as the secretary shall prescribe, pay to the secretary an amount equal to the full amount of regular benefits plus one-half of the extended benefits paid during such quarter or other prescribed period that is attributable to services in the employ of such organization. Such payments shall be made within 20 calendar days after notice of the amount due is mailed by the secretary.
(2) Each governmental entity which has elected to make payments in lieu of contributions shall make such payments to the secretary in an amount representing one of the following:
a. Any entity becoming subject to this chapter effective January 1, 1972, shall pay:
1. For the calendar quarter beginning July 1, 1972, and each succeeding calendar quarter thereafter through and including the quarter ending September 30, 1973, such amount as such employer may estimate to be equal to the amount determined pursuant to paragraph (4)b. of subsection (a) of this section but the amount shall not be less than 0.25 percent of its average quarterly payroll (without regard to the limitations specified in Section 25-4-16) paid to all employees covered by this chapter in its employ during the calendar year 1971, said payments to be made not later than the tenth day of the first month of each quarter, and
2. For each calendar quarter during fiscal years beginning on and after October 1, 1973, such percentage of its average quarterly covered payroll for the four-quarter period ending on the immediately preceding June 30, as the secretary shall determine. Such determination, except as hereinafter provided, shall be based each year on the average quarterly benefit cost during the four-calendar-quarter period ending on the immediately preceding June 30, which is attributable to service in the employ of such entity; provided, however, that for each calendar quarter beginning on or after October 1, 1978, the rate shall be determined on the basis of its average quarterly payroll and benefit costs for the four-calendar-quarter period ending on the immediately preceding December 31.
b. Any entity becoming subject effective January 1, 1978, shall pay:
1. For the calendar quarter beginning July 1, 1978, and each succeeding calendar quarter thereafter through and including the quarter ending September 30, 1979, such amount as such employer may estimate to be equal to the amount determined pursuant to paragraph (a)(4)b. of this section but the amount shall not be less than 0.25 percent of its average quarterly payroll (without regard to the limitations specified in Section 25-4-16) paid to all employees covered by this chapter in its employ during the calendar year 1977, said payments to be made not later than the tenth day of the first month of each quarter, and
2. In each calendar quarter during fiscal years beginning on and after October 1, 1979, such percentage of its average quarterly covered payroll for the four-quarter period ending on the immediately preceding December 31 as the secretary shall determine. Such determinations, except as hereinafter provided, shall be based each year on the average quarterly benefit cost during the four-calendar-quarter period ending on the immediately preceding December 31 which is attributable to service in the employ of such entity including benefits paid under the provisions of paragraph (b) of Section 25-4-74.
3. The secretary shall notify each governmental entity of its rate for the next fiscal year not later than the first day of April preceding such fiscal year.
c. Any governmental entity becoming subject to this chapter, and/or electing to make payments under this subsection, subsequent to January 1, 1978, will make the advance payment as provided in paragraph b. of subdivision (2) of this subsection (b) in such amount as is therein provided within the first 10 days of the first month of the second quarter following the quarter during which the coverage and/or election becomes effective and during the first 10 days of each calendar quarter thereafter until the first day of October of the calendar year next following the calendar year during which such election became effective. Thereafter, the rate of such payment shall be computed as provided in subparagraph b.2 of this subdivision.
d. For any governmental entity which did not pay wages throughout the periods specified in paragraphs a. and b., respectively, of this subdivision (2), the average quarterly covered payroll shall be as determined by the secretary based on that portion of such periods during which wages were paid.
(3) When a rate of payments in lieu of contributions has been set by the secretary for any one-year period as is provided by this subsection (b) nothing herein shall be construed as preventing the secretary from modifying the percentage thereafter payable by a government entity, for such entity, from the rate set in order to minimize excess or insufficient payments. In making such modification the secretary shall consider factors such as current benefit cost ratio and current benefit costs as may be effected by an increase or decrease in state or federal funding, reorganization of the entity, increase or decrease in the number of employees and general economic conditions which directly or indirectly affect benefits costs attributable to any entity. Any modification so made shall become effective the first day of the calendar quarter next following a notice to the employer of such modification at least 10 days prior thereto.
(4) At the end of each one-year period for which a rate for payments in lieu of contributions has been set, the secretary shall determine whether the total of payments for such year made by any employer is less than, or in excess of, the total amount of regular benefits plus such amount of extended benefits as is required by this section to be charged to such employer, paid to individuals during such year based on wages attributable to service in the employ of such employer. Each such employer whose total payments for such year are less than the amount so determined shall be liable for payment of the unpaid balance to the fund in accordance with this subsection. If the total payments are in excess of the amount so determined for the specified one-year period, all or a part of the excess may, at the discretion of the secretary, be refunded from the fund or retained in the fund as part of the payments which may be required for the next such year. Any payments due to be made under this subdivision (4) shall be made not later than 20 days after the date on which the secretary shall mail to the employer notice of the amount.
(5) Payments made by any organization under the provisions of this subsection shall not be deducted or deductible, in whole or in part, from the remuneration of individuals in the employ of such organizations.
(6)a. Indian tribe or tribal units (subdivisions, subsidiaries, or business enterprises wholly owned by such Indian tribes) subject to this chapter shall pay contributions under the same terms and conditions as all other subject employers, unless they elect to pay into the state Unemployment Compensation Trust Fund amounts equal to the amount of benefits attributable to service in the employ of the Indian tribe.
b. Indian tribes electing to make payments in lieu of contributions must make such election in the same manner and under the same conditions as provided herein pertaining to state and local governments and nonprofit organizations subject to this chapter. Indian tribes will determine if reimbursement for benefits paid will be elected by the tribe as a whole, by individual tribal units, or by combinations of individual tribal units.
c. Indian tribes or tribal units will be billed for the full amount of benefits attributable to service in the employ of the Indian tribes or tribal unit on the same schedule as other employing units that have elected to make payments in lieu of contributions.
d. At the discretion of the secretary, any Indian tribe or tribal unit that elects to become liable for payments in lieu of contributions shall be required within 30 days after the effective date of its election to:
1. Execute and file with the secretary a surety bond approved by the secretary, or
2. Deposit with the secretary money or securities on the same basis as other employers with the same election option.
(7) Any other provisions of law notwithstanding, payments in lieu of contributions as provided by this subsection shall be:
a. Subject to the same penalties, collection and enforcement proceedings and provisions for hearing and review, extensions, refunds, and protections that pursuant to Sections 25-4-54, 25-4-132 through 25-4-138, and 25-4-145 apply to contributions, and
b.1. Should any amounts due from any component or instrumentality of this state remain due and unpaid for a period of 90 days after the due date, the state Comptroller shall take such action as is necessary to collect such amounts and is hereby authorized and required to levy against any funds due such component or instrumentality by any other department, agency or official of the state or against any bank account established in any bank whether or not in this state. Such department, agency or official shall deduct such amounts as are certified by the Comptroller from any accounts or deposits or any funds due such delinquent component or instrumentality without regard to any prior claim and promptly forward such amounts to the Comptroller.
2. Should any amounts due from any governmental entity of any county, municipality or any instrumentality thereof, as defined in paragraph (a)(2)b. of Section 25-4-10, remain due and unpaid for a period of 120 days after the due date, the secretary shall take such action as is necessary to collect such amounts and is hereby authorized and required to levy against any funds due such governmental entity by the State Treasurer, Comptroller, Commissioner of Revenue, or any other official or agency of this state or against any bank account established in any bank. Such officials, agency, or bank shall deduct such amounts as are certified by the secretary from any accounts or deposits with or any funds due such delinquent governmental entity without regard to any prior claim and promptly forward such amounts to the secretary for the fund; provided, however, that the secretary shall notify the delinquent entity of his intent to file such levy by certified mail at least 10 days prior to filing of a levy on any funds due the entity by any state official or agency.
c.1. Failure of the Indian tribe or tribal unit to make required payments, including assessments of interest and penalty, within 90 days of the receipt of the statement will cause the Indian tribe to lose the option to make payments in lieu of contributions, as herein described, for the following tax year unless payment in full is received before contribution rates for next tax year are computed.
2. Any Indian tribe that loses the option to make payments in lieu of contributions due to late payment or nonpayment, as described above, shall have such option reinstated if, after a period of one year, all contributions have been made timely, provided no contributions, payments in lieu of contributions for benefits paid, penalties, or interest remain outstanding.
d.1. Failure of the Indian tribe or any tribal unit thereof to make required payments, including assessments of interest and penalty, after all collection activities deemed necessary by the secretary have been exhausted, will cause services performed for such tribe to not be treated as “employment” as herein provided.
2. The secretary may determine that any Indian tribe that loses coverage as herein provided, may have services performed for such tribe again included as “employment” as herein provided, if all contributions, payments in lieu of contributions, penalties, and interest have been paid.
3. The secretary will notify the United States Internal Revenue Service and the United States Department of Labor of any termination or reinstatement of coverage as herein provided.
(8) Any nonprofit organization which elects to become liable for payments in lieu of contributions shall, in addition to making such payments, be required within 30 days after the date the secretary mails notice of his approval of its election, to execute and file with the secretary a surety bond, or a cash deposit in lieu thereof, as approved by the secretary. For the purpose of this subdivision, a surety bond is a bond of surety issued by an organization licensed and authorized to issue such bond in this state. The amount of the surety bond or cash deposit required by this subdivision (8) shall be an amount as determined by the secretary based on a percentage (not higher than the maximum percentage provided by Section 25-4-54) of the organization’s covered payroll as defined in this chapter for the four-calendar quarters immediately preceding the effective date of the election, or the renewal date in case of a bond, or the biennial anniversary in the case of a cash deposit, whichever date shall be most recent and applicable. For any such organization which did not pay wages throughout each of four such calendar quarters the amount of the bond or deposit shall be as determined by the secretary.
a. Any surety bond deposited under this subdivision shall be in force for a period of not less than two full calendar years and shall be renewed not less frequently than at two-year intervals as long as the organization continues to be liable for payments in lieu of contributions. The secretary shall require adjustments to be made in a previously filed bond as he deems appropriate. If the bond is to be increased, the adjusted bond shall be filed by the organization within 30 days of the date notice of such adjustment was mailed or otherwise delivered to it. Failure of any organization covered by such bond to pay the full amount of payments in lieu of contributions when due, together with any applicable interest and penalties as provided by this chapter, shall render the surety liable on said bond to the extent of the bond, as though the surety was such organization.
b. Any deposit of money in accordance with this subdivision (8) shall be retained by the secretary in an escrow account until liability under the election is terminated, at which time it shall be returned to the organization, less any deductions as hereinafter provided. The secretary may direct deductions from the money deposited under this subdivision (8) by any organization to the extent necessary to satisfy any due and unpaid payments in lieu of contributions and any applicable interest and penalty. The secretary shall require the organization within 30 days following any deduction from a money deposit under the provisions of this subdivision (8) to deposit sufficient additional moneys to make whole the organization’s deposit at the prior level. The secretary may, at any time, review the adequacy of the deposit made by any organization. If, as a result of such review, he determines that an adjustment is necessary, he shall require the organization to make an additional deposit within 30 days of written notice of his determination or shall direct the return to it such portion of the deposit as he or she no longer considers necessary whichever action is appropriate.
c. Nonprofit organizations defined in Section 25-4-8(a)(8), as amended, shall be eligible to deposit money in accordance with this subdivision (8) in interest-bearing accounts so long as the accounts are approved by the secretary and are assigned to the secretary for the purpose of payment of unemployment compensation benefit charges. Any approved accounts shall be subject to the conditions specified in paragraph b. of this subdivision above, except that the employer shall be permitted to remove interest from the account whenever the balance remaining in the account is at a level equal to, or greater than, the money deposit required by the secretary.
d. If any organization subject to the provisions of this section fails to file a surety bond or make a cash deposit or to file a surety bond in an increased amount or to increase or make whole the amount of a previously made cash deposit, or fails to pay before the delinquency date any payments due together with any accumulated interest and penalty as provided by this chapter, the secretary may terminate such organization’s election to make payments in lieu of contributions effective as of the end of any calendar quarter and such termination shall continue for not less than two consecutive calendar years; provided, that the secretary may extend for good cause the posting of a cash deposit, the filing of a surety bond or the extension of an adjustment period by not more than 30 days.
(9) If benefits paid to an individual are based on wages paid by two or more employers, the amount of benefits payable by an organization required to or electing to make payments in lieu of contributions shall be an amount which bears the same ratio to the total benefits paid to the individual as the total base period wages paid by such employer to the individual and used for the payment of benefits bears to the total base period wages paid to the individual by all his base period employers and used for payment of benefits.
The other provisions of this subsection notwithstanding, no such employer shall be required to reimburse the fund for any portion of the benefits paid to any individual whose benefits which are attributable to public service wages funded under the Comprehensive Employment and Training Act of 1973, as amended, after December 31, 1975, to the extent that such benefits are reimbursed to the fund by the federal government under the provisions of Section 220 of the Emergency Jobs Program Extension Act of 1976 (P.L. 94-444).
(10) Two or more employers that have elected to make payments in lieu of contributions in accordance with the provisions of this section 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 employ of such organizations. Each such application shall identify and authorize a group representative to act as the group’s agent for the purposes of this subsection. Upon his approval of the application, the secretary shall establish a group account for such employers effective as of the beginning of the calendar quarter next following the quarter in which he received such application, and shall notify the group’s representative of the effective date of the account. Such group account shall remain in effect for not less than eight calendar quarters and thereafter 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 contributions with respect to each calendar quarter in the amount that bears the same ratio to the total benefits paid in such quarter that are attributable to service performed in the employ of all members of the group as the total wages paid for services in employment by such member in such quarter bears to the total wages paid during such quarter for service performed in the employ of all members of the group. The secretary shall prescribe such regulations as he deems necessary with respect to applications for establishment, maintenance and termination of group accounts that are authorized by this subdivision (10), for addition of new members to, and withdrawal of active members from, such accounts, and for the determination of the amounts that are payable under this subdivision by members of a group and the time and manner of such payments.
(11) Notwithstanding any other provisions of this chapter, any employer who was liable for payments in lieu of contributions for the period immediately preceding the effective date of termination of its coverage pursuant to Section 25-4-130 shall nevertheless continue to be liable to pay to the secretary for the fund the amount of regular benefits and extended benefits paid, as required by this chapter, that is attributable to service in the employ of such employer prior to the effective date of such termination, to individuals for weeks of unemployment which begin on or after such effective date. Such payments to the secretary shall be made at such times and in such manner as the secretary shall prescribe and the secretary shall continue to require payments in lieu of contributions and surety in such amounts and for such period as he may deem necessary to insure restoration to the fund of the amount of such regular and extended benefits.
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