§ 28-43-10. Application of predecessor's payroll record to successor employer.
(a)(1)(i) Whenever any employing unit in any manner succeeds to, or has succeeded to, or acquires,
or has acquired, the organization, trade, separate establishment (provided separate
payroll reports have been filed with the director for the separate establishment),
or business, or substantially all the assets thereof, and whenever the successor was
not prior to that acquisition an employing unit as that term is defined in § 28-42-3 of another which at the time of the acquisition was an employer subject to chapters
42 — 44 of this title, the predecessor employing unit shall be deemed to have relinquished
all rights to have its prior payroll records, or in the case of a separate establishment
the prior payroll records of the establishment, used for the purpose of determining
experience rates of employer contributions for that predecessor, and the director
shall use those prior payroll records for the purpose of determining experience rates
of employer contributions for that successor. That successor shall, if not already
an employer prior to that acquisition, become an employer on the date of that acquisition,
and for the purpose of determining experience rates of employer contributions the
director shall hereafter consider those prior payroll records of the predecessor as
the payroll records of the successor, and the successor shall assume the position
of the predecessor or predecessors with respect to the payroll records of the predecessor
or predecessors as if there had been no change in the ownership of the organization,
trade, separate establishment, business, or assets. If the successor is an employer
prior to the time of the transfer, it may continue to pay employer contributions at
the rate applicable to it from the date the transfer occurred until the end of the
then current tax year, or it may elect to pay at the rate applicable to its predecessor
for the balance of that year. If the successor is not an employer prior to the time
of the transfer, it shall pay employer contributions at the rate applicable to the
predecessor or, if more than one and the same rate is applicable to both, the rate
applicable to the predecessor or predecessors from the date the transfer occurred
until the end of the then current tax year. If the successor is not an employer prior
to the time of the transfer and simultaneously acquires the businesses of two (2)
or more employers to whom different rates of employer contributions are applicable,
it shall pay employer contributions at the highest rate applicable to those predecessors
from the date the transfers occurred until the end of the then current tax year.
(ii) In all cases the rate of employer contributions applicable to the successor for each
tax year beginning with the tax year commencing next after the transfer shall be computed
on the basis of the combined payroll records of the successor and of the predecessor
or predecessors. A successor shall be deemed to be an eligible employer if its experience
combined with that of its predecessors meets the requirements of §â€‚28-43-1(3). As used in this section, "successorâ€� means the employing unit to whom a transfer
as provided in this section is made, and "predecessor� means the employer making the
transfer and may, if the context so requires, be construed as referring only to the
separate establishment transferred in case of the transfer of a separate establishment.
(2) A successor to any portion of the business of its predecessor shall have its rate
determined based on its own unemployment experience combined with that portion of
the predecessor's unemployment experience attributable to the share of the trade or
business transferred to the successor in the following manner:
(i) The total payroll of the employees on the predecessor's payroll during the last completed
calendar quarter prior to the date of the transfer who are also on the payroll of
the successor when the transfer takes effect shall be divided by the predecessor's
total payroll during the last completed calendar quarter prior to the date of the
transfer, and that percentage shall be applied to the experience rating balances and
payroll of the predecessor as of the end of the experience year used to determine
the contribution rate for the tax year in effect at the date of transfer. The resulting
amounts shall be subtracted from the experience rating balances and payroll of the
predecessor. The predecessor's remaining experience rating balances and payroll shall
be used to determine its contribution rate for the new tax year or for the remainder
of the current tax year, whichever is applicable, effective on the first day of the
calendar quarter following the date of the transfer; provided, that if the date of
the transfer is the first day of the calendar quarter, then the new contribution rate
shall take effect on the date of the transfer.
(ii) The balances subtracted from the predecessor's account in subsection (a)(2)(i) of
this section shall be combined with the experience rating balances and payroll of
the successor as of the end of the experience year used to determine the contribution
rate for the tax year in effect at the date of transfer. Those combined balances shall
be used to determine the contribution rate for the successor for the new tax year
or for the remainder of the current tax year, whichever is applicable, effective on
the first day of the calendar quarter following the date of the transfer; provided,
that if the date of the transfer is the first day of the calendar quarter then the
new contribution rate shall take effect on the date of the transfer. For successors
in business for less than one experience year, their contribution rate for the new
tax year or for the remainder of the current tax year, whichever is applicable, shall
be computed based on the transferred experience rating balances and payroll of the
predecessor and shall take effect on the first day of the calendar quarter following
the date of the transfer; provided, that if the date of the transfer is the first
day of the calendar quarter then the new contribution rate shall take effect on the
date of the transfer.
(b) Any determination of the director under this section shall be final unless an appeal
from it is filed by the aggrieved party within fifteen (15) days from the date that
notice is mailed to the last known address of that party. All appeals shall follow
the provision of §â€‚28-43-13.