2009 LEGISLATIVE CHANGES AFFECTING UNEMPLOYMENT INSURANCE

The following is a brief summary of the changes made to Minnesota law during the 2009 legislative session which affect unemployment insurance. All changes are effective August 2, 2009, unless otherwise noted.

Federal Emergency Unemployment Compensation State Extension Creates a state extension as a “backfill” to the Federal Emergency Unemployment Compensation (EUC) extension for those applicants who do not qualify for the federal extension because they did not have wage credits equal to or more than 40 times their weekly benefit amount. This section became effective the day following enactment - February 1, 2009.

Reference: Chapter 1

Base Period Definition Change
Amends Minn. Stat. §268.035, subd. 4. Changes the definition of “base period” to provide for a “primary base period” of the last four completed quarters which is used if the applicant applies for unemployment benefits during the second and third month of a quarter. An applicant filing during the second two months of a quarter may use the “secondary base period” of the first four of the last five completed calendar quarters if that base period results in more wage credits than under the primary base period.

• If an applicant has insufficient wage credits to establish a benefit account using the “secondary base period,” which is the first four of the last five completed calendar quarters, usable only if an individual applies during the first month of a calendar quarter, an “alternate base period” of the last four completed calendar quarters is used.
  
  
• The qualifying requirements under Minn. Stat. §268.07, subd. 2, for the “secondary base period” have been changed to a straight $1,000 or more paid in the high quarter (there are no additional wage credit requirements).
  
  
• Qualifying requirements under Minn. Stat. §268.07, subd. 2, for using the “primary base period” remain the same as currently, $1,000 in a high quarter and $250 in the remainder of the base period.
  
  
• Amends Minn. Stat. §268.07, subd. 1. Provides that if wage detail if not yet due, and an applicant is using an alternate base period, the Department may obtain that information directly from an applicant, or may obtain it from the employer.

Effect: More recent wages are used, whenever practical, to establish a benefit account. The UI Program received federal stimulus money for this modification of the base period.

Reference: Chapter 15, Sec. 1

Reemployment Assistance Training
Amends Minn. Stat. §268.035, subd. 21a, Modifications were made to the definition of reemployment assistance training eliminating the requirement that training be necessary for an individual to become reemployed, and now simply being that training will assist the applicant in becoming reemployed. (effective day following enactment - April 9, 2009). Makes apprenticeship training under the state apprenticeship program under Chapter 178 considered reemployment assistance training meaning skilled trades workers and an apprenticeship program will automatically be considered in reemployment assistance training.

Reference: Chapter 15, Sec. 1

Changes to Qualifications for Receiving Unemployment Insurance benefits

• Amends Minn. Stat. §268.085, subd. 15. Changes the definition of available for suitable employment for students, making it clear that school attendance restricts availability only when the student has regularly scheduled classes and that class attendance restricts the applicant from accepting employment and the applicant is unable to change the schedule of classes or make other arrangements. (Effective day following enactment - April 9, 2009)
  
  
• Amends Minn. Stat. §268.095, subd. 1. Provides for an exception to quitting if an individual quits in order to provide necessary care to an immediate family member (defined as a spouse, parent, step-parent, son or daughter, stepson or stepdaughter, or grandson or granddaughter).
  
  
• Amends Minn. Stat. §268.095, subd. 1. Provides for an exception to quitting for an individual who quit in order to relocate to accompany a spouse whose job location changes making it impractical for the applicant to commute.
  
  
• Amends Minn. Stat. §268.095, subd. 6. Provides that it is not misconduct if an applicant is absent, with proper notice to the employer, in order to provide necessary care to an immediate family member.

Reference: Chapter 15, Sec. 1

WIRED Grant Shared Work Changes
Allows the Department to suspend the requirements of shared work in order to provide partial benefits to workers who are in this incumbent training during part of the week as part of the WIRED grant program, which provides a grant for training incumbent workers.

Reference: Chapter 25

Shared Work Program Changes
Amends Minn. Stat. §268.135. Makes the shared work program more flexible allowing for back-to-back plans covering the same workers and allows for half-time workers and salaried workers to be covered under shared work.

Reference: Chapter 27

Independent Contractor – Residential and Commercial Construction
Minn. Stat. §268.035 subd. 9a. For purposes of this chapter, section 181.723 determines whether a worker is an independent contractor or an employee when performing public or private sector commercial or residential building construction or improvement services.

Reference: Chapter 78, Article 4

Independent Contractor Definition Amendment for Trucking Industry
Amends Minn. Stat. §268.035, subd. 25(b). Modifies the definition of independent contractor in the trucking industry to create a presumption of employment and providing that the driver, including messengers and couriers, are independent contractors only if seven specific requirements are met.

Reference: Chapter 89

Temporary Workforce Development Fee Increase
Amends Minn. Stat. §268.116L.20. Increases the workforce development special assessment effective July 1, 2009 until June 30, 2011, to .12 percent of taxable wages. (effective July 1, 2009).

Reference: Chapter 78, Article 2

Withdrawal of Benefit Account Changes
Amends Minn. Stat. §268.07, subd. 3b. Allows the withdrawal of benefit account so long as the applicant has not paid any benefits (prior law would not allow it if the applicant had served the waiting week).

Reference: Chapter 78, Article 3

No Penalty for Early 401 K Withdrawal
Amends Minn. Stat. §268.085, subd. 3. Provides that if an applicant cashes in a 401-K early, and pays the income tax penalty, that the distribution is not considered to have been received (effective retroactive to December 1, 2008)

Reference: Chapter 78, Article 3

Severance Pay Application
Amends Minn. Stat. §268.085, subd. 3. Provides that severance pay is not applied back to the last day of employment (effective retroactive to December 1, 2008)

Reference: Chapter 78, Article 3

Voluntary Unemployment Benefits
Adds Minn. Stat. §268.088. Provides that unemployment benefits may be paid during certain voluntary unemployment if an election to become unemployed is authorized under collective bargaining agreement or written employer policy, and the employer has provided written certification that the applicant’s election prevented another employee from being laid off due to lack of work and the applicant’s unemployment is to be temporary.

Reference: Chapter 78, Article 3

Temporary Agency Responsibility for Benefits
Amends Minn. Stat. §268.095, subd. 2. Provides that an applicant, who after the completion of a temporary assignment accept employment with the client of the staffing service is considered to have quit the employment with the staffing service and that quit under this circumstance is considered quit for better employment.

Reference: Chapter 78, Article 3

Online Filing of Employer Appeals
Amends Minn. Stat. §268.103. If an agent of an employer files an appeal, the appeal must be filed online (applies to attorney, accountants, and third party agents). (Effective April 1, 2010).

Reference: Chapter 78, Article 3

Fee for Federal Income Tax Refund Offset
Amends Minn. Stat. §268.18, subd. 4a. Provides that if the Internal Revenue Service assesses a fee for offsetting from a federal income tax refund in the amount of any fraud overpayment, the fee may be added to the total amount due and any money offset, includes penalties and interest, are placed into the trust fund.

Reference: Chapter 78, Article 3

Penalty for Failure to Report Weekly Wage Breakdown
Amends Minn. Stat. §268.186. Provides for an administrative penalty of $100 for an employer that fails or refuses to provide a weekly breakdown of wages paid an applicant, information necessary to detect applicant fraud.

Reference: Chapter 78, Article 3

Project GATE Participant Eligibility for UI Allows for the waiver of availability for employment as well as the deductive earnings provisions for dislocated workers under the GATE program, which is available for dislocated workers who wish to start their own business. This is limited to 500 applicants, 50 years of age or older, and is effective the day following enactment.

Reference: Chapter 78, Article 3

Technical Changes to Unemployment Insurance

• Repeals Minn. Stat. §268.085, subd. 14. Eliminates “able to work” as a concept separate and distinct from the concept of available for suitable employment.
  
  
• Repeals Minn. Stat. §268.086 and substitutes Minn. Stat. §268.0865. Eliminates reactivation of a benefit account as a concept separate from filing a continued request.
  
  
• Amends Minn. Stat. §268.105, subd. 1. Requires unemployment law judges at the beginning of any evidentiary hearing to explain the meaning of “preponderance of the evidence.”
  
  
• Amends Minn. Stat. §268.105, subd. 1. Requires the Commissioner to designate a chief unemployment law judge.
  
  
• Amends Minn. Stat. §268.105, subd. 4. Requires that if a subpoena was initially denied, the unemployment law judge, on his own motion, must reconsider that request during the evidentiary hearing and rule on whether the subpoena request was properly denied.

Reference: Chapter 78, Article 4