2019 -- H 5825

========

LC002044

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

____________

A N   A C T

RELATING TO LABOR AND LABOR RELATIONS - TEMPORARY DISABILITY

BENEFITS AND CONTRIBUTIONS

     Introduced By: Representatives Azzinaro, Corvese, Costantino, Solomon, and Phillips

     Date Introduced: March 08, 2019

     Referred To: House Labor

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 28-39-2 of the General Laws in Chapter 28-39 entitled "Temporary

Disability Insurance - General Provisions" is hereby amended to read as follows:

     28-39-2. Definitions.

     The following words and phrases, as used in chapters 39 -- 41 of this title, have the

following meanings unless the context clearly requires otherwise:

     (1) "Average weekly wage" means the amount determined by dividing the individual's

total wages including any sales commission earned for services performed in employment within

his or her base period by the number of that individual's credit weeks within the base period;

     (2) "Base period" with respect to an individual's benefit year when the benefit year begins

on or after October 7, 1990, means the first four (4) of the most recently completed five (5)

calendar quarters immediately preceding the first day of an individual's benefit year; provided,

that for any individual's benefit year when the benefit year begins on or after October 4, 1992,

and for any individual deemed monetarily ineligible for benefits under the "base period" as

defined in this subdivision, the department shall make a re-determination of entitlement based

upon an alternate base period which consists of the last four (4) completed calendar quarters

immediately preceding the first day of the claimant's benefit year. Notwithstanding anything

contained to the contrary in this subdivision, the base period shall not include any calendar

quarter previously used to establish a valid claim for benefits; provided, however, that the "base

period" with respect to members of the United States military service, the Rhode Island National

Guard, or a United States military reserve force, and who served in a United States declared

combat operation during their military service, who file a claim for benefits following their

release from their state or federal active military service and who are deemed to be monetarily

ineligible for benefits under this section, shall mean the first four (4) of the most recently

completed five (5) calendar quarters immediately preceding the first day the individual was called

into that state or federal active military service; provided, that for any individual deemed

monetarily ineligible for benefits under the "base period" as defined in this section, the

department shall make a re-determination of entitlement based upon an alternative base period

which consists of the last four (4) completed calendar quarters immediately preceding the first

day the claimant was called into that state or federal active military service. Notwithstanding any

provision of this section of the general or public laws to the contrary, the base period shall not

include any calendar quarter previously used to establish a valid claim for benefits;

     (3) "Benefit" means the money payable, as provided in chapters 39 -- 41 of this title, to

an individual as compensation for his or her unemployment caused by sickness;

     (4) "Benefit credits" means the total amount of money payable to an individual as

benefits, as provided in § 28-41-7;

     (5) "Benefit rate" means the money payable to an individual as compensation, as

provided in chapters 39 -- 41 of this title, for his or her wage losses with respect to any week

during which his or her unemployment is caused by sickness;

     (6) "Benefit year" with respect to any individual who does not already have a benefit year

in effect, and who files a valid claim for benefits as of November 16, 1958 or any later date,

means fifty-two (52) consecutive calendar weeks, the first of which shall be the week containing

the day as of which he or she first files that valid claim in accordance with regulations adopted as

subsequently prescribed; provided, that for any benefit year beginning on or after October 7,

1990, the benefit year shall be fifty-three (53) consecutive calendar weeks if the subsequent filing

of a new valid claim immediately following the end of a previous benefit year would result in the

overlapping of any quarter of the base period of the prior new claim. In no event shall a new

benefit year begin prior to the Sunday next following the end of the old benefit year;

     (i) For benefit years that begin on or after July 1, 2012, an individual's benefit year will

begin on the Sunday of the calendar week in which an individual first became unemployed due to

sickness and for which the individual has filed a valid claim for benefits;

     (7) "Board" means the board of review as created under chapter 19 of title 42;

     (8) "Calendar quarter" has the same definition as contained in chapter 42 of this title;

LC002044 - Page 2 of 7

     (9) "Credit week" means any week within an individual's base period in which that

individual earns wages amounting to at least twenty (20) times the minimum hourly wage as

defined in chapter 12 of this title, for performing services in employment for one or more

employers subject to chapters 39 -- 41 of this title;

     (10) "Director" means the director of the department of labor and training;

     (11) "Employee" means any person who is or has been employed by an employer subject

to chapters 39 -- 41 of this title and in employment subject to those chapters;

     (12) "Employer" means any employing unit that is an employer under chapters 42 -- 44

of this title;

     (13) "Employing unit" has the same definition as contained in chapter 42 of this title and

includes any governmental entity that elects to become subject to the provisions of chapters 39 --

41 of this title, in accordance with the provisions of §§ 28-39-3.1 and 28-39-3.2;

     (14) "Employment" has the same definition as contained in chapter 42 of this title;

     (15) "Employment office" has the same definition as contained in chapter 42 of this title;

     (16) "Fund" means the Rhode Island temporary disability insurance fund established by

this chapter;

     (17) "Partial unemployment due to sickness". For weeks beginning on or after January 1,

2006 an individual shall be deemed partially unemployed due to sickness in any week of less than

full-time work if he or she fails to earn in wages for services for that week an amount equal to the

weekly benefit rate for total unemployment due to sickness to which he or she would be entitled

if totally unemployed due to sickness and eligible.

     (i) For the purposes of this subdivision and subdivision (22) of this section, "Wages"

includes only that part of remuneration for any work, which is in excess of one-fifth (1/5) of the

weekly benefit rate for total unemployment, rounded to the next lower multiple of one dollar

($1.00), to which the individual would be entitled if totally unemployed and eligible in any one

week, and "services" includes only that part of any work for which remuneration in excess of

one-fifth (1/5) of the weekly benefit rate for total unemployment, rounded to the next lower

multiple of one dollar ($1.00), to which the individual would be entitled if totally unemployed

and eligible in any one week is payable; provided, that nothing contained in this paragraph shall

permit any individual to whom remuneration is payable for any work performed in any week in

an amount equal to, or greater than, his or her weekly benefit rate to receive benefits under this

subdivision for that week.

     (18) "Reserve fund" means the temporary disability insurance reserve fund established by

§ 28-39-7;

LC002044 - Page 3 of 7

     (19) "Sales commissions" mean an extra amount of money that is paid to a sales person,

based upon the sales that they have generated, in addition to their wages and salary.

     (19)(20) "Services" means all endeavors undertaken by an individual that are paid for by

another or with respect to which the individual performing the services expects to receive wages

or profits;

     (20)(21) "Sickness". An individual shall be deemed to be sick in any week in which,

because of his or her physical or mental condition, including pregnancy, he or she is unemployed

and unable to perform his or her regular or customary work or services;

     (21)(i)(22)(i) "Taxes" means the money payments required by chapters 39 -- 41 of this

title, to be made to the temporary disability insurance fund or to the temporary disability

insurance reserve fund.

     (ii) Wherever and whenever in chapters 39 -- 41 of this title, the words "contribution"

and/or "contributions" appear, those words shall be construed to mean the "taxes," as defined in

this subdivision, which are the money payments required by those chapters to be made to the

temporary disability insurance fund or to the temporary disability insurance reserve fund;

     (22)(23) "Wages" has the same definition as contained in chapter 42 of this title except

that it shall include "sales commissions" as defined herein; provided, that no individual shall be

denied benefits under chapters 39 -- 41 of this title because his or her employer continues to pay

to that individual his or her regular wages, or parts of them, while he or she is unemployed due to

sickness and unable to perform his or her regular or customary work or services. The amount of

any payments, whether or not under a plan or system, made to or on behalf of an employee by his

or her employer after the expiration of six (6) calendar months following the last calendar month

in which the employee performed actual bona fide personal services for his or her employer, shall

not be deemed to be wages either for the purpose of paying contributions thereon under chapter

40 of this title, or for the purpose of being used as a basis for paying benefits under chapter 41 of

this title; and

     (23)(24) "Week" has the same definition as contained in chapter 42 of this title.

     SECTION 2. Section 28-40-1 of the General Laws in Chapter 28-40 entitled "Temporary

Disability Insurance - Contributions" is hereby amended to read as follows:

     28-40-1. Amount of employee contributions -- Wages on which based.

     (a) The taxable wage base under this chapter for each calendar year shall be equal to the

greater of thirty-eight thousand dollars ($38,000) or the annual earnings needed by an individual

to qualify for the maximum weekly benefit amount and the maximum duration under chapters 39

-- 41 of this title. That taxable wage base shall be computed as follows: Every September 30, the

LC002044 - Page 4 of 7

maximum weekly benefit amount in effect as of that date shall be multiplied by thirty (30) and

the resultant product shall be divided by thirty-six hundredths (.36). If the result thus obtained is

not an even multiple of one hundred dollars ($100), it shall be rounded upward to the next higher

even multiple of one hundred dollars ($100). That taxable wage base shall be effective for the

calendar year beginning on the next January 1.

     (b) Each employee shall contribute with respect to employment after the date upon which

the employer becomes subject to chapters 39 -- 41 of this title, an amount equal to the fund cost

rate times the wages, including sales commissions, as defined in § 28-39-2 and paid by the

employer to the employee up to the taxable wage base as defined and computed in subsection (a)

of this section. The employee contribution rate for the following calendar year shall be

determined by computing the fund cost rate on or before November 15 of each year as follows:

     (1) The total amount of disbursements made from the fund for the twelve (12) month

period ending on the immediately preceding September 30 shall be divided by the total taxable

wages paid by employers during the twelve (12) month period ending on the immediately

preceding June 30. The ratio thus obtained shall be multiplied by one hundred (100) and the

resultant product if not an exact multiple of one-tenth of one percent (0.1%) shall be rounded

down to the next lowest multiple of one-tenth of one percent (0.1%);

     (2) If the fund balance as of the preceding September 30 is less than the total

disbursements from the fund for the six (6) month period ending on that September 30, that

difference shall be added to the total disbursements for the twelve (12) month period ending

September 30 for the purpose of computing the fund cost rate, and if the resulting fund cost rate is

not an exact multiple of one-tenth of one percent (0.1%) it shall be rounded to the nearest

multiple of one-tenth of one percent (0.1%).

     SECTION 3. Section 28-41-2 of the General Laws in Chapter 28-41 entitled "Temporary

Disability Insurance - Benefits" is hereby amended to read as follows:

     28-41-2. Wages included for benefit purposes.

     Notwithstanding any provisions of chapters 39 -- 41 of this title to the contrary, "wages"

as used in the phrase "wages for employment from employers", including sales commissions, as

defined in § 28-39-2 and means, with reference to the benefits provisions of chapters 39 -- 41 of

this title, only those wages which are paid subsequent to the date upon which the employing unit,

by whom those wages were paid, has satisfied the conditions of § 28-39-2 (12) with respect to

becoming an employer subject to those chapters. No individual shall be denied benefits under

chapters 39 -- 41 of this title because his or her employer continued to pay to that individual his

or her regular wages, or parts of them, while he or she was sick and unable to perform his or her

LC002044 - Page 5 of 7

regular or customary work or services. The amount of any payments, whether or not under a plan

or system, made to or on behalf of an employee by his or her employer after the expiration of six

(6) calendar months following the last calendar month in which the employee performed actual

bona fide personal services for that employer, shall not be deemed to be wages for the purpose of

being used as a basis for paying benefits under chapter 41 of this title.

     SECTION 4. This act shall take effect upon passage.

========

LC002044

========

LC002044 - Page 6 of 7

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO LABOR AND LABOR RELATIONS - TEMPORARY DISABILITY

BENEFITS AND CONTRIBUTIONS

***

     This act would require temporary disability contributions and benefits to be calculated

based upon an employee's wages and salaries, that shall also include any sales commissions

earned.

     This act would take effect upon passage.

========

LC002044

========

LC002044 - Page 7 of 7