Bill Summary for S 751 (2019-2020)

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Summary date: 

May 14 2020

Bill Information:

View NCGA Bill Details2019-2020 Session
Senate Bill 751 (Public) Filed Thursday, May 14, 2020
Intro. by Nickel.

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Bill summary

Enacts Article 6, Work-Sharing and Short-Time Compensation, of GS Chapter 96. Establishes a short-time compensation program that allows employers to submit a short-time compensation plan for approval by the Division of Employment Security (Division) for an affected unit of the employer to avert layoffs and offer short-time compensation to workers in the affected unit under an approved plan.

Requires an employer to submit a signed, written short-time compensation plan (plan) to the Division for approval. Requires the Division to develop an application form that includes nine specified components, including (1) the affected units and employees covered; (2) the employees' usual weekly hours of work, as defined, and the employer's proposed reduction percentage during weeks covered by the plan, which must be between 10 and 60 percent; (3) certification of continued health and retirement benefits, as defined, during weeks covered by the plan; (4) certification that the aggregate reduction of work hours is in lieu of layoffs; and (5) the effective date and duration of the plan, which cannot exceed 12 months. Provides for flexibility in the application process for demonstrated good cause, such as modes of operation that preclude setting specific dates and hours in the application. Excludes overtime work from the term usual weekly hours of work, and prohibits the hours from exceeding 40.

Requires the Division to approve or disapprove the plan in writing within 30 days of receipt and to promptly notify the employer. Requires notice of disapproval to include specific reasoning. Allows submission of another plan after 90 days of disapproval.

Details parameters regarding the effective date and duration of the plan, allowing plans to expire earlier than the end of the twelfth calendar month after its effective date. Allows an employer to terminate the plan at any time upon written notice to the Division. Allows an employer to submit a new application at any time after the expiration or termination date of a plan.

Allows for the Division to revoke plan approval for good cause at any time. Requires revocation to be in writing and include specific reasoning. Provides that revocation terminates the plan on the date specified in the order. Authorizes the Division to periodically review plans to assure no good cause exists for revocation, such as failure to comply with the assurances given in the plan, unreasonable revision of productivity standards for the affected unit, conduct or occurrence tending to defeat the intent and effective operation of the plan, and violation of any criteria on which approval of the plan was based.

Details requirements and limitations regarding plan modification. Prohibits any modification from extending the original plan's expiration date. Requires reporting of any modification that is not substantial which does not require Division approval.

Details eligibility for short-time compensation and benefits included under an approved plan. Eligibility criteria are that the individual be monetarily eligible and not disqualified for unemployment compensation who: (1) during the week, is employed as a member of an affected unit under a prior approved plan and the plan is in effect with respect to the week for which compensation is claimed; (2) is available for his or her usual hours of work with the employer, including training; and (3) is deemed unemployed in any week during the duration of the plan when remuneration as an employee in an affected unit is reduced based on a reduction of the individual's usual weekly hours of work under an approved plan. Defines unemployment compensation to mean the unemployment benefits payable under new Article 6 other than short-time compensation including any amounts payable pursuant to an agreement under any federal law providing for compensation, assistance, or allowances with respect to unemployment. Sets the weekly compensation amount to be the product of the regular weekly unemployment compensation amount for a week of total unemployment multiplied by the percentage of reduction in the individual's usual weekly hours of work. Bars eligibility for combined benefits in any benefit year in an amount more than the maximum entitlement for regular unemployment compensation and payment for more than 52 weeks under the plan. Details further parameters and limitations for compensation, including relation to regular unemployment compensation and the impact of working or not working for a short-time employer and/or another employer during weeks covered by the plan.

Provides that short-time compensation benefits must be charged to an employers' experience rating accounts in the same manner as unemployment compensation charged under GS Chapter 96. Adds that employers liable for payments in lieu of contributions must have short-time compensation attributed to service in their employ in the same manner as unemployment compensation is attributed.

Deems an individual who has received all of the short-time compensation or combined unemployment compensation and short-time compensation available in a benefit year to be an exhaustee of extended benefits unless otherwise eligible for extended benefits.

Includes a severability clause.

Effective 60 days after the date the act becomes law. Applies to claims arising and plans submitted on or after February 15, 2020.

Effective July 1, 2020, appropriates $100,000 from the General Fund to the Division of Employment Security for the 2020-21 fiscal year to implement the provisions of new Article 6, GS Chapter 96.