BILL NUMBER: AB 1845	CHAPTERED
	BILL TEXT

	CHAPTER  783
	FILED WITH SECRETARY OF STATE  SEPTEMBER 29, 2012
	APPROVED BY GOVERNOR  SEPTEMBER 29, 2012
	PASSED THE SENATE  AUGUST 29, 2012
	PASSED THE ASSEMBLY  AUGUST 30, 2012
	AMENDED IN SENATE  AUGUST 24, 2012
	AMENDED IN SENATE  AUGUST 7, 2012
	AMENDED IN SENATE  AUGUST 6, 2012
	AMENDED IN SENATE  JULY 5, 2012
	AMENDED IN SENATE  JUNE 18, 2012
	AMENDED IN ASSEMBLY  APRIL 11, 2012
	AMENDED IN ASSEMBLY  MARCH 29, 2012

INTRODUCED BY   Assembly Member Solorio

                        FEBRUARY 22, 2012

   An act to amend Sections 803, 821, 1030, 1032, 1032.5, 1088.5,
1142, 1329.1, 1335, 1338, 1375.1, 1381, 1521, 1595, 3701, 4701,
13021, and 13021.5 of, and to add Section 1026.1 to, the Unemployment
Insurance Code, relating to unemployment insurance, and making an
appropriation therefor.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1845, Solorio. Unemployment compensation benefits: overpayment
assessments: termination: income tax withholding.
   Existing law requires the Director of Employment Development to
maintain a separate reserve account for each employer, and generally
requires the director to credit each reserve account with all the
contributions paid on the employer's behalf and to charge against the
employer's reserve account unemployment compensation benefits paid
to an unemployed individual during any benefit year during his or her
base period. Under existing law, certain benefits paid to claimants
are not charged to an employer's reserve account, except as provided,
if the department rules that specified circumstances exist.
   This bill would provide that an employer's reserve account is not
relieved of charges relating to a benefit overpayment established on
or after October 22, 2013, if the department determines that the
payment was made because the employer, or an agent of the employer,
was at fault for failing to respond timely or adequately to requests
of the department for information relating to the individual claim
for unemployment compensation benefits, as provided.
   Existing law permits certain employing units to elect to pay the
cost of benefits into the Unemployment Fund in lieu of paying
contributions required of employers. Existing law provides that the
cost of benefits charged to that employer includes benefits or
payments improperly paid.
   This bill would provide that the cost of benefits charged to an
employer under that election include credits of benefit overpayments
actually collected by the department, unless the department
determines that the payment was made because the entity, or an agent
of the entity, was at fault for failing to respond timely or
adequately to requests of the department for information relating to
the individual claim for unemployment compensation benefits, as
provided. This provision would apply to benefit overpayments
established on or after October 22, 2013.
   Existing law requires each employer to report to the department,
as specified, the hiring of any employee who works in this state and
to whom the employer anticipates paying wages.
   This bill would additionally require each employer to report the
hiring of any employee who previously worked for the employer, but
had been separated from such prior employment for at least 60
consecutive days.
   Existing law allows an employer that is entitled to receive notice
of the filing of a new or additional claim for unemployment benefits
to submit to the Employment Development Department facts explaining
the reasons for the claimant leaving the employer's employ; however,
the employer is restricted to providing reasons only from a specified
list that the department will use to determine the cause of
termination. Existing law also allows a base period employer that is
not entitled to receive notice of the filing of a new or additional
claim for unemployment benefits, but is entitled to notice of
computation, to submit to the department facts explaining the reasons
for the claimant leaving the employer's employ; however, the
employer is restricted to providing reasons only from a specified
list that the department will use to determine the cause of
termination.
   This bill would expand these lists to include as a reason, the
claimant leaving the employer's employ for a substantially better
job.
   Existing law allows an employer that is entitled to receive notice
of the filing of a primary claim or additional claim for extended
unemployment compensation benefits or federal-state extended benefits
to submit to the Employment Development Department any facts
explaining the reason for the claimant leaving the employer's employ;
however, the employer is restricted to providing reasons only from a
specified list that the department will use to determine the cause
of termination.
   This bill would expand these lists to include the claimant leaving
the employer's employ for reason of a substantially better job or to
protect his or her family or himself or herself from domestic
violence abuse.
   Existing law provides that a claim for unemployment compensation
benefits may be canceled if the individual has not been deemed
ineligible for unemployment compensation benefits, has not been
overpaid unemployment compensation benefits, and has not collected
unemployment compensation benefits.
   This bill would, in order to cancel a claim for unemployment
compensation benefits, add an additional requirement that the
individual request to cancel the claim during the benefit year of
that claim or the extended duration period of that claim.
   Existing law authorizes the Employment Development Department to
administer the federal-state unemployment insurance program and
provides for the payment of unemployment compensation benefits to
eligible individuals who are unemployed through no fault of their
own.
   Federal law requires, on and after October 22, 2013, at the time a
state agency determines an erroneous payment from its unemployment
insurance fund was made to an individual due to fraud committed by
the individual, the assessment of a penalty on the individual in an
amount of not less than 15% of the amount of the erroneous payment,
and requires that assessment to be deposited into the unemployment
insurance fund of the state.
   Under existing law, if the Director of Employment Development
finds that an individual has been overpaid unemployment compensation
benefits because he or she, for the purpose of obtaining those
benefits, either made a false statement or representation, with
actual knowledge of the falsity, or withheld a material fact, the
director is required to assess against the individual an amount equal
to 30% of the overpayment amount. Existing law requires the
assessments collected to be deposited in the Benefit Audit Fund.
   This bill would instead, for penalty assessments established on
and after October 22, 2013, require that overpayment assessment
amount to be deposited 50% into the Unemployment Trust Fund and 50%
into the Benefit Audit Fund.
   By depositing additional amounts into the Unemployment Trust Fund
in the Unemployment Fund, which is a continuously appropriated
special fund, this bill would make an appropriation.
   Under existing law, if the Director of Employment Development
finds that any employer or any employee, officer, or agent of any
employer, in submitting facts concerning the termination of a
claimant's employment or in submitting a written statement concerning
the reasonable assurance of a claimant's reemployment pursuant to
specified provisions of unemployment insurance law, willfully makes a
false statement of representation or willfully fails to report a
material fact concerning that termination or the reasonable assurance
of that reemployment, the director must assess a penalty against the
employer in an amount not less than 2 nor more than 10 times the
weekly benefit amount of that claimant. Existing law requires the
penalties to be deposited into the Employment Development Department
Contingent Fund, a continuously appropriated fund.
   This bill would instead provide that the penalty be assessed on an
employer or agent of the employer, depending on who the director
finds was at fault for willfully making a false statement or
representation or for willfully failing to report a material fact
concerning that termination or the reasonable assurance of that
reemployment. The bill would provide that if both the employer and
the agent of the employer were at fault, this penalty would be
assessed against the employer and another penalty would be assessed
against the agent of the employer. This bill would further provide
that the additional penalties that are assessed against an agent of
the employer be available for the specified purposes upon
appropriation by the Legislature for those purposes.
   Existing law requires employers to withhold income taxes each
calendar quarter, file a withholding report, a quarterly return, a
report of wages, and pay over the taxes so required to be withheld.
Existing law requires employers to remit the total amount of income
tax withheld within a specified number of banking days, and uses
banking days to determine when a payment is complete.
   This bill would, under those provisions, on and after January 1,
2013, use business days to measure time instead of banking days, as
provided.
   This bill would incorporate additional changes in Section 1088.5
of the Unemployment Insurance Code, proposed by AB 174 and AB 1794,
that would become operative only if this bill and either or both of
those bills are chaptered and become effective January 1, 2013, and
this bill is chaptered last.
   Appropriation: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 803 of the Unemployment Insurance Code is
amended to read:
   803.  (a) As used in this section, "entity" means any employing
unit that is authorized by any provision of Article 4 (commencing
with Section 701) or by Section 801 or 802 to elect a method of
financing coverage permitted by this section.
   (b) In lieu of the contributions required of employers, an entity
may elect any one of the following:
   (1) To pay into the Unemployment Fund the cost of benefits,
including extended duration benefits and federal-state extended
benefits, paid based on base period wages with respect to employment
for the entity and charged to its account in the manner provided by
Section 1026, pursuant to authorized regulations that shall prescribe
the rate or amount, time, manner, and method of payment or advance
payment or providing a good and sufficient bond to guarantee payment
of contributions.
   (2) Two or more entities may, pursuant to authorized regulations,
file an application with the director for the establishment of a
joint account for the purpose of determining the rate of
contributions they shall pay into the Unemployment Fund to reimburse
the fund for benefits paid with respect to employment for those
entities. The members of the joint account may share the cost of
benefits, including extended duration benefits and federal-state
extended benefits, paid based on the base period wages with respect
to employment for those members and charged to the joint account in
the manner provided by Section 1026. The director shall prescribe
authorized regulations for the establishment, maintenance, and
dissolution of joint accounts, and for the rate or amount, time,
manner, and method of payment or advance payment or providing a good
and sufficient bond to guarantee payment of contributions by the
members of joint accounts, on the cost of benefits charged in the
manner provided by Section 1026.
   (c) Sections 1030, 1031, 1032, and 1032.5, and any provision of
this division for the noncharging of benefits to the account of an
employer, shall not apply to an election under subdivision (b). The
cost of benefits charged to an entity under this section shall
include, but not be limited to, benefits or payments improperly paid
in excess of a weekly benefit amount, or in excess of a maximum
benefit amount, or otherwise in excess of the amount that should have
been paid, due to any computational or other error of any type by
the Employment Development Department or the Department of Benefit
Payments, whether or not the error could be anticipated.
   (d) The cost of benefits charged to an entity under this section
shall include credits of benefit overpayments actually collected by
the department, unless the department determines that the payment was
made because the entity, or an agent of the entity, was at fault for
failing to respond timely or adequately to requests of the
department for information relating to the individual claim for
unemployment compensation benefits. The department shall make this
determination when the entity or agent fails to respond timely or
adequately in two instances relating to the individual claim for
unemployment compensation benefits. This subdivision shall apply to
benefit overpayments established on or after October 22, 2013.
   (e) In making the payments prescribed by subdivision (b), there
shall be paid or credited to the Unemployment Fund, either in advance
or by way of reimbursement, as may be determined by the director,
any sums he or she estimates the Unemployment Fund will be entitled
to receive from each entity for each calendar quarter, reduced or
increased by any sum by which he or she finds that his or her
estimates for any prior calendar quarter were greater or less than
the amounts which should have been paid to the fund. The estimates
may be made upon the basis of statistical sampling, or any other
method as may be determined by the director.
   Upon making that determination, the director shall give notice of
the determination, pursuant to Section 1206, to the entity. The
director may cancel any contributions or portion thereof that he or
she finds has been erroneously determined.
   The director shall charge to any special fund, that is responsible
for the salary of any employee of an entity, the amount determined
by the director for which the fund is liable pursuant to this
section. The contributions due from the entity shall be paid from the
liable special fund, the General Fund, or other liable fund to the
Unemployment Fund by the Controller or other officer or person
responsible for disbursements on behalf of the entity within 30 days
of the date of mailing of the director's notice of determination to
the entity. The director for good cause may extend for not to exceed
60 days the time for paying without penalty the amount determined and
required to be paid. Contributions are due upon the date of mailing
of the notice of determination and are delinquent if not paid on or
before the 30th day following the date of mailing of the notice.
   (f) Any entity that fails to pay the contributions required within
the time required shall be liable for interest on the contributions
at the adjusted annual rate and by the method established pursuant to
Section 19521 of the Revenue and Taxation Code from and after the
date of delinquency until paid, and any entity that without good
cause fails to pay any contributions required within the time
required shall pay a penalty of 10 percent of the amount of the
contributions. If the entity fails to pay the contributions required
on or before the delinquency date, the director may assess the entity
for the amount required by the notice of determination. This
subdivision shall not apply to employers electing financing under
Section 821, for amounts due after December 31, 1992.
   (g) Article 8 (commencing with Section 1126) of Chapter 4 of Part
1 with respect to the assessment of contributions, and Chapter 7
(commencing with Section 1701) of Part 1 with respect to the
collection of contributions, shall apply to the assessments provided
by this section. Sections 1177 to 1184, inclusive, relating to
refunds and overpayments, shall apply to amounts paid to the
Unemployment Fund pursuant to this section. Sections 1222, 1223,
1224, 1241, and 1242 shall apply to matters arising under this
section.
   (h) (1) The director may terminate the election of any entity for
financing under this section if the entity is delinquent in the
payment of advances or reimbursements required by the director under
this section. After any termination the entity may again make an
election pursuant to this section but only if it is not delinquent in
the payment of contributions and not delinquent in the payment of
advances or reimbursements required by the director under this
section.
   (2) In the case of an Indian tribe (as described by subsection (u)
of Section 3306 of Title 26 of the United States Code), the director
shall terminate all elections for the tribe and all subdivisions,
subsidiaries, and business enterprises wholly owned by that tribe if
the tribe or any subdivision, subsidiary, or business enterprise
wholly owned by that tribe is more than 90 days delinquent in the
payment of contributions, bonds, advances, reimbursements, or
applicable penalties or interest required under this code, after
notice to the tribe. After any termination the Indian tribe may again
make an election pursuant to this section but only if it is not
delinquent in the payment of contributions, bonds, advances,
reimbursements, or applicable penalties or interest required under
this code.
   (i) Notwithstanding any other provision of this section, no entity
shall be liable for that portion of any extended duration benefits
or federal-state extended benefits that is reimbursed or reimbursable
by the federal government to the State of California.
   (j) After the termination of any election under this section, the
entity shall remain liable for its proportionate share of the cost of
benefits paid and charged to its account in the manner provided by
Section 1026, which are based on wages paid for services during the
period of the election. That liability may be charged against any
remaining balance of a prior reserve account used by the entity
pursuant to Section 712 or 713. Any portion of the remaining balance
shall be included in the reserve account of the entity following any
termination of an election under this section which occurs prior to
the expiration of a period of three consecutive years commencing with
the effective date of the election. For purposes of Section 982, the
period of an election under Section 803 shall, to the extent
permitted by federal law, be included as a period during which a
reserve account has been subject to benefit charges.
  SEC. 2.  Section 821 of the Unemployment Insurance Code is amended
to read:
   821.  (a) Each school employer may, in lieu of the contributions
required of employers, elect to pay into the Unemployment Fund the
cost of benefits, including extended duration benefits and
federal-state extended benefits, paid based on base period wages with
respect to employment for an employing unit and charged to its
account in the manner provided by Section 1026, pursuant to
authorized regulations that shall prescribe the rate or amount, time,
manner, and method of payment or advance payment or providing a good
and sufficient bond to guarantee payment of contributions. The
provisions of this article shall apply to school employers who have
elected financing under this section.
   (b) Sections 1030, 1031, 1032, and 1032.5, and any provision of
this division for the noncharging of benefits to the account of an
employer, shall not apply to an employing unit under subdivision (a).
The cost of benefits charged to a school employer under this section
shall include, but not be limited to, benefits or payments
improperly paid in excess of a weekly benefit amount, or in excess of
a maximum benefit amount, or otherwise in excess of the amount that
should have been paid, due to any computational or other error of any
type by the Employment Development Department or the Department of
Benefit Payments, whether or not the error could be anticipated.
   (c) The cost of benefits charged to a school employer under this
section shall include credits of benefit overpayments actually
collected by the department, unless the department determines that
the payment was made because the school employer, or an agent of the
school employer, was at fault for failing to respond timely or
adequately to requests of the department for information relating to
the individual claim for unemployment compensation benefits. The
department shall make this determination when the school employer or
agent fails to respond timely or adequately in two instances relating
to the individual claim for unemployment compensation benefits. This
subdivision shall apply to benefit overpayments established on or
after October 22, 2013.
   (d) In making the payments prescribed by subdivision (a), there
shall be paid or credited to the Unemployment Fund, either in advance
or by way of reimbursement, as may be determined by the director,
any sums he or she estimates the Unemployment Fund will be entitled
to receive from each employing unit for each calendar quarter,
reduced or increased by any sum by which he or she finds that his or
her estimates for any prior calendar quarter were greater or less
than the amounts that should have been paid to the fund. These
estimates may be made upon the basis of a statistical sampling, or
other method as may be determined by the director.
   Upon making the determination, the director shall mail notice of
the determination, pursuant to Section 1206, to the employing unit.
   The director may cancel any contributions or portion thereof that
he or she finds have been erroneously determined. The contributions
due from the employing units shall be paid, transferred, or credited
from the School Employees Fund established in the State Treasury by
Section 822 to the Unemployment Fund by the State Treasurer, State
Controller, or other officer or person responsible for disbursements
on behalf of the employing unit within 30 days of the date of mailing
of the director's notice of determination to the employing unit.
   Each employing unit shall send a copy of any and all notices,
billings, or correspondence not normally routed to the administrator
and the Superintendent of Public Instruction, regarding unemployment
insurance for the school employees, to the administrator, the
Superintendent of Public Instruction, and the county superintendent
of schools, or agent thereof, with timely documentation of charges or
determination. Article 8 (commencing with Section 1126) of Chapter 4
with respect to the assessment of contributions, and Chapter 7
(commencing with Section 1701) with respect to the collection of
contributions, shall apply to the assessments provided by this
article. Sections 1177 to 1184, inclusive, relating to refunds and
overpayments, shall apply to amounts paid to the Unemployment Fund
pursuant to this section. Sections 1222, 1223, 1224, 1241, and 1242
shall apply to matters arising under this section.
   (e) Notwithstanding any other provision of this section, no
employing unit shall be liable for that portion of any extended
duration benefits or federal-state extended benefits that is
reimbursed or reimbursable by the federal government to the state.
   (f) To the extent permitted by federal law, including Section 121
(e) of Public Law 94-566, any school employer that elects a method of
financing under this article shall not be liable to reimburse the
cost of benefits paid to any individual whose base period wages
include wages for services performed prior to January 1, 1978, if the
benefits are reimbursable by the federal government under Section
121 of Public Law 94-566 and to the extent that the individual would
not have been eligible for the benefits had this state not provided
for benefits payable based on services performed prior to January 1,
1978.
   (g) The administrator and the Superintendent of Public Instruction
shall adopt rules and regulations for the administration of their
respective functions under this article in accordance with Chapter
3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code. Regulations of the administrator shall be
subject to Article 1 (commencing with Section 301) of Chapter 2 of
Part 1 of Division 1. Rules and regulations of the Superintendent of
Public Instruction shall not be subject to the provisions of Article
1 (commencing with Section 301) of Chapter 2 of Part 1 of Division 1.

   (h) Any election for financing coverage under this section shall
take effect with respect to services performed from and after the
first day of the calendar quarter in which the election is filed with
the director, and shall continue in effect for not less than two
full calendar years. Thereafter, the election under this section may
be terminated as of January 1 of any calendar year only if the school
employer, on or before the 31st day of January of that year, has
filed with the director a written application for termination. The
director may for good cause waive the requirement that a written
application for termination shall be filed on or before the 31st day
of January. School employers shall be prohibited from making a
subsequent reelection under this section for 10 years from the date
of termination of an election under this section. An election for
financing coverage under this section is deemed to have been filed by
every school employer effective as of January 1, 1976, is deemed to
have been in effect for two calendar years prior to January 1, 1978,
and may be terminated as of January 1, 1978, or as of January 1,
1980, or any later January 1 pursuant to this section. Upon the
termination of any election under this section, the school employer
shall be and remain liable for all benefits paid based upon wages
paid by the school employer during the period of an election under
this section.
  SEC. 3.  Section 1026.1 is added to the Unemployment Insurance
Code, to read:
   1026.1.  Notwithstanding any other provision of this code, an
employer's reserve account shall not be relieved of charges relating
to a benefit overpayment if the department determines that the
payment was made because the employer, or an agent of the employer,
was at fault for failing to respond timely or adequately to requests
of the department for information relating to the individual claim
for unemployment compensation benefits. The department shall make
this determination when the employer or agent fails to respond timely
or adequately in two instances relating to the individual claim for
unemployment compensation benefits. This section shall apply to
benefit overpayments established on or after October 22, 2013.
  SEC. 4.  Section 1030 of the Unemployment Insurance Code is amended
to read:
   1030.  (a) An employer that is entitled under Section 1327 to
receive notice of the filing of a new or additional claim may, within
10 days after mailing of the notice, submit to the department any
facts within its possession disclosing whether the claimant left the
employer's employ voluntarily and without good cause or left under
one of the following circumstances:
   (1) The claimant was discharged from the employment for misconduct
connected with his or her work.
   (2) The claimant's discharge or quitting from his or her most
recent employer was the result of an irresistible compulsion to use
or consume intoxicants including alcoholic beverages.
   (3) The claimant was a student employed on a temporary basis and
whose employment began within, and ended with his or her leaving to
return to school at the close of, his or her vacation period.
   (4) The claimant left the employer's employ to accompany his or
her spouse or domestic partner to a place or to join him or her at a
place from which it is impractical to commute to the employment, and
to which a transfer of the claimant by the employer is not available.

   (5) The claimant left the employer's employ to protect his or her
family or himself or herself from domestic violence abuse.
   (6) The claimant left the employer's employ to take a
substantially better job.
   The period during which the employer may submit these facts may be
extended by the director for good cause.
   (b) A base period employer that is not entitled under Section 1327
to receive notice of the filing of a new or additional claim and is
entitled under Section 1329 to receive notice of computation may,
within 15 days after mailing of the notice of computation, submit to
the department any facts within its possession disclosing whether the
claimant left the employer's employ voluntarily and without good
cause or left under one of the following circumstances:
   (1) The claimant was discharged from the employment for misconduct
connected with his or her work.
   (2) The claimant was a student employed on a temporary basis and
whose employment began within, and ended with his or her leaving to
return to school at the close of, his or her vacation period.
   (3) The claimant left the employer's employ to accompany his or
her spouse or domestic partner to a place or join him or her at a
place from which it is impractical to commute to the employment, and
to which a transfer of the claimant by the employer is not available.

   (4) The claimant left the employer's employ to protect his or her
family or himself or herself from domestic violence abuse.
   (5) The claimant left the employer's employ to take a
substantially better job.
   The period during which the employer may submit these facts may be
extended by the director for good cause.
   (c) The department shall consider these facts together with any
information in its possession. If the employer is entitled to a
ruling under subdivision (b) or to a determination under Section
1328, the department shall promptly notify the employer of its ruling
as to the cause of the termination of the claimant's employment. The
employer may appeal from a ruling or reconsidered ruling to an
administrative law judge within 20 days after mailing or personal
service of notice of the ruling or reconsidered ruling. The 20-day
period may be extended for good cause, which includes, but is not
limited to, mistake, inadvertence, surprise, or excusable neglect.
The director is an interested party to an appeal. The department may
for good cause reconsider a ruling or reconsidered ruling within
either five days after the date an appeal to an administrative law
judge is filed or, if an appeal is not filed, within 20 days after
mailing or personal service of notice of the ruling or reconsidered
ruling. However, a ruling or reconsidered ruling that relates to a
determination that is reconsidered pursuant to subdivision (a) of
Section 1332 may also be reconsidered by the department within the
time provided for reconsideration of that determination.
   (d) For purposes of this section only, if the claimant voluntarily
leaves the employer's employ without notification to the employer of
the reasons for the leaving, and if the employer submits all of the
facts within its possession concerning the leaving within the
applicable time period referred to in this section, the leaving is
presumed to be without good cause.
   (e) An individual whose employment is terminated under the
compulsory retirement provisions of a collective bargaining agreement
to which the employer is a party shall not be deemed to have
voluntarily left his or her employment without good cause.
   (f) For purposes of this section "spouse" includes a person to
whom marriage is imminent, and "domestic partner" includes a person
to whom a domestic partnership, as described in Section 297 of the
Family Code, is imminent.
  SEC. 5.  Section 1032 of the Unemployment Insurance Code is amended
to read:
   1032.  If it is ruled under Section 1030 or 1328 that the claimant
left the employer's employ voluntarily and without good cause, or
left under one of the following circumstances, benefits paid to the
claimant subsequent to the termination of employment that are based
upon wages earned from the employer prior to the date of the
termination of employment shall not be charged to the account of the
employer, except as provided by Section 1026 or if the department
determines pursuant to Section 1026.1 that the employer's reserve
account should not be credited, unless the employer failed to furnish
the information specified in Section 1030 within the time limit
prescribed in that section or unless that ruling is reversed by a
reconsidered ruling:
   (a) The claimant was discharged by reason of misconduct connected
with his or her work.
   (b) The claimant was a student employed on a temporary basis and
whose employment began within, and ended with his or her leaving to
return to school at the close of, his or her vacation period.
   (c) The claimant left the employer's employ to accompany his or
her spouse or domestic partner to a place or to join him or her at a
place from which it is impractical to commute to the employment, and
to which a transfer of the claimant by the employer is not available.

   (d) The claimant left the employer's employ to protect his or her
family or himself or herself from domestic violence abuse.
   (e) The claimant left the employer's employ to take a
substantially better job.
   (f) The claimant's discharge or quitting from his or her most
recent employer was the result of an irresistible compulsion to use
or consume intoxicants including alcoholic beverages.
   (g) For purposes of this section "spouse" includes a person to
whom marriage is imminent, and "domestic partner" includes a person
to whom a domestic partnership, as described in Section 297 of the
Family Code, is imminent.
  SEC. 6.  Section 1032.5 of the Unemployment Insurance Code is
amended to read:
   1032.5.  (a) Any base period employer may, within 15 days after
mailing of a notice of computation under subdivision (a) of Section
1329, submit to the department facts within its possession disclosing
that the individual claiming benefits is rendering services for that
employer in less than full-time work, and that the individual has
continuously, commencing in or prior to the beginning of the base
period, rendered services for that employer in such less than
full-time work.
   (b) The department shall consider facts submitted under
subdivision (a) of this section together with any information in its
possession and promptly notify the employer of its ruling. If the
department finds that an individual is, under Section 1252,
unemployed in any week on the basis of his or her having less than
full-time work, and that the employer submitting facts under this
section is a base period employer for whom the individual has
continuously, commencing in or prior to the beginning of the base
period, rendered services in such less than full-time work, that
employer's account shall not be charged, except as provided by
Section 1026 or if the department determines pursuant to Section
1026.1 that the employer's reserve account should not be credited,
for benefits paid the individual in any week in which such wages are
payable by that employer to the individual. The employer may appeal
from a ruling or reconsidered ruling to an administrative law judge
within 20 days after mailing or personal service of notice of the
ruling or reconsidered ruling. The 20-day period may be extended for
good cause, which shall include, but not be limited to, mistake,
inadvertence, surprise, or excusable neglect. The director shall be
an interested party to any appeal. The department may for good cause
reconsider any ruling or reconsidered ruling within either five days
after an appeal to an administrative law judge is filed or, if no
appeal is filed, within 20 days after mailing or personal service of
the notice of the ruling or reconsidered ruling.
  SEC. 7.  Section 1088.5 of the Unemployment Insurance Code is
amended to read:
   1088.5.  (a) In addition to information reported in accordance
with Section 1088, effective July 1, 1998, each employer shall file,
with the department, the information provided for in subdivision (b)
on new employees.
   (b) Each employer shall report the hiring of any employee who
works in this state and to whom the employer anticipates paying
wages, and also shall report the hiring of any employee who
previously worked for the employer but had been separated from that
prior employment for at least 60 consecutive days.
         (c) (1) This section shall not apply to any department,
agency, or instrumentality of the United States.
   (2) State agency employers shall not be required to report
employees performing intelligence or counterintelligence functions,
if the head of the agency has determined that reporting pursuant to
this section would endanger the safety of the employee or compromise
an ongoing investigation or intelligence mission.
   (d) (1) Employers shall submit a report as described in paragraph
(4) within 20 days of hiring any employee whom the employer is
required to report pursuant to this section.
   (2) Notwithstanding subdivision (a), employers transmitting
reports magnetically or electronically shall submit the report by two
monthly transmissions not less than 12 days and not more than 16
days apart.
   (3) For purposes of this section, an employer that has employees
in two or more states and that transmits reports magnetically or
electronically may designate one state in which the employer has
employees to which the employer will transmit the report described in
paragraph (4). Any employer that transmits reports pursuant to this
paragraph shall notify the Secretary of Health and Human Services in
writing as to which state the employer designates for the purpose of
sending reports.
   (4) The report shall contain the following:
   (A) The name, address, and social security number of the
employees.
   (B) The employer's name, address, state employer identification
number (if one has been issued), and identifying number assigned to
the employer under Section 6109 of the Internal Revenue Code of 1986.

   (C) The first date the employee worked.
   (5) Employers may report pursuant to this section by submitting a
copy of the employee's W-4 form, a form provided by the department,
or any other hiring document transmitted by first-class mail,
magnetically, or electronically.
   (e) For each failure to report the hiring of an employee, as
required and within the time required by this section, unless the
failure is due to good cause, the department may assess a penalty of
twenty-four dollars ($24), or four hundred ninety dollars ($490) if
the failure is the result of conspiracy between the employer and
employee not to supply the required report or to supply a false or
incomplete report.
   (f) Information collected pursuant to this section may be used for
the following purposes:
   (1) Administration of this code.
   (2) Locating individuals for purposes of establishing paternity
and establishing, modifying, and enforcing child support obligations.

   (3) Administration of employment security and workers'
compensation programs.
   (4) Providing employer or employee information to the Franchise
Tax Board and the State Board of Equalization for the purpose of tax
or fee enforcement.
   (5) Verification of eligibility of applicants for, or recipients
of, the public assistance programs listed in Section 1320b-7(b) of
Title 42 of the United States Code.
   (g) For purposes of this section, "employer" includes a labor
union hiring hall.
   (h) This section shall become operative on July 1, 1998.
  SEC. 7.1.  Section 1088.5 of the Unemployment Insurance Code is
amended to read:
   1088.5.  (a) In addition to information reported in accordance
with Section 1088, effective July 1, 1998, each employer shall file,
with the department, the information provided for in subdivision (b)
on new employees.
   (b) Each employer shall report the hiring of any employee who
works in this state and to whom the employer anticipates paying
wages, and also shall report the hiring of any employee who
previously worked for the employer but had been separated from that
prior employment for at least 60 consecutive days.
   (c) (1) This section shall not apply to any department, agency, or
instrumentality of the United States.
   (2) State agency employers shall not be required to report
employees performing intelligence or counterintelligence functions,
if the head of the agency has determined that reporting pursuant to
this section would endanger the safety of the employee or compromise
an ongoing investigation or intelligence mission.
   (d) (1) Employers shall submit a report as described in paragraph
(4) within 20 days of hiring any employee whom the employer is
required to report pursuant to this section.
   (2) Notwithstanding subdivision (a), employers transmitting
reports magnetically or electronically shall submit the report by two
monthly transmissions not less than 12 days and not more than 16
days apart.
   (3) For purposes of this section, an employer that has employees
in two or more states and that transmits reports magnetically or
electronically may designate one state in which the employer has
employees to which the employer will transmit the report described in
paragraph (4). Any employer that transmits reports pursuant to this
paragraph shall notify the Secretary of Health and Human Services in
writing as to which state the employer designates for the purpose of
sending reports.
   (4) The report shall contain the following:
   (A) The name, address, and social security number of the
employees.
   (B) The employer's name, address, state employer identification
number (if one has been issued), and identifying number assigned to
the employer under Section 6109 of the Internal Revenue Code of 1986.

   (C) The first date the employee worked.
   (5) Employers may report pursuant to this section by submitting a
copy of the employee's W-4 form, a form provided by the department,
or any other hiring document transmitted by first-class mail,
magnetically, or electronically.
   (e) For each failure to report the hiring of an employee, as
required and within the time required by this section, unless the
failure is due to good cause, the department may assess a penalty of
twenty-four dollars ($24), or four hundred ninety dollars ($490) if
the failure is the result of conspiracy between the employer and
employee not to supply the required report or to supply a false or
incomplete report.
   (f) Information collected pursuant to this section may be used for
the following purposes:
   (1) Administration of this code.
   (2) Locating individuals for purposes of establishing paternity
and establishing, modifying, and enforcing child support obligations.

   (3) Administration of employment security and workers'
compensation programs.
   (4) Providing employer or employee information to the Franchise
Tax Board and the State Board of Equalization for the purpose of tax
or fee enforcement.
   (5) Verification of eligibility of applicants for, or recipients
of, the public assistance programs listed in Section 1320b-7(b) of
Title 42 of the United States Code.
   (6) Providing employer or employee information to the State
Department of Health Care Services, the California Health Benefit
Exchange, the Managed Risk Medical Insurance Board, and county
departments and agencies for the purpose of:
   (A) Verifying or determining the eligibility of an applicant for,
or a recipient of, state health subsidy programs, limited to the
Medi-Cal program, provided pursuant to Chapter 7 (commencing with
Section 14000) of Part 3 of Division 9 of the Welfare and
Institutions Code, the Healthy Families Program, provided pursuant to
Part 6.2 (commencing with Section 12693) of Division 2 of the
Insurance Code, and the Access for Infants and Mothers Program,
provided pursuant to Part 6.3 (commencing with Section 12695) of
Division 2 of the Insurance Code, where the verification or
determination is directly connected with, and limited to, the
administration of the state health subsidy programs referenced in
this subparagraph.
   (B) Verifying or determining the eligibility of an applicant for,
or a recipient of, federal subsidies offered through the California
Health Benefit Exchange, provided pursuant to Title 22 (commencing
with Section 100500) of the Government Code, including federal tax
credits and cost-sharing assistance pursuant to the federal Patient
Protection and Affordable Care Act, (Public Law 111-148), as amended
by the federal Health Care and Education Reconciliation Act of 2010
(Public Law 111-152), where the verification or determination is
directly connected with, and limited to, the administration of the
California Health Benefit Exchange.
   (C) Verifying or determining the eligibility of employees and
employers for health coverage through the Small Business Health
Options Program, provided pursuant to Section 100502 of the
Government Code, where the verification or determination is directly
connected with, and limited to the administration of the Small
Business Health Options Program.
   (g) For purposes of this section, "employer" includes a labor
union hiring hall.
   (h) This section shall become operative on July 1, 1998.
  SEC. 7.2.  Section 1088.5 of the Unemployment Insurance Code is
amended to read:
   1088.5.  (a) In addition to information reported in accordance
with Section 1088, effective July 1, 1998, each employer shall file,
with the department, the information provided for in subdivision (b)
on new employees.
   (b) Each employer shall report the hiring of any employee who
works in this state and to whom the employer anticipates paying
wages, and also shall report the hiring of any employee who
previously worked for the employer but had been separated from that
prior employment for at least 60 consecutive days.
   (c) (1) This section shall not apply to any department, agency, or
instrumentality of the United States.
   (2) State agency employers shall not be required to report
employees performing intelligence or counterintelligence functions,
if the head of the agency has determined that reporting pursuant to
this section would endanger the safety of the employee or compromise
an ongoing investigation or intelligence mission.
   (d) (1) Employers shall submit a report as described in paragraph
(4) within 20 days of hiring any employee whom the employer is
required to report pursuant to this section.
   (2) Notwithstanding subdivision (a), employers transmitting
reports magnetically or electronically shall submit the report by two
monthly transmissions not less than 12 days and not more than 16
days apart.
   (3) For purposes of this section, an employer that has employees
in two or more states and that transmits reports magnetically or
electronically may designate one state in which the employer has
employees to which the employer will transmit the report described in
paragraph (4). Any employer that transmits reports pursuant to this
paragraph shall notify the Secretary of Health and Human Services in
writing as to which state the employer designates for the purpose of
sending reports.
   (4) The report shall contain the following:
   (A) The name, address, and social security number of the
employees.
   (B) The employer's name, address, state employer identification
number (if one has been issued), and identifying number assigned to
the employer under Section 6109 of the Internal Revenue Code of 1986.

   (C) The first date the employee worked.
   (5) Employers may report pursuant to this section by submitting a
copy of the employee's W-4 form, a form provided by the department,
or any other hiring document transmitted by first-class mail,
magnetically, or electronically.
   (e) For each failure to report the hiring of an employee, as
required and within the time required by this section, unless the
failure is due to good cause, the department may assess a penalty of
twenty-four dollars ($24), or four hundred ninety dollars ($490) if
the failure is the result of conspiracy between the employer and
employee not to supply the required report or to supply a false or
incomplete report.
   (f) (1) On and after January 1, 2013, and before January 1, 2019,
information collected pursuant to this section may be used for the
following purposes:
   (A) Administration of this code, including, but not limited to,
providing employer or employee information to participating members
of the Joint Enforcement Strike Force on the Underground Economy
pursuant to Section 329 for the purposes of auditing, investigating,
and prosecuting violations of tax and cash-pay reporting laws.
   (B) Locating individuals for purposes of establishing paternity
and establishing, modifying, and enforcing child support obligations.

   (C) Administration of employment security and workers'
compensation programs.
   (D) Providing employer or employee information to the Franchise
Tax Board and the State Board of Equalization for the purpose of tax
or fee enforcement.
   (E) Verification of eligibility of applicants for, or recipients
of, the public assistance programs listed in Section 1320b-7(b) of
Title 42 of the United States Code.
   (F) Providing employer or employee information to the Contractors'
State License Board and the State Compensation Insurance Fund for
the purpose of workers' compensation payroll reporting.
   (2) On and after January 1, 2019, information collected pursuant
to this section may be used for the following purposes:
   (A) Administration of this code.
   (B) Locating individuals for purposes of establishing paternity
and establishing, modifying, and enforcing child support obligations.

   (C) Administration of employment security and workers'
compensation programs.
   (D) Providing employer or employee information to the Franchise
Tax Board and to the State Board of Equalization for the purposes of
tax or fee enforcement.
   (E) Verification of eligibility of applicants for, or recipients
of, the public assistance programs listed in Section 1320b-7(b) of
Title 42 of the United States Code.
   (g) For purposes of this section, "employer" includes a labor
union hiring hall.
   (h) This section shall become operative on July 1, 1998.
  SEC. 7.3.  Section 1088.5 of the Unemployment Insurance Code is
amended to read:
   1088.5.  (a) In addition to information reported in accordance
with Section 1088, effective July 1, 1998, each employer shall file,
with the department, the information provided for in subdivision (b)
on new employees.
   (b) Each employer shall report the hiring of any employee who
works in this state and to whom the employer anticipates paying
wages, and also shall report the hiring of any employee who
previously worked for the employer but had been separated from that
prior employment for at least 60 consecutive days.
   (c) (1) This section shall not apply to any department, agency, or
instrumentality of the United States.
   (2) State agency employers shall not be required to report
employees performing intelligence or counterintelligence functions,
if the head of the agency has determined that reporting pursuant to
this section would endanger the safety of the employee or compromise
an ongoing investigation or intelligence mission.
   (d) (1) Employers shall submit a report as described in paragraph
(4) within 20 days of hiring any employee whom the employer is
required to report pursuant to this section.
   (2) Notwithstanding subdivision (a), employers transmitting
reports magnetically or electronically shall submit the report by two
monthly transmissions not less than 12 days and not more than 16
days apart.
   (3) For purposes of this section, an employer that has employees
in two or more states and that transmits reports magnetically or
electronically may designate one state in which the employer has
employees to which the employer will transmit the report described in
paragraph (4). Any employer that transmits reports pursuant to this
paragraph shall notify the Secretary of Health and Human Services in
writing as to which state the employer designates for the purpose of
sending reports.
   (4) The report shall contain the following:
   (A) The name, address, and social security number of the
employees.
   (B) The employer's name, address, state employer identification
number (if one has been issued), and identifying number assigned to
the employer under Section 6109 of the Internal Revenue Code of 1986.

   (C) The first date the employee worked.
   (5) Employers may report pursuant to this section by submitting a
copy of the employee's W-4 form, a form provided by the department,
or any other hiring document transmitted by first-class mail,
magnetically, or electronically.
   (e) For each failure to report the hiring of an employee, as
required and within the time required by this section, unless the
failure is due to good cause, the department may assess a penalty of
twenty-four dollars ($24), or four hundred ninety dollars ($490) if
the failure is the result of conspiracy between the employer and
employee not to supply the required report or to supply a false or
incomplete report.
   (f) (1) On and after January 1, 2013, and before January 1, 2019,
information collected pursuant to this section may be used for the
following purposes:
   (A) Administration of this code, including, but not limited to,
providing employer or employee information to participating members
of the Joint Enforcement Strike Force on the Underground Economy
pursuant to Section 329 for the purposes of auditing, investigating,
and prosecuting violations of tax and cash-pay reporting laws.
   (B) Locating individuals for purposes of establishing paternity
and establishing, modifying, and enforcing child support obligations.

   (C) Administration of employment security and workers'
compensation programs.
   (D) Providing employer or employee information to the Franchise
Tax Board and the State Board of Equalization for the purpose of tax
or fee enforcement.
   (E) Verification of eligibility of applicants for, or recipients
of, the public assistance programs listed in Section 1320b-7(b) of
Title 42 of the United States Code.
   (F) Providing employer or employee information to the Contractors'
State License Board and the State Compensation Insurance Fund for
the purpose of workers' compensation payroll reporting.
   (G) Providing employer or employee information to the State
Department of Health Care Services, the California Health Benefit
Exchange, the Managed Risk Medical Insurance Board, and county
departments and agencies for the purpose of:
   (i) Verifying or determining the eligibility of an applicant for,
or a recipient of, state health subsidy programs, limited to the
Medi-Cal program, provided pursuant to Chapter 7 (commencing with
Section 14000) of Part 3 of Division 9 of the Welfare and
Institutions Code, the Healthy Families Program, provided pursuant to
Part 6.2 (commencing with Section 12693) of Division 2 of the
Insurance Code, and the Access for Infants and Mothers Program,
provided pursuant to Part 6.3 (commencing with Section 12695) of
Division 2 of the Insurance Code, where the verification or
determination is directly connected with, and limited to, the
administration of the state health subsidy programs referenced in
this clause.
   (ii) Verifying or determining the eligibility of an applicant for,
or a recipient of, federal subsidies offered through the California
Health Benefit Exchange, provided pursuant to Title 22 (commencing
with Section 100500) of the Government Code, including federal tax
credits and cost-sharing assistance pursuant to the federal Patient
Protection and Affordable Care Act, (Public Law 111-148), as amended
by the federal Health Care and Education Reconciliation Act of 2010
(Public Law 111-152), where the verification or determination is
directly connected with, and limited to, the administration of the
California Health Benefit Exchange.
   (iii) Verifying or determining the eligibility of employees and
employers for health coverage through the Small Business Health
Options Program, provided pursuant to Section 100502 of the
Government Code, where the verification or determination is directly
connected with, and limited to the administration of the Small
Business Health Options Program.
   (2) On and after January 1, 2019, information collected pursuant
to this section may be used for the following purposes:
   (A) Administration of this code.
   (B) Locating individuals for purposes of establishing paternity
and establishing, modifying, and enforcing child support obligations.

   (C) Administration of employment security and workers'
compensation programs.
   (D) Providing employer or employee information to the Franchise
Tax Board and to the State Board of Equalization for the purposes of
tax or fee enforcement.
   (E) Verification of eligibility of applicants for, or recipients
of, the public assistance programs listed in Section 1320b-7(b) of
Title 42 of the United States Code.
   (F) Providing employer or employee information to the State
Department of Health Care Services, the California Health Benefit
Exchange, the Managed Risk Medical Insurance Board, and county
departments and agencies for the purpose of:
   (i) Verifying or determining the eligibility of an applicant for,
or a recipient of, state health subsidy programs, limited to the
Medi-Cal program, provided pursuant to Chapter 7 (commencing with
Section 14000) of Part 3 of Division 9 of the Welfare and
Institutions Code, the Healthy Families Program, provided pursuant to
Part 6.2 (commencing with Section 12693) of Division 2 of the
Insurance Code, and the Access for Infants and Mothers Program,
provided pursuant to Part 6.3 (commencing with Section 12695) of
Division 2 of the Insurance Code, where the verification or
determination is directly connected with, and limited to, the
administration of the state health subsidy programs referenced in
this clause.
   (ii) Verifying or determining the eligibility of an applicant for,
or a recipient of, federal subsidies offered through the California
Health Benefit Exchange, provided pursuant to Title 22 (commencing
with Section 100500) of the Government Code, including federal tax
credits and cost-sharing assistance pursuant to the federal Patient
Protection and Affordable Care Act, (Public Law 111-148), as amended
by the federal Health Care and Education Reconciliation Act of 2010
(Public Law 111-152), where the verification or determination is
directly connected with, and limited to, the administration of the
California Health Benefit Exchange.
   (iii) Verifying or determining the eligibility of employees and
employers for health coverage through the Small Business Health
Options Program, provided pursuant to Section 100502 of the
Government Code, where the verification or determination is directly
connected with, and limited to the administration of the Small
Business Health Options Program.
   (g) For purposes of this section, "employer" includes a labor
union hiring hall.
   (h) This section shall become operative on July 1, 1998.
  SEC. 8.  Section 1142 of the Unemployment Insurance Code is amended
to read:
   1142.  (a) If the director finds that any employer or any
employee, officer, or agent of any employer, in submitting facts
concerning the termination of a claimant's employment pursuant to
Section 1030, 1327, 3654, 3701, 4654, or 4701, willfully makes a
false statement or representation or willfully fails to report a
material fact concerning that termination, the director shall assess
a penalty of an amount not less than 2 nor more than 10 times the
weekly benefit amount of that claimant. The director shall assess
this penalty in the following manner:
   (1) If the director finds that the employer was at fault for
willfully making a false statement or representation or willfully
failing to report a material fact concerning that termination, the
director shall assess the penalty against the employer.
   (2) If the director finds that the agent of the employer was at
fault for willfully making a false statement or representation or
willfully failing to report a material fact concerning that
termination, the director shall assess the penalty against the agent
of the employer.
   (3) If the director finds that the employer and the agent of the
employer were both at fault for willfully making a false statement or
representation or willfully failing to report a material fact
concerning that termination, the director shall assess the penalty
against the employer and also shall assess another penalty against
the agent of the employer.
   (b) If the director finds that any employer or any employee,
officer, or agent of any employer, in submitting a written statement
concerning the reasonable assurance, as defined in subdivision (g) of
Section 1253.3, of a claimant's reemployment, as required by
subdivisions (b), (c), and (i) of Section 1253.3, willfully makes a
false statement or representation or willfully fails to report a
material fact concerning the reasonable assurance of that
reemployment, the director shall assess a penalty of an amount not
less than 2 nor more than 10 times the weekly benefit amount of that
claimant. The director shall assess this penalty in the following
manner:
   (1) If the director finds that the employer was at fault for
willfully making a false statement or representation or willfully
failing to report a material fact concerning the reasonable assurance
of that reemployment, the director shall assess the penalty against
the employer.
   (2) If the director finds that the agent of the employer was at
fault for willfully making a false statement or representation or
willfully failing to report a material fact concerning the reasonable
assurance of that reemployment, the director shall assess the
penalty against the agent of the employer.
   (3) If the director finds that the employer and the agent of the
employer were both at fault for willfully making a false statement or
representation or willfully failing to report a material fact
concerning the reasonable assurance of that reemployment, the
director shall assess the penalty against the employer and also shall
assess another penalty against the agent of the employer.
   (c) (1) This article, Article 9 (commencing with Section 1176) of
this chapter with respect to refunds, and Chapter 7 (commencing with
Section 1701) of this part with respect to collections shall apply to
the assessments provided by this section. Penalties collected under
this section shall be deposited in the contingent fund.
   (2) Notwithstanding Section 1586, additional penalties that are
assessed against an agent of the employer and collected pursuant to
paragraph (3) of subdivision (a) and paragraph (3) of subdivision (b)
shall be available for the purposes specified in Section 1586 upon
appropriation by the Legislature for those purposes.
  SEC. 9.  Section 1329.1 of the Unemployment Insurance Code is
amended to read:
   1329.1.  A claim for unemployment compensation benefits may be
canceled if all of the following apply:
                               (a) The individual has not been deemed
ineligible for unemployment compensation benefits.
   (b) The individual has not been overpaid unemployment compensation
benefits.
   (c) The individual has not been paid unemployment compensation
benefits.
   (d) The individual requests to cancel the claim during the benefit
year of that claim, or in the case of a claim for federal-state
extended duration benefits, during the extended duration period of
that claim.
  SEC. 10.  Section 1335 of the Unemployment Insurance Code is
amended to read:
   1335.  If an appeal is filed, benefits with respect to the period
prior to the final decision on the appeal shall be paid only after
the decision, except that:
   (a) If benefits for any week are payable in accordance with a
determination by the department irrespective of any decision on the
issues set forth in the appeal, such benefits shall be promptly paid
regardless of such appeal.
   (b) If an administrative law judge affirms a determination
allowing benefits, such benefits shall be promptly paid regardless of
any appeal which may thereafter be taken, and regardless of any
action taken under Section 1336 or otherwise by the director, appeals
board, or other administrative body or by any court.
   If the determination is finally reversed, no employer's account
shall be charged with benefits paid because of that determination,
except as provided in Section 1026, or if the department determines
pursuant to Section 1026.1 that the employer's reserve account should
not be credited.
   (c) If benefits for any week are payable in accordance with a
determination by the department, or an administrative law judge
issues a decision allowing benefits, the benefits shall be promptly
paid regardless of any appeal, and regardless of any action taken by
the appeals board pursuant to Section 412 or 413. If the
determination of the department or the decision of the administrative
law judge is finally reversed, no employer's reserve account shall
be charged with benefits paid pursuant to this subdivision, except as
provided in Section 1026 or if the department determines pursuant to
Section 1026.1 that the employer's reserve account should not be
credited.
  SEC. 11.  Section 1338 of the Unemployment Insurance Code is
amended to read:
   1338.  If the appeals board issues a decision allowing benefits
the benefits shall be paid regardless of any further action taken by
the director, the appeals board, or any other administrative agency,
and regardless of any appeal or mandamus, or other proceeding in the
courts. If the decision of the appeals board is finally reversed or
set aside, no employer's account shall be charged with the benefits
paid pursuant to this section, except as provided in Section 1026, or
if the department determines pursuant to Section 1026.1 that the
employer's reserve account should not be credited.
  SEC. 12.  Section 1375.1 of the Unemployment Insurance Code is
amended to read:
   1375.1.  If the director finds that an individual has been
overpaid unemployment compensation benefits because he or she
willfully, for the purpose of obtaining unemployment compensation
benefits, either made a false statement or representation, with
actual knowledge of the falsity thereof, or withheld a material fact,
the director shall assess against the individual an amount equal to
30 percent of the overpayment amount. Assessments collected under
this section shall be deposited in the following manner:
   (a) For penalty assessments established prior to October 22, 2013,
100 percent of the overpayment penalty amount in the Benefit Audit
Fund.
   (b) For penalty assessments established on or after October 22,
2013, as follows:
   (1) 50 percent of the overpayment penalty amount in the
Unemployment Trust Fund.
   (2) 50 percent of the overpayment penalty amount in the Benefit
Audit Fund.
  SEC. 13.  Section 1381 of the Unemployment Insurance Code is
amended to read:
   1381.  The director shall enforce collection of any judgment
obtained by the director under subdivision (a) or (b) of Section
1379. Amounts collected under this section shall be deposited in the
fund from which the overpayment was made, except that the amounts
collected to offset the costs of collections shall be deposited in
the Unemployment Administration Fund and the amounts collected
pursuant to Section 1375.1 shall be deposited as specified in that
section.
  SEC. 14.  Section 1521 of the Unemployment Insurance Code is
amended to read:
   1521.  The Unemployment Fund is continued in existence as a
special fund, separate and apart from all public money or funds of
this state. This fund shall consist of (1) all employer contributions
collected under this division; (2) interest earned upon any money in
the fund; (3) any property or securities acquired through the use of
money belonging to the fund; (4) all earnings of such property or
securities; (5) all money credited to this state's account in the
Unemployment Trust Fund pursuant to Section 903 of the Social
Security Act, as amended; (6) all assessments collected pursuant to
paragraph (1) of subdivision (b) of Section 1375.1; and (7) all other
money received for the fund from any other source. All money in the
fund shall be mingled and undivided.
   Notwithstanding Section 13340 of the Government Code, all money in
the Unemployment Fund and in the various accounts of that fund,
except any money deposited pursuant to Section 1528.5, is
continuously appropriated for the purposes authorized in this
article.
  SEC. 15.  Section 1595 of the Unemployment Insurance Code is
amended to read:
   1595.  There is in the State Treasury a special fund known as the
Employment Development Department Benefit Audit Fund. There shall be
deposited in, or transferred to, this fund those sums as specified
pursuant to Section 1375.1, except all interest collected shall be
deposited in this fund.
  SEC. 16.  Section 3701 of the Unemployment Insurance Code is
amended to read:
   3701.  (a) (1) An employer that is entitled under Section 3654 to
notice of the filing of a primary claim or additional claim and that,
within 10 days after mailing of the notice, submits to the
department any facts within its possession disclosing whether the
exhaustee left the most recent employment with the employer
voluntarily and without good cause or was discharged from the
employment for misconduct connected with his or her work, or whether
the claimant was a student employed on a temporary basis and whose
employment began within, and ended with his or her leaving to return
to school at the close of, his or her vacation period, or whether the
claimant left the employer's employ to accompany his or her spouse
or domestic partner to a place or join him or her at a place from
which it is impractical to commute to the employment, and to which a
transfer of the claimant by the employer is not available, or whether
the claimant's discharge or quit from his or her most recent
employer was the result of an irresistible compulsion to use or
consume intoxicants, including alcoholic beverages, or whether the
claimant left the employer's employ to protect his or her family or
himself or herself from domestic violence abuse, or whether the
claimant left the employer's employ to take a substantially better
job, shall be entitled to a ruling as prescribed by this section. The
period during which the employer may submit these facts may be
extended by the director for good cause.
   (2) For purposes of this section, "spouse" includes a person to
whom marriage is imminent, and "domestic partner" includes a person
to whom a domestic partnership, as described in Section 297 of the
Family Code, is imminent.
   (b) The department shall consider these facts together with any
information in its possession. If the employer is entitled to a
determination pursuant to Section 3655, the department shall promptly
notify the employer of its ruling as to the cause of the termination
of the exhaustee's most recent employment. The employer may appeal
from a ruling or reconsidered ruling to an administrative law judge
within 20 days after mailing or personal service of notice of the
ruling or reconsidered ruling. The 20-day period may be extended for
good cause, which shall include, but not be limited to, mistake,
inadvertence, surprise, or excusable neglect. The director shall be
an interested party to an appeal. The department may for good cause
reconsider a ruling or reconsidered ruling within either five days
after the date an appeal to an administrative law judge is filed or,
if an appeal is not filed, within 20 days after mailing or personal
service of notice of the ruling or reconsidered ruling, except that a
ruling or reconsidered ruling which related to a determination that
is reconsidered pursuant to subdivision (a) of Section 1332 may also
be reconsidered by the department within the time provided for
reconsideration of that determination.
   (c) For purposes of this section only, if the claimant voluntarily
leaves the employer's employ without notification to the employer of
the reasons therefor, and if the employer submits all of the facts
within its possession concerning the leaving within the applicable
time period referred to in this section, the leaving shall be
presumed to be without good cause.
   (d) An individual whose employment is terminated under the
compulsory retirement provisions of a collective bargaining agreement
to which the employer is a party shall not be deemed to have
voluntarily left his or her employment without good cause.
   (e) Rulings under this section shall have the effect prescribed by
Section 1032.
  SEC. 17.  Section 4701 of the Unemployment Insurance Code is
amended to read:
   4701.  (a) (1) An employer that is entitled under Section 4654 to
notice of the filing of an application or additional claim and who,
within 10 days after mailing of the notice, submits to the department
any facts within its possession disclosing whether the individual
left the most recent employment with the employer voluntarily and
without good cause or was discharged from the employment for
misconduct connected with his or her work, or whether the claimant
was a student employed on a temporary basis and whose employment
began within, and ended with his or her leaving to return to school
at the close of, his or her vacation period, or whether the claimant
left the employer's employ to accompany his or her spouse or domestic
partner to a place or to join him or her at a place from which it is
impractical to commute to the employment, and to which a transfer of
the claimant by the employer is not available, or whether the
claimant's discharge or quit from his or her most recent employer was
the result of an irresistible compulsion to use or consume
intoxicants, including alcoholic beverages, or whether the claimant
left the employer's employ to protect his or her family or himself or
herself from domestic violence abuse, or whether the claimant left
the employer's employ to take a substantially better job, shall be
entitled to a ruling as prescribed by this section. The period during
which the employer may submit these facts may be extended by the
director for good cause.
   (2) For purposes of this section, "spouse" includes a person to
whom marriage is imminent, and "domestic partner" includes a person
to whom a domestic partnership, as described in Section 297 of the
Family Code, is imminent.
   (b) The department shall consider the facts together with any
information in its possession. If the employer is entitled to a
determination pursuant to Section 4655, the department shall promptly
issue to the employer its ruling as to the cause of the termination
of the individual's most recent employment. The employer may appeal
from a ruling or reconsidered ruling to an administrative law judge
within 20 days after mailing or personal service of notice of the
ruling or reconsidered ruling. The 20-day period may be extended for
good cause, which shall include, but not be limited to, mistake,
inadvertence, surprise, or excusable neglect. The director shall be
an interested party to an appeal. The department may for good cause
reconsider a ruling or reconsidered ruling within either five days
after the date an appeal to an administrative law judge is filed or,
if no appeal is filed, within 20 days after mailing or personal
service of notice of the ruling or reconsidered ruling, except that a
ruling or reconsidered ruling that relates to a determination that
is reconsidered pursuant to subdivision (a) of Section 1332 may also
be reconsidered by the department within the time provided for
reconsideration of that determination.
   (c) For purposes of this section only, if the claimant voluntarily
leaves the employer's employ without notification to the employer of
the reasons therefor, and if the employer submits all of the facts
within its possession concerning the leaving within the applicable
time period referred to in this section, the leaving shall be
presumed to be without good cause.
   (d) An individual whose employment is terminated under the
compulsory retirement provisions of a collective bargaining agreement
to which the employer is a party shall not be deemed to have
voluntarily left his or her employment without good cause.
   (e) Rulings under this section shall have the effect prescribed by
Section 1032.
  SEC. 18.  Section 13021 of the Unemployment Insurance Code is
amended to read:
   13021.  (a) Every employer required to withhold any tax under
Section 13020 shall for each calendar quarter, whether or not wages
or payments are paid in the quarter, file a withholding report, a
quarterly return, as prescribed in subdivision (a) of Section 1088,
and a report of wages in a form prescribed by the department, and pay
over the taxes so required to be withheld. The report of wages shall
include individual amounts required to be withheld under Section
13020 or withheld under Section 13028. Except as provided in
subdivisions (c) and (d), the employer shall file a withholding
report, a quarterly return, as prescribed in subdivision (a) of
Section 1088, and a report of wages, and remit the total amount of
income taxes withheld during the calendar quarter on or before the
last day of the month following the close of the calendar quarter.
   (b) Every employer electing to file a single annual return under
subdivision (d) of Section 1110 shall report and pay any taxes
withheld under Section 13020 on an annual basis within the time
specified in subdivision (d) of Section 1110.
   (c) (1) Effective January 1, 1995, whenever an employer is
required, for federal income tax purposes, to remit the total amount
of withheld federal income tax in accordance with Section 6302 of the
Internal Revenue Code and regulations thereunder, and the
accumulated amount of state income tax withheld is more than five
hundred dollars ($500), the employer shall remit the total amount of
income tax withheld for state income tax purposes within the number
of business days as specified for withheld federal income taxes by
Section 6302 of the Internal Revenue Code, and regulations
thereunder.
   (2) Effective January 1, 1996, the five hundred dollar ($500)
amount referred to in paragraph (1) shall be adjusted annually as
follows, based on the annual average rate of interest earned on the
Pooled Money Investment Account as of June 30 in the prior fiscal
year:
Average Rate of Interest
Greater than or equal to 9                 $ 75
percent:
Less than 9 percent, but greater than
or equal
to                                          250
7 percent:
Less than 7 percent, but greater than
or equal
to                                          400
4 percent:
Less than 4       percent:                  500


   (d) (1) Notwithstanding subdivisions (a) and (c), for calendar
years beginning prior to January 1, 1995, if in the 12-month period
ending June 30 of the prior year the cumulative average payment made
pursuant to this division or Section 1110, for eight-month periods,
as defined under Section 6302 of the Internal Revenue Code and
regulations thereunder, was fifty thousand dollars ($50,000) or more,
the employer shall remit the total amount of income tax withheld
within three banking days following the close of each eight-month
period, as described by Section 6302 of the Internal Revenue Code and
regulations thereunder. For purposes of this subdivision, payment
shall be made by electronic funds transfer in accordance with Section
13021.5, for one calendar year beginning on January 1. Payment is
deemed complete on the date the electronic funds transfer is
initiated if settlement to the state's demand account occurs on or
before the banking day following the date the transfer is initiated.
If settlement to the state's demand account does not occur on or
before the banking day following the date the transfer is initiated,
payment is deemed complete on the date settlement occurs. The
department shall, on or before October 31 of the prior year, notify
all employers required to make payment by electronic funds transfer
of these requirements.
   (2) Notwithstanding subdivisions (a) and (c), for calendar years
beginning on or after January 1, 1995, if in the 12-month period
ending June 30 of the prior year, the cumulative average payment made
pursuant to this division or Section 1110 for any deposit periods,
as described under Section 6302 of the Internal Revenue Code and
regulations thereunder, was twenty thousand dollars ($20,000) or
more, the employer shall remit the total amount of income tax
withheld within the number of business days as specified for federal
income taxes by Section 6302 of the Internal Revenue Code and
regulations thereunder. For purposes of this subdivision, payment
shall be made by electronic funds transfer in accordance with Section
13021.5, for one calendar year beginning on January 1. Payment is
deemed complete on the date the electronic funds transfer is
initiated if settlement to the state's demand account occurs on or
before the business day following the date the transfer is initiated.
If settlement to the state's demand account does not occur on or
before the business day following the date the transfer is initiated,
payment is deemed complete on the date settlement occurs. The
department shall, on or before October 31 of the prior year, notify
all employers required by this paragraph to make payments by
electronic funds transfer of these requirements.
   (3) Notwithstanding paragraph (2), effective January 1, 1995,
electronic funds transfer payments that are subject to the one-day
deposit rule, as described by Section 6302 of the Internal Revenue
Code and regulations thereunder, shall be deemed timely if the
payment settles to the state's demand account within three business
days after the date the employer meets the threshold for the one-day
deposit rule.
   (4) Any taxpayer required to remit payments pursuant to paragraphs
(1) and (2) may request from the department a waiver of those
requirements. The department may grant a waiver only if it determines
that the particular amounts paid in excess of fifty thousand dollars
($50,000) or twenty thousand dollars ($20,000), as stated in
paragraphs (1) and (2), respectively, were the result of an
unprecedented occurrence for that employer, and were not
representative of the employer's cumulative average payment in prior
years.
   (5) A state agency required to remit payments pursuant to
paragraphs (1) and (2) may request a waiver of those requirements
from the department. The department may grant a waiver if it
determines that there will not be a negative impact on the interest
earnings of the General Fund. If there is a negative impact to the
General Fund, the department may grant a waiver if the requesting
state agency follows procedures designated by the department to
mitigate the impact to the General Fund.
   (e) An employer not required to make payment pursuant to
subdivision (d) may elect to make payment by electronic funds
transfer in accordance with Section 13021.5 under the following
conditions:
   (1) The election shall be made in a form, and shall contain
information, as prescribed by the director, and shall be subject to
approval by the department.
   (2) If approved, the election shall be effective on the date
specified in the notification to the employer of approval.
   (3) The election shall be operative from the date specified in the
notification of approval, and shall continue in effect until
terminated by the employer or the department.
   (4) Funds remitted by electronic funds transfer pursuant to this
subdivision shall be deemed complete in accordance with subdivision
(d) or as deemed appropriate by the director to encourage use of this
payment method.
   (f) Notwithstanding Section 1112, interest and penalties shall not
be assessed against an employer that remits at least 95 percent of
the amount required by subdivision (c) or (d) if the failure to remit
the full amount is not willful and any remaining amount due is paid
with the next payment. The director may allow any employer to submit
the amounts due from multiple locations upon a showing that those
submissions are necessary to comply with subdivision (c) or (d).
   (g) The department may, if it believes that action is necessary,
require any employer to make the report or return required by this
section and pay to it the tax deducted and withheld at any time, or
from time to time but no less frequently than provided for in
subdivision (a).
   (h) An employer required to withhold any tax and that is not
required to make payment under subdivision (c) shall remit the total
amount of income tax withheld during each month of each calendar
quarter, on or before the 15th day of the subsequent month if the
income tax withheld for any of the three months or, cumulatively for
two or more months, is three hundred fifty dollars ($350) or more.
   (i) For purposes of subdivisions (a), (c), and (h), payment is
deemed complete when it is placed in a properly addressed envelope,
bearing the correct postage, and it is deposited in the United States
mail.
   (j) (1) In addition to the withholding report, quarterly return,
and report of wages described in subdivision (a), each employer shall
file with the director an annual reconciliation return showing the
amount required to be withheld under Section 13020, and any other
information the director shall prescribe. This annual reconciliation
return shall be due on the first day of January following the close
of the prior calendar year and shall become delinquent if not filed
on or before the last day of that month.
   (2) The requirement to file the annual reconciliation return for
the prior calendar year under this subdivision shall not apply to the
2012 calendar year and thereafter.
   (k) The requirement in subdivision (a) to file a quarterly return
shall begin with the first calendar quarter of the 2011 calendar
year.
   (l) The changes made to this section by the act adding this
subdivision shall apply on and after January 1, 2013.
  SEC. 19.  Section 13021.5 of the Unemployment Insurance Code is
amended to read:
   13021.5.  (a) "Electronic funds transfer" means a transfer of
funds, other than a transaction originated by check, draft, or
similar paper instrument, that is initiated through an electronic
terminal, telephonic instrument, or computer or magnetic tape, so as
to order, instruct, or authorize a financial institution to debit or
credit an account. Electronic funds transfers shall be accomplished
by an automated clearinghouse debit, an automated clearinghouse
credit, Fedwire, or by other specific electronic funds transfer
methods approved in advance by the department.
   (b) "Automated clearinghouse" means a federal reserve bank, or an
organization established in agreement with the National Automated
Clearing House Association, that operates as a clearinghouse for
transmitting or receiving entries between banks and/or bank accounts
and which authorizes an electronic transfer of funds between those
banks or bank accounts.
   (c) "Automated clearinghouse debit" means a transaction in which
the state, through its designated depository bank, originates an
automated clearinghouse transaction debiting the employer's bank
account and crediting the state's bank account for the amount of tax.
Banking costs incurred for the automated clearinghouse debit
transaction shall be paid by the state.
   (d) "Automated clearinghouse credit" means an automated
clearinghouse transaction in which the employer, through its own
bank, originates an entry crediting the state's bank account and
debiting its own bank account. Banking costs incurred for the
automated clearinghouse credit transaction charged to the employer
and to the state shall be paid by the employer.
   (e) "Fedwire" means a transaction originated by the employer and
utilizing the national electronic payment system to transfer funds
through the federal reserve banks, pursuant to which the employer
debits its own bank account and credits the state's bank account.
Electronic funds transfer payments may be made by Fedwire only if
prior approval is obtained from the department and payment cannot,
for good cause, be made pursuant to subdivision (a). Banking costs
incurred for the Fedwire transaction charged to the employer and to
the state shall be paid by the employer.
   (f) "Business day" means any day other than a Saturday, Sunday,
legal holiday as recognized by the Internal Revenue Service,
statewide legal holiday as recognized by the State of California
pursuant to Section 6700 of the Government Code, or a day in which
the department is closed pursuant to Section 12b of the Code of Civil
Procedure.
   (g) "Settlement date" means the date on which an exchange of funds
with respect to an entry is reflected on the books of the Federal
Reserve Bank.
   (h) For the purposes of Section 13021, the "cumulative average
payment" means the cumulative dollar amount of deposits divided by
the number of payments submitted during a given period. For the
purposes of this section, the "cumulative average payment" may also
be defined as a single annual deposit, when only one payment is made
during the 12-month period ending June 30.
  SEC. 20.  (a) Section 7.1 of this bill incorporates amendments to
Section 1088.5 of the Unemployment Insurance Code proposed by both
this bill and Assembly Bill 174. It shall only become operative if
(1) both bills are enacted and become effective on or before January
1, 2013, (2) each bill amends Section 1088.5 of the Unemployment
Insurance Code, and (3) Assembly Bill 1794 is not enacted or as
enacted does not amend that section, and (4) this bill is enacted
after Assembly Bill 174, in which case Sections
                         7, 7.2, and 7.3 of this bill shall not
become operative.
   (b) Section 7.2 of this bill incorporates amendments to Section
1088.5 of the Unemployment Insurance Code proposed by both this bill
and Assembly Bill 1794. It shall only become operative if (1) both
bills are enacted and become effective on or before January 1, 2013,
(2) each bill amends Section 1088.5 of the Unemployment Insurance
Code, (3) Assembly Bill 174 is not enacted or as enacted does not
amend that section, and (4) this bill is enacted after Assembly Bill
1794 in which case Sections 7, 7.1, and 7.3 of this bill shall not
become operative.
   (c) Section 7.3 of this bill incorporates all of the substantive
amendments to Section 1088.5 of the Unemployment Insurance Code
proposed by this bill, Assembly Bill 174, and Assembly Bill 1794. It
shall only become operative if (1) all three bills are enacted and
become effective on or before January 1, 2013, (2) all three bills
amend Section 1088.5 of the Unemployment Insurance Code, and (3) this
bill is enacted after Assembly Bill 174 and Assembly Bill 1794, in
which case Sections 7, 7.1, and 7.2 of this bill shall not become
operative.