Senate Bill No. 339

Introduced by Senator Gaines

February 23, 2015

An act to amend Section 101 of the Unemployment Insurance Code, relating to unemployment compensation.

LEGISLATIVE COUNSEL’S DIGEST

SB 339, as introduced, Gaines. Unemployment compensation: payroll tax.

Existing federal law, the Federal Unemployment Tax Act, levies a payroll tax on employers and provides a credit against this tax for contributions made to certified state unemployment compensation programs. Existing law requires employers to contribute to the Unemployment Fund for the purpose of funding unemployment benefits for qualified individuals. Existing law provides that the provisions requiring employer contributions to the Unemployment Fund will become inoperative, and the provisions for payment of unemployment benefits will cease, if the federal law establishing the state credit against the federal payroll tax is repealed or otherwise affected in such a way that all or any part of an employer’s contributions to the Unemployment Fund are no longer credited against the federal tax.

This bill would make technical, nonsubstantive changes to these provisions.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 101 of the Unemployment Insurance
Code is amended to read:

101.  

This part is a part of a national plan of unemployment
reserves and social security, and is enacted for the purpose of
assisting in the stabilization of employment conditions. The
imposition of the tax herein imposed upon California industry
alone, without a corresponding tax being imposed upon all industry
in the United States, would, by the corresponding penalty upon
California industry, defeat the begin delete very end delete purposes of this law as set forth
in this article. Therefore when existing federal legislation which
provides for a tax upon the payment of wages by employers in this
State, against which all or any part of the employer contributions
required under this part may be credited is repealed, amended,
interpreted, affected or otherwise changed in such manner that no
portion of begin delete such end delete begin insert the employer’s end insert contributions may be begin delete thus end delete credited,
then upon the date of begin delete such end delete begin insert that end insert change, the provisions of this part
requiring employer contributions and providing for payment of
unemployment compensation benefits shall cease to be operative
and any assets in the Unemployment Fund or Unemployment
Administration Fund shall in the discretion of the State Treasurer
be held in the then existing depositaries or otherwise in the State
Treasury. In the case of the Unemployment Administration Fund,
begin delete such end delete begin insert the end insert money may begin delete thereafter end delete be dealt with by the State Treasurer
pursuant to the conditions of the grant thereof to the State by the
United States Government or agency thereof.