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| Montana Administrative Register Notice 24-11-275 | No. 18 09/19/2013 | |
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BEFORE THE DEPARTMENT OF LABOR AND INDUSTRY OF THE STATE OF MONTANA
TO: All Concerned Persons
1. On October 16, 2013, at 1:00 p.m., the Department of Labor and Industry will hold a public hearing in the Sanders Auditorium of the DPHHS Building, 111 North Sanders, Helena, Montana, to consider the proposed adoption, amendment, and repeal of the above-stated rules.
2. The Department of Labor and Industry (department) will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact the department no later than 5:00 p.m. on October 9, 2013, to advise us of the nature of the accommodation that you need. Please contact Don Gilbert, Department of Labor and Industry, P.O. Box 8020, Helena, MT 59624-8020; telephone (406) 444-4336; fax (406) 444-2993; TDD/Montana Relay Service (406) 444-5529; or e-mail dgilbert@mt.gov.
3. The rules as proposed to be adopted provide as follows:
NEW RULE I EMPLOYER LOSS OF INTERESTED PARTY STATUS (1) The department shall determine an employer forfeited the right to participate as an interested party in the adjudication of an unemployment insurance claim when the employer: (a) fails to respond within eight days of a department request for information related to a claimant's wage, employment, separation and eligibility for benefits, in accordance with ARM 24.11.450A; or (b) fails to provide an adequate response to a relevant and material question regarding a claim for benefits posed by the department. (2) For the purpose of this rule, "adequate response" means an accurate and complete answer by an employer to each relevant and material question posed by the department. Examples of employer responses, which the department may determine to be inadequate, include, but are not limited to, the following: (a) answering a relevant and material department question with "not applicable" or "unknown at this time"; (b) failing to submit copies of written employee discipline or details of verbal employee discipline when the employer alleges misconduct; (c) neglecting to provide a detailed description, upon request, of the final incident that triggered the claimant's separation from employment; (d) failing to provide written statements by a workplace witness when requested by the department; or (e) failing to provide a copy of the employer's rule or policy when employer alleges claimant was discharged for violation of the rule or policy. (3) The department shall provide written notice to the employer of a determination that the employer forfeited the right to participate as an interested party to the adjudication of a claim. Following the employer's forfeiture, the employer may participate as an informational witness only. (4) An employer may appeal the department's determination in accordance with the procedures of 39-51-2402, MCA, and ARM 24.11.450A. (5) The employer and the department are the only interested parties to the adjudication of an employer's forfeit of interested party status. (6) The department may rescind the employer's forfeit of interested party status only when good cause is demonstrated, as defined by ARM 24.11.204. The employer bears the burden of showing good cause for the employer's untimely or inadequate response. (7) When an employer forfeits interested party status in the adjudication of a particular claim, the employer also forfeits the following: (a) the right to appeal a department decision regarding the adjudication of that benefit claim; and (b) the right to credit for a benefit overpayment created by the employer's untimely or inadequate response.
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-605, MCA
REASON: The Trade Adjustment Assistance Extension Act of 2011, Public Law 112-40, which was enacted on October 21, 2011, requires that state unemployment insurance programs enact measures to ensure that employers respond to program requests for information regarding claims in a timely and adequate manner. The 2013 Montana Legislature enacted 39-51-605, MCA, Chap. 203, Sec. 1, L. 2013 (HB 127), which establishes that an employer forfeits the right to participate as an interested party in the adjudication of a claim for benefits when the employer, without good cause, fails to timely or adequately answer the department's questions regarding the circumstances of a former employee's separation from employment. The law provides that an employer also forfeits the right to appeal a department decision and the right to credit for any overpayment that may have resulted from the employer's failure to timely and adequately address the department's material and relevant questions regarding an employee's separation.
The department determines it is reasonable and necessary to propose New Rule I to clarify that an employer forfeits its interested party status and the right to receive credit for any overpayment created by the employer's untimely or inadequate response. The proposed new rule is also necessary to outline the process for an employer to appeal the department's determination that an employer has forfeited its right to participate as an interested party. The department used the term forfeit to distinguish from the use of the term waive because waivers can be granted by the department for overpayments. The department doesn't want customers to confuse the two situations. However, the forfeiture required by this rule acts as a legal waiver of rights.
NEW RULE II RELIEF OF CHARGES TO EMPLOYERS (1) Except as provided in [NEW RULE I], the department shall relieve the charge to an employer's experience-rated account for benefits paid to a claimant who was discharged for misconduct or voluntarily left work without good cause attributable to the employment, in accordance with 39-51-2302 and 39-51-2303, MCA. (2) The department shall also relieve the charge to an employer's experience-rated account for the benefits paid to a claimant who voluntarily left work for the following reasons: (a) the department reached an individualized determination that the claimant left work that was unsuitable for the claimant, pursuant to ARM 24.11.485; (b) the claimant left work within 30 days of resuming a state-approved training program, pursuant to ARM 24.11.475; (c) the claimant left work or was discharged due to circumstances resulting from domestic violence, sexual assault, or stalking of claimant or claimant's child, pursuant to 39-51-2111, MCA; (d) the claimant left temporary work, accepted during a period of unemployment, in order to return immediately to work for claimant's regular employer, pursuant to 39-51-2302, MCA; (e) the claimant left work due to the mandatory military transfer of the claimant's spouse, pursuant to 39-51-2302, MCA; or (f) the claimant's job was unavailable after claimant was ordered into military service for a period of less than six weeks, pursuant to 39-51-2302, MCA. (3) The department shall assign the costs of benefits paid to claimants under (2) to the unemployment insurance trust fund.
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-1214, 39-51-2111, 39-51-2116, 39-51-2302, 39-51-2303, MCA
REASON: The department determined it is necessary to propose NEW RULE II to avoid confusion regarding the circumstances in which the department will assign the costs of benefits paid to the unemployment insurance tax fund rather than charge the employer's experience rating account. The 2013 Montana Legislature amended 39-51-1214, MCA, Chap. 287, Sec. 1, L. 2013 (SB 128). The amended statute mandates that employers may not be charged for benefits paid to workers who were discharged for misconduct or voluntarily terminated their services without good cause attributable to the employment. SB 128 further directs that "the department shall determine a claimant left work with good cause attributable to employment" when the claimant left unsuitable work or left within 30 days of returning to state-approved training. The department finds SB 128 implies, but does not mandate, that employers will be charged for benefits paid to workers in these two circumstances, which conflicts with the statutes and rules governing Montana's unemployment insurance program.
The department charges employers for the benefits paid to workers who voluntarily terminate their services only when the employment, itself, gave the worker a compelling reason to leave and the worker meets all other criteria set forth by statute and rule. Conversely, the department does not charge the employer for benefits paid to a worker who left unsuitable work or left work within 30 days of returning to state-approved training because the employer and the employment, itself, was not at fault in the worker's decision to terminate services.
By proposed NEW RULE II, the department reiterates all circumstances in which benefits paid will not be charged to an employer's experience rating account because the "good cause" for the worker's decision to terminate services was not attributable to the employment. The proposed rule further clarifies that the costs of benefits paid under the listed circumstances, instead, will be assigned to the unemployment insurance trust fund.
4. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:
24.11.204 DEFINITIONS The terms used by the department are, in great part, defined in 39-51-201 through 39-51-205, MCA. In addition to these statutory definitions, the following definitions apply to this chapter, unless context or the particular rule provides otherwise: (1) through (17) remain the same. (18) "Good cause" means reasonably compelling circumstances which did not result from any act or omission on the part of the person or business entity claiming good cause and which could not be overcome by reasonable diligence (19) through (43) remain the same.
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-201, 39-51-605, 39-51-2111, 39-51-2112, 39-51-2115, 39-51-2116, 39-51-2304, MCA
REASON: The department determines it is reasonable and necessary to clarify that a business entity, as well as an individual person, may demonstrate good cause for an action or inaction, which resulted in a determination by the department that was adverse to the interest of the business entity.
24.11.207 INTERESTED PARTY (1) and (2) remain the same. (3) Except as provided by 39-51-605, MCA, and [NEW RULE I], an employer who paid wages to the claimant is an interested party to proceedings that adjudicate the claimant's separation from employment with that employer. Proceedings that adjudicate the claimant's separation from employment during the base period of a claim determine whether any portion of benefits paid to a claimant are chargeable to the base period employer's account pursuant to 39‑51‑1125, 39-51-1212, or 39‑51‑1214, MCA. An employer is not an interested party to proceedings that adjudicate nonseparation issues related to a claim. (4) through (7) remain the same.
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-605, Title 39, chapter 51, parts 11 and 12, 21 through 24, and 32, MCA
REASON: HB 127 mandates that an employer waives the right to participate as an interested party in the adjudication of a benefit claim when the employer fails to timely and adequately respond to the material and relevant questions of the department regarding a former employee's separation from employment. Consequently, the department determines the proposed amendment is necessary to bring the rule into conformity with HB 127.
24.11.335 SUBPOENAS (1) The appeals referee may issue subpoenas on the referee's own motion or may issue up to three to an interested (2) When an interested party requires more than three subpoenas, the party must file a written request with the Hearings Bureau, which specifies the following: (a) expected content of evidence or witness testimony; (b) necessity of the witness' testimony; (c) refusal of the witness to testify voluntarily; and (d) how the testimony of each witness differs from the expected testimony of other witnesses. (3) A requested subpoena will not be issued when the hearing officer determines a subpoena is unduly burdensome or the expected witness testimony will be unnecessarily repetitive or irrelevant. (2) remains the same but is renumbered (4).
AUTH: 39-51-302, MCA IMP: 39-51-1109, 39‑51-2403, MCA
REASON: The Hearings Bureau of the department has received a significant number of requests by interested parties for 10 or 15 subpoenas in unemployment insurance benefit claim cases. The department determines that, in some cases, the inordinate number of subpoenas served to harass the other party and did not result in new, relevant information pertinent to the issue to be decided at the hearing. Therefore, the department determines it is reasonable to limit the number of subpoenas an interested party may freely request to three, and require an interested party to justify each request for an additional subpoena to prevent irrelevant or duplicative evidence at the hearing.
24.11.450A NONMONETARY DETERMINATIONS AND REDETERMINATIONS (1) and (2) remain the same. (3) Interested parties shall respond to all department requests for information pertinent to an investigation within eight days of the request, unless the delay in responding was for "good cause" as defined in ARM 24.11.204. When (4) through (13) remain the same.
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-605, 39-51-2202, 39-51-2203, 39-51-2205, 39-51-2301 through 39-51-2304, 39-51-2402, 39-51-2507, 39-51-2508, 39-51-2511, 39-51-2602, 39-51-3201, 39-51-3202, 39-51-3206, MCA
REASON: Section 39-51-605, MCA, which was enacted by the 2013 Montana Legislature (HB 127) mandates that an employer waives the right to participate as an interested party in the adjudication of a benefit claim when the employer fails to timely and adequately respond to the material and relevant questions of the department regarding a former employee's separation from employment. Consequently, the department determines the proposed amendment is necessary to bring the rule into conformity with 39-51-605, MCA.
24.11.452A ELIGIBILITY FOR BENEFITS (1) through (4) remain the same. (5) The department shall determine a claimant to be ineligible for benefits when, without good cause, the claimant: (a) remains the same. (b) fails to provide information requested by the department for the proper administration of the claim within eight days of the date of a mailed, faxed, or telephoned request; (c) fails to provide the department with updated contact information within three days of a change to claimant's mailing address. Claimants are urged to also provide the department with updated telephone number(s), e-mail address and, if applicable, fax number. The department shall reinstate a claimant's eligibility for benefits upon department receipt of the updated mailing address; or (c) remains the same but is renumbered (d). (6) remains the same.
AUTH: 39-51-301, 39‑51-302, MCA IMP: 39-51-504, 39-51-2101, 39-51-2104, 39‑51‑2115, 39-51-2304, MCA
REASON: The department determines the proposed amendment is necessary to clarify that claimants must immediately update their mailing address so the department is able to correspond with claimants in a timely manner concerning their claim. The department has encountered an increasing number of inaccurate mailing addresses for claimants. While the department urges claimants to provide updated contact information by means of the telephone, e-mail, or facsimile, an accurate mailing address is essential for the timely adjudication of a claim. Prompt communication between the department and a claimant is essential for the processing of claims; addressing issues that arise in the payment or nonpayment of weekly claims; notification of reemployment opportunities, termination date for "job-attached" or Job Service registration status, and verification of a change in the claimant's bank account PIN number. Failure of a claimant to timely update claimant's mailing address can result in the creation of an overpayment, the inability of the claimant to file a timely appeal, or the denial of benefits. The department determines that three days is a reasonable time in which claimants must inform the department of a change in their mailing address.
24.11.485 SUITABLE WORK (1) remains the same. (2) The department shall allow claimant (3) To determine whether (a) prospects for reemployment in claimant's customary occupation or comparable work; (b) claimant's prior earnings and length of claimant's current unemployment: (i) during the first half of the benefit entitlement period, work is suitable when it pays the prevailing wage in the locality for claimant's customary occupation or comparable work; (ii) after 13 weeks of paid benefits (iii) work is not suitable when the offered wage is substantially less favorable to the claimant than the prevailing wage for similar work in the locality; (c) claimant's prior work experience, training, education, and occupational licensure: (i) work in related occupations becomes suitable when claimant has no realistic expectation of obtaining employment in an occupation that utilizes claimant's highest skill level; and (ii) after 13 weeks of paid benefits (d) through (i) remain the same. (4) and (5) remain the same.
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-2101, 39-51-2112, 39-51-2115, 39-51-2304, MCA
REASON: The proposed rule amendment is necessary to bring this rule into conformity with 39-51-2304(4), MCA, which specifies that after 13 weeks of unemployment, suitable work is work that pays at least 75 percent of the claimant's prior earnings.
24.11.613 CHARGING BENEFIT PAYMENTS TO EXPERIENCE-RATED EMPLOYERS–CHARGEABLE EMPLOYERS (1) Benefit payments are charged to each employer who paid wages to the claimant during the base period. The charge will be based on the percentage of wages the employer paid to the claimant during the base period. For example, if the claimant earned 10 (a) If more than one separation (b) The department's determination concerning a separation (2) remains the same. (3) When the first benefit check is issued, the department mails a "Potential (a) As provided in 39-51-1214, MCA, the department reviews the information submitted by the employer and issues a determination notice stating whether (b) An employer has eight calendar days from the date of the notice to respond to the "Potential (c) If the employer provides the department with information that justifies (d) remains the same. (4) Within 60 days of the end of each calendar quarter, the department mails to the employer a statement of benefits charged to the employer's account. This statement is the "Quarterly Statement of Benefits Paid" and is for informational purposes only since any appeal must be made from the "Potential (a) through (c) remain the same.
AUTH: 39‑51-301, 39-51-302, MCA IMP: 39-51-1214, MCA
REASON: By rule amendment in 2011, the department clarified the definition of "separation" from employment in ARM 24.11.204 to mean "any reduction in a worker's hours of insured work for a particular employer." (See MAR Notice No. 24-11-270.) While the alternative phrase "severance of employment" indicates a complete cessation of work, the department finds the distinction is neither useful nor relevant. Consequently, the department determines that it is reasonable to delete the phrase "severance of employment" from this rule as unnecessary.
Because New Rule II outlines the various circumstances in which an employer will not be charged for benefits paid to a claimant, the department determines it is necessary to provide reference in this rule to the statutory bases for claimant disqualification for unemployment insurance benefits. Section 39-51-2302, MCA, fully describes the disqualification of claimants for "leaving work without good cause" and 39-51-2303, MCA, fully describes discharge for "misconduct."
24.11.616 BENEFIT OVERPAYMENTS–CREDITING EMPLOYER ACCOUNTS (1) The department shall determine an employer forfeited the right to credit for a benefit overpayment whenever the department determines an employer forfeited the right to participate as an interested party and the right to appeal in the adjudication of an unemployment insurance claim, pursuant to 39-51-605, MCA, and [NEW RULE I]. (2) and (3) remain the same but are renumbered (3) and (4).
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-605, 39-51-1110, MCA
REASON: Section 39-51-605, MCA, enacted by the 2013 Legislature (HB 127), mandates that the employer who provides untimely or inadequate information in response to a department request for information, without good cause, must be denied credit for any subsequent erroneous payments made to the claimant. The proposed amendment is necessary to clarify that only employers that have not forfeited their right to a credit, pursuant to 39-51-605, MCA, are qualified to receive credit to the employer's experience-rated account for a benefit overpayment.
24.11.1205 BENEFIT OVERPAYMENTS–NOTICES AND APPEAL RIGHTS (1) The department shall notify claimants (a) non-monetary determinations; (b) appeal (c) revised monetary determinations. (2) If a decision or determination described in (1) results in a benefit overpayment, the department shall provide the claimant (3) A claimant may appeal the non-monetary determination, appeal
AUTH: 39-51-301, 39‑51-302, MCA IMP: 39-51-3206, MCA
REASON: The proposed rule amendment is necessary to implement HB 127 by adding any penalty the department has assessed for fraudulent behavior to the overpayment a claimant must pay back to the department. The amendment is also necessary to correct the citation to the administrative rule related to benefit overpayment waivers.
24.11.1209 FRAUDULENT BENEFIT OVERPAYMENTS–ADMINISTRATIVE PENALTIES (1) remains the same. (2) The penalty referred to in 39-51-3201
AUTH: 39‑51-301, 39-51-302, MCA IMP: 39-51-3201, 39-51-3202, 39-51-3203, 39‑51‑3206, MCA
REASON: HB 127 established the fraudulent benefit overpayment penalty as 50 percent of the fraudulently obtained benefits. The proposed amendment is necessary to bring the rule into conformity with the statute.
5. The department proposes to repeal the following rule:
24.11.461 SPECIFIC ACTS OF MISCONDUCT
AUTH: 39-51-301, 39-51-302, MCA IMP: 39-51-2303, MCA
REASON: The 2013 Montana Legislature enacted SB 127, which incorporated the language of ARM 24.11.461, almost completely verbatim, into the statutory definitions governing the unemployment insurance program. Consequently, the department determines that the rule is unnecessary and merely redundant.
6. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Don Gilbert, Department of Labor and Industry, P.O. Box 8020, Helena, MT 59624-8020; telephone (406) 444-4336; fax (406) 444-2993; TDD/Montana Relay Service (406) 444-5529; or e-mail dgilbert@mt.gov., and must be received no later than 5:00 p.m., October 25, 2013.
7. Peggy Harper, Department of Labor and Industry, Hearings Bureau, has been designated to preside over and conduct this hearing.
8. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 6 above or may be made by completing a request form at any rules hearing held by the department.
9. An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register. The Secretary of State strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.
10. The bill sponsor contact requirements of 2-4-302, MCA, apply and have been fulfilled. The primary bill sponsor was contacted by e-mail and telephone on June 10, 2013 during the initial stage of rule drafting.
11. With regard to the requirements of 2-4-111, MCA, the department conducted a small business impact analysis and determined that there will not be significant, direct impact upon small employers as a result of the adoption of proposed NEW RULES I and II. A copy of the department's small business impact analysis is available on request from Don Gilbert, Department of Labor and Industry, P.O. Box 8020, Helena, MT 59624-8020; telephone (406) 444-4336; fax (406) 444-2993; TDD/Montana Relay Service (406) 444-5529; or e-mail dgilbert@mt.gov.
/s/ Judy Bovington /s/ Pam Bucy Judy Bovington Pam Bucy Rule Reviewer Commissioner of Labor Department of Labor and Industry
Certified to the Secretary of State September 9, 2013.
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A directory of state agencies is available online at http://www.mt.gov/govt/agencylisting.asp.
For questions about the organization of the ARM or this web site, contact sosarm@mt.gov.
