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HB2690 - 572R - H Ver
House Engrossed
unemployment
benefits; requirements; disqualifications; determinations.
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HOUSE BILL 2690
AN
ACT
amending sections 23-634.01, 23-762,
23-763, 23-771, 23-773 and 23-776, Arizona Revised Statutes; relating to
employment security.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it
enacted by the Legislature of the State of Arizona:
Section
1.
1. Section
23-634.01, Arizona Revised Statutes, is amended to read:
START_STATUTE
23-634.01.
Denial of benefits for failure to accept suitable work or
actively seek work; definition
A. Notwithstanding section 23-776, an
individual who is found by the department, with respect to any week in an
eligibility period
which
that
begins
from and after April 4, 1981, to have failed to apply for or accept available
suitable work to which
he
the individual
was
referred by the department or to have failed to actively engage in seeking work
is disqualified from receiving extended benefits. The
disqualification shall begin with the week in which the failure occurred and
continue until the individual has been employed in each of four subsequent
weeks, whether or not consecutive, and has earned remuneration equal to
not less than
at least
four times
his
the individual's
weekly benefit
amount.
B. An individual shall not be denied extended
benefits for failure to accept an offer of or apply for available suitable work
as defined in subsection G of this section, if:
1. The position was not offered to the individual in
writing or was not listed with the department.
2. The failure would not result in a denial of
benefits under section 23-776 to the extent that the criteria of
suitability in section 23-776 are not inconsistent with this section.
C. If an individual furnishes evidence satisfactory
to the department that prospects for obtaining work in
his
the individual's
customary occupation within a reasonably
short period are good, the determination of whether any work is suitable with
respect to the individual shall be made in accordance with
the
provisions of
section 23-776 without reference to the definition
contained in this section.
D. Work shall not be considered suitable work under
this section if it would not be considered suitable under section 23-776,
subsection
C
E
.
E. For the purposes of this section, an individual
shall be treated as actively engaged in seeking work during any week if the
department finds from tangible evidence provided by the individual that
he
the individual
has engaged in a
systematic and sustained effort to obtain work during such week.
F. The department shall refer an individual entitled
to extended benefits under this chapter to any work
which
that
is suitable work.
G. For the purposes of this section, "suitable
work" with respect to any individual means work within the individual's
capabilities in which:
1. The gross average weekly wages payable for the
work exceed the sum of the individual's weekly benefit amount plus the amount
of any supplemental unemployment benefits payable to the individual for such
week.
2. The wages for the work are at least equal to the
higher of:
(a) The minimum wages provided by section 6(a)(1) of
the fair labor standards act of 1938, without regard to any exemption.
(b) The state or local minimum wage.
END_STATUTE
Sec.
2.
2. Section
23-762, Arizona Revised Statutes, is amended to read:
START_STATUTE
23-762.
Requirements of shared work plan; approval
A. An employer
wishing
that wishes
to participate in the shared work unemployment
compensation program shall submit a signed, written shared work plan to the
department for approval. The department shall approve a shared work
plan only if the plan:
1. Specifies the employees in the affected group.
2. Applies to only one affected group.
3. If feasible, includes a description of the
employer's plan for notifying an employee whose
work week
workweek
is to be reduced.
4. Includes a certified statement by the employer
that, for the six-month period immediately preceding the date the plan is
submitted, compensation was payable from the shared work employer, or its
predecessors whether or not they were shared work employers, to each employee
in the affected group in an amount equal to or greater than the wages for
insured work in one calendar quarter as provided in section 23-771,
subsection A, paragraph
6
7
. An
employee who joins an affected group after the approval of the shared work plan
is automatically covered under the previously approved plan, effective the week
that the department receives written notice from the shared work employer that
the employee has joined and certification from the employer that the employee
meets the provisions of section 23-771, subsection A, paragraph
6
7
.
5. Includes a certified statement by the employer
that for the duration of the plan the reduction in the total normal weekly
hours of work of the employees in the affected group is instead of layoffs
which
that
otherwise would result in at
least as large a reduction in the total normal weekly hours of
work. The employer shall include an estimate of the number of
layoffs that would have occurred without an approved shared work plan.
6. Specifies the manner in which the employer will
treat fringe benefits of the employees in the affected group if the employees'
hours are reduced to less than their normal weekly hours of work.� The employer
must certify, if the employer provides health benefits and retirement benefits
under a defined benefit plan to any employee whose workweek is reduced under
the plan, that these benefits will continue to be provided to an employee
participating in the shared work plan under the same terms and conditions as
though the workweek of the employee had not been reduced or to the same extent
as other employees not participating in the shared work program.
7. Specifies an expiration date that is
no
not
more than one year
from
after
the date the employer submits the plan for approval,
except that on written request by the employer, the department may approve an
extension of the plan for a period of not more than one year
from
after
the date of the request.
8. Is approved in writing by the collective
bargaining agent for each collective bargaining agreement that covers any
employee in the affected group.
B. The plan prescribed in subsection A of this
section and the implementation of the plan must be consistent with the
employer's obligations under all other federal and state laws.
C. The department shall approve or disapprove the
plan within fifteen days after receipt of the plan by the
department. The department shall notify the employer of the reasons
for denial of a shared work plan within ten days
of
after
the determination.
END_STATUTE
Sec.
3.
3. Section
23-763, Arizona Revised Statutes, is amended to read:
START_STATUTE
23-763.
Shared work benefits; eligibility; requirements
A. An individual is eligible to receive shared work
benefits with respect to any week only if, in addition to meeting the
requirements of article 6 of this chapter as modified by subsection E of this
section, the department finds that during the week:
1. The individual is employed as a member of an
affected group in an approved plan that was approved before the week and is in
effect for the week.
2. The individual's normal weekly hours of work were
reduced at least ten
per cent
percent
but not more than forty
per cent
percent
.
3. The individual met the requirements of section 23-771,
subsection A, paragraphs 3
,
and
4
and 5
.
B. Eligible individuals may participate in training
to enhance job skills, including
employer sponsored
employer-sponsored
training or worker training funded
under the workforce investment act of 1998, if the training is approved by the
department.
C. The department shall not pay an individual shared
work benefits for more than twenty-six weeks in a benefit year, except
that this limitation does not apply to a week if for the period consisting of
the week and the immediately preceding twelve weeks the rate, not seasonally
adjusted, of insured unemployment in this state is equal to or greater than
four
per cent
percent
.
D. The total amount of regular benefits and shared
work benefits that the department pays to an individual for weeks in the
individual's benefit year shall not exceed the total for the benefit year as
provided in section 23-780.
E. Notwithstanding
section 23-621 or any other provision of this chapter, for purposes of
this article an individual is unemployed in any week for which compensation is
payable to the individual, as an employee in an affected group, for less than
the individual's normal weekly hours of work in accordance with an approved
plan in effect for the week.
END_STATUTE
Sec.
4.
4. Section
23-771, Arizona Revised Statutes, is amended to read:
START_STATUTE
23-771.
Eligibility for benefits
A. An unemployed individual is eligible to receive
benefits with respect to any week only if the department finds that the
individual:
1. Has registered for work at and thereafter has
continued to report at an employment office in accordance with the regulations
prescribed by the department.
2. Has made a claim for benefits in accordance with
section 23-772.
3. Is able to work.
4. Is available for work.
4.
5.
Except
for an individual who is applying for shared work benefits pursuant to article
5.1 of this chapter,
is available for work and both of the
following apply:
(a) The individual has engaged in a
systematic and sustained effort to obtain work during at least four days of the
week.
(b) The individual has made at least
one job contact per day on four different days of the week.
actively seeks and applies for suitable work and:
(
a
) conducts at
least five work search actions each week in order to qualify as actively
seeking and applying for suitable work. The actions shall include
any of the following:
(
i
) Submitting
resumes to employers.
(
ii
) Completing
job applications and submitting the APPLICATIONS to employers.
(
iii
) Attending
job fairs that are recognized by the department and the individual's attendance
is verifiable by the department.
(
iv
) Attending
interviews with potential employers.
(
v
) Attending a
department-approved training program that includes a resume writing
session, which shall count as one work search action for the week the
individual attended the training program.
(
b
) If the
individual is applying for a weekly benefit, provides a weekly report to the
department that details the individual's work search actions for every week a
benefit is sought.
5.
6.
Has
been unemployed for a waiting period of one week. A week is not
counted as a week of unemployment for the purpose of this paragraph:
(a) Unless it occurs within the benefit year that
includes the week with respect to which the individual claims payment of
benefits.
(b) Unless the individual was eligible for benefits
with respect to the week as provided in this section and sections 23-775,
23-776 and 23-777.
(c) If benefits have been paid in respect to the
week.
6.
7.
Has
met one of the following requirements:
(a) Has been paid wages for insured work during the
individual's base period equal to at least one and one-half times the
wages paid to the individual in the calendar quarter of the individual's base
period in which the wages were highest, and the individual has been paid wages
for insured work in one calendar quarter of the individual's base period equal
to an amount that is equal to at least three hundred ninety times the minimum
wage prescribed by section 23-363 that is in effect when the individual
files a claim for benefits.
(b) For a benefit year beginning on or after
September 2, 1984, has been paid wages for insured work during at least two
quarters of the individual's base period and the amount of the wages paid in
one quarter would be sufficient to qualify the individual for the maximum
weekly benefit amount payable under this chapter and the total of the
individual's base-period wages is equal to or greater than the taxable
limit as specified in section 23-622, subsection B, paragraphs 1 and 2.
7.
8.
Following
the beginning date of a benefit year established under this chapter or the
unemployment compensation law of any other state and before the effective date
of a subsequent benefit year under this chapter, has performed services whether
or not in employment as defined in section 23-615 for which wages were
payable in an amount equal to or in excess of eight times the weekly benefit
amount for which the individual is otherwise qualified under section 23-779. In
making a determination under this paragraph, the department shall use
information available in its records or require the individual to furnish
necessary information within thirty days after the date notice is given that
the information is required.
B. If an unemployed individual cannot establish a
benefit year as defined in section 23-609 due to receipt during the base
period of compensation for a temporary total disability pursuant to chapter 6
of this title, or any similar federal law, the individual's base period shall
be the first four of the last five completed calendar quarters immediately
preceding the first day of the calendar week in which the disability
began. Wages previously used to establish a benefit year may not be
reused.� This subsection does not apply unless all of the following occur:
1. The individual has filed a claim for benefits not
later than the fourth calendar week of unemployment after the end of the period
of disability.
2. The claim is filed within two years after the
period of disability begins.
3. The individual meets the requirements of
subsection A of this section.
4. The individual has attempted to return to the
employment where the temporary total disability occurred.
C. If an unemployed individual is a member of the
national guard or other reserve component of the United States armed forces,
the individual is not considered to be either employed or unavailable for work
by reason of the individual's participation in drill, training or other
national guard or reserve activity that occurs on not more than one weekend per
month or in lieu of a weekend drill or the equivalent.
D. The department shall not disqualify an individual
from receiving benefits under this chapter on the basis of the individual's
separation from employment if the individual is a victim of domestic violence
and leaves employment due to a documented case involving domestic violence
pursuant to section 13-3601 or 13-3601.02.� Benefits paid to an
individual pursuant to this subsection shall not be charged against an
employer's account pursuant to section 23-727, subsection G.
E. The department shall not disqualify an individual
from receiving benefits under this chapter on the basis of the individual's
separation from employment if the individual was terminated from employment for
not receiving a COVID-19 vaccine or COVID-19 booster shot required
by the employer. Benefits paid to an individual pursuant to this
subsection shall not be charged against an employer's account pursuant to
section 23-727 if the employer's requirement that employees receive the
COVID-19 vaccine or COVID-19 booster shot is required by law.
F. For the purposes of subsection A, paragraph
6
7
of this section, wages shall be
counted as wages for insured work for benefit purposes with respect to any
benefit year only if that benefit year begins subsequent to the date on which
the employing unit by which those wages were paid has become an employer
subject to this chapter.
END_STATUTE
Sec.
5.
5. Section
23-773, Arizona Revised Statutes, is amended to read:
START_STATUTE
23-773.
Examination and determination of claims
A. A representative designated by the department as
a deputy shall promptly examine any claim for benefits and, on the basis of the
facts found by the deputy, shall determine whether
or not
the claim is valid.� If the claim is valid, the deputy shall also determine the
week with respect to which the benefit year shall commence, the weekly benefit
amount payable and the maximum duration of the benefit.
B. The deputy shall promptly notify the claimant and
any other interested parties of the determination and the reasons for the
determination.� Except as provided in subsection D of this section, unless the
claimant or an interested party, within seven calendar days after the delivery
of notification, or within fifteen calendar days after notification was mailed
to the claimant's or interested party's last known address, files an appeal
from the determination, it shall become final, and benefits shall be paid or
denied in accordance with the determination.� The department shall adopt rules
to allow an appeal to be filed in writing, electronically or by
telephone. If an appeal tribunal affirms a determination of the
deputy allowing benefits, or the appeals board affirms a determination or
decision allowing benefits, the benefits shall be paid regardless of any appeal
that may thereafter be taken, but if that decision is finally reversed, no
employer's account shall be charged with benefits so paid.
C. On receipt of a request from an interested party
for information about a deputy's determination made pursuant to this section or
section 23-673, the department shall make available by memorandum or
other written document within five days after receipt of the request the
following information:
1. The facts considered and the facts relied on in
making the determination.
2. The specific statutes, regulations or other
authority relied on in making the determination.
3. The reasoning applied in making the
determination.
D. Before the time for appeal as prescribed in
subsection B of this section has expired, an interested party may request a
reconsidered determination.� The department shall examine the request and,
within seven calendar days, deny the request or issue a reconsidered
determination.� The interested party may prove that a response was timely filed
by using evidence of fax records that documents the date and time when a faxed
response was transmitted and received by the department.� A request for
reconsideration that is denied shall be treated as an appeal, and the same
procedure shall be followed as provided for in case of appeal from the original
determination. If a reconsidered determination is issued, the time
for appeal shall run from the date of issuance of the reconsidered
determination. The employer and the claimant shall each be
permitted no
allowed not
more than one
request for reconsideration on each case.
E. Before the actual filing of an appeal under
subsection B of this section, but not later than the time
permitted
allowed
to appeal, the department on its own motion may
issue a reconsidered determination.� After the time for appeal has expired, but
within one year after the issuance of the original determination, the
department with authorization of the unemployment insurance program
administrator may issue a reconsidered determination, on the basis of newly
discovered evidence that by due diligence could not have been previously
discovered, if no administrative or judicial review has occurred or is pending
on the original determination. If a redetermination is based on
fraud, the
one year
one-year
limitation
on the issuance of redeterminations does not apply.
F. Prompt notice in writing of any reconsidered
determination under subsection E of this section and the reasons for
reconsideration shall be given to all interested parties. An
interested party may appeal within the time prescribed under subsection B of
this section, and the same procedure shall be followed as provided for in case
of an appeal from the original determination.
G. In determining the validity of
claims pursuant to subsection a of this section, the department may not pay
benefits for an initial or ongoing claim until the initial claim is cross-checked,
or an ongoing claim is cross-checked on a weekly basis, against the
following data sets:
1. The national association of state
workforce agencies' integrity data hub.
2. The United States department of
health and human services national directory of new hires.
3. The department of economic
security's new hire reporting system.
4. The state department of
corrections inmate databases
or a third-party,
commercially available incarceration data network.
5. The social security
administration's prisoner update processing system.
6. The centers for disease control
and prevention's national vital statistics system's death records database.
7. The department of health services
bureau of vital
records' death records database
or a third-party, commercially available death records database.
8. Current employment and income
information deliverable instantaneously via verification services from external
data sources pursuant to Section 23-799.01.
H. To make the most effective determination of
the potential validity of claims, the department shall prioritize
cross-checking the most current data sets, including those from a commercially
available third-party database, before cross-checking older data sets.
I. If a cross-check pursuant to
subsection G of this section results in information indicating that a claim is
ineligible or fraudulent, that claim may not be paid and the claimant shall be
disqualified from receiving benefits pursuant to section 23-778 and
referred for prosecution.�
J. The department shall examine any
initial claim for benefits and confirm its validity before benefits are paid if
the initial claim:
1. Was submitted electronically
through an internet protocol address located outside of this state or the
United States.
2. References a mailing address or
residential address for which another current claim was submitted.
3. Is
associated with a direct deposit for a bank account already used for another
current claim.
K. If
a fraudulent claim was filed, the department may refer the matter for
prosecution.
END_STATUTE
Sec.
6.
6. Section
23-776, Arizona Revised Statutes, is amended to read:
START_STATUTE
23-776.
Disqualification from benefits for failure to accept suitable
work or actively seek work; exceptions
A. An individual shall be disqualified for benefits
if the department finds the individual has failed without cause
either
to apply for available, suitable work, when so directed by the employment
office or the department, to actively engage in seeking work, to accept
suitable work when offered or to return to the individual's customary self-employment
when so directed by the department
to actively seek and
apply for suitable work, to accept an offer of suitable work or to accept
reemployment at the same employer for suitable work, if offered
.
The disqualification shall begin with the week in
which the failure occurred and shall continue for the duration of the
individual's unemployment and until the individual has earned wages in an
amount equivalent to eight times the individual's weekly benefit amount
otherwise payable.
B. An employer shall report to the
department when an individual who was previously employed with that employer
does any of the following:
1. Refuses to return to work.
2. Refuses to accept an offer of
suitable work.
3. Fails, without cause, to appear
for a scheduled interview.
4. Fails to respond to an offer of
employment.
C. The department shall allow
employers to submit the reports pursuant to subsection B of this section
digitally or through email and shall conduct an independent review of each
report to determine whether an individual should be disqualified from receiving
benefits.
B.
D.
In
determining whether
or not
work is suitable for an
individual:
1. During the first four weeks of a benefit period,
the department shall consider the degree of risk involved to the individual's
health, safety and morals, the individual's physical fitness and prior
training, the individual's experience and prior earnings, the individual's
length of unemployment and prospects for securing local work in the
individual's customary occupation and the distance of the available work from
the individual's residence.
2. After the first four weeks of a benefit period,
the department shall consider any employment offer that pays one hundred twenty
percent of the individual's weekly benefit amount to be suitable work.
C.
E.
Notwithstanding any other provisions of this
chapter, work shall not be deemed suitable and benefits shall not be denied
under this chapter to an otherwise eligible individual for refusing to accept
new work under any of the following conditions:
1. The position offered is vacant due directly to a
strike, lockout or other labor dispute.
2. The wages, hours or other conditions of the work
offered are substantially less favorable to the individual than those
prevailing for similar work in the locality.
3. As a condition of being employed
,
the individual would be required to join a company union or to resign from or
refrain from joining a bona fide labor organization.
D.
F.
An
individual is considered to have refused an offer of suitable work under
subsection A of this section if an offer of work is withdrawn by an employer
after an individual either:
1. Tests positive for drugs after a drug test given
pursuant to chapter 2, article 14 of this title by or on behalf of a
prospective employer as a condition of an offer of employment.
2. Refuses, without good cause, to submit to a drug
test that is required by a prospective employer as a condition of an offer of
employment.
END_STATUTE