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- 83rd Session (2025)
Assembly Bill No. 21–Committee
on Commerce and Labor
CHAPTER..........
AN ACT relating to unemployment compensation; eliminating
provisions requiring the Administrator of the Employment
Security Division of the Department of Employment,
Training and Rehabilitation to annually perform certain
calculations to determine certain information relating to the
solvency of the Unemployment Compensation Fund; revising
the amount of certain money that is required to be annually
transferred from the Un employment Compensation
Administration Fund to the Unemployment Compensation
Fund; and providing other matters properly relating thereto.
Legislative Counsel’s Digest:
The Unemployment Compensation Law, in general: (1) requires employers to
pay contributions into the Unemployment Compensation Fund at a certain rate of
the wages paid by the employer for employment; and (2) makes persons who have
become unemployed and comply with certain requirements eligible for benefits
from the Unemployment Compensation F und in an amount based on the person’s
previous wages for employment. (Chapter 612 of NRS) Section 1 of this bill
eliminates provisions requiring the Admini strator of the Employment Security
Division of the Department of Employment, Training and Rehabilitation, on or
before September 30 of each year, to perform certain calculations to determine
certain information relating to the solvency of the Unemployment Compensation
Fund. (NRS 612.550)
Existing law requires, with certain exceptions, each employer to make
payments, at the rate of .05 percent of the wages the employer pays, into the
Unemployment Compensation Administration Fund. (NRS 612.606) Existing law
requires the money collected from such payments to be used for certain purposes
relating to the employment and training of unemployed persons and persons
employed in this State. (NRS 612.606, 612.607) Under existing law, at the end of
each fiscal year, the State Controller is required to transfer into the Clearing
Account in the Unemployment Compensation Fund the amount by which the
unencumbered balance of the money collected from such payments exceeds the
amount of that money which the Legislature has auth orized for expenditure during
the first 90 days of the succeeding fiscal year. (NRS 612.607) Section 2 of this bill
revises the amount of the required transfer to be the amount by which the
unencumbered balance of the money collected from such payments exceeds the
amount of that money which the Legislature has authorized for expenditure during
the first 180 days of the succeeding fiscal year.
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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. NRS 612.550 is hereby amended to read as follows:
612.550 1. As used in this section:
(a) [“Average actual duration” means the number of weeks
obtained by dividing the number of weeks of benefits paid for weeks
of total unemployment in a consecutive 12 -month period by the
number of first payments made in the same 12-month period.
(b)] “Average annual payroll” for each calendar year means the
annual average of total wages paid by an employer subject to
contributions for the 3 consecutive calendar years immediately
preceding the computation date. The average annual payroll for
employers first qualifying as eligible employers must be computed
on the total amount of wages paid, subject to contributions, for not
less than 10 consecutive quarters and not more than 12 consecutive
quarters ending on December 31, immediately preceding the
computation date.
[(c) “Beneficiary” means a person who has received a first
payment.
(d)] (b) “Computation date” for each calendar year means
June 30 of the preceding calendar year.
[(e) “Covered worker” means a person who has worked in
employment subject to this chapter.
(f) “First payment” means the first weekly unemployment
insurance benefit paid to a person in the person’s benefit year.
(g)] (c) “Reserve balance” means the excess, if any, of total
contributions paid by each employer over total benefit charges to
that employer’s experience rating record.
[(h)] (d) “Reserve ratio” means the p ercentage ratio that the
reserve balance bears to the average annual payroll.
[(i)] (e) “Total contributions paid” means the total amount of
contributions, due on wages paid on or before the computation date,
paid by an employer not later than the last da y of the second month
immediately following the computation date.
[(j) “Unemployment risk ratio” means the ratio obtained by
dividing the number of first payments issued in any consecutive 12 -
month period by the average monthly number of covered workers in
employment as shown on the records of the Division for the same
12-month period.]
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2. The Administrator shall, as of the computation date for each
calendar year, classify employers in accordance with their actual
payrolls, contributions and benefit expe rience, and shall determine
for each employer the rate of contribution which applies to that
employer for each calendar year in order to reflect his or her
experience and classification. The contribution rate of an employer
may not be reduced below 2.95 pe rcent, unless there have been 12
consecutive calendar quarters immediately preceding the
computation date throughout which the employer has been subject
to this chapter and his or her account as an employer could have
been charged with benefit payments, ex cept that an employer who
has not been subject to the law for a sufficient period to meet this
requirement may qualify for a rate less than 2.95 percent if his or
her account has been chargeable throughout a lesser period not less
than the 10 -consecutive-calendar-quarter period ending on the
computation date.
3. Any employer who qualifies under paragraph (b) of
subsection [9] 8 and receives the experience record of a predecessor
employer must be assigned the contribution rate of the predecessor.
4. Benefits paid to a person up to and including the
computation date must be charged against the records, for
experience rating, of the person’s base-period employers in the same
percentage relationship that wages reported by individual employers
represent t o total wages reported by all base period employers,
except that:
(a) If one of the base period employers has paid 75 percent or
more of the wages paid to the person during the person’s base
period, and except as otherwise provided in NRS 612.551, the
benefits, less a proportion equal to the proportion of wages paid
during the base period by employers who make reimbursement in
lieu of contributions, must be charged to the records for experience
rating of that employer. The proportion of benefits paid which is
equal to the part of the wages of the claimant for the base period
paid by an employer who makes reimbursement must be charged to
the record of that employer.
(b) No benefits paid to a multistate claimant based upon
entitlement to benefits in more tha n one state may be charged to the
experience rating record of any employer when no benefits would
have been payable except pursuant to NRS 612.295.
(c) Except for employers who have been given the right to make
reimbursement in lieu of contributions, exte nded benefits paid to a
person must not be charged against the accounts of the person’s
base-period employers.
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5. The Administrator shall, as of the computation date for each
calendar year, compute the reserve ratio for each eligible employer
and shall c lassify those employers on the basis of their individual
reserve ratios. The contribution rate assigned to each eligible
employer for the calendar year must be determined by the range
within which the employer’s reserve ratio falls. The Administrator
shall, by regulation, prescribe the contribution rate schedule to apply
for each calendar year by designating the ranges of reserve ratios to
which must be assigned the various contribution rates provided in
subsection 6. The lowest contribution rate must be as signed to the
designated range of highest reserve ratios and each succeeding
higher contribution rate must be assigned to each succeeding
designated range of lower reserve ratios, except that, within the
limits possible, the differences between reserve ratio ranges must be
uniform.
6. Each employer eligible for a contribution rate based upon
experience and classified in accordance with this section must be
assigned a contribution rate by the Administrator for each calendar
year according to the following classes:
Class 1 ................................................................... 0.25 percent
Class 2 ................................................................... 0.55 percent
Class 3 ................................................................... 0.85 percent
Class 4 ................................................................... 1.15 percent
Class 5 ................................................................... 1.45 percent
Class 6 ................................................................... 1.75 percent
Class 7 ................................................................... 2.05 percent
Class 8 ................................................................... 2.35 percent
Class 9 ................................................................... 2.65 percent
Class 10 ................................................................. 2.95 percent
Class 11 ................................................................. 3.25 percent
Class 12 ................................................................. 3.55 percent
Class 13 ................................................................. 3.85 percent
Class 14 ................................................................. 4.15 percent
Class 15 ................................................................. 4.45 percent
Class 16 ................................................................. 4.75 percent
Class 17 ................................................................. 5.05 percent
Class 18 ................................................................. 5.40 percent
7. [On September 30 of each year, the Administrator shall
determine:
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(a) The highest of the unemployment risk ratios experienced in
the 109 consecutive 12 -month periods in the 10 years ending on
March 31;
(b) The potential annual number of beneficiaries found by
multiplying the highest unemployment risk ratio by the average
monthly number of covered workers in em ployment as shown on
the records of the Division for the 12 months ending on March 31;
(c) The potential annual number of weeks of benefits payable
found by multiplying the potential number of beneficiaries by the
highest average actual duration experienc ed in the 109 consecutive
12-month periods in the 10 years ending on September 30; and
(d) The potential maximum annual benefits payable found by
multiplying the potential annual number of weeks of benefits
payable by the average payment made to beneficia ries for weeks of
total unemployment in the 12 months ending on September 30.
8.] The Administrator shall issue an individual statement,
itemizing benefits charged during the 12 -month period ending on
the computation date, total benefit charges, total co ntributions paid,
reserve balance and the rate of contributions to apply for that
calendar year, for each employer whose account is in active status
on the records of the Division on January 1 of each year and whose
account is chargeable with benefit payme nts on the computation
date of that year.
[9.] 8. If an employer transfers its trade or business, or a
portion thereof, to another employer:
(a) And there is substantially common ownership, management
or control of the employers, the experience record attributable to the
transferred trade or business must be transferred to the employer to
whom the trade or business is transferred. The rates of both
employers must be recalculated, and the recalculated rates become
effective on the date of the transfer of the trade or business. If the
Administrator determines, following the transfer of the experience
record pursuant to this paragraph, that the sole or primary purpose
of the transfer of the trade or business was to obtain a reduced
liability for contribution s, the Administrator shall combine the
experience rating records of the employers involved into a single
account and assign a single rate to the account.
(b) And there is no substantially common ownership,
management or control of the employers, the exper ience record of
an employer may be transferred to a successor employer as of the
effective date of the change of ownership if:
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(1) The successor employer acquires the entire or a severable
and distinct portion of the business, or substantially all of the assets,
of the employer;
(2) The successor employer notifies the Division of the
acquisition in writing within 90 days after the date of the
acquisition;
(3) The employer and successor employer submit a joint
application to the Administrator requesting the transfer; and
(4) The joint application is approved by the Administrator.
The joint application must be submitted within 1 year after the
date of issuance by the Division of official notice of eligibility to
transfer.
(c) Except as otherwise provided in paragraph (a), a transfer of
the experience record must not be completed if the Administrator
determines that the acquisition was effected solely or primarily to
obtain a more favorable contribution rate.
(d) Any liability to the Division for unpaid contributions,
interest or forfeit attributable to the transferred trade or business
must be transferred to the successor employer. The percentage of
liability transferred must be the same as the percentage of the
experience record transferred.
[10.] 9. Whenever an employer has paid no wages in
employment for 8 consecutive calendar quarters following the last
calendar quarter in which the employer paid wages for employment,
the Administrator shall terminate the employer’s experience rating
account, and the account must not thereafter be used in any rate
computation.
[11.] 10. The Administrator may adopt reasonable accounting
methods to account for those employers which are in a category for
providing reimbursement in lieu of contributions.
[12.] 11. To the extent allowed by federal law, the
Administrator may, by regulation, suspend, modify, amend or waive
any requirement of this section for the duration of a state of
emergency or declaration of disaster proclaimed pursuant to NRS
414.070 and for any additional period of time during which the
emergency or disaster directly affects the requirement of this section
if:
(a) The Administrator determines the action is:
(1) In the best interest of the Division, this State or the
general health, safety and welfare of the citizens of this State; or
(2) Necessary to comply with instructions received from the
Department of Labor; and
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(b) The action of the Administrator is approved by the
Governor.
Sec. 2. NRS 612.607 is hereby amended to read as follows:
612.607 1. All payments collected pursuant to NRS 612.606
must be deposited in the Unemployment Compensation
Administration Fund. At the end of each fiscal year, the
State Controller shall transfer to the Clearing Acc ount in
the Unemployment Compensation Fund the amount by which the
unencumbered balance of the money deposited in the
Unemployment Compensation Administration Fund pursuant to this
subsection exceeds the amount of that money which the Legislature
has authorized for expenditure during the first [90] 180 days of the
succeeding fiscal year.
2. Except for money transferred from the Unemployment
Compensation Administration Fund pursuant to subsection 1, the
Administrator may only expend the money collected fo r the
employment and training of unemployed persons and persons
employed in this State to:
(a) Establish and administer an employment training program
which must foster job creation, minimize unemployment costs of
employers and meet the needs of employers for skilled workers by
providing training to unemployed persons.
(b) Establish or provide support for job training programs in the
public and private sectors for training, retraining or improving the
skills of persons employed in this State.
(c) Establish a program to provide grants of money to a
nonprofit private entity to be used to make loans of money to
veterans and senior citizens to start small businesses. The
Administrator shall adopt regulations establishing criteria and
standards relating to the eligibility for and use of any grants made
pursuant to this paragraph.
(d) Pay the costs of the collection of payments required pursuant
to NRS 612.606.
3. The money used for the program for the employment and
training of unemployed persons and persons employed in this State
must supplement and not displace money available through existing
employment training programs conducted by any employer or
public agency and must not replace, parallel, supplant, compete with
or duplicate in any way existing appren ticeship programs approved
by the State Apprenticeship Council.
4. As used in this section:
(a) “Senior citizen” means a person who is domiciled in this
State and is 62 years of age or older.
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(b) “Small business” means a business conducted for profit
which:
(1) Employs 50 or fewer full-time employees; and
(2) Has gross annual sales of less than $5,000,000.
Sec. 3. This act becomes effective upon passage and approval.
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