various changes to the unemployment insurance and worker’s compensation laws

Wisconsin Legislature: SB486: Bill Text

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SB486: Bill Text

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2025 - 2026 LEGISLATURE
LRB-4606/1
MED:wlj
2025 SENATE BILL 486
October 2, 2025 - Introduced by Senators
L. Johnson
,
Hesselbein
,
Larson
,
Ratcliff
,
Smith
,
Spreitzer
and
Dassler-Alfheim
, cosponsored by Representatives
Hysell
,
Andraca
,
Arney
,
Bare
,
Brown
,
Clancy
,
DeSmidt
,
Joers
,
Kirsch
,
Madison
,
McCarville
,
Miresse
,
Moore Omokunde
,
Phelps
,
Rivera-Wagner
,
Roe
,
Snodgrass
,
Stubbs
,
Subeck
,
Tenorio
and
Udell
. Referred to Committee on Government Operations, Labor and Economic Development.
SB486,1,6
1
An Act

to repeal
20.445 (1) (aL), 108.04 (5g), 108.04 (8) (b), 108.133 and 108.19
2
(1s) (a) 5.;
to renumber and amend
108.04 (5) (intro.) and 108.04 (5) (a) to
3
(g);
to amend
49.791 (4) (f) (intro.), 102.43 (9) (e), 108.04 (8) (a), 108.14 (8n)
4
(e), 108.141 (7) (a), 108.141 (7) (b) and 108.16 (6m) (a);
to create
20.445 (1)
5
(am) of the statutes;
relating to:
various changes to the unemployment
6
insurance and worker’s compensation laws.
Analysis by the Legislative Reference Bureau
This bill makes various changes to the unemployment insurance and worker’s compensation laws, as follows:
Unemployment insurance; substantial fault
Under current law, a claimant for UI benefits whose work is terminated by his or her employer for substantial fault by the claimant connected with the claimant’s work is ineligible to receive UI benefits until the claimant satisfies certain requalification criteria. With certain exceptions, current law defines “substantial fault” to include those acts or omissions of a claimant over which the claimant exercised reasonable control and that violate reasonable requirements of the claimant’s employer. This bill repeals this provision on substantial fault.
Unemployment insurance; misconduct
Under current law, a claimant for UI benefits whose work is terminated by his or her employer for misconduct by the claimant connected with the claimant’s work is ineligible to receive UI benefits until the claimant satisfies certain requalification criteria, and the claimant’s wages paid by the employer that terminates the claimant for misconduct are excluded for purposes of calculating benefit entitlement. Current law defines “misconduct” using a general, common law standard derived from
Boynton Cab Co. v. Neubeck
, 237 Wis. 249 (1941), and enumerates several specific types of conduct that also constitute misconduct. Under one of these specific provisions, misconduct includes 1) absenteeism on more than two occasions within the 120-day period before the date of the claimant’s termination, unless otherwise specified by his or her employer in an employment manual of which the claimant has acknowledged receipt with his or her signature, or 2) excessive tardiness by a claimant in violation of a policy of the employer that has been communicated to the claimant. In
Department of Workforce Development v. Labor and Industry Review Commission (Beres)
, 2018 WI 77, the supreme court held that an employer could, under the language described above, institute an attendance policy more restrictive than two occasions within the 120-day period.
Current law also provides that absenteeism or tardiness count as misconduct only if the claimant did not provide to his or her employer both notice and one or more valid reasons for the absenteeism or tardiness. In
Bevco Precision Manufacturing v. Labor and Industry Review Commission
, 2024 WI App. 54, the court of appeals held that under
Beres
, this qualifying language did not apply if an employer had adopted its own standard on absenteeism and tardiness, as described above.
The bill does all of the following:
1. Repeals the language referencing “excessive tardiness.”
2. Reverses the holding in
Bevco
by providing that a claimant’s notice and reason for an occasion of absenteeism or tardiness are to be analyzed under the common law misconduct standard. Under the bill, therefore, an employer may not establish its own policy for determining the reasonableness of absenteeism or tardiness. The bill does not, however, affect the general ability of an employer to institute a standard for absenteeism and tardiness more restrictive than two occasions within the 120-day period before termination.
3. Clarifies, in another provision defining misconduct, that “tribal government” has the meaning given under state and federal law for what is considered an Indian tribe.
Unemployment insurance; drug testing
Current state law requires DWD to establish a program to test certain claimants who apply for UI benefits for the presence of controlled substances in a manner that is consistent with federal law. A claimant who tests positive for a controlled substance for which the claimant does not have a prescription is ineligible for UI benefits until certain requalification criteria are satisfied or unless he or she enrolls in a substance abuse treatment program and undergoes a job skills assessment, and a claimant who declines to submit to a test is simply ineligible for benefits until he or she requalifies. This bill repeals the requirement to establish the drug testing program.
Also under current law, an employer may voluntarily submit to DWD the results of a preemployment test for the presence of controlled substances that was conducted on an individual as a condition of an offer of employment or notify DWD that an individual declined to submit to such a test. If DWD then verifies that submission, the employee may be ineligible for UI benefits until he or she requalifies. However, a claimant who tested positive may maintain eligibility by enrolling in a substance abuse treatment program and undergoing a job skills assessment. This bill repeals these preemployment drug testing provisions.
The bill also repeals an appropriation to DWD for conducting screenings of applicants, testing applicants for controlled substances, the provision of substance abuse treatment to applicants and claimants, and related expenses. The bill replaces the repealed appropriation with a general appropriation to DWD for administration of the UI law.
Worker’s compensation; substantial fault
Currently, under the worker’s compensation law, an employer is not liable for temporary disability benefits during an employee’s healing period if the employee is suspended or terminated from employment due to misconduct by the employee connected with the employee’s work. Current law defines “misconduct” by reference to the UI law. The bill changes the definition of “misconduct” under the UI law, which change also applies for purposes of the worker’s compensation law as described above.
For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
SB486,1
1
Section

1
.
20.005 (3) (schedule) of the statutes: at the appropriate place,
2
insert the following amounts for the purposes indicated:
-
See PDF for table

SB486,2
3
Section
2
.
20.445 (1) (aL) of the statutes is repealed.
SB486,3
4
Section
3
.
20.445 (1) (am) of the statutes is created to read:
SB486,3,7
5
20.445
(1)
(am)
Unemployment insurance; general administration.
As a
6
continuing appropriation, the amounts in the schedule for administration of ch.
7
108.
SB486,4
8
Section

4
.
49.791 (4) (f) (intro.) of the statutes is amended to read:
SB486,3,15
9
49.791
(4)
(f)
Accepting test results from other programs.
(intro.) For purposes
10
of this section, an administering agency may use results of a drug test performed by
11
the administering agency for the purpose of eligibility for another state program,
12
including a work experience program under s. 49.162
,

or
49.36,
or 108.133,

13
performed at the request of the department of corrections, or performed by other
14
drug testing providers as approved by the department to determine whether to
15
refer an able-bodied adult to treatment if all of the following apply:
SB486,5
16
Section
5
.
102.43 (9) (e) of the statutes is amended to read:
SB486,3,20
17
102.43
(9)
(e) The employee’s employment with the employer has been
18
suspended or terminated due to misconduct, as defined in s. 108.04 (5),
or
19
substantial fault, as defined in s. 108.04 (5g) (a),
by the employee connected with
20
the employee’s work.
SB486,6
21
Section

6
.
108.04 (5) (intro.) of the statutes is renumbered 108.04 (5) (cm)
22
and amended to read:
SB486,4,19
23
108.04
(5)
(cm) An employee whose work is terminated by an employing unit
1
for misconduct by the employee connected with the employee’s work is ineligible to
2
receive benefits until 7 weeks have elapsed since the end of the week in which the
3
discharge occurs and the employee earns wages after the week in which the
4
discharge occurs equal to at least 14 times the employee’s weekly benefit rate under
5
s. 108.05 (1) in employment or other work covered by the unemployment insurance
6
law of any state or the federal government. For purposes of requalification, the
7
employee’s weekly benefit rate shall be the rate that would have been paid had the
8
discharge not occurred. The wages paid to an employee by an employer which
9
terminates employment of the employee for misconduct connected with the
10
employee’s employment shall be excluded from the employee’s base period wages
11
under s. 108.06 (1) for purposes of benefit entitlement. This
subsection

paragraph

12
does not preclude an employee who has employment with an employer other than
13
the employer which terminated the employee for misconduct from establishing a
14
benefit year using the base period wages excluded under this
subsection

paragraph

15
if the employee qualifies to establish a benefit year under s. 108.06 (2) (a). The
16
department shall charge to the fund’s balancing account any benefits otherwise
17
chargeable to the account of an employer that is subject to the contribution
18
requirements under ss. 108.17 and 108.18 from which base period wages are
19
excluded under this
subsection

paragraph
.
SB486,5,3
20
(am)
For purposes of this subsection, “misconduct” means one or more actions
21
or conduct evincing such willful or wanton disregard of an employer’s interests as is
22
found in deliberate violations or disregard of standards of behavior which an
23
employer has a right to expect of his or her employees, or in carelessness or
24
negligence of such degree or recurrence as to manifest culpability, wrongful intent,
1
or evil design of equal severity to such disregard, or to show an intentional and
2
substantial disregard of an employer’s interests, or of an employee’s duties and
3
obligations to his or her employer.
SB486,5,5
4
(bm)
In addition
to the conduct described in par. (am)
, “misconduct” includes
5
all of the following
:
SB486,7
6
Section

7
.
108.04 (5) (a) to (g) of the statutes are renumbered 108.04 (5) (bm)
7
1. to 7., and 108.04 (5) (bm) 5. and 7., as renumbered, are amended to read:
SB486,5,16
8
108.04
(5)
(bm) 5. Absenteeism by an employee on more than 2 occasions
9
within the 120-day period before the date of the employee’s termination, unless
10
otherwise specified by his or her employer in an employment manual of which the
11
employee has acknowledged receipt with his or her signature,
or excessive tardiness
12
by an employee in violation of a policy of the employer that has been communicated
13
to the employee,
if the employee does not provide to his or her employer both notice
14
and one or more valid reasons for the absenteeism
or tardiness
. For purposes of this
15
subdivision, an employee’s notice and reason for an occasion of absenteeism or
16
tardiness shall be analyzed under the standard specified in par. (am)
.
SB486,5,23
17
7. Unless directed by the employer, a willful and deliberate violation of a
18
written and uniformly applied standard or regulation of the federal government or
19
a state or
Indian
tribal government by an employee of an employer that is licensed
20
or certified by a governmental agency, which standard or regulation has been
21
communicated by the employer to the employee and which violation would cause the
22
employer to be sanctioned or to have its license or certification suspended by the
23
agency.
SB486,8
24
Section
8
.
108.04 (5g) of the statutes is repealed.
SB486,9
1
Section
9
.
108.04 (8) (a) of the statutes is amended to read:
SB486,6,16
2
108.04
(8)
(a)
Except as provided in par. (b), if

If
an employee fails, without
3
good cause, to accept suitable work when offered, the employee is ineligible to
4
receive benefits until the employee earns wages after the week in which the failure
5
occurs equal to at least 6 times the employee’s weekly benefit rate under s. 108.05
6
(1) in employment or other work covered by the unemployment insurance law of any
7
state or the federal government. For purposes of requalification, the employee’s
8
weekly benefit rate shall be that rate which would have been paid had the failure
9
not occurred. This paragraph does not preclude an employee from establishing a
10
benefit year during a period in which the employee is ineligible to receive benefits
11
under this paragraph if the employee qualifies to establish a benefit year under s.
12
108.06 (2) (a).
Except as provided in par. (b), the

The
department shall charge to
13
the fund’s balancing account any benefits otherwise chargeable to the account of an
14
employer that is subject to the contribution requirements under ss. 108.17 and
15
108.18 whenever an employee of that employer fails, without good cause, to accept
16
suitable work offered by that employer.
SB486,10
17
Section
10
.
108.04 (8) (b) of the statutes is repealed.
SB486,11
18
Section
11
.
108.133 of the statutes is repealed.
SB486,12
19
Section

12
.
108.14 (8n) (e) of the statutes is amended to read:
SB486,7,9
20
108.14
(8n)
(e) The department shall charge this state’s share of any benefits
21
paid under this subsection to the account of each employer by which the employee
22
claiming benefits was employed in the applicable base period, in proportion to the
23
total amount of wages he or she earned from each employer in the base period,
24
except that if s. 108.04 (1) (f), (5), (5g), (7) (a), (c), (cg), (e), (L), (q), (s), or (t), (7m)
,
or
1
(8) (a)
to

or
(c)
,

or
108.07 (3), (3r), or (5) (am) 2.
, or 108.133 (3) (f)
would have applied
2
to employment by such an employer who is subject to the contribution requirements
3
of ss. 108.17 and 108.18, the department shall charge the share of benefits based on
4
employment with that employer to the fund’s balancing account, or, if s. 108.04 (1)
5
(f), (5), or (5g) or 108.07 (3) would have applied to an employer that is not subject to
6
the contribution requirements of ss. 108.17 and 108.18, the department shall
7
charge the share of benefits based on that employment in accordance with s. 108.07
8
(5) (am) 1. and 2. The department shall also charge the fund’s balancing account
9
with any other state’s share of such benefits pending reimbursement by that state.
SB486,13
10
Section

13
.
108.14 (8n) (e) of the statutes, as affected by 2025 Wisconsin Act
11
.... (this act), is amended to read:
SB486,8,2
12
108.14
(8n)
(e) The department shall charge this state’s share of any benefits
13
paid under this subsection to the account of each employer by which the employee
14
claiming benefits was employed in the applicable base period, in proportion to the
15
total amount of wages he or she earned from each employer in the base period,
16
except that if s. 108.04 (1) (f), (5),
(5g),
(7) (a), (c), (cg), (e), (L), (q), (s), or (t), (7m), or
17
(8) (a) or (c) or 108.07 (3), (3r), or (5) (am) 2. would have applied to employment by
18
such an employer who is subject to the contribution requirements of ss. 108.17 and
19
108.18, the department shall charge the share of benefits based on employment
20
with that employer to the fund’s balancing account, or, if s. 108.04 (1) (f)
,

or
(5)
, or
21
(5g)
or 108.07 (3) would have applied to an employer that is not subject to the
22
contribution requirements of ss. 108.17 and 108.18, the department shall charge
23
the share of benefits based on that employment in accordance with s. 108.07 (5)
1
(am) 1. and 2. The department shall also charge the fund’s balancing account with
2
any other state’s share of such benefits pending reimbursement by that state.
SB486,14
3
Section

14
.
108.141 (7) (a) of the statutes is amended to read:
SB486,8,11
4
108.141
(7)
(a) The department shall charge the state’s share of each week of
5
extended benefits to each employer’s account in proportion to the employer’s share
6
of the total wages of the employee receiving the benefits in the employee’s base
7
period, except that if the employer is subject to the contribution requirements of ss.
8
108.17 and 108.18 the department shall charge the share of extended benefits to
9
which s. 108.04 (1) (f), (5), (5g), (7) (a), (c), (cg), (e), (L), (q), (s), or (t), (7m)
,
or (8) (a)
10
to

or
(c)
,

or
108.07 (3), (3r), or (5) (am) 2.
, or 108.133 (3) (f)
applies to the fund’s
11
balancing account.
SB486,15
12
Section

15
.
108.141 (7) (a) of the statutes, as affected by 2025 Wisconsin Act
13
.... (this act), is amended to read:
SB486,8,20
14
108.141
(7)
(a) The department shall charge the state’s share of each week of
15
extended benefits to each employer’s account in proportion to the employer’s share
16
of the total wages of the employee receiving the benefits in the employee’s base
17
period, except that if the employer is subject to the contribution requirements of ss.
18
108.17 and 108.18 the department shall charge the share of extended benefits to
19
which s. 108.04 (1) (f), (5),
(5g),
(7) (a), (c), (cg), (e), (L), (q), (s), or (t), (7m), or (8) (a)
20
or (c) or 108.07 (3), (3r), or (5) (am) 2. applies to the fund’s balancing account.

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