Sec. 31-222-14 - Joint accounts; merger of experience; contribution rates

ยง 31-222-14. Joint accounts; merger of experience; contribution rates

(a) Any employer not previously subject to the act, who becomes subject by reason of acquiring substantially all of the assets, organization, trade or business of a covered employer, may, after written application on a form provided by the administrator and upon approval by the administrator, succeed to the experience of the predecessor employer. Such written application shall be submitted by the employer within ten days following the date of the administrator's notice to him advising him of his liability under the law, and such written notice shall be accompanied by a written statement signed by the predecessor employer, waiving the predecessor's rights to his experience and tax credit in favor of the successor. Transfer of the experience and any unliquidated balance of tax credit of the predecessor employer will be effective as of the date of acquisition of the business. The administrator upon good cause may extend the time for application.

(b) Any employer not previously subject to the act, who becomes subject by reason of acquiring substantially all of the assets, organization, trade or business of two or more covered employers who enjoyed different merit rates, may, after written application on a form provided by the administrator and upon approval by the administrator, succeed to the experience of the predecessor employers. The successor employer will be granted a composite merit rate for the remainder of the calendar year in which acquisition of the business takes place. The composite rate shall be the quotient obtained by dividing the sum of the total estimated contributions of each of the predecessor employers for the whole of the calendar year in which the acquisition takes place by the sum of the payroll of each of the predecessor employers for the preceding calendar year. Merger of experience will be allowed as of June thirtieth of the year in which the acquisition takes place.

(c) If an employer who is subject to the act acquires substantially all of the assets, organization, trade or business of a covered employer, merger of the experience may be allowed, upon written application to the administrator, on a form provided by the administrator as of June thirtieth of the year in which the acquisition takes place. The first contribution rate based upon the joint experience will become effective for the calendar year following such June thirtieth.

(d) An employer who acquires a portion of but less than substantially all of the assets, organization, trade or business of a covered employer, which portion had been operated as a segregated unit, may apply for a joint account with and succeed to the experience of the transferring employer with respect to such segregated unit. Such application, on a form provided by the administrator, shall be accompanied by a written statement signed by the transferring employer, waiving his rights to the experience with respect to such unit in favor of the acquiring employer. If such employer was not previously subject to the act and because of such acquisition becomes immediately liable, he shall pay contributions at the same reduced rate as the transferring employer from the date of the acquisition to the end of the calendar year, if the segregated unit has been in operation during the whole of the preceding experience period ending on June thirtieth with respect to which the rate currently in effect at the time of the acquisition was established; otherwise he shall pay at the full rate of two and seven-tenths per cent. A segregated unit is a unit, by whatever name called, for which the payroll records have been so maintained that the employment experience as is required for merit rating purposes may readily be identified and separated.

(e) The administrator will establish a joint account for two or more active employers as of June thirtieth of any year upon written application of each such employer, provided such applications shall be filed not later than the September thirtieth next succeeding such June thirtieth. The first contribution rate based upon the joint experience will become effective as of January first following such June thirtieth. Dissolution of joint accounts will be allowed only as of June thirtieth next succeeding the application therefor by the member employers, and the first contribution rates based upon the separate experiences shall be effective as of January first next following such June thirtieth. When joint accounts are established by the administrator, the employers concerned shall continue to submit individually such reports and contributions as are required of employers with individual merit rating accounts. When two or more employers have a joint merit rating account, the merit rating index computation for such account shall include only the experience of those employers in the joint account who have been subject to the provisions of the act for the whole of the preceding experience period. The merit rating index computed for the joint account and the employer's contribution rate, based upon such computation, shall apply only to the employers in the joint merit rating account who have been subject to the provisions of the act for the whole of the preceding experience period.

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