IC 22-4-11.5
    Chapter 11.5. Assignment of Employer Contribution Rates andTransfers of Employer Experience Accounts

IC 22-4-11.5-1
Applicability
    Sec. 1. Notwithstanding any other provision of this article, thischapter applies to the assignment of contribution rates and transfersof employer experience accounts after December 31, 2005.
As added by P.L.98-2005, SEC.9.

IC 22-4-11.5-2
"Administrative law judge"
    Sec. 2. As used in this chapter, "administrative law judge" meansa person employed by the commissioner under IC 22-4-17-4.
As added by P.L.98-2005, SEC.9. Amended by P.L.108-2006,SEC.16.

IC 22-4-11.5-3
"Person"
    Sec. 3. As used in this chapter, "person" has the meaning set forthin section 7701(a)(1) of the Internal Revenue Code.
As added by P.L.98-2005, SEC.9.

IC 22-4-11.5-4
"Trade or business"
    Sec. 4. As used in this chapter, "trade or business" includes anemployer's workforce.
As added by P.L.98-2005, SEC.9.

IC 22-4-11.5-5
"Violates or attempts to violate"
    Sec. 5. As used in this chapter, "violates or attempts to violate"includes the intent to evade a higher employer contribution rate inconnection with a transfer of a trade or business throughmisrepresentation or willful nondisclosure of information relevant tothe transfer.
As added by P.L.98-2005, SEC.9. Amended by P.L.108-2006,SEC.17.

IC 22-4-11.5-6
"Knowingly"; "recklessly"
    Sec. 6. As used in this chapter:
        (1) "knowingly" has the meaning set forth in IC 35-41-2-2(b);and
        (2) "recklessly" has the meaning set forth in IC 35-41-2-2(c).
As added by P.L.98-2005, SEC.9.

IC 22-4-11.5-7
Transferring all or part of trade or business; successor employers

with substantially common ownership, management, or control
    Sec. 7. (a) This section applies to a transfer of a trade or businessthat meets the following requirements:
        (1) An employer transfers all or a portion of the employer'strade or business to another employer.
        (2) At the time of the transfer, the two (2) employers havesubstantially common ownership, management, or control.
    (b) The successor employer shall assume the experience accountbalance of the predecessor employer for the resources and liabilitiesof the predecessor employer's experience account that are attributableto the transfer.
    (c) The contribution rates of both employers shall be recalculated,and the recalculated rate made effective on the effective date of thetransfer described in subsection (a).
    (d) The payroll of the predecessor employer on the effective dateof the transfer, and the benefits chargeable to the predecessoremployer's original experience account after the effective date of thetransfer, must be divided between the predecessor employer and thesuccessor employer in accordance with rules adopted by thedepartment under IC 4-22-2.
    (e) Any written determination made by the department isconclusive and binding on both the predecessor employer and thesuccessor employer unless one (1) employer files or both employersfile a written protest with the department setting forth all reasons forthe protest. A protest under this section must be filed not later thanfifteen (15) days after the date the department sends the initialdetermination to the employers. The protest shall be heard anddetermined under this section and IC 22-4-32-1 throughIC 22-4-32-15. The predecessor employer, the successor employer,and the department shall be parties to the hearing before the liabilityadministrative law judge and are entitled to receive copies of allpleadings and the decision.
As added by P.L.98-2005, SEC.9. Amended by P.L.108-2006,SEC.18.

IC 22-4-11.5-8
Transfers solely to obtain lower employer contribution rate
    Sec. 8. (a) If the department determines that an employing unit orother person that is not an employer under IC 22-4-7 at the time ofthe acquisition has acquired an employer's trade or business solely orprimarily for the purpose of obtaining a lower employer contributionrate, the employing unit or other person:
        (1) may not assume the experience account balance of thepredecessor employer for the resources and liabilities of thepredecessor employer's experience account that are attributableto the acquisition; and
        (2) shall pay the applicable contribution rate as determinedunder this article.
    (b) In determining whether an employing unit or other personacquired a trade or business solely or primarily for the purpose of

obtaining a lower employer contribution rate under subsection (a),the department shall consider the following factors:
        (1) The cost of acquiring the trade or business.
        (2) Whether the employing unit or other person continued thebusiness enterprise of the acquired trade or business, includingwhether the predecessor employer is no longer performing thesame trade or business and the trade or business is performed bythe employing unit to whom the workforce is transferred. Anemploying unit is considered to continue the business enterpriseif any one (1) of the following applies:
            (A) The predecessor employer and the employing unit arecorporations that are members of a "controlled group ofcorporations", as defined in Section 1563 of the InternalRevenue Code (generally parent-subsidiary or brother-sistercontrolled groups), or would be members if Section1563(a)(4) and 1563(b) of the Internal Revenue Code did notapply and if the phrase "more than fifty percent (50%)" weresubstituted for the phrase "at least eighty percent (80%)"wherever it appears in Section 1563(a) of the InternalRevenue Code.
            (B) The predecessor employer and the employing unit areentities that are part of an affiliated group, as defined inSection 1504 of the Internal Revenue Code, except that theownership percentage in Section 1504(a)(2) of the InternalRevenue Code shall be determined using fifty percent (50%)instead of eighty percent (80%).
            (C) A predecessor employer and an employing unit areentities that do not issue stock, either fifty percent (50%) ormore of the members of one (1) entity's board of directors(or other governing body) are members of the other entity'sboard of directors (or other governing body), or the holdersof fifty percent (50%) or more of the voting power to selectthese members are concurrently the holders of fifty percent(50%) or more of that power with respect to the other entity.
            (D) Fifty percent (50%) or more of one (1) entity's officersare concurrently officers of the other entity.
            (E) Thirty percent (30%) or more of one (1) entity'semployees are concurrently employees of the other entity.
        (3) The length of time the employing unit or other personcontinued the business enterprise of the acquired trade orbusiness.
        (4) Whether a substantial number of new employees were hiredto perform duties unrelated to the business enterprise that thetrade or business conducted before the trade or business wasacquired.
        (5) Whether the predecessor employer and the employing unitare united by factors of control, operation, or use.
        (6) Whether a new employing unit is being created solely toobtain a lower contribution rate.
    (c) Any written determination made by the department is

conclusive and binding on the employing unit or other person, unlessthe employing unit or other person files a written protest with thedepartment setting forth all reasons for the protest. A protest underthis section must be filed not later than fifteen (15) days after thedate the department sends the initial determination to the employingunit or other person. The protest shall be heard and determined underthis section and IC 22-4-32-1 through IC 22-4-32-15. The departmentand the employing unit or other person shall be parties to the hearingbefore the liability administrative law judge and are entitled toreceive copies of all pleadings and the decision.
As added by P.L.98-2005, SEC.9. Amended by P.L.108-2006,SEC.19; P.L.175-2009, SEC.16.

IC 22-4-11.5-9
Violation of chapter; civil penalties
    Sec. 9. (a) A person who knowingly or recklessly:
        (1) violates or attempts to violate:
            (A) section 7 or 8 of this chapter; or
            (B) any other provision of this article related to determiningthe assumption or assignment of an employer's contributionrate; or
        (2) advises another person in a way that results in a violation of:
            (A) section 7 or 8 of this chapter; or
            (B) any other provision of this article related to determiningthe assumption or assignment of an employer's contributionrate;
is subject to a civil penalty under this chapter.
    (b) If the department determines that an employer (as definedunder IC 22-4-7) is subject to a civil penalty under subsection (a)(1),the department shall assign an employer contribution rate equal toone (1) of the following as a civil penalty:
        (1) The highest employer contribution rate assignable under thisarticle for the year in which the violation occurred and thefollowing three (3) years.
        (2) An additional employer contribution rate of two percent(2%) of the employer's taxable wages (as defined inIC 22-4-4-2) for the year in which the violation occurred andthe following three (3) years, if:
            (A) an employer is already paying the highest employercontribution rate at the time of the violation; or
            (B) the increase in the contribution rate described insubdivision (1) is less than two percent (2%).
    (c) If the department determines that a person who is not anemployer (as defined in IC 22-4-7) is subject to a civil penalty undersubsection (a)(2), the department shall assess a civil penalty of notmore than five thousand dollars ($5,000).
    (d) All civil penalties collected under this section shall bedeposited in the unemployment insurance benefit fund established byIC 22-4-26-1.
    (e) Any written determination made by the department is

conclusive and binding on the employing unit, employer, or personunless the employing unit, employer, or person files a written protestwith the department setting forth all reasons for the protest. A protestunder this section must be filed not later than fifteen (15) days afterthe date the department sends the initial determination to theemploying unit, employer, or person. The protest shall be heard anddetermined under this section and IC 22-4-32-1 throughIC 22-4-32-15. The employing unit, employer, or person, and thedepartment shall be parties to the hearing before the liabilityadministrative law judge and are entitled to receive copies of allpleadings and the decision.
As added by P.L.98-2005, SEC.9. Amended by P.L.108-2006,SEC.20.

IC 22-4-11.5-10
Violation of chapter; Class C misdemeanor
    Sec. 10. In addition to any other penalty imposed, a person whoknowingly, recklessly, or intentionally violates this chapter commitsa Class C misdemeanor.
As added by P.L.98-2005, SEC.9. Amended by P.L.1-2006, SEC.342;P.L.108-2006, SEC.21.

IC 22-4-11.5-11
Commissioner procedures to identify violators; applicability offederal Department of Labor regulations
    Sec. 11. (a) The commissioner shall establish procedures toidentify the transfer or acquisition of a business for purposes of thischapter.
    (b) The interpretation and application of this chapter must meetthe minimum requirements contained in any guidance or regulationsissued by the United States Department of Labor.
As added by P.L.98-2005, SEC.9.