Text: HF02170 Text: HF02172 Text: HF02100 - HF02199 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. Section 96.7, subsection 2, paragraph b,
1 2 unnumbered paragraph 1, Code Supplement 2003, is amended to
1 3 read as follows:
1 4 b. If an enterprise or business, or a clearly segregable
1 5 and identifiable part of an enterprise or business, for which
1 6 contributions have been paid is sold or transferred to a
1 7 subsequent employing unit, or if one or more employing units
1 8 have been reorganized or merged into a single employing unit,
1 9 and the successor employer, having qualified as an employer as
1 10 defined in section 96.19, subsection 16, paragraph "b",
1 11 continues to operate the enterprise or business, the successor
1 12 employer shall assume the position of the predecessor employer
1 13 or employers with respect to the predecessors' payrolls,
1 14 contributions, accounts, and contribution rates to the same
1 15 extent as if no change had taken place in the ownership or
1 16 control of the enterprise or business, unless all of the
1 17 following apply:
1 18 (1) The predecessor employer is a debtor in bankruptcy
1 19 subject to an order of relief under Title 11 of the United
1 20 States Code or a comparable order under federal, state, or
1 21 foreign law governing insolvency.
1 22 (2) The sale or transfer occurs by order of a court of
1 23 competent jurisdiction within debtor proceedings.
1 24 (3) A majority of the ownership interests of the successor
1 25 employer are possessed by residents of this state or possessed
1 26 by a business entity the majority ownership interests of which
1 27 are also possessed by residents of this state.
1 28 Such a successor employer of a bankrupt predecessor
1 29 employer shall initially pay contributions at the applicable
1 30 rate specified in paragraph "c".
1 31 PARAGRAPH DIVIDED. However, the successor employer shall
1 32 not assume the position of the predecessor employer or
1 33 employers with respect to the predecessor employer's or
1 34 employers' payrolls, contributions, accounts, and contribution
1 35 rates which are attributable to that part of the enterprise or
2 1 business transferred, unless the successor employer applies to
2 2 the department within ninety days from the date of the partial
2 3 transfer, and the succession is approved by the predecessor
2 4 employer or employers and the department.
2 5 EXPLANATION
2 6 This bill relates to the unemployment contribution rate of
2 7 an employer who purchases or merges with another business.
2 8 Under current law, the successor employer must assume the
2 9 contribution rate of the business which the successor is
2 10 purchasing or with which the successor is merging. The bill
2 11 provides that if the business being purchased or merged is a
2 12 debtor in bankruptcy court, and the purchase or merger occurs
2 13 as part of the bankruptcy proceeding, and the successor is
2 14 primarily owned by residents of Iowa, then the successor shall
2 15 not assume the predecessor's contribution rate but rather pay
2 16 the rate applicable to an employer newly subject to Code
2 17 chapter 96.
2 18 LSB 5671HH 80
2 19 kk/gg/14
Text: HF02170 Text: HF02172 Text: HF02100 - HF02199 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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