LegalTips.ORG - Texas LABOR CODE

§ 204.001. DEFINITION. In this chapter, "manual" means
the North American Industrial Classification System Manual
published by the United States Office of Management and Budget.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 398, § 1, eff. Sept. 1, 2001.

§ 204.002. CONTRIBUTION REQUIRED. (a) An employer
shall pay a contribution on wages for employment paid during a
calendar year or the portion of the calendar year in which the
employer is subject to this subtitle.
(b) The contribution shall be paid to the commission in
accordance with rules adopted by the commission.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.003. CONTRIBUTION NOT DEDUCTED FROM WAGES. An
employer may not deduct any part of a contribution from the wages of
an individual in the employer's employ.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.004. ASSIGNMENT TO MAJOR GROUP. The commission
shall assign each employer to a major group in accordance with the
definitions contained in the manual.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.005. ESTABLISHMENT OF MAJOR GROUP CONTRIBUTION
RATE. (a) For each calendar year, the commission shall establish
by industry an average contribution rate for each major group.
(b) The commission shall determine the year's contribution
rate for an industry by averaging the contribution rates paid by
employers in that industry during the preceding year ending on
September 30, as shown by the employment records maintained by the
commission.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.006. INITIAL CONTRIBUTION RATE. (a) A person's
contribution rate for the calendar year in which the person becomes
an employer is the greater of:
(1) the rate established for that year for the major
group to which the employer is assigned under Section 204.004; or
(2) two and seven-tenths percent.
(b) A rate established under Subsection (a) applies to the
employer until the date the experience rate computed under Section
204.041 takes effect for the employer.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.007. SPECIAL RATE; CERTAIN EMPLOYERS ENGAGED IN
AGRICULTURE. (a) This section applies to an employer identified
by the commission as classified in the manual as:
(1) Number 115114, crop preparation services for
market; or
(2) Number 115111, cotton ginning.
(b) An employer subject to this section shall pay a
contribution at the lowest of the following rates:
(1) five and four-tenths percent;
(2) the general tax rate applicable to that employer,
with the deficit tax rate and replenishment tax rate; or
(3) any other tax rate applicable to that employer
under this subtitle.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 864, § 1, eff. Sept. 1, 2001.

§ 204.008. TIME BENEFITS ARE PAID. For the purpose of
this chapter, benefits are paid at the time the claim for the
benefits is certified by the commission to the comptroller for
payment.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.009. APPLICATION TO LABOR AGENT. (a) A labor
agent who furnishes a farm and ranch laborer is liable for the
payment of a tax under this subtitle as if the labor agent were the
employer of the laborer, without regard to any factor used to
determine an employer-employee relationship, including the right
of control.
(b) If a labor agent does not pay the tax in accordance with
this subtitle, a person who contracts with the labor agent for the
services of a farm and ranch laborer is jointly and severally liable
with the labor agent for payment of the tax under this subtitle as
an employer.
(c) A labor agent shall notify each person with whom the
labor agent contracts whether the labor agent pays the tax under
this subtitle.
(d) A labor agent who pays the tax shall present evidence of
payment to each person with whom the labor agent contracts.
(e) In this section, "labor agent" means a person who is a
farm labor contractor under the Migrant and Seasonal Agricultural
Worker Protection Act (29 U.S.C. Section 1801 et seq.).

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.010. PAYMENT OF CONTRIBUTIONS BY INDIAN
TRIBES. An Indian tribe that is subject to this subtitle shall pay
contributions under the same terms and conditions as any other
subject employer unless the Indian tribe elects under Chapter 205
to make reimbursements for benefits instead of contributions.

Added by Acts 2001, 77th Leg., ch. 518, § 5, eff. June 11, 2001.

SUBCHAPTER B. CHARGEBACKS

§ 204.021. CHARGEBACKS. (a) The amount of benefits
paid to a claimant for a benefit year shall be charged to the
accounts of each of the claimant's employers during the claimant's
base period. The chargebacks of an employer for a calendar quarter
are the benefits paid to all of the employer's employees or former
employees during that quarter.
(b) The chargeback of benefits of a claimant who has two or
more employers during the claimant's base period is allocated among
those employers according to the proportion of the total of the
claimant's benefit wage credits paid during the base period by each
employer.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.022. EXCLUSIONS FROM CHARGEBACKS. (a) Benefits
computed on benefit wage credits of an employee or former employee
may not be charged to the account of an employer if the employee's
last separation from the employer's employment before the
employee's benefit year:
(1) was required by a federal statute;
(2) was required by a statute of this state or an
ordinance of a municipality of this state;
(3) would have disqualified the employee under Section
207.044, 207.045, 207.051, or 207.053 if the employment had been
the employee's last work;
(4) imposes a disqualification under Section 207.044,
207.045, 207.051, or 207.053;
(5) was caused by a medically verifiable illness of
the employee or the employee's minor child;
(6) was based on a natural disaster that results in a
disaster declaration by the president of the United States under
the Robert T. Stafford Disaster Relief and Emergency Assistance Act
(42 U.S.C. Section 5121 et seq.), if the employee would have been
entitled to unemployment assistance benefits under Section 410 of
that act (42 U.S.C. Section 5177) had the employee not received
state unemployment compensation benefits;
(7) was caused by a natural disaster, fire, flood, or
explosion that causes employees to be separated from one employer's
employment;
(8) resulted from the employee's resigning from
partial employment to accept other employment that the employee
reasonably believed would increase the employee's weekly wage; or

Text of subsec. (a)(9) as amended by Acts 2003, 78th Leg., ch. 77,
§ 1
(9) was based on a disaster that results in a disaster
declaration by the governor under Section 418.014, Government Code.

Text of subsec. (a)(9) as amended by Acts 2003, 78th Leg., ch. 526,
§ 1
(9) was caused by the employer being called to active
military service in any branch of the United States armed forces on
or after January 1, 2003.

Text of subsec. (a)(9) as amended by Acts 2003, 78th Leg., ch. 817,
§ 7A.01
(9) resulted from the employee leaving the employee's
workplace to protect the employee from family violence or stalking
as evidenced by:
(A) an active or recently issued protective order
documenting family violence against, or the stalking of, the
employee or the potential for family violence against, or the
stalking of, the employee;
(B) a police record documenting family violence
against, or the stalking of, the employee; and
(C) a physician's statement or other medical
documentation of family violence against the employee.
(b) For the purpose of this section, if an employee's last
separation from the employment of an employer is a separation for
which the employee was determined to have been disqualified under
Section 207.048, the employee's last separation from the employment
of that employer is considered to be the next later separation from
the employment of that employer.
(c) Except as provided by law, evidence regarding an
employee described by Subsection (a)(9) may not be disclosed to any
person without the consent of the employee.
(d) For purposes of Subsection (a)(9):
(1) "Family violence" has the meaning assigned by
Section 71.004, Family Code.
(2) "Stalking" means conduct described by Section
42.072, Penal Code.
(e) Benefits may not be charged to the account of an
employer, regardless of whether the liability for the chargeback
arises in the employee's current benefit year or in a subsequent
benefit year, if the employee's last separation from the employer's
employment before the employee's benefit year was or would have
been excepted from disqualification under Section 207.052(b).

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 93, § 1, eff. Sept. 1, 1997; Acts
2003, 78th Leg., ch. 77, § 1, eff. May 15, 2003; Acts 2003, 78th
Leg., ch. 526, § 1, eff. June 20, 2003; Acts 2003, 78th Leg., ch.
817, § 7A.01, eff. Sept. 1, 2003.

§ 204.023. NOTICE SENT AT TIME BENEFITS PAID. The
commission shall mail to an employer a notice of the employer's
maximum potential chargebacks when benefits are first paid if:
(1) notice of an initial claim has not already been
mailed to the employer under Section 208.002; and
(2) the employer's account is potentially chargeable
with benefits as a result of the initial claim and payment of
benefits.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.024. PROTEST OF POTENTIAL CHARGEBACKS. To
protest a potential chargeback, an employer to whom notice is
mailed under Section 204.023 must mail to the commission at Austin a
protest not later than the 30th day after the date the notice was
mailed or the right to protest the chargeback is waived. The
protest must include a statement of the facts supporting the
grounds of the protest.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 773, § 1, eff. Sept. 1, 1999.

§ 204.025. DECISION AND ADMINISTRATIVE REVIEW OF
PROTEST. (a) An examiner promptly shall decide the issues
involved in a timely protest filed under Section 204.024 and shall
mail a notice of the decision to the protesting employer.
(b) The examiner's decision becomes final 14 days from the
date the examiner mails the notice unless before that date the
employer mails to the commission at Austin a written appeal from the
examiner's decision.
(c) Administrative review under this section must be in
accordance with the rules of the commission.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.026. JUDICIAL REVIEW OF PROTEST. (a) An
employer may appeal an administrative determination made under
Section 204.025 after the employer has exhausted the employer's
administrative remedies, not including a motion for rehearing,
before the commission. An appeal must be filed within the time
prescribed by Sections 212.153 and 212.201 for commission decisions
on benefits.
(b) An appeal to a court relating to a chargeback has the
same venue and jurisdiction as a suit to collect contributions and
penalties under this subtitle.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.027. NOTICE, PROTEST, AND APPEAL--NOTICE SENT AT
TIME OF CLAIM. (a) If notice of the claim was sent to an employer
under Section 208.002, the commission shall mail the employer a
notice of the amount of the employer's potential chargeback
resulting from the claim.
(b) The employer may protest a clerical or machine error
relating to the amount of the chargeback not later than the 14th day
after the date the notice was mailed.
(c) The commission shall mail a decision on the protest to
the employer.
(d) An employer may appeal the decision on the protest not
later than the 14th day after the date notice of the decision is
mailed to the employer.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

SUBCHAPTER C. GENERAL TAX RATE FOR EXPERIENCE-RATED EMPLOYERS

§ 204.041. TAX ON EXPERIENCE-RATED
EMPLOYERS. (a) Each employer whose account has been chargeable
with benefits throughout four or more consecutive calendar quarters
shall pay contributions at the rate prescribed by the table in
Section 204.042 or a table extended under Section 204.043.
(b) Except as provided by Subsection (c), a change in the
rate applicable to an employer takes effect on January 1.
(c) The rate for an employer who becomes subject to
contributions under Subsection (a) for the first time at the close
of a calendar quarter takes effect on the first day of the next
calendar quarter and continues in effect until the January 1 of the
next calendar year.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.042. TAX RATE TABLE.

If the
replenishment
ratio is and the employer's benefit ratio does not exceed
d:
1.00 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90
...
1.20 0.00 0.08 0.16 0.25 0.33 0.41 0.50 0.58 0.66 0.75
1.21 0.00 0.08 0.16 0.24 0.33 0.41 0.49 0.57 0.66 0.74
1.22 0.00 0.08 0.16 0.24 0.32 0.40 0.49 0.57 0.65 0.73
1.23 0.00 0.08 0.16 0.24 0.32 0.40 0.48 0.56 0.65 0.73
1.24 0.00 0.08 0.16 0.24 0.32 0.40 0.48 0.56 0.64 0.72
1.25 0.00 0.08 0.16 0.24 0.32 0.40 0.48 0.56 0.64 0.72
1.26 0.00 0.07 0.15 0.23 0.31 0.39 0.47 0.55 0.63 0.71
1.27 0.00 0.07 0.15 0.23 0.31 0.39 0.47 0.55 0.62 0.70
1.28 0.00 0.07 0.15 0.23 0.31 0.39 0.46 0.54 0.62 0.70
1.29 0.00 0.07 0.15 0.23 0.31 0.38 0.46 0.54 0.62 0.69
1.30 0.00 0.07 0.15 0.23 0.30 0.38 0.46 0.53 0.61 0.69
1.31 0.00 0.07 0.15 0.22 0.30 0.38 0.45 0.53 0.61 0.68
1.32 0.00 0.07 0.15 0.22 0.30 0.37 0.45 0.53 0.60 0.68
1.33 0.00 0.07 0.15 0.22 0.30 0.37 0.45 0.53 0.60 0.67
1.34 0.00 0.07 0.14 0.22 0.29 0.37 0.44 0.52 0.59 0.67
1.35 0.00 0.07 0.14 0.22 0.29 0.37 0.44 0.51 0.59 0.66
1.36 0.00 0.07 0.14 0.22 0.29 0.36 0.44 0.51 0.58 0.66
1.37 0.00 0.07 0.14 0.21 0.29 0.36 0.43 0.51 0.58 0.65
1.38 0.00 0.07 0.14 0.21 0.28 0.36 0.43 0.50 0.57 0.65
1.39 0.00 0.07 0.14 0.21 0.28 0.35 0.43 0.50 0.57 0.64
1.40 0.00 0.07 0.14 0.21 0.28 0.35 0.42 0.50 0.57 0.64
1.41 0.00 0.07 0.14 0.21 0.28 0.35 0.42 0.49 0.56 0.63
1.42 0.00 0.07 0.14 0.21 0.28 0.35 0.42 0.49 0.56 0.63
1.43 0.00 0.06 0.13 0.20 0.27 0.34 0.41 0.48 0.55 0.62
1.44 0.00 0.06 0.13 0.20 0.27 0.34 0.41 0.48 0.55 0.62
1.45 0.00 0.06 0.13 0.20 0.27 0.34 0.41 0.48 0.55 0.62
1.46 0.00 0.06 0.13 0.20 0.27 0.34 0.41 0.47 0.54 0.62
1.47 0.00 0.06 0.13 0.20 0.27 0.34 0.40 0.47 0.54 0.61
1.48 0.00 0.06 0.13 0.20 0.27 0.33 0.40 0.47 0.54 0.60
1.49 0.00 0.06 0.13 0.20 0.26 0.33 0.40 0.46 0.53 0.60
1.50 0.00 0.06 0.13 0.20 0.26 0.33 0.40 0.46 0.53 0.60
1.51 0.00 0.06 0.13 0.19 0.26 0.33 0.39 0.46 0.52 0.59
1.52 0.00 0.06 0.13 0.19 0.26 0.32 0.39 0.46 0.52 0.59
1.53 0.00 0.06 0.13 0.19 0.26 0.32 0.39 0.45 0.52 0.58
1.54 0.00 0.06 0.12 0.19 0.25 0.32 0.38 0.45 0.51 0.58
1.55 0.00 0.06 0.12 0.19 0.25 0.32 0.38 0.45 0.51 0.58
1.56 0.00 0.06 0.12 0.19 0.25 0.32 0.38 0.44 0.51 0.57
1.57 0.00 0.06 0.12 0.19 0.25 0.31 0.38 0.44 0.50 0.57
1.58 0.00 0.06 0.12 0.18 0.25 0.31 0.37 0.44 0.50 0.56
1.59 0.00 0.06 0.12 0.18 0.25 0.31 0.37 0.44 0.50 0.56
1.60 0.00 0.06 0.12 0.18 0.25 0.31 0.37 0.43 0.50 0.56

the employer's tax rate is: 0.00% 0.1% 0.2% 0.3% 0.4% 0.5% 0.6% 0.7% 0.8% 0.9%

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.043. EXTENSION OF TAX RATE TABLE UP TO SIX
PERCENT. (a) The commission shall extend the table in Section
204.042 by providing additional replenishment ratios, benefit
ratios, and tax rates up to six percent.
(b) In extending the table in Section 204.042, the
commission shall use the same mathematical principles used in
constructing the table.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.044. BENEFIT RATIO. (a) The benefit ratio for an
employer is equal to the total amounts of the employer's
chargebacks for the 36 consecutive months preceding the tax rate
computation date divided by the total of the employer's taxable
wages for the same months.
(b) The benefit ratio of an employer whose account has been
chargeable with benefits for less than 36 consecutive months but
throughout each month of at least four calendar quarters is equal to
the total amount of the employer's chargebacks for those months
preceding the tax rate computation date divided by the total of the
employer's taxable wages for those months.
(c) In computing the benefit ratio, only taxable wages on
which contributions have been paid to the commission not later than
the last day of the month in which the computation date occurs may
be used.
(d) In computing the benefit ratio for employers who are
subject only to Section 201.027 and who have elected under that
section to file reports annually, only taxable wages for which
contributions have been paid to the commission on or before January
31 may be used.
(e) The benefit ratio is expressed as a percentage.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 487, § 2, eff. Sept. 1, 2001.

§ 204.045. REPLENISHMENT RATIO. (a) The replenishment
ratio for a calendar year is computed by:
(1) dividing the numerator described in Subsection (b)
by the denominator described in Subsection (c); and
(2) rounding the result to the nearest hundredth.
(b) The numerator is equal to the amount of benefits paid
during the 12 months ending September 30 of the preceding year that
are effectively charged to employers' accounts, plus one-half of
the amount of benefits paid during that period that are not
effectively charged to employers' accounts. In computing the
amount of the benefits charged or paid, the commission shall not
include the amount of:
(1) a canceled benefit warrant;
(2) that part of a benefit that has been overpaid and
been repaid; or
(3) benefits paid that are repayable from a
reimbursing employer, the federal government, or another
governmental entity.
(c) The denominator is the total amount of benefits paid
during the 12 months ending September 30 of the preceding year that
are effectively charged to employers' accounts.
(d) The commission shall compute the replenishment ratio
for each calendar year before the date the first contribution
payment with respect to wages for employment paid in that year is
due. Once computed for the year, the replenishment ratio may not be
adjusted.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.046. EFFECTIVELY CHARGED BENEFITS. (a) A
benefit is not effectively charged if it is:
(1) not charged to an employer's account;
(2) charged to an employer's account after the
employer has reached maximum liability because of the maximum tax
rate; or
(3) charged to an employer's account but considered
not collectible.
(b) A benefit not described in Subsection (a) is effectively
charged.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.047. TAX RATE COMPUTATION DATE FOR EXPERIENCE TAX
RATE. (a) The computation date for the tax rate for the
contribution under Section 204.041 is October 1 of the year
preceding the calendar year in which the rate takes effect, except
as provided by Subsections (b) and (c).
(b) The computation date for the tax rate for the
contribution under Section 204.041(a) for an employer who becomes
subject to that tax rate for the first time is the date on which the
rate takes effect under Section 204.041(c).
(c) An employer who reports annually under Section 201.027
has the same computation date as other employers, but the final
computation of a rate for the employer may not occur before February
1 of the year following the computation date.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 487, § 3, eff. Sept. 1, 2001.

§ 204.048. VOLUNTARY CONTRIBUTIONS. (a)
Notwithstanding any other provision of this subtitle, an employer
for whom the commission has computed an experience rate as of
October 1 of a calendar year that is effective for the succeeding
calendar year, as provided by Section 204.047(a), may elect to make
a voluntary payment of contributions to the commission.
(b) The amount of a voluntary contribution may be equal to
all or part of the employer's chargebacks during the period ending
September 30 that are used in computing the employer's experience
rate for the succeeding calendar year. The commission shall
allocate a voluntary contribution of less than the full amount of
the employer's chargebacks first to the employer's most recent
chargebacks.
(c) On receipt of a voluntary contribution during the period
prescribed by Subsection (d), the commission shall reduce the
employer's chargebacks by an amount equal to the contribution and
shall recompute the experience rate applicable to that employer for
the succeeding calendar year.
(d) An employer who elects to make a voluntary contribution
for the recomputation of the employer's experience rate must make
the contribution as prescribed by rules adopted by the commission.
The employer may not revoke the contribution after the date on which
the commission uses the contribution to recompute the employer's
experience rate.
(e) Notwithstanding Subsection (a), the commission may not
compute a new experience rate for an employer or reduce an
employer's experience rate based on a voluntary contribution made
by the employer after the expiration of the 120th day of the
calendar year for which the rate is effective.
(f) The commission shall deposit a voluntary contribution
made under this section to the credit of the compensation fund.

Added by Acts 1997, 75th Leg., ch. 383, § 1, eff. Sept. 1, 1997.
Amended by Acts 2003, 78th Leg., ch. 934, § 1, eff. Sept. 1,
2003.

SUBCHAPTER D. ADJUSTMENTS TO TAX RATE FOR EXPERIENCE-RATED
EMPLOYERS

§ 204.061. CEILING AND FLOOR OF COMPENSATION FUND. In
computing the tax rates under this subchapter:
(1) the ceiling of the compensation fund is two
percent of the total taxable wages for the four calendar quarters
ending the preceding June 30; and
(2) the floor of the compensation fund is equal to the
greater of:
(A) $400 million; or
(B) one percent of the total taxable wages for
the four calendar quarters ending the preceding June 30.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.062. REPLENISHMENT TAX. (a) In addition to the
general tax computed under Subchapter C, an employer entitled to an
experience rate shall pay a replenishment tax at the rate computed
by:
(1) dividing the numerator described by Subsection (b)
by the denominator described by Subsection (c);
(2) multiplying that result by 100 to obtain a
percentage; and
(3) rounding that result to the nearest hundredth.
(b) The numerator is an amount equal to one-half of the
amount of benefits paid by all employers during the 12 months ending
the preceding September 30 that are not effectively charged.
(c) The denominator is an amount equal to the taxable wages
paid by all employers during the four quarters ending the preceding
June 30.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, § 9.31, eff. Sept. 1, 1995.

§ 204.063. DEFICIT ASSESSMENT. (a) If the amount of
money in the compensation fund on a tax rate computation date is
less than the floor of the compensation fund, a deficit tax rate is
added for the next calendar year to the general tax rate for each
employer entitled to an experience rate for that year.
(b) The deficit tax rate for a calendar year is the lesser
of:
(1) the rate computed by multiplying the deficit
ratio, as computed under Section 204.064, by the sum of the
employer's general tax rate, the replenishment tax rate, and the
deficit tax rate for the previous calendar year; or
(2) two percent.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 317, § 6, eff. June 18, 2003; Acts
2003, 78th Leg., ch. 817, § 6.06, eff. June 20, 2003.

§ 204.064. DEFICIT RATIO. (a) The deficit ratio is
computed by:
(1) dividing the numerator computed under Subsection
(b) by the denominator described by Subsection (c); and
(2) rounding that result to the nearest hundredth.
(b) The numerator is computed by subtracting the balance of
the compensation fund, considering any federal advance, from the
floor of the compensation fund.
(c) The denominator is the amount of contributions due under
the general tax rate and the replenishment rate for the four
calendar quarters ending the preceding September 30 from employers
entitled to an experience rate on the tax rate computation date.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 317, § 7, eff. June 18, 2003; Acts
2003, 78th Leg., ch. 817, § 6.07, eff. June 20, 2003.

§ 204.065. CREDIT. (a) If the amount in the
compensation fund on a tax rate computation date is more than the
ceiling of the compensation fund, an employer entitled to an
experience rate on the computation date is entitled to a credit to
be applied beginning with contributions for the first quarter of
the following year.
(b) The amount of the credit is computed by multiplying the
surplus ratio computed under Section 204.066 by the employer's
contributions due for the four calendar quarters ending the
preceding September 30.
(c) An employer may not apply a credit against delinquent
contributions. A credit may not be applied until the employer has
paid any delinquent contributions.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.066. SURPLUS RATIO. (a) The surplus ratio is
computed by:
(1) dividing the numerator computed under Subsection
(b) by the denominator described by Subsection (c); and
(2) rounding that result to the nearest hundredth.
(b) The numerator is computed by subtracting the ceiling of
the compensation fund from the balance of the compensation fund.
(c) The denominator is the amount of contributions due for
the four calendar quarters ending the preceding September 30 from
employers entitled to an experience rate on the tax rate
computation date.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

SUBCHAPTER E. ACQUISITION OF EXPERIENCE-RATED EMPLOYER

§ 204.081. DEFINITION. In this subchapter,
"compensation experience" includes the period that benefit wage
credits or benefits have been chargeable and any other factor under
Subchapter A, B, C, or D necessary to the computation of experience
rating under those subchapters.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.082. EFFECTIVE DATE OF ACQUISITION. For purposes
of this subchapter, an acquisition is effective on the first day of
the calendar quarter in which the acquisition occurs.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.083. ACQUISITION OF ALL OF EXPERIENCE-RATED
ORGANIZATION, TRADE, OR BUSINESS. An employing unit that acquires
all of the organization, trade, or business of an employer and that
continues operation of the organization, trade, or business
acquires the compensation experience of the predecessor employer if
on the date of the acquisition, a shareholder, officer, or other
owner of a legal or equitable interest in the predecessor employer,
or the spouse or a person within the first degree of consanguinity
or affinity, as determined under Chapter 573, Government Code, of
the shareholder, officer, or other owner:
(1) is a shareholder, officer, or other owner of a
legal or equitable interest in the successor employing unit; or
(2) holds an option to purchase a legal or equitable
interest in the successor employing unit.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, § 5.95(27), eff. Sept. 1, 1995.

§ 204.084. ACQUISITION OF PART OF EXPERIENCE-RATED
ORGANIZATION, TRADE, OR BUSINESS: APPROVAL OF TRANSFER OF
COMPENSATION EXPERIENCE. (a) If an employing unit acquires a
part of the organization, trade, or business of an employer, the
successor employing unit and the predecessor employer may jointly
make a written application to the commission to transfer the
compensation experience of the predecessor employer that is
attributable to the part of the organization, trade, or business
acquired to the successor employing unit.
(b) If the acquisition results from the death of the
predecessor employer, the requirement that the predecessor
employer join in the application for transfer of the compensation
experience does not apply.
(c) Except as provided by Subsection (d), the commission
shall approve an application if:
(1) immediately after the acquisition the successor
employing unit continues operation of substantially the same part
of the organization, trade, or business acquired;
(2) the predecessor employer waives in writing all
rights to an experience rating computed on the compensation
experience attributable to the part of the organization, trade, or
business acquired by the successor employing unit, unless the
acquisition results from the death of the predecessor employer;
(3) a definitely identifiable and segregable part of
the predecessor employer's compensation experience is attributable
to the part of the organization, trade, or business acquired;
(4) for a successor employing unit that is not an
employer at the time of the acquisition, the successor employing
unit elects to become an employer on the date of the acquisition or
otherwise becomes an employer during the year in which the
acquisition occurs;
(5) the application was filed with the commission not
later than the first anniversary of the effective date of the
acquisition; and
(6) the applicants have shown that:
(A) the acquired part of the organization, trade,
or business is capable of operating independently and separately
from the predecessor employer; and
(B) the wages attributable to the acquired part
of the organization, trade, or business are solely attributable to
services provided on behalf of the acquired part of the
organization, trade, or business.
(d) The commission may deny a transfer of compensation
experience under this section if the commission determines based on
credible evidence that the acquisition was done primarily to
qualify for a reduced unemployment insurance tax rate by:
(1) circumventing the experience rating system; or
(2) manipulating the experience rating system by
minimizing the impact of chargebacks to the predecessor employer's
tax account.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 817, § 7.01, eff. Sept. 1, 2003.

§ 204.085. CONTRIBUTION RATE FOR SUCCESSOR
EMPLOYER. (a) A successor employing unit that is subject to
Section 204.083 or 204.084 and is an experience-rated employer on
the date of the acquisition shall pay contributions from the date of
the acquisition until the end of the calendar year in which the
acquisition occurred at the rate applicable to the successor
employing unit on the date of the acquisition.
(b) A successor employing unit that is subject to Section
204.083 or 204.084 and is not an experience-rated employer on the
date of the acquisition shall pay contributions from the date of the
acquisition until the next tax rate computation date at the highest
rate applicable at the time of the acquisition to any predecessor
employer who is a party to the acquisition.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.086. COLLECTION OF CONTRIBUTION, PENALTY, OR
INTEREST FROM SUCCESSOR EMPLOYER. (a) An individual or employing
unit that acquires the organization, trade, or business or
substantially all of the assets of an organization, trade, or
business of an employer who, at the time of the acquisition, is
indebted to the commission for a contribution, a penalty, or
interest, is liable to the commission for prompt payment of the
contribution, penalty, or interest.
(b) If not paid, the commission may bring an action under
Chapter 213 for the collection of a contribution, a penalty, or
interest as though the contribution, penalty, or interest had been
incurred by the successor employer.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 398, § 2, eff. Sept. 1, 2001.

SUBCHAPTER F. SPECIAL CONTRIBUTIONS FOR GOVERNMENTAL EMPLOYERS

§ 204.101. CONTRIBUTION FROM GOVERNMENTAL EMPLOYER. A
governmental employer shall pay a contribution in accordance with
this subchapter and rules adopted by the commission on wages paid
for employment during each year or portion of the year in which the
governmental employer is subject to this subtitle.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.102. CONTRIBUTION NOT DEDUCTION FROM WAGES. A
contribution paid by a governmental employer may not be deducted
from the wages of individuals in the employer's employ.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.103. RATE OF CONTRIBUTIONS FOR GOVERNMENTAL
EMPLOYERS. (a) The rate of the contribution required under
Section 204.101 for each calendar year is equal to the greater of:
(1) one-tenth of one percent; or
(2) the percentage, adjusted to the next higher
one-tenth of one percent, computed by dividing the numerator
described by Subsection (b) by the denominator described by
Subsection (c).
(b) The numerator is the amount of all benefits paid during
the preceding calendar year based on wage credits earned from
employers that pay contributions under this subchapter, not
including benefit payments that are reimbursable from any other
source. If the amount of benefits paid during the period used for
determining the rate is greater than the contributions paid by the
same employers for the same period, the amount of the benefits paid
in excess of the amount of contributions collected shall be added to
the numerator in determining the contribution rate. If the amount
of benefits paid for the period used for determining the rate is
less than the contributions paid by the same employers for the same
period, that amount shall be deducted from the numerator in
computing the rate.
(c) The denominator is the amount of the total wages paid
during the preceding calendar year by all employers that pay
contributions under this subchapter.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.104. ACCOUNTING FOR GOVERNMENTAL EMPLOYERS. The
commission shall account separately for benefits paid and
contributions collected under this subchapter, and these benefits
and contributions may not be used in determining contribution rates
under Subchapters A, B, C, and D.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.105. PAST DUE CONTRIBUTIONS. (a) A governmental
employer that fails to pay a contribution due under this subchapter
on the date it is due as prescribed by the commission is subject to
the same penalties as provided for other employers under Section
213.021.
(b) The provisions for collecting delinquent contributions
under Chapter 213 apply to a governmental employer.
(c) The commission shall notify the comptroller in writing
of the name of each governmental employer that is delinquent in
payment of contributions under this subtitle and the amount of the
delinquency. On receipt of the notice, the comptroller shall pay
the amount of the delinquency to the commission from any funds that
otherwise would be due from the state to the delinquent
governmental employer.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.

§ 204.106. REPORTS AND RECORDS. (a) A governmental
employer shall keep records and file reports with the commission
relating to individuals in its employ as required by rules adopted
by the commission.
(b) A governmental employer that does not keep the records
or file the reports when due is subject to the same penalties
provided for other employers under Sections 213.022, 213.023,
213.024, and 213.056.

Acts 1993, 73rd Leg., ch. 269, § 1, eff. Sept. 1, 1993.