View all text of Chapter 11 [§ 351 - § 369]
§ 358. Contributions
(a) Employer contribution
(1) In general
(A) General rule
(i) Contribution rate generally
(ii) Multiple employer limitationIf compensation is paid to an employee by more than one employer in any calendar month—(I) the contributions required by this subsection shall not apply to any amount of the aggregate compensation paid to such employee by all such employers in such calendar month which is in excess of such monthly compensation base; and(II) each employer (other than a subordinate unit of a national-railway-labor-organization employer) shall be liable for that portion of the contribution with respect to such compensation paid by all such employers which the compensation paid by him to such employee bears to the total compensation paid in such month by all such employers to such employee.
In the event that the compensation paid by such employers to the employee in such month is less than such monthly compensation base, each subordinate unit of a national-railway-labor-organization employer shall be liable for such portion of any additional contribution as the compensation paid by such employer to such employee in such month bears to the total compensation paid by all such employers to such employee in such month.
(B) Transitional rule
(i) 1st, 2d, and 3d calendar years
(ii) 4th calendar yearWith respect to compensation paid in calendar year 1991, the contribution rate shall be the smaller of—(I) the maximum contribution limit computed under paragraph (20); or(II) the percentage computed pursuant to the following formula:
2A+B | |||
R= | ——— | ||
3 |
(iii) 5th calendar yearWith respect to compensation paid in calendar year 1992, the contribution rate shall be the smaller of—(I) the maximum contribution limit computed under paragraph (20); or(II) the percentage computed pursuant to the following formula:
A+2C | |||
R= | ——— | ||
3 |
(iv) Meaning of symbolsFor purposes of the formulas in clauses (ii) and (iii)—(I) “R” is the applicable contribution rate expressed as a percentage for months in the calendar year;(II) “A” is the contribution rate determined under clause (i);(III) “B” is the percentage rate for the employer, as determined under subparagraph (C), for calendar year 1991; and(IV) “C” is the percentage rate for the employer, as determined under subparagraph (C), for calendar year 1992.
(v) Special rule for certain computationsFor purposes of computing B and C in such formulas—(I) the percentage rate computed under subparagraph (C), if more than the maximum contribution limit computed under paragraph (20) shall not be reduced to that limit; and(II) any computations which under subparagraph (C) are to be made on the basis of a 4-quarter or a 12-quarter period ending on a given June 30 shall be made on the basis of a period beginning on January 1, 1990, and ending on that June 30, and the amount so computed shall be increased to an amount that bears the same ratio to the amount so computed as 4 or 12, as appropriate, bears to the number of calendar quarters in the period on which the computation was based.
(vi) Special transition rule for public commuter railroads
(C) Experience-rated contributionsWith respect to compensation paid in a calendar year that begins after December 31, 1992, the contribution rate for each employer shall be determined as follows:
(i) Step 1
(ii) Step 2
(iii) Step 3
(iv) Step 4
(v) Step 5
(vi) Step 6
(vii) Step 7
(viii) Step 8
(D) New-employer contribution ratesNotwithstanding subparagraphs (B) and (C), the contribution rate applicable to a new employer who does not become subject to this chapter until after December 31, 1989, shall be determined as follows:
(i) 1st calendar yearWith respect to compensation paid in calendar months before the end of the first full calendar year in which the employer is subject to this chapter, the contribution rate shall be the average contribution rate paid by all employers during the 3 calendar years preceding the calendar year before the calendar year in which the compensation is paid. The average contribution rate shall be determined—(I) by dividing the aggregate contributions paid by all employers under this subsection in those 3 calendar years by the aggregate compensation with respect to which such contributions were paid; and(II) by multiplying the resulting ratio as computed to 4 decimal points by 100.
(ii) 2d calendar yearWith respect to compensation paid in calendar months in the next calendar year, the contribution rate shall be the smaller of—(I) the maximum contribution limit computed under paragraph (20); or(II) the percentage rate computed pursuant to the following formula:
2(A2)+B | |||||
R= | A | ———— | | ||
3 |
(iii) 3d calendar yearWith respect to compensation paid in calendar months in the third full calendar year in which the employer is subject to the coverage of this chapter, the contribution rate shall be the smaller of—(I) the maximum contribution limit computed under paragraph (20); or(II) the percentage rate computed pursuant to the following formula:
A3+2C | |||
R= | ——— | ||
3 |
(iv) Subsequent calendar years
(v) Meaning of symbolsFor purposes of the formulas in clauses (ii) and (iii)—(I) “R” is the applicable contribution rate expressed as a percentage for months in the calendar year;(II) “A1” is the contribution rate determined under clause (i) for such employer’s first full calendar year;(III) “A2” is the contribution rate which would have been determined under clause (i) if the employer’s second calendar year had been its first full calendar year;(IV) “A3” is the contribution rate which would have been determined under clause (i) if the employer’s third calendar year had been such employer’s first full calendar year;(V) “B” is the contribution rate for the employer as determined under subparagraph (C) for the employer’s second full calendar year; and(VI) “C” is the contribution rate for the employer as determined under subparagraph (C) for the employer’s third full calendar year.
(vi) Special rule for certain computationsFor purposes of computing B and C in such formulas—(I) the percentage rate computed under subparagraph (C), shall not be reduced under clause (viii) of that subparagraph; and(II) any computations which under subparagraph (C) are to be made on the basis of a 4-quarter or 12-quarter period ending on a given June 30 shall be made on the basis of a period commencing with the first day of the first calendar quarter that begins after the date on which the employer first commenced paying compensation subject to this chapter and ending on that June 30, and the amount so computed shall be increased to an amount that bears the same ratio to the amount so computed as 4 or 12, as appropriate, bears to the number of calendar quarters in the period on which the computation was based.
(2) Benefit ratio
(3) 3-year compensation base
(4) Reserve ratio
(5) 1-year compensation base
(6) Reserve balance
(7) Cumulative benefit balanceAn employer’s cumulative benefit balance as of any given June 30 shall be determined by adding—
(A) the net amount of the benefits charged to the employer under paragraph (15) on or after January 1, 1990; and
(B) the cumulative amount of the employer’s unallocated charges for the same period, if any, as computed under paragraph (9).
(8) Net cumulative contribution balanceAn employer’s net cumulative contribution balance as of any given June 30 shall be determined as follows:
(A) Step 1Compute the sum of
(i) all contributions paid by the employer pursuant to this subsection;
(ii) that portion of the tax imposed under section 3321(a) of title 26 that is attributable to the surtax rate under section 516(b) of the Railroad Unemployment Insurance and Retirement Improvement Act of 1988; 2
2 See References in Text note below.
and(iii) any taxes paid by the employer pursuant to section 3321(a) of title 26 (after the outstanding balance of loans made under section 360(d) of this title before October 1, 1985, plus interest, have been paid);
on or after January 1, 1990.
(B) Step 2
(C) Step 3
(9) Unallocated charge
(10) System unallocated charge balanceThe system unallocated charge balance as of any given June 30 shall be determined as follows:
(A) Step 1
(B) Step 2
(C) Step 3
(D) Step 4
(E) Step 5
(F) Step 6
(G) Step 7
(11) System compensation base
(12) Pooled credit ratioThe pooled credit ratio, if any, for a calendar year shall be determined as follows:
(A) Step 1
(B) Step 2
(13) Pooled charge ratioThe pooled charge ratio, if any, for a calendar year shall be determined as follows:
(A) Step 1With respect to each employer whose contribution rate for that calendar year as computed through step 6 under paragraph (1)(C) was greater than the maximum contribution limit computed under paragraph (20), multiply the employer’s 1-year compensation base as of the preceding June 30, as computed in accordance with paragraph (5), by the difference between—
(i) the percentage rate determined under subparagraph (B), (C), or (D) of paragraph (1) before the reduction to the maximum contribution limit; and
(ii) the maximum contribution limit.
(B) Step 2
(C) Step 3
(D) Step 4
(14) Surcharge rateThe surcharge rate for a calendar year, if any, shall be determined as follows:
(A) Step 1
(B) Step 2
(i) If the balance to the credit of the account is less than the greater of the amounts referred to in the 2nd sentence of step 1 but is equal to or more than the greater of $50,000,000 or of the amount that bears the same ratio to $50,000,000 as the system compensation base as of that June 30 bears to the system compensation base as of June 30, 1991, then the surcharge rate for the calendar year shall be 1.5 percent.
(ii) If the balance to the credit of the account is less than the greater of the amounts referred to in the clause (i), but greater than or equal to zero, then the surcharge rate for the calendar year shall be 2.5 percent.
(iii) If the balance to the credit of the account is less than zero, the surcharge rate for the calendar year shall be 3.5 percent.
(15) Chargeable benefits
(A) In general
(B) Adjustments
(C) Multiple employers
(i) In generalAll benefits paid to an employee who had more than 1 base-year employer shall be charged to the cumulative benefit balances of the employee’s base year employers—(I) in reverse chronological order of the employee’s employment with each such employer in the base year if the employer at the time of the claim was the last base year employer, and the amount charged to each employer shall not exceed the compensation paid by that employer to the employee in the base year; and(II) in all other cases, in the same ratio as the compensation paid to such employee by the employer bears to the total of such compensation paid to such employees by all such employers in the base year.
(ii) Special rule for employer with cancelled balances
(16) Defunct employer
(17) Individual employer record
(A) In general
(B) Definition
(18) Joint employer records
(19) Mergers, consolidations, or other changes in employer identity
(A) With other employers
(B) With nonemployers
(C) Sale of assets
(D) Reincorporation
(E) Abandonment
(20) Maximum contribution limit
(21) Special rules for certain computations under paragraph (1)(C)
(A) Any computation that is to be made under paragraph (1)(C) on the basis of a 12-quarter period ending on a given June 30 shall be made on the basis of a period—
(i) beginning on the later of—(I)January 1, 1990;(II) the first day of the first calendar quarter that begins after the date on which the employer first began to pay compensation subject to this chapter; or(III) July 1 of the third calendar year preceding that June 30; and
(ii) ending on that June 30.
(B) The amount computed under subparagraph (A) shall be increased to an amount that bears the same ratio to the amount so computed as 12 bears to the number of calendar quarters on which the computation is based.
(b) Employee representative contribution
(c) Board proclamation of balance
(1) In generalNot later than October 15, 1990, and October 15 of each year thereafter the Board shall proclaim—
(A) the balance to the credit of the account as of the preceding June 30 for purposes of paragraphs (12) and (14) of subsection (a);
(B) the balance of any advances to the account under section 360(d) of this title after September 30, 1985, that has not been repaid with interest as provided in such section as of September 30 of that year;
(C) the system compensation base as of that June 30 as computed in accordance with paragraph (11) of that subsection;
(D) the system unallocated charge balance as of that June 30, as computed in accordance with paragraph (10) of that subsection; and
(E) the pooled credit ratio, the pooled charge ratio, and the surcharge rate, if any, as determined under paragraph (12), (13), or (14) of that subsection and applicable in the following calendar year.
(2) Publication of notice
(d) Notifications by Board
(1) Not later than the last day of any calendar quarter that begins after March 31, 1990, the Board shall notify each employer and employee representative of its net cumulative contribution balance and cumulative benefit balance as of the end of the preceding calendar quarter, as computed in accordance with paragraphs (7) and (8) of subsection (a) as of the last day of such preceding calendar quarter rather than as of a given June 30 if such last day is not a June 30.
(2) Not later than October 15, 1990, and October 15 of each year thereafter, the Board shall notify each employer and employee representative of its benefit ratio, reserve ratio, 1-year compensation base, 3-year compensation base, unallocated charge, and reserve balance as of the preceding June 30 as computed in accordance with paragraphs (2), (3), (4), (5), (6), and (9) of subsection (a), and of the contribution rate applicable to the employer or employee representative in the following calendar year as computed under paragraphs (1)(B), (C), or (D) of that subsection.
(e) Information to verify accuracy to be made available
(f) Fractional parts of a cent
(g) Adjustments for improper payments
(h) Refunding overpayment; collecting underpayment
(i) Collection and deposit of contributions
(j) Time for payment; failure to pay promptly
(k) Application of other laws; authority of Board
(June 25, 1938, ch. 680, § 8, 52 Stat. 1102; July 31, 1946, ch. 709, § 318, 60 Stat. 739; June 23, 1948, ch. 608, §§ 4, 5(a), 6, 62 Stat. 577, 578; Aug. 31, 1954, ch. 1164, pt. III, §§ 305, 306, 68 Stat. 1042; Pub. L. 85–927, pt. II, § 203, Sept. 6, 1958, 72 Stat. 1782; Pub. L. 86–28, pt. III, §§ 306, 307, May 19, 1959, 73 Stat. 32; Pub. L. 88–133, title III, §§ 303(a), 304, Oct. 5, 1963, 77 Stat. 222, 223; Pub. L. 89–700, title II, § 204, title III, § 301(i), (ii), Oct. 30, 1966, 80 Stat. 1087, 1088; Pub. L. 94–92, title I, § 1(g), (h), Aug. 9, 1975, 89 Stat. 463; Pub. L. 97–35, title XI, § 1128(b), Aug. 13, 1981, 95 Stat. 641; Pub. L. 98–76, title V, § 503(a), Aug. 12, 1983, 97 Stat. 440; Pub. L. 100–647, title VII, §§ 7102(a)–(d), 7103(a), Nov. 10, 1988, 102 Stat. 3759–3770; Pub. L. 101–322, § 8(a), July 6, 1990, 104 Stat. 297.)