Utah Administrative Code

The Utah Administrative Code is the body of all effective administrative rules as compiled and organized by the Division of Administrative Rules (see Subsection 63G-3-102(5); see also Sections 63G-3-701 and 702).

NOTE: For a list of rules that have been made effective since October 1, 2019, please see the codification segue page.

NOTE TO RULEFILING AGENCIES: Use the RTF version for submitting rule changes.


R994. Workforce Services, Unemployment Insurance.

Rule R994-304. Special Provisions Regarding Transfers of Unemployment Experience and Assigning Rates.

As in effect on October 1, 2019

Table of Contents

R994-304-101. Transfer of a Trade or Business, or Portion Thereof, with Common Ownership, Management, or Control.

(1) The term "person" includes an individual, trust, estate, partnership, association, limited liability company, corporation, government entity, or Indian tribe. The "predecessor employer" is the employer that transfers its trade or business, or a portion of its trade of business, to another employer. The "successor employer" is the employer that acquires the trade or business, or a portion of the trade or business.

(2) Common ownership exists if an employer transfers a trade or business, or a portion of a trade or business, to another employer and at the time of the transfer:

(a) the predecessor employer owns 50% or more of the trade or business of the successor employer. For entities that issue shares of stock ownership, 50% or more of the "voting shares" of stock interest must be common to both; or

(b) an individual with a controlling interest in the predecessor trade or business, transfers that controlling interest to an individual in the successor trade or business and the parties are related in one of the following ways:

(i) spouse;

(ii) parent;

(iii) step parent;

(iv) child;

(v) step child;

(vi) sibling; or

(vii) step sibling.

(3) The Department will determine common management or control using the best available evidence.

(a) Common management will be found if the predecessor and successor employers have the same or similar:

(i) managers, officers, board of directors;

(ii) personnel and human resource policies;

(iii) operating procedures;

(iv) sales and pricing policies;

(v) collection procedures;

(vi) financing policies;

(vii) accounting practices; or

(viii) purchasing practices.

(b) Common control will be found where the predecessor and successor employers have the same or similar:

(i) control of the assets used to conduct the business enterprise;

(ii) financing and/or leasing arrangements;

(iii) contracts; or

(iv) business, professional, and regulatory licenses of the business enterprise.

(4) The factors listed in subsections 3(a) and (3)(b) of this section are not exclusive and are intended as aids for analyzing the facts of each case. The degree of importance of each factor in those subsections varies depending on the nature of the trade or business transferred. Some do not apply to certain trades or businesses and, therefore, should not be given any weight. The Department will scrutinize the facts in each case to assure that the form of the transfer does not obscure the substance of the transfer.

R994-304-102. Notification Requirements.

(1) All parties to a transfer described in Section 35A-4-304(3)(a) must provide the following information to the Department within 30 days of the transfer date:

(a) the effective date of the transfer.

(b) the percentage of the assets, trade or business, and workforce transferred.

(c) the reason for the transfer.

(d) the following information for both the predecessor and the successor employers:

(i) name;

(ii) street address;

(iii) Utah Unemployment Insurance Registration Numbers, if one has been assigned; and

(iv) Federal Employer Identification Numbers (FEIN), if one has been assigned.

(e) the name and Social Security number (SSN) or FEIN of any successor employer who was also a predecessor employer, or any individual who is related to the predecessor. Related means to have a family relationship as described in Section R994-304-101(2)(b).

(f) common management and control practices that were retained from the predecessor employer.

(g) any other information requested by the Department.

R994-304-103. Recalculation and Effective Date of Contribution Rates.

Any employer that is a party to a transfer of an employer's trade or business described in Section 35A-4-304(3)(a) shall have its contribution rate recalculated. The effective date of the recalculation shall be the first day of the calendar quarter following the actual date of the transfer, unless the actual transfer occurred on the first day of a calendar quarter, in which case the recalculation takes effect on that day.

R994-304-104. Identification of the Transfer or Acquisition of an Employer's Workforce.

The Department will develop and implement programs to aid in the detection and identification of employers that transfer or acquire all or a portion of another employer's workforce.

KEY

unemployment experience rating

Date of Enactment or Last Substantive Amendment

June 1, 2005

Notice of Continuation

March 25, 2015

Authorizing, Implemented, or Interpreted Law

35-A-4-304


Additional Information

Contact

For questions regarding the content or application of rules under Title R994, please contact the promulgating agency (Workforce Services, Unemployment Insurance). A list of agencies with links to their homepages is available at http://www.utah.gov/government/agencylist.html or from http://www.rules.utah.gov/contact/agencycontacts.htm.