71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1477
House Bill 2126
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
Presession filed (at the request of House Interim Business and
Commerce Committee for John and Patrick Hamilton)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Shifts burden of proof from employer to Director of Employment
Department in certain contested cases. Stays interest and
penalties on Employment Department assessments until final
decision of hearing officer or reviewing court. Allows award of
attorney fees to employer in certain contested cases.
A BILL FOR AN ACT
Relating to Employment Department contested case hearings;
creating new provisions; and amending ORS 657.040, 657.485,
657.681 and 657.683.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 657.040 is amended to read:
657.040. (1) Services performed by an individual for
remuneration are { - deemed to be - } employment subject to
this chapter
{ - unless and until it is shown to the satisfaction of - }
{ + if + } the Director of the Employment Department
{ + shows + } that { - : - } { + the individual is an
employee. Services performed by an individual for remuneration
are not employment subject to this chapter if the individual: + }
(a) { - Such individual - } Is an independent contractor, as
that term is defined in ORS 670.600; or
(b) { - Such individual - } Has been and will continue to be
free from control or direction over the performance of
{ - such - } { + the + } services, both under a contract of
service and in fact; and
(c) { - Such individual - } Customarily is engaged in an
independently established business of the same nature as that
involved in the contract of service.
(2) A finding that an individual performed services for an
employing unit and earned less than the minimum amount necessary
to qualify for benefits under ORS 657.150 based on earnings from
that employing unit shall not be considered in determining
whether
{ - such - } { + the + } service is employment under
subsection (1) of this section.
SECTION 2. ORS 657.683 is amended to read:
657.683. (1) An application for hearing under ORS 657.679 and
657.681 shall be in writing and shall state that { - such - }
{ + the + } determination or assessment of the Director of the
Employment Department or authorized representative is unjust or
incorrect and that the employing unit requests a hearing thereon.
The application shall set forth the objections of the employing
unit to the determination or assessment and the amount of
contributions, if any, { - which - } { + that + } the
applicant admits to be due to the Employment Department. An
application for a hearing to review an assessment made under ORS
657.681 (4) { - which - } { + that + } was accompanied by a
demand for a bond or deposit shall not be valid unless
{ - such - } { + the + } bond or deposit is filed with the
application in a form acceptable to the director or authorized
representative.
(2) If a valid application for hearing is filed within the time
provided by ORS 657.679 and 657.681, a hearing officer shall
review the determination or assessment and if requested by the
employing unit shall grant a hearing unless a hearing has
previously been { - afforded - } { + given + } the employing
unit on the same grounds as set forth in the application. The
hearing officer shall give notice of the time and place of the
hearing to the director or authorized representative and shall
also give notice to the employing unit by mail directed to the
last-known address of the employing unit of record with the
director.
(3) Hearings under ORS 657.679 and 657.681 shall be conducted
in accordance with this chapter. { + Discovery shall be as
provided for in the Oregon Rules of Civil Procedure. + } The
filing of an application for hearing with respect to a disputed
assessment shall not affect the right of the director or
authorized representative to perfect any liens provided by this
chapter.
(4) All testimony at any hearing held under ORS 657.679 and
657.681 shall be recorded but need not be transcribed unless a
petition for judicial review from the decision of the hearing
officer is filed in the manner and within the time prescribed. At
any hearing held { - as provided in - } { + under + } ORS
657.679 and 657.681 { + , + } the { + director or authorized
representative has the burden of proving that the + }
determination or assessment of the director or authorized
representative { - shall be prima facie correct and the burden
shall be upon the protesting employing unit to prove that it is
incorrect - } { + is correct + }. Thereafter the hearing
officer shall enter the findings of fact and decision, either
affirming, modifying, or setting aside the determination or
assessment of the director or authorized representative and in
the case of an assessment, the hearing officer may increase or
decrease the amount of the assessment. The employing unit and the
director shall be promptly notified of the decision of the
hearing officer.
(5) A decision of the hearing officer shall become final on the
date of notification or the mailing thereof to the director and
to the employing unit at the last-known address of record with
the director unless within the time specified in ORS 183.480 (2)
the hearing officer on the hearing officer's own motion reviews
the same and issues an amended decision in which case the amended
decision becomes the final decision.
{ + (6) The hearing officer shall award attorney fees to the
employing unit if the hearing officer finds that the assessment
is objectively unreasonable. In determining whether an assessment
is objectively unreasonable, the hearing officer shall consider:
(a) The extent to which the assessment is adverse to the
employing unit. If the assessment is greater than 10 percent in
error, the assessment shall be presumed to be objectively
unreasonable and the director or authorized representative has
the burden of proving that the assessment is reasonable.
(b) The extent to which the director or authorized
representative utilized all the information regarding the
employing unit that was reasonably available to the director or
authorized representative.
(c) Any additional factors other than those described in
paragraphs (a) and (b) of this subsection that the hearing
officer deems relevant in determining whether the assessment is
objectively unreasonable.
(7) A decision by the hearing officer to award attorney fees
under subsection (6) of this section is final and may not be
modified by the director or authorized representative.
(8) The director or authorized representative or the employing
unit may appeal an award of attorney fees under subsection (6) of
this section as provided under ORS 657.684. The reviewing court
may award attorney fees to an employing unit on the same basis as
awarded under subsection (6) of this section. + }
SECTION 3. ORS 657.683, as amended by section 151, chapter 849,
Oregon Laws 1999, is amended to read:
657.683. (1) An application for hearing under ORS 657.679 and
657.681 shall be in writing and shall state that such
determination or assessment of the Director of the Employment
Department or authorized representative is unjust or incorrect
and that the employing unit requests a hearing thereon. The
application shall set forth the objections of the employing unit
to the determination or assessment and the amount of
contributions, if any, { - which - } { + that + } the
applicant admits to be due to the Employment Department. An
application for a hearing to review an assessment made under ORS
657.681 (4) { - which - } { + that + } was accompanied by a
demand for a bond or deposit shall not be valid unless such bond
or deposit is filed with the application in a form acceptable to
the director or authorized representative.
(2) If a valid application for hearing is filed within the time
provided by ORS 657.679 and 657.681, a hearing officer designated
by the director shall review the determination or assessment and
if requested by the employing unit shall grant a hearing unless a
hearing has previously been { - afforded - } { + given + }
the employing unit on the same grounds as set forth in the
application. The hearing officer shall give notice of the time
and place of the hearing to the director or authorized
representative and shall also give notice to the employing unit
by mail directed to the last-known address of the employing unit
of record with the director.
(3) Hearings under ORS 657.679 and 657.681 shall be conducted
in accordance with this chapter and the rules and regulations of
the director. { + Discovery shall be as provided for in the
Oregon Rules of Civil Procedure. + } The filing of an application
for hearing with respect to a disputed assessment shall not
affect the right of the director or authorized representative to
perfect any liens provided by this chapter.
(4) All testimony at any hearing held under ORS 657.679 and
657.681 shall be recorded but need not be transcribed unless a
petition for judicial review from the decision of the hearing
officer is filed in the manner and within the time prescribed. At
any hearing held { - as provided in - } { + under + } ORS
657.679 and 657.681 { + , + } the { + director or authorized
representative has the burden of proving that the + }
determination or assessment of the director or authorized
representative { - shall be prima facie correct and the burden
shall be upon the protesting employing unit to prove that it is
incorrect - } { + is correct + }. Thereafter the hearing
officer shall enter the findings of fact and decision, either
affirming, modifying, or setting aside the determination or
assessment of the director or authorized representative and in
the case of an assessment, the hearing officer may increase or
decrease the amount of the assessment. The employing unit and the
director shall be promptly notified of the decision of the
hearing officer.
(5) A decision of the hearing officer shall become final on the
date of notification or the mailing thereof to the director and
to the employing unit at the last-known address of record with
the director unless within the time specified in ORS 183.480 (2)
the hearing officer on the hearing officer's own motion reviews
the same and issues an amended decision in which case the amended
decision becomes the final decision.
{ + (6) The hearing officer shall award attorney fees to the
employing unit if the hearing officer finds that the assessment
is objectively unreasonable. In determining whether an assessment
is objectively unreasonable, the hearing officer shall consider:
(a) The extent to which the assessment is adverse to the
employing unit. If the assessment is greater than 10 percent in
error, the assessment shall be presumed to be objectively
unreasonable and the director or authorized representative shall
have the burden of proving that the assessment is reasonable.
(b) The extent to which the director or authorized
representative utilized all the information regarding the
employing unit that was reasonably available to the director or
authorized representative.
(c) Any additional factors other than those described in
paragraphs (a) and (b) of this subsection that the hearing
officer deems relevant in determining whether the assessment is
objectively unreasonable.
(7) A decision by the hearing officer to award attorney fees
under subsection (6) of this section is final and may not be
modified by the director or authorized representative.
(8) The director or authorized representative or the employing
unit may appeal an award of attorney fees under subsection (6) of
this section as provided under ORS 657.684. The reviewing court
may award attorney fees to an employing unit on the same basis as
awarded under subsection (6) of this section. + }
SECTION 4. ORS 657.681 is amended to read:
657.681. (1) If an employer files a report for the purpose of
determining the amount of contributions due under this chapter
but fails to pay contributions or interest, the Director of the
Employment Department or authorized representative may assess the
amount of contributions or interest due on the basis of the
information submitted and shall give written notice of the
assessment to the employer mailed to the last-known address of
record with the director. In the event that such report is
subsequently found to be incorrect additional assessments may be
made, subsection (5) of this section to the contrary
notwithstanding.
(2) If an employer fails to file a report when required by the
director for the purpose of determining the amount of
contribution due under this chapter, the director or authorized
representative may make an estimate based upon any information of
the amount of wages paid for employment in the period or periods
for which no report was filed and upon the basis of such estimate
shall compute and assess the amount of employer contributions
payable by the employer. Written notice of the assessment shall
be mailed to the last-known address of the employer of record
with the director.
(3) If the director or authorized representative is not
satisfied with a report made by an employer for the purpose of
determining the amount of contribution due under this chapter,
the director or authorized representative may compute the amount
required to be paid upon the basis of facts contained in the
report or upon the basis of any information obtainable and may
make an assessment of the amount of the deficiency. Written
notice of such deficiency assessment shall be mailed to the
last-known address of the employer of record with the director.
(4) If the director or authorized representative has reason to
believe that an employer is insolvent, or that the collection of
any contributions will be jeopardized by delaying collection, the
director or authorized representative may thereupon make an
immediate assessment of the estimated amount of accrued
contributions, noting upon the assessment that it is a jeopardy
assessment levied under this subsection, and may proceed to
enforce collection immediately, but interest shall not begin to
accrue upon such contributions until the due date nor shall court
costs be taxed against such employer on any action to enforce
collection commenced prior to the due date. The director or
authorized representative may, in levying the assessment, demand
a bond or deposit of such security as is necessary to insure
collection of the amount of such assessment. Written notice of
the assessment shall be mailed to the last-known address of the
employer of record with the director.
(5) All assessments provided for in this section shall finally
fix the amount of contributions due and payable unless the
employer { + , + } { - shall - } within 20 days after the
mailing of the notice of assessment { + , applies + }
{ - apply - } to the director for a hearing, or unless the
director or authorized representative on the motion of the
director or authorized representative reviews the same prior to a
decision of the hearing officer thereon pursuant to hearing. An
employer who fails to apply for a hearing upon an assessment
within the time provided or, having applied, fails to appear and
be heard after due notice of such hearing, shall be precluded
from raising any defense to any action, suit or proceeding
brought by the director for the recovery of contributions based
upon such assessment which could have been raised in the hearing.
{ + Except as provided in subsection (6) of this section, + }
the amount of contributions { - so - } assessed under this
section shall be subject to the penalties and interest provided
by ORS 657.515 and 657.663.
{ + (6) If an application for hearing under ORS 657.683 is
filed or a petition for judicial review under ORS 657.684 is
filed, the amount of contributions assessed under this section is
not subject to the penalties and interest provided under ORS
657.515 and 657.663 until the decision of the hearing officer or
the reviewing court becomes final. + }
SECTION 5. ORS 657.485 is amended to read:
657.485. (1) An employer, when notified that the employer has
been determined an employer subject to this chapter, shall also
be notified of the tax rate for the employer as determined
{ - pursuant to - } { + under + } this chapter. Such tax rate
shall become conclusive and binding upon the employer unless
within 20 days after the mailing of the notice to the last-known
address of the employer as shown on the records of the Director
of the Employment Department, or in the absence of mailing,
within 20 days after the delivery of such notice, the employer
files a request for hearing with the director, setting forth the
reason therefor.
(2) An employer whose rate has been determined in accordance
with the provisions of ORS 657.462, shall be notified of the tax
rate for the employer not later than November 15 of the year
preceding the calendar year for which the rate is applicable. An
employer whose account is open according to the Employment
Department records as of November 15 but whose tax rate was not
determined under ORS 657.462 shall be notified of the tax rate
for the following calendar year by November 15 or as soon as
possible thereafter. Such tax rate shall become conclusive and
binding upon the employer unless, within 20 days after the
mailing of the notice to the last-known address of the employer
as shown by the records of the director or, in the absence of
mailing, within 20 days after the delivery of such notice, the
employer files a written application for review and
redetermination with the director, setting forth the reasons
therefor.
(3) If a valid application is filed within the time provided in
subsection (2) of this section, an authorized representative of
the director shall review the determination and notify the
employer in writing thereof. If the review results in a change in
either the employer's tax rate or information included on the
original tax rate notice, an amended notice shall be provided the
employer.
(4) The decision of the authorized representative reflecting
the result of the review provided for in subsection (3) of this
section shall become final and conclusive and binding upon the
employer unless the employer, within 20 days after delivery of
the notice, or if mailed, within 20 days after the same was
mailed to the last-known address of the employer, files a request
for hearing with the director. The request shall be in writing
and shall state that the decision of the authorized
representative is incorrect and the reasons therefor.
(5) When a valid request for hearing has been filed, as
provided in subsections (1) and (4) of this section, a hearing
shall be conducted by a hearing officer assigned from the Hearing
Officer Panel established under section 3, chapter 849, Oregon
Laws 1999, unless a hearing has previously been
{ - afforded - } { + given + } the employer on the same
grounds as set forth in the request. The hearing officer shall
give notice of the time and place of hearing to the director or
authorized representative of the director and shall also give
notice to the employer by mail directed to the last-known address
of record with the director. Hearings under this subsection shall
be conducted in accordance with this chapter. The filing of a
request for hearing with respect to a disputed tax rate shall not
affect the right of the director or authorized representative of
the director to perfect any liens provided by this chapter.
(6) After hearing, the hearing officer shall enter findings of
fact and decision either affirming or modifying the tax rate
notice. The employer and the director shall be promptly notified
of the decision of the hearing officer. All testimony at any
hearing held before a hearing officer under this section shall be
recorded but need not be transcribed unless a petition for
judicial review from the decision of the hearing officer is filed
in the manner and within the time prescribed in ORS 657.487.
(7) A decision of the hearing officer shall become final on the
date of notification or the mailing thereof to the director and
to the employer at the last-known address of record with the
director, and shall become conclusive and binding upon the
employer and the director unless a petition for judicial review
is filed in the manner and within the time prescribed in ORS
657.487.
(8) No employer shall have any standing, in any proceeding
involving tax rate or tax liability, to contest the chargeability
to the account of the employer of any benefits paid in accordance
with a determination, redetermination or decision pursuant to ORS
657.265, 657.266 to 657.269 and 657.270 to 657.290, except upon
the ground that the services on the basis of which such benefits
were found to be chargeable did not constitute services performed
in employment for the employer or for a predecessor employer and
only in the event that the employer or the predecessor was not a
party to such determination, redetermination or decision or to
any other proceeding under this chapter in which the character of
such service was determined. At any hearing under this
section { + , the director has the burden of proving that + } the
tax rate determined by the director or authorized representative
of the director { - shall be prima facie correct and the burden
shall be upon the protesting employer to prove it is
incorrect - } { + is correct + }.
SECTION 6. ORS 657.485, as amended by section 133, chapter 849,
Oregon Laws 1999, is amended to read:
657.485. (1) An employer, when notified that the employer has
been determined an employer subject to this chapter, shall also
be notified of the tax rate for the employer as determined
{ - pursuant to - } { + under + } this chapter. Such tax rate
shall become conclusive and binding upon the employer unless
within 20 days after the mailing of the notice to the last-known
address of the employer as shown on the records of the Director
of the Employment Department, or in the absence of mailing,
within 20 days after the delivery of such notice, the employer
files a request for hearing with the director, setting forth the
reason therefor.
(2) An employer whose rate has been determined in accordance
with the provisions of ORS 657.462, shall be notified of the tax
rate for the employer not later than November 15 of the year
preceding the calendar year for which the rate is applicable. An
employer whose account is open according to the Employment
Department records as of November 15 but whose tax rate was not
determined under ORS 657.462 shall be notified of the tax rate
for the following calendar year by November 15 or as soon as
possible thereafter. Such tax rate shall become conclusive and
binding upon the employer unless, within 20 days after the
mailing of the notice to the last-known address of the employer
as shown by the records of the director or, in the absence of
mailing, within 20 days after the delivery of such notice, the
employer files a written application for review and
redetermination with the director, setting forth the reasons
therefor.
(3) If a valid application is filed within the time provided in
subsection (2) of this section, an authorized representative of
the director shall review the determination and notify the
employer in writing thereof. If the review results in a change in
either the employer's tax rate or information included on the
original tax rate notice, an amended notice shall be provided the
employer.
(4) The decision of the authorized representative reflecting
the result of the review provided for in subsection (3) of this
section shall become final and conclusive and binding upon the
employer unless the employer, within 20 days after delivery of
the notice, or if mailed, within 20 days after the same was
mailed to the last-known address of the employer, files a request
for hearing with the director. The request shall be in writing
and shall state that the decision of the authorized
representative is incorrect and the reasons therefor.
(5) When a valid request for hearing has been filed, as
provided in subsections (1) and (4) of this section, a hearing
shall be conducted by a hearing officer designated by the
director unless a hearing has previously been { - afforded - }
{ + given + } the employer on the same grounds as set forth in
the request. The hearing officer shall give notice of the time
and place of hearing to the director or authorized representative
of the director and shall also give notice to the employer by
mail directed to the last-known address of record with the
director. Hearings under this subsection shall be conducted in
accordance with this chapter and the rules of the director. The
filing of a request for hearing with respect to a disputed tax
rate shall not affect the right of the director or authorized
representative of the director to perfect any liens provided by
this chapter.
(6) After hearing, the hearing officer shall enter findings of
fact and decision either affirming or modifying the tax rate
notice. The employer and the director shall be promptly notified
of the decision of the hearing officer. All testimony at any
hearing held before a hearing officer under this section shall be
recorded but need not be transcribed unless a petition for
judicial review from the decision of the hearing officer is filed
in the manner and within the time prescribed in ORS 657.487.
(7) A decision of the hearing officer shall become final on the
date of notification or the mailing thereof to the director and
to the employer at the last-known address of record with the
director, and shall become conclusive and binding upon the
employer and the director unless a petition for judicial review
is filed in the manner and within the time prescribed in ORS
657.487.
(8) No employer shall have any standing, in any proceeding
involving tax rate or tax liability, to contest the chargeability
to the account of the employer of any benefits paid in accordance
with a determination, redetermination or decision pursuant to ORS
657.265, 657.266 to 657.269 and 657.270 to 657.290, except upon
the ground that the services on the basis of which such benefits
were found to be chargeable did not constitute services performed
in employment for the employer or for a predecessor employer and
only in the event that the employer or the predecessor was not a
party to such determination, redetermination or decision or to
any other proceeding under this chapter in which the character of
such service was determined. At any hearing under this
section { + , the director has the burden of proving that + } the
tax rate determined by the director or authorized representative
of the director { - shall be prima facie correct and the burden
shall be upon the protesting employer to prove it is
incorrect - } { + is correct + }.
SECTION 7. { + The amendments to ORS 657.040, 657.485, 657.681
and 657.683 by sections 1 to 6 of this 2001 Act apply only to
requests for hearing filed on or after the effective date of this
2001 Act. + }
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