KRS § 336.248 — KY Code / Title XXVII / Chapter 336 / Section 336.248
336.248 Reports and contributions to unemployment insurance fund -- Options for submitting -- Changing choice of contribution method -- Clients contributing under KRS 341.275 -- Client treated as new employer
Status: in_force

336.248 Reports and contributions to unemployment insurance fund -- Options for

submitting -- Changing choice of contribution method -- Clients contributing

under KRS 341.275 -- Client treated as new employer.

For the purposes of KRS Chapter 341:

(1) The professional employer organization shall submit all required wage reports and

pay all required contributions to the Office of Unemployment Insurance under KRS

Chapter 341 using one (1) of the following:

(a) The professional employer organization shall file quarterly unemployment

wage and tax reports to report the wages of all covered employees and pay all

contributions, penalties, and interest on wages paid by the professional

employer organization to its covered employees during the term of the

applicable professional employer agreement under the reserve account of the

professional employer organization; or

(b) The professional employer organization shall file quarterly unemployment

wage and tax reports to report the wages of all covered employees and shall

pay all contributions, penalties, and interest on wages paid by the professional

employer organization to its covered employees during the term of the

applicable professional employer agreement under the reserve or reimbursing

account of the client. If the professional employer chooses this option:

1. The professional employer organization shall notify the Office of

Unemployment Insurance in writing;

2. The professional employer organization shall assist the Office of

Unemployment Insurance in the process of the separation and

identification of the contribution history, benefit experience history, and

payroll of each of its clients, and the Office of Unemployment Insurance

shall transfer the benefit experience history to the client account;

3. The Office of Unemployment Insurance shall determine the contribution

rate of each client account separately based upon the client's

contribution history, benefit experience history, and actual payroll. If:

a. There is not sufficient benefit experience history in the client

account to establish a tax rate, the account will be assigned a tax

rate pursuant to KRS 341.270(1); or

b. The client has benefit experience history from a previous account,

that benefit experience history shall be used in calculating an

earned tax rate pursuant to the provisions of KRS 341.270(4). The

benefit experience history shall be transferred to the account

assigned to that client as co-employer of the professional employer

organization. If taxable wages were reported by the client in a

previous account within the calendar year that the professional

employer organization and the client enter into a professional

employer agreement, the professional employer organization shall

be given credit for the taxable wages reported by the client on each

employee in the previous account; and

4. The professional employer organization shall produce all documentation

and information necessary for the Office of Unemployment Insurance to

create the client account within sixty (60) days of filing a notice under

this paragraph. If the information needed by the Office of

Unemployment Insurance is not produced within the sixty (60) day

period, the professional employer organization shall revert to reporting

under subsection (1)(a) of this section;

(2) Beginning on January 6, 2023, and continuing through December 31, 2024, the

professional employer organization shall submit all required wage reports and pay

all required contributions to the Office of Unemployment Insurance using the state

employer identification number and contribution rate of the client. After January 1,

2025, the professional employer organization shall report and pay all required

contributions to the unemployment insurance fund in accordance with the

provisions of subsection (1) of this section;

(3) Any professional employer organization with an existing employer reserve account

with the Office of Unemployment Insurance as of June 29, 2023, shall comply with

the provisions of this section no later than January 1, 2025;

(4) Any professional employer organization that does not have a current employer

reserve account with the Office of Unemployment Insurance as of June 29, 2023,

shall be liable for contributions under KRS Chapter 341 pursuant to this section;

(5) After choosing one (1) of the elections provided for under subsection (1) of this

section, a professional employer organization shall be permitted to change its

contribution election only once. The change of contribution election shall be made

by the professional employer organization in writing. The change of contribution

election shall become effective in the calendar year following the date the Office of

Unemployment Insurance approves the professional employer organization's

change of contribution option. If the Office of Unemployment Insurance approves a

change of contribution election, all contribution history, benefit experience history,

and payroll of each client shall be transferred to the:

(a) Professional employer organization account, if the election of subsection

(1)(a) of this section is chosen; or

(b) Individual client accounts, if the election in subsection (1)(b) of this section is

chosen;

(6) Notwithstanding subsection (1) of this section, any client of a professional

employer organization that is eligible for and has made an election to use the

contribution method under KRS 341.275 shall continue using this method,

regardless of whether the professional employer organization elected the option in

subsection (1)(a) of this section; and

(7) Upon the termination of a contract between a professional employer organization

and a client or the failure of a professional employer organization to submit reports

or make tax payments as required by KRS 336.230 to 336.250, the client shall be

treated as a new employer without a previous experience record unless that client is

otherwise eligible for an experience rating.