2023 Laws of Puerto Rico › TITLE TWENTY-NINE - Labor (§§ 1 — 3004) › PART III - Social Security (§§ 611 — 726f) › Chapter 47 - Employment Security Act (§§ 701 — 717) › § 710 - Unemployment Fund

(a) Creation and control.— A special fund, separate and apart from all moneys and funds of the Commonwealth of Puerto Rico, is hereby established as an unemployment fund to be administered by the Secretary exclusively for the purposes of this chapter. The fund shall consist of:
(1)
(A) All the taxes collected under the provisions of this chapter, except that ten percent (10%) of the taxes collected from employers covered by this chapter but not by the Federal Unemployment Tax Act with respect to employment before January 1, 1963, an amount of taxes equal to point four percent (0.4%) of the wages paid by said employers with respect to employment during the period from January 1, 1963 to December 31, 1970, an amount of taxes equal to one half percent (0.5%) of the wages paid by said employer with respect to employment during the period from January 1, 1971 to June 30, 1974, an amount of taxes equal to point five eighths percent (0.58%) of the wages paid by said employers during the period from July 1, 1974 to June 30, 1975, and an amount of taxes equal to one half percent (0.5%) on and after said date and until December 31, 1978, shall be deposited into the Special Auxiliary Fund established by § 711a of this title, and
(B) every refund in lieu of taxes collected under the provisions of § 708(d) and (e) of this title.
(2) All interest earned upon any money in the Fund.
(3) All property or securities accredited in lieu of taxes or other obligations with respect to the Fund.
(4) All earnings on such property or securities.
(5) All money recovered on losses incurred by the Fund.
(6) All money received from the Federal Unemployment Account in the Federal Unemployment Trust Fund by virtue of Title XII of the Social Security Act.
(7) All moneys credited to the Commonwealth’s account in the Unemployment Trust Fund by virtue of Title IX of the Social Security Act. Provided, That the credited funds corresponding to the 2000, 2001 and 2002 fiscal years shall be transferred to the Administration Fund to be used exclusively for administrative expenses incurred in the implementation of the Employment Security Program, as specified in the specific expenses guidelines. The credited funds corresponding to subsequent years may be used for the payment of benefits and for other purposes as provided in the Social Security Act.
(8) All money received from the federal government as a refund by virtue of § 204 of the Federal-State Extended Benefits Act of 1970 (P.L. 91-373).
(9) All money received for the Fund from any source. All moneys of the Fund shall be kept commingled and undivided.
(b) Accounts and deposits.—
(1) The Secretary of the Treasury shall be the treasurer and ex officio custodian of the Unemployment Fund. He shall maintain within the Fund three separate accounts: a Clearing Account, an Unemployment Trust Fund Account and a Benefit Account. All money collected pursuant to this chapter shall, upon receipt thereof by the Secretary of the Treasury, be immediately covered into the Clearing Account, but all interest and penalties, and ten percent (10%) of the contributions collected from employers covered by this chapter, but not by the Federal Unemployment Tax Act, shall be deposited for clearance only and shall, upon clearance, be paid over to the Special Auxiliary Fund established by § 711a of this title.
Except as otherwise provided herein, all money in the Liquidating Account shall, after liquidation, be deposited immediately with the Secretary of the Treasury of the United States to the credit of this Commonwealth in the Unemployment Trust Fund, established and maintained pursuant to § 904 of the Social Security Act, notwithstanding any other legal provisions of this Commonwealth related to the deposit, administration, release or disbursement of money in the Commonwealth’s possession or custody. Refunds payable from the Unemployment Fund by virtue of §§ 708(d)(2)(B)(iii), 709(d) and 702(k)(6)(G) of this title can be paid from the Liquidation Account or the Benefits Account. The Benefits Account shall consist of all money requisitioned from the Commonwealth’s account in the Unemployment Trust Fund for the payment of benefits and refunds existing in the United States Treasury.
(2) Except as herein otherwise provided, money in the Clearing and Benefit Accounts shall be deposited in any depositary bank in which general funds of Puerto Rico may be deposited, but no public deposit insurance charge or premium shall be paid out of the Unemployment Fund. Money in the Clearing and Benefit Accounts shall not be commingled with other Commonwealth funds, however, contributions collected under §§ 201—212 of Title 11, known as the Disability Benefits Act of Puerto Rico, may be commingled with money in the Clearing Account solely for purposes of clearance. The money in the Clearing and Benefit Accounts shall be maintained in two (2) separate accounts on the books of the depositary bank. Such money shall be secured by the depositary bank by collateral in the full amount of the funds on deposit. Such security shall consist of:
(A) United States government debentures, direct or secured, and
(B) direct debentures of the Government of Puerto Rico. Such collateral security shall be pledged for not to exceed the face value of the obligation and shall be kept separate and distinct from any collateral security pledged to secure other funds of the Commonwealth. The official bond of the Secretary of the Treasury shall answer for the faithful performance of his duties in connection with the Unemployment Fund created by this chapter. Such underwriting under the official bond of the Secretary of the Treasury shall become operative as soon as this act takes effect, and any liability under such bond shall stand in addition to any other liability under any other bond existing as of the date of approval of this act or which may be given thereafter.
(c) Advances of funds from the federal unemployment account.— The Governor of the Commonwealth of Puerto Rico is hereby authorized to apply to the Puerto Rico Unemployment Fund for an advance from the federal unemployment account in the Unemployment Trust Fund pursuant to the conditions specified in Title XII of the Social Security Act in order to secure the benefits available under that Title for this Commonwealth and its citizens, and to refund any such advances as provided by § 1202 of that Title. Provided, That the Governor of the Commonwealth of Puerto Rico may delegate this function on the Secretary.
The refund of any advances applied for on and after April 1, 1982, shall include the payment of interest as provided in § 1202(b) of Title XII of the Federal Social Security Act.
(d) Withdrawals of money from the Unemployment Trust Fund.—
(1) Money requisitioned from this Commonwealth’s account in the Unemployment Trust Fund shall be used exclusively for the payment of benefits and for refunds out of the unemployment fund pursuant to §§ 709(d) and 702(k)(6)(I) of this title. The Secretary shall from time to time requisition from the Unemployment Trust Fund such amounts, not exceeding the amounts standing to this Commonwealth’s account therein, as he deems necessary for the payment of such benefits and refunds for a reasonable future period. Upon the receipt thereof, such money shall be deposited in the Benefit Account.
(2) Any balance of money requisitioned from the Unemployment Trust Fund which remains in the Benefit Account after the expiration of the period for which it was requisitioned shall be deducted from estimates for, and utilized in the payment of, benefits and refunds during succeeding periods, or, in the discretion of the Secretary shall be redeposited with the Secretary of the Treasury of the United States, to the credit of the Commonwealth’s account in the Unemployment Trust Fund, as provided in subsection (b) of this section.
(e) Conditions of expenditure for benefit payments and refunds.— Expenditures and refunds of money from the Benefit Account and refunds from the Clearing Account shall not be subject to any provisions of law requiring specific appropriations or other formal release by Commonwealth officers of money in their custody. All checks issued for the payment of benefits and refunds shall bear the signature of the Secretary or his duly authorized agent for that purpose. The amount of any check issued for the payment of benefits or for the refund of contributions which has not been cashed within the one year period following the date on which it was issued, shall revert to the Unemployment Fund, any other provision of law to the contrary notwithstanding.
(f) Management of fund upon discontinuance of the Unemployment Trust Fund.— The provisions of subsections (a), (b), and (d) of this section, to the extent that they relate to the Unemployment Trust Fund, shall be operative only so long as such Unemployment Trust Fund continues to exist and so long as the Secretary of the Treasury of the United States continues to maintain for this Commonwealth a separate book account of all funds deposited therein by this Commonwealth together with this Commonwealth’s proportionate share of the earnings of such Unemployment Trust Fund, from which no other state is permitted to make withdrawals. If and when such Unemployment Trust Fund ceases to exist, or such separate book account is no longer maintained, all money belonging to the unemployment fund of this Commonwealth shall be administered by the Secretary as a trust fund exclusively for the purposes of this chapter, and the Secretary shall have authority to hold, invest, transfer, sell, deposit, and release such money, and any properties, securities, or earnings acquired as an incident to such administration.
(g) Unemployment compensation to veterans and federal employees.— All moneys paid to the Commonwealth of Puerto Rico by the United States pursuant to Public Law 550, 82nd Congress (66 Stat. 663) for the payment of unemployment compensation to veterans provided thereunder shall continue to be covered into the Veterans Unemployment Compensation Account kept by the Secretary of the Treasury and shall be used solely for the purposes for which they were paid. All moneys paid to the Commonwealth of Puerto Rico by the United States pursuant to Title XV of the Social Security Act, as amended, for the payment of unemployment compensation to federal employees provided thereunder shall continue to be paid into the Federal Employees Unemployment Compensation Account kept by the Secretary of the Treasury, and shall be used solely for the purposes for which they were paid.
(h) The Secretary is authorized and directed to pay over, on or before February 1, 1961, to the Secretary of the Treasury of the United States, for credit to the Puerto Rico account in the Unemployment Trust Fund, an amount equal to the excess of:
(1) The aggregate of the moneys received before January 1, 1961, in the Puerto Rico unemployment fund, including interest on any such moneys that have been invested, over
(2) the aggregate of the moneys paid from such fund before January 1, 1961, as unemployment compensation or as refunds of contributions or interest erroneously paid.
History —June 21, 1956, No. 74, p. 328, § 10; Dec. 22, 1960, No. 1, p. 1, § 11; June 8, 1962, No. 27, p. 54, § 6; June 24, 1971, No. 85, p. 257, § 7; June 15, 1972, No. 16, p. 374, § 9; Aug. 9, 1974, No. 21, Part 2, p. 646, § 5; June 24, 1977, No. 101, p. 228, § 6; July 26, 1979, No. 4, p. 924, § 8; July 9, 1982, No. 2, p. 191, § 3; May 25, 1985, No. 15, p. 46, § 2; July 15, 1988, No. 102, p. 424, § 6; Jan. 13, 2002, No. 28, § 2.