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U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210

CLASSIFICATION

UI

CORRESPONDENCE SYMBOL

TEURL

ISSUE DATE

August 24, 1989

RESCISSIONS

None

EXPIRATION DATE

June 30, 1991

DIRECTIVE

:

UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 49-89

 

TO

:

ALL STATE EMPLOYMENT SECURITY AGENCIES

 

FROM

:

OFFICE OF THE DEPUTY ASSISTANT SECRETARY
DONALD J. KULICK
Administrator
for Regional Management

 

SUBJECT

:

Corrected Draft Language for Implementing Section 3304(a)(14)(A), FUTA

  1. Purpose. To provide State agencies with corrected draft language to implement Section 3304(a)(14)(A) of the Federal Unemployment Tax Act (FUTA).

  2. References. Section 3304(a)(14), FUTA; Draft Language and Commentary to Implement the Unemployment Compensation Amendments of 1976--P. L. 94-566, ("1976 Draft Language"), including Supplement #1--Questions and Answers, issued December 7, 1976; UIPL 1-86, dated October 28, 1985; UIPL 1-86, Change 1, dated February 16, 1989.

  3. Background. Section 3304(a)(14)(A), FUTA, requires, as a condition for the Secretary of Labor's certification of a State to the Secretary of the Treasury, that the State law provide that:

      compensation shall not be payable on the basis of services performed by an alien unless such alien is an individual who was lawfully admitted for permanent residence at the time such services were performed, was lawfully present for purposes of performing such services, or was permanently residing in the United States under color of law at the time such services were performed (including an alien who was lawfully present in the United States as a result of' the application of the provisions of is section 203(a)(7) or section 212(d)(5) of the Immigration and Nationality Act).

    Simply put, base period wages may not be used in a monetary determination on a claim for unemployment benefits unless the wages were earned while the alien was in one of the three eligible categories specified in Section 3304(a)(14)(A) and the State law.  The three categories of aliens are:

    1. Aliens lawfully admitted for permanent residence at the time the services were performed.

    2. Aliens lawfully present for purposes of performing the services.

    3. Aliens permanently residing in the United States under color of law at the time the services were performed.

    A State unemployment compensation law is not required to contain any of the three categories of eligible aliens.  However, a State may not broaden the definition of any of the three categories of eligible aliens. UIPL 1-86 and UIPL 1-86, Change 1, set forth the Department of Labor's interpretation of these three eligible categories of aliens.

    Section 3304(a)(14) was added to FUTA by Section 314(a ) of the Unemployment Compensation Amendments of 1976, P.L. 94-566.  At that time, only the current first and third categories of eligible aliens were included. The 1976 Draft Language provided language implementing these amendments. In 1977, Section 302(a) of P.L. 95-19 amended Section 3304(a)(14)(A) to add the current second category. Supplement #1 to the 1976 Draft Language provided draft language implementing this amendment.  The draft language provided in both the 1976 Draft Language and Supplement #1 does not accurately reflect the requirements of Section 3304(a)(14)(A), FUTA.  This UIPL is issued to provide corrected language.

  4. Discussion. On page 51 of the 1976 Draft Language, the Department provided language intended to implement the provisions of Section 3304(a)(14)(A), as provided by P.L. 94-566.  This language provided that:

      Benefits shall not be paid on the basis of services performed by an alien unless such alien is an individual who has been lawfully admitted for permanent residence or otherwise is permanently residing in the United States under color of law . . . .

    This language does not reflect the requirement of Section 3304(a)(14)(A), FUTA, that the alien must be in the eligible category at the time the services were performed.  Instead, under this draft language, if an alien is in an eligible category at the moment of claiming benefits, then all services performed by the alien in the base period may be used in determining the alien's monetary eligibility.

    In addition, on page 24 of Supplement #1 to the 1976 Draft Language, the Department provided draft language in anticipation of the enactment of P.L. 95-19 which added the current second category of eligible aliens, those lawfully present for the purposes of performing services.  This recommended language:

      Provided, that any modifications to the provisions of section 3304(a)(14) of the Federal Unemployment Tax Act as provided by Public Law 94-566 which specify other conditions or other effective date [sic] than stated herein for denial of benefits based on services performed by aliens and which modifications are required to be implemented under State law as a condition for full tax credit against the tax imposed by the Federal Unemployment Tax Act, shall be deemed applicable under the provisions of this section.

    This language was provided on the assumption that State law must contain the current second category of aliens.  However, as noted above, the State has the option of determining whether any or all of the categories of eligible aliens are included in State law.  Because the draft language was designed to incorporate only those amendments to Section 3304(a)(14) which were required as a condition for full tax credit, it does not incorporate the current second category of aliens into State law.

    Revised draft language correcting these problems is attached.  The draft language assumes that State law will include all three categories of eligible aliens.

    In addition, the draft language follows Section 3304(a)(14)(A) in that it refers to Section 203(a)(7) of the Immigration and Nationality Act (INA). Section 203(a)(7) was repealed by Section 203(c)(3) of the Refugee Act of 1980 (P.L. 96-212) and replaced under Section 201(b) of the Refugee Act with Sections 207 and 208. Under Section 203(h) of the Refugee Act, Section 203(a)(7) is applicable prior to April 1, 1980.  In addition, Section 203(h) provides that, effective April 1, 1980, any reference in Federal law to Section 203(a)(7) is considered a reference to new Sections 207 and 208, INA.  Section 207 relates to refugees and Section 208 to asylees, both of which are, therefore, considered to be permanently residing in the United States under color of law under Section 3304(a)(14)(A), FUTA.  Whether a reference in State law to Section 203(a)(7), INA, is considered a reference to Sections 207 and 208 is a matter for the State to determine.  To clarify this matter, States may wish to amend their laws to also contain specific references to Sections 207 and 208.

  5. Action Required.

    1. State agencies should replace page 51 of the 1976 Draft Legislation with the attached corrected page 51.

    2. States which followed the incorrect draft language on the original page 51 of the 1976 Draft Legislation must seek amendment to their laws.

    3. States which followed the language in Supplement #1 to the 1976 Draft Language need not seek amendments for purposes of meeting Federal law requirements.  However, these States might wish to examine their laws to determine whether services performed by aliens lawfully present for purposes of performing such services may be included when computing an alien's eligibility for benefits.

  6. Inquiries. Please direct inquiries to the appropriate Regional Office.

  7. AttachmentRevised Draft Language.

 

 


ATTACHMENT TO UIPL 49-89

 


Section 4(a)(5)
Treatment of Services Performed by Aliens
(Section 3304(a)(14), FUTA)




                * 4(a)(5)(A) Benefits shall not be payable on the basis of services performed by an alien unless such alien is an individual who was lawfully admitted for permanent residence at the time such services were performed, was lawfully present for purposes of performing such services, or was permanently residing in the United States under color of law at the time such services were performed (including an alien who was lawfully present in the United States as a result of the application of the provisions of section 203(a)(7) or section 212(d)(5) of the Immigration and Nationality Act).

                    (B) Any data or information required of individuals applying for benefits to determine whether benefits are not payable to them because of their alien status shall be uniformly required from all applicants for benefits.

                    (C) In the case of an individual whose application for benefits would otherwise be approved, no determination that benefits to such individual are not payable because of his alien status shall be made except upon a preponderance of the evidence.
 

Revised 1989