SECTIONS 1051-1061 - California Statutes

UNEMPLOYMENT INSURANCE CODE

SECTION 1051-1061

1051. Whenever any employing unit acquires the organization, trade,
or business, or substantially all of the assets thereof, or a
distinct and severable portion of such organization, trade, or
business, of any employer, excepting any assets retained by the
employer incident to the liquidation of his obligations (whether or
not the acquiring employing unit was an "employing unit" within the
meaning of Section 135 prior to such acquisition), and continues such
organization, trade, or business, or such distinct and severable
portion thereof without substantial reduction of personnel resulting
from such acquisition, an application may be made within 90 days of
such acquisition for transfer of reserve account. The application
shall contain the name and address of the predecessor, the date of
acquisition, the name of the successor, the number of employees prior
to and subsequent to the date of acquisition, and, in case of
severable portions, such pay roll data as may be required by the
department to determine the proper amount to be transferred.

1051.5. To the extent permitted by federal law, Sections 1051,
1052, and 1053 are applicable to acquisitions by a nonprofit
organization which has elected reimbursement financing pursuant to
Section 801 and the director shall transfer the reserve account of
the predecessor employer to the successor nonprofit organization.
Notwithstanding Section 1029, the reserve account shall not be
canceled and the cost of benefits otherwise chargeable to the
organization shall be charged to the reserve account until it is
exhausted.

1052. Upon receipt of the application the separate account, actual
contribution and benefit experience and payrolls of the predecessor
or that part thereof, as determined by authorized regulations, which
pertains to the organization, trade, or business, or portion thereof
acquired, shall be transferred to the successor employer for the
purpose of determining its rate of contribution after the acquisition
with the same effect for that purpose as if the operations of the
predecessor had at all times been carried on by the successor. The
separate account shall be transferred by the director to the
successor employer and, as of the date of the acquisition, shall
become the separate account or part of the separate account, as the
case may be, of the successor employer, and the benefits thereafter
chargeable to the predecessor employer on account of employment
relating to the transferred organization, trade, or business or
transferred portion thereof prior to the date of the acquisition
shall be charged to the separate account. This section shall not
apply to any acquisition which is determined by the director to have
been made for the purpose of obtaining a more favorable rate of
contributions under Section 977.

1053. Sections 1051 and 1052 are applicable to applications for
transfer of reserve accounts made after the 90-day period beginning
with the date of acquisition but prior to the cancellation of the
reserve account pursuant to Section 1029 if the reserve account has
not been reacquired by the predecessor on re-entering business or, in
the case of distinct and severable portions, if the predecessor did
not continue in business, but any amendment of the contribution rate
shall be made as of the first day of the calendar quarter next
succeeding the date of the application.

1054. The provisions of this article requiring a specific
application for transfer of reserve account shall not apply to any
successor who through error or inadvertence continued to file
contribution reports and pay contributions for the account and at the
rate determined by the department to apply to the predecessor
employer, but such reporting and payment shall be deemed to be in
lieu of the application and shall be given the same effect as though
a specific application had been filed during the 90-day period
beginning with the date of acquisition.

1055. In the event of a denial or granting of an application for
transfer of reserve account, the director shall give notice pursuant
to Section 1206 to the employing unit making such application, and to
the predecessor employing unit to whose reserve account the
application relates, if such predecessor employing unit has continued
in business as an employer.

1056. The director may prescribe regulations for the establishment,
maintenance, and dissolution of joint accounts by two or more
employers and shall, in accordance with such regulations, upon
application by two or more employers to establish such account or to
merge their several individual accounts in a joint account, maintain
such joint account, as if it constituted a single employer's account.

1057. Upon dissolution of a joint venture each participating
employer may within 90 days apply for the transfer of his
proportionate share of the reserve account. Upon receipt of the
application the separate account, actual contribution and benefit
experience and pay rolls of such joint venture shall be apportioned
among the employers making such application in the same proportion
that assets are distributed among the participating employers, and
the portion thereof of each shall be transferred to each such
employer for the purpose of determining its rate of contribution
after the dissolution with the same effect for such purpose as if the
applicable portion of the operations of such joint venture had at
all times been carried on by such employer. Such portion of such
separate account shall be transferred by the director to each such
employer and as of the date of such dissolution shall become the
separate account or part of the separate account, as the case may be,
of such employer. The benefits thereafter chargeable to such joint
venture on account of employment relating to such joint venture prior
to the date of such dissolution shall be charged to the separate
accounts of such employers in proportion to their participation in
the joint venture. Any such joint venture shall promptly notify the
director of its dissolution.
As used in this section only, "employer" includes the successor of
an employer and any subsequent successor employer or employers.

1058. As used in this article the term "joint venture" means a
separate employing unit which has been organized by two or more
employers to accomplish a contract or project or series of contracts
or projects and which is wholly owned by such employers. As used in
this section only, "employer" means any individual or type of
organization, including any partnership, joint venture, association,
trust, estate, joint stock company, insurance company, corporation
whether domestic or foreign, and the receiver, trustee in bankruptcy,
trustee or successor thereof, and the legal representative of a
deceased person.

1060. A change in contribution rate caused by a transfer under this
article of all or a portion of the separate account, actual
contribution and benefit experience and pay rolls shall not become
effective earlier than the beginning of the calendar quarter next
succeeding the effective date of the transfer.

1061. (a) For purposes of this article, the reserve account
attributable to a transferred business shall also be transferred to,
and combined with, the reserve account attributable to the employer
to whom that business is transferred, if both of the following are
satisfied:
(1) An employer transfers all or part of its business or payroll
to another employer.
(2) At the time of transfer, both employers are under common
ownership, management, or control.
(b) This section shall be applied to meet the minimum requirements
contained in any guidance or regulations issued by the United States
Department of Labor.