Sec. 2. (a) Except as provided in IC 22-4-10-6 and IC 22-4-11.5, the department shall for each year determine the contribution rate applicable to each employer.

     (b) The balance shall include contributions with respect to the period ending on the computation date and actually paid on or before July 31 immediately following the computation date and benefits actually paid on or before the computation date and shall also include any voluntary payments made in accordance with IC 22-4-10-5 or IC 22-4-10-5.5 (repealed):

(1) for each calendar year, an employer’s rate shall be determined in accordance with the rate schedules in section 3.3 or 3.5 of this chapter; and

(2) for each calendar year, an employer’s rate shall be two and five-tenths percent (2.5%), except as otherwise provided in subsection (g) or IC 22-4-37-3, unless:

(A) the employer has been subject to this article throughout the thirty-six (36) consecutive calendar months immediately preceding the computation date;

(B) there has been some annual payroll in each of the three (3) twelve (12) month periods immediately preceding the computation date; and

(C) the employer has properly filed all required contribution and wage reports, and all contributions, penalties, and interest due and owing by the employer or the employer’s predecessors have been paid.

     (c) In addition to the conditions and requirements set forth and provided in subsection (b)(2)(A), (b)(2)(B), and (b)(2)(C), an employer’s rate is equal to the sum of the employer’s contribution rate determined or estimated by the department under this article plus two percent (2%) unless all required contributions and wage reports have been filed within thirty-one (31) days following the computation date and all contributions, penalties, and interest due and owing by the employer or the employer’s predecessor for periods before and including the computation date have been paid:

(1) within thirty-one (31) days following the computation date; or

(2) within ten (10) days after the department has given the employer a written notice by registered mail to the employer’s last known address of:

(A) the delinquency; or

(B) failure to file the reports;

whichever is the later date. The department or the department’s designee may waive the imposition of rates under this subsection if the department finds the employer’s failure to meet the deadlines was for excusable cause. The department shall give written notice to the employer before this additional condition or requirement shall apply. An employer’s rate under this subsection may not exceed twelve percent (12%).

     (d) However, if the employer is the state or a political subdivision of the state or any instrumentality of a state or a political subdivision, or any instrumentality which is wholly owned by the state and one (1) or more other states or political subdivisions, the employer may contribute at a rate of one and six-tenths percent (1.6%) until it has been subject to this article throughout the thirty-six (36) consecutive calendar months immediately preceding the computation date.

     (e) On the computation date every employer who had taxable wages in the previous calendar year shall have the employer’s experience account charged with the amount determined under the following formula:

STEP ONE: Divide:

(A) the employer’s taxable wages for the preceding calendar year; by

(B) the total taxable wages for the preceding calendar year.

STEP TWO: Subtract:

(A) the amount described in IC 22-4-10-4.5(e)(2), if any; from

(B) the total amount of benefits charged to the fund under section 1 of this chapter.

STEP THREE: Multiply the quotient determined under STEP ONE by the difference determined under STEP TWO.

     (f) One (1) percentage point of the rate imposed under subsection (c), or the amount of the employer’s payment that is attributable to the increase in the contribution rate, whichever is less, shall be imposed as a penalty that is due and shall be deposited upon collection into the special employment and training services fund established under IC 22-4-25-1. The remainder of the contributions paid by an employer pursuant to the maximum rate shall be:

(1) considered a contribution for the purposes of this article; and

(2) deposited in the unemployment insurance benefit fund established under IC 22-4-26.

     (g) Except as otherwise provided in IC 22-4-37-3, this subsection, instead of subsection (b)(2), applies to an employer in the construction industry. As used in the subsection, “construction industry” means business establishments whose proper primary classification in the current edition of the North American Industry Classification System Manual – United States, published by the National Technical Information Service of the United States Department of Commerce is 23 (construction). For each calendar year beginning after December 31, 2013, an employer’s rate shall be equal to the lesser of four percent (4%) or the average of the contribution rates paid by all employers in the construction industry subject to this article during the twelve (12) months preceding the computation date, unless:

(1) the employer has been subject to this article throughout the thirty-six (36) consecutive calendar months immediately preceding the computation date;

(2) there has been some annual payroll in each of the three (3) twelve (12) month periods immediately preceding the computation date; and

(3) the employer has properly filed all required contribution and wage reports, and all contributions, penalties, and interest due and owing by the employer or the employer’s predecessors have been paid.

Formerly: Acts 1947, c.208, s.1102; Acts 1953, c.177, s.12; Acts 1955, c.317, s.6; Acts 1965, c.190, s.5; Acts 1967, c.310, s.14; Acts 1971, P.L.355, SEC.24. As amended by Acts 1977, P.L.262, SEC.19; P.L.227-1983, SEC.5; P.L.225-1985, SEC.2; P.L.34-1985, SEC.4; P.L.20-1986, SEC.6; P.L.18-1987, SEC.37; P.L.80-1990, SEC.11; P.L.1-1992, SEC.107; P.L.105-1994, SEC.2; P.L.21-1995, SEC.73; P.L.179-1999, SEC.1; P.L.98-2005, SEC.8; P.L.108-2006, SEC.15; P.L.175-2009, SEC.12; P.L.110-2010, SEC.26; P.L.1-2010, SEC.86; P.L.2-2011, SEC.9; P.L.42-2011, SEC.39; P.L.6-2012, SEC.153; P.L.154-2013, SEC.3; P.L.183-2015, SEC.2; P.L.171-2016, SEC.7.