Article 1. Employment Development Department of California Unemployment Insurance Code >> Division 1. >> Part 1. >> Chapter 2. >> Article 1.

There is in the Labor and Workforce Development Agency the Employment Development Department, which is vested with the duties, purposes, responsibilities, and jurisdiction heretofore exercised by the State Department of Benefit Payments or the California Health and Human Services Agency with respect to job creation activities. The Employment Development Department shall be administered by an executive officer known as the Director of Employment Development who is vested with the duties, purposes, responsibilities, and jurisdiction heretofore exercised by the Director of Benefit Payments with respect to the following functions:
  (a) Job creation activities.
  (b) Making manual computations and making or denying recomputations of the amount and duration of benefits.
  (c) Determination of contribution rates and the administration and collection of contributions, penalties and interest, including but not limited to filing and releasing liens.
  (d) Establishment, administration, and transfer of reserve accounts.
  (e) Making assessments and the administration of credits and refunds.
  (f) Approving elections for coverage or for financing unemployment and disability insurance coverage.

The Employment Development Department shall have the possession and control of all records, papers, offices, equipment, supplies, moneys, appropriations, land, and other property real or personal held for the benefit or use of the State Department of Benefit Payments in the performance of the duties, powers, purposes, responsibilities, and jurisdiction that are vested in the Employment Development Department by Section 301.

All officers and employees of the State Department of Benefit Payments who, on the operative date of the statute amending this section at the 1977 portion of the 1977-78 Regular Session of the Legislature, are serving in the state civil service, other than as temporary employees, and engaged in the performance of a function vested in the Employment Development Department by Section 301 shall be transferred to the Employment Development Department. The status, positions, and rights of such persons shall not be affected by the transfer and shall be retained by them as officers and employees of the Employment Development Department pursuant to the State Civil Service Act, except as to positions exempt from civil service.

The Director of Employment Development shall be appointed by the Governor, subject to the approval of the Senate, and shall serve as director at the pleasure of the Governor. The annual salary of the Director of Employment Development shall be as provided for by Chapter 6 of Part 1 of Division 3 of Title 2 of the Government Code.

There shall be five deputy directors in the Employment Development Department who shall be appointed by the Governor subject to the approval of the Senate and shall hold office at the pleasure of the Governor. The salary of the deputy directors shall be fixed in accordance with law.

Whenever a reference to this division is made in this article it shall also include all other divisions of this code.

Regulations for the administration of the functions of the Employment Development Department under this code shall be adopted, amended, or repealed by the Director of Employment Development as provided in Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.

All regulations heretofore adopted by the Director of the Department of Human Resources Development shall remain in effect and shall be fully enforceable unless and until readopted, amended or repealed by the Director of Employment Development.

All regulations heretofore adopted by the Director of Benefit Payments pursuant to this code and in effect immediately preceding the operative date of the amendment of this section enacted by the Legislature during the 1977-78 Regular Session, shall remain in effect and shall be fully enforceable unless and until readopted, amended or repealed by the Director of Employment Development.

The Director of Employment Development may adopt, amend, or repeal such regulations as are reasonably necessary to enforce his functions under this code.

The department shall provide, upon the request of any person or entity, any or all of the department's rules, regulations, guidelines, bulletins, manuals, standards of general application, or the departmental responsibilities under any state or federal law, along with any subscription service necessary to assure prompt receipt of additional amendments to any of the above materials. The department shall charge a fee to cover (1) the costs of reproducing the materials and (2) postage associated with a subscription service; however, one free copy of the materials shall be provided to each state legislator, upon request. Any documents properly classified as confidential shall be exempt from the requirements of this section.

The Director of Employment Development or the Department of Employment Development may prescribe the extent, if any, to which any rule, regulation or interpretation issued or promulgated in accordance with the provisions of this code shall be applied without retroactive effect.

The Director of Employment Development shall appoint such assistants except personnel of the appeals division as he finds necessary for the administration of this division, subject to the provisions of the Government Code, and may delegate to any of the officers or employees of the department such powers and duties as he considers necessary for the proper administration of this division. The Director of Employment Development and his authorized representatives in the enforcement of the division shall have all the powers of a head of a department as set forth in Article 2 (commencing with Section 11180) of Chapter 2, Part 1, Division 3, Title 2 of the Government Code. For the purpose of any investigation, hearing, or proceeding under this division, the Director of Employment Development may delegate his power in relation thereto to any deputy, or other person properly authorized in writing by him.

The appeals division within the department includes the appeals board and its clerical staff and assistants and the administrative law judges and their supervisors and clerical staff and assistants.

(a) There shall be maintained within an appropriate division of the department, a bureau, section, or unit relating to education and public instruction for the purpose of informing employers and workers of their rights and responsibilities under this code, and of instructing the public generally concerning its basic purposes, provisions, and operations. All standard information employee pamphlets concerning unemployment and disability insurance programs shall be printed in English and the seven other most commonly used languages among participants in each program in such number as he or she may determine.
  (b) The department shall make the pages on its Internet Web site that provide information regarding applying for, and receiving, unemployment insurance benefits available in the seven languages, other than English, most commonly used by unemployment insurance applicants and claimants.

The Director of Employment Development shall maintain a field investigating staff, whose function shall embrace investigation throughout the state of violations of this code, to the end that its provisions are more adequately and strictly enforced.

The Director of Employment Development shall comply with all applicable provisions of the Government Code relating to contracts, budgets and other fiscal matters, including Sections 13320 to 13324, inclusive, of that code, in the same manner and to the same extent as other state agencies, insofar as such provisions are not inconsistent with the provisions of the Social Security Act and the rules and regulations of the Secretary of Labor.

The Director of Employment Development shall make such reports in such form and containing such information as the Secretary of Labor may from time to time require, and shall comply with such provisions as the secretary may from time to time find necessary to assure the correctness and verification of such reports.

(a) The director shall periodically review policies and practices used to determine eligibility for and the amount of benefits in the unemployment insurance program to identify those policies and practices that do all of the following:
  (1) Result in delayed eligibility determinations or benefit payments.
  (2) Increase workload for the department.
  (3) Provide little or no value in identifying or preventing fraud or abuse in the unemployment insurance program.
  (b) The director shall report to the Legislature the results of the first review on or before July 1, 2015, and may submit subsequent reports thereafter. The report shall be submitted in compliance with Section 9795 of the Government Code.

The director may by authorized regulations prescribe the information required to be reported to the department by employing units under this division and employers subject to withholding tax under Division 6 (commencing with Section 13000) in order to make reports required by the Secretary of Labor, to provide information necessary to administer this code, to estimate unemployment rates or to make other estimates required for the purpose of dispensing or withholding money payments under the Welfare Reform Act of 1971, the Employment Security Amendments of 1970, the Emergency Unemployment Compensation Act of 1971, or the Workforce Investment Act of 1998, and to make any other reports or estimates that may be required by any other state or federal law. The authorized regulations of the director may include requirements for the reporting of employment, unemployment, hours, wages, earnings, the location and nature of the industrial, business, or other activity of each establishment for the conduct of business, performance of services, or industrial operations, and such other requirements as are necessary to comply with this section.

The Director of Employment Development shall make available, upon request, to any agency of the United States government charged with the administration of public works or assistance through public employment, the following information relating to recipients of unemployment compensation:
  (a) The recipient's name.
  (b) The recipient's address.
  (c) The ordinary occupation and employment status of each such recipient of unemployment benefits.
  (d) A statement of such recipient's rights to further compensation under this division.

The department may exchange information with other governmental departments and agencies, both federal and state, which are concerned with the administration of unemployment insurance, or the collection of taxes which may be used to finance the administration of unemployment insurance, or the relief of unemployed or destitute individuals, or legislation concerning, regulating, or in any manner affecting the obligations arising out of an employer-employee relation, and with other departments or agencies of government as the department deems necessary or desirable for the proper administration of this division in accordance with authorized regulations.

The Director of Employment Development may apply for an advance to the Unemployment Fund and accept the responsibility for the repayment of such advance in accordance with the conditions specified in Title XII of the Social Security Act, as amended, to secure to this state and its citizens the advantages available under the provisions of that title.

The expense of the administration of this division shall be paid out of the Unemployment Administration Fund, unless otherwise provided for in this division.

(a) The department may study and make recommendations as to action which might tend to:
  (1) Promote the prevention of unemployment and the stabilization of employment.
  (2) Encourage and assist in the adoption of practical methods of vocational training, retraining and guidance.
  (3) Promote the establishment and operation by governmental units and agencies of reserves for public work to be prosecuted in time of business depression and unemployment.
  (4) Promote the reemployment of unemployed workers throughout the state in any way that may seem feasible.
  (5) Reduce and prevent unemployment.
  (6) Establish the most effective methods of providing economic security through all forms of social insurance.
  (b) To accomplish the ends set forth in subdivision (a) of this section, the department may carry on and publish the results of investigations and research studies.

The department, in consultation and coordination with veterans' organizations and veteran service providers, shall do all of the following:
  (a) Research the needs of veterans throughout the state and develop a profile of veterans' employment and training needs.
  (b) Develop a statewide plan for the equitable distribution of employment funds for veterans' employment services.
  (c) Seek federal funding for purposes of subdivision (a).

(a) It is the intent of the Legislature that state supported Veterans Employment Training services meet the same performance standards as those required by the federal Workforce Investment Act for services provided to veterans.
  (b) Following any fiscal year in which state funds support the Veterans Employment Training services program, the Employment Development Department shall provide an annual report to the Legislature, on or before November 1, regarding the following performance measures:
  (1) The number of veterans receiving individualized, case managed services.
  (2) The number of veterans who receive individualized, case managed services entering employment.
  (3) The retention rate for veterans who enter employment.
  (4) The average earnings for veterans entering employment.

The department shall investigate and report upon the degree of unemployment hazard in various industries and occupations and their cost to the Unemployment Fund. It shall recommend to employers in industries or occupations showing an excessive cost to that fund, means for stabilizing employment. It shall also, if necessary, recommend to the Legislature a higher rate of contribution for any classification of industries or occupations in which unemployment is excessive or chronic.

The department is authorized to enter into negotiations with the United States Bureau of the Census to expand the current population survey for a sample of up to 35,000 households in California. The department shall report its findings and the result of the negotiations to the Legislature. At such time as the Bureau of the Census is prepared to undertake the workload involved in expanding California's portion of the population survey, the department shall submit to the Legislature a budget request for funds not available from other sources to finance a contract with the Bureau of the Census. When sufficient funds are made available through the budget process or from other sources, the department is authorized to contract with the Bureau of the Census for the purpose of expanding the current population survey to a sample of up to 35,000 households in California. Based on the results of the expanded survey, the department shall compile and publish monthly information pertaining to employment and unemployment and shall provide such information to state governmental entities, including the Legislature, which are responsible for preparing state economic projections and revenue estimates.

(a) The director, or his or her designee, shall serve as Chairperson of the Joint Enforcement Strike Force on the Underground Economy provided for in Executive Order W-66-93. The strike force shall include, but not be limited to, representatives of the Employment Development Department, the Department of Consumer Affairs, the Department of Industrial Relations, the Department of Insurance, and the Office of Criminal Justice Planning. Other agencies that are not part of the administration, such as the Franchise Tax Board, the State Board of Equalization, and the Department of Justice, are encouraged to participate in the strike force.
  (b) The strike force shall have the following duties:
  (1) To facilitate and encourage the development and sharing of information by the participating agencies necessary to combat the underground economy.
  (2) To improve the coordination of activities among the participating agencies.
  (3) To develop methods to pool, focus, and target the enforcement resources of the participating agencies in order to deter tax evasion and maximize recoveries from blatant tax evaders and violators of cash-pay reporting laws.
  (4) To reduce enforcement costs wherever possible by eliminating duplicative audits and investigations.
  (c) In addition, the strike force shall be empowered to:
  (1) Form joint enforcement teams when appropriate to utilize the collective investigative and enforcement capabilities of the participating members.
  (2) Establish committees and rules of procedure to carry out the activities of the strike force.
  (3) To solicit the cooperation and participation of district attorneys and other state and local agencies in carrying out the objectives of the strike force.
  (4) Establish procedures for soliciting referrals from the public, including, but not limited to, an advertised telephone hotline.
  (5) Develop procedures for improved information sharing among the participating agencies, such as shared automated information database systems, the use of a common business identification number, and a centralized debt collection system.
  (6) Develop procedures to permit the participating agencies to use more efficient and effective civil sanctions in lieu of criminal actions wherever possible.
  (7) Evaluate, based on its activities, the need for any statutory change to do any of the following:
  (A) Eliminate barriers to interagency information sharing.
  (B) Improve the ability of the participating agencies to audit, investigate, and prosecute tax and cash-pay violations.
  (C) Deter violations and improve voluntary compliance.
  (D) Eliminate duplication and improve cooperation among the participating agencies.
  (E) Establish shareable information databases.
  (F) Establish a common business identification number for use by participating agencies.
  (G) Establish centralized, automated debt collection services for the participating agencies.
  (H) Strengthen civil penalty procedures to allow the strike force to emphasize civil rather than criminal penalties wherever possible.
  (d) The strike force shall report to the Governor and the Legislature annually during the period of its existence, by June 30, of each year, regarding its activities. The report shall include, but not be limited to, all of the following:
  (1) The number of cases of blatant violations and noncompliance with tax and cash-pay laws identified, audited, investigated, or prosecuted through civil action or referred for criminal prosecution.
  (2) Actions taken by the strike force to publicize its activities.
  (3) Efforts made by the strike force to establish an advertised telephone hotline for receiving referrals from the public.
  (4) Procedures for improving information sharing among the agencies represented on the strike force.
  (5) Steps taken by the strike force to improve cooperation among participating agencies, reduce duplication of effort, and improve voluntary compliance.
  (6) Recommendations for any statutory changes needed to accomplish the goals described in paragraph (7) of subdivision (c).

(a) The department shall place a high priority on the automation of the Benefit Payment Control Program, specifically including, but not limited to, automating the ledger and collection functions.
  (b) An automated system for the Benefit Payment Control Program shall include a function which provides for the automatic issuance of monthly collection letters to unemployment insurance claimants who have received benefit overpayments.
  (c) Personnel savings from automation of the Benefit Payment Control Program, notwithstanding any other provision of law, shall be redirected to the processing of additional willful overpayment cases.

The director shall pursue the following methods to increase the collection of unemployment insurance benefit overpayments:
  (a) Developing administrative or automated procedures to insure that field offices appropriately refer cases to the central office for the timely interception of a claimant's state tax refund.
  (b) Modifying the automated overpayment detection system so that it will identify more overpayments.
  (c) Increasing the number of potential overpayments which are reviewed by the department.
  (d) Working with the Legislature and the Governor to adequately staff the Benefit Payment Control Program.

The department, in consultation and coordination with the film and movie industry, the Governor's Office of Business and Economic Development, and the California Film Commission shall do all of the following, contingent upon the appropriation of funds in the annual Budget Act for these specified purposes:
  (a) Research and maintain data on the employment and output of the film industry, including full-time, part-time, contract, and short duration or single event employees.
  (b) Examine the ethnic diversity and representation of minorities in the entertainment industry.
  (c) Determine the overall direct and indirect economic impact of the film industry.
  (d) Monitor film industry employment and activity in other states and countries that compete with California for film production.
  (e) Review the effect that federal and state laws and local ordinances have on the filmed entertainment industry.
  (f) Prepare and release biannually a report to the chairpersons of the appropriate Senate and Assembly policy committees that details the information required by this section.

The director shall establish procedures to identify the transfer or acquisition of a business that is undertaken for purposes of obtaining a lower unemployment insurance contribution rate.