(2)(a) If a person is not an employer when the person acquires a trade or business or a portion of a trade or business of an employer, the unemployment experience of the acquired trade or business shall be transferred to the person unless the Director of the Employment Department finds that the person acquired the trade or business solely or primarily for the purpose of obtaining a lower tax rate.
(b) The person described in paragraph (a) of this subsection is not entitled to a tax rate of less than the tax rate assigned under ORS 657.435 unless and until the person, based upon the person’s unemployment experience and the unemployment experience of the trade or business transferred, has throughout the 12 consecutive months preceding the computation date had its account chargeable with benefits.
(c) If the director finds that a person acquired a trade or business solely or primarily for the purpose of obtaining a lower tax rate, the director shall deny a transfer of unemployment experience. In determining whether a person acquired a trade or business solely or primarily for the purpose of obtaining a lower tax rate, the director shall use objective factors that may include:
(A) The cost of acquiring the trade or business;
(B) Whether the person continued the business activities of the transferred trade or business;
(C) How long the person continued the business activities of the transferred trade or business; or
(D) Whether a substantial number of new employees were hired for the performance of duties unrelated to the business activities of the trade or business that were conducted before the transfer.
(3)(a) A person may not engage in activity to transfer or acquire, or to attempt to transfer or acquire, a trade or business or any portion of a trade or business solely or primarily for the purpose of obtaining a lower tax rate. If a person knowingly engages in activity to transfer or acquire, or to attempt to transfer or acquire, a trade or business or any portion of a trade or business solely or primarily for the purpose of obtaining a lower tax rate, the director shall assign the person the highest tax rate designated under this chapter for the rate year during which the activity occurred and for the next three rate years. However, if the person is already subject to the highest tax rate for a year, or if the amount of increase in the person’s tax rate would be less than two percentage points for the year, the director shall impose an additional penalty tax rate of two percentage points added to the calculated tax rate.
(b) A person may not advise another person to engage in activity to transfer or acquire, or to attempt to transfer or acquire, a trade or business or any portion of a trade or business solely or primarily for the purpose of obtaining a lower tax rate. In addition to any other penalty provided by law, the director may assess a civil penalty not to exceed $10,000 against a person that knowingly advises another person to engage in activity to transfer or acquire, or to attempt to transfer or acquire, a trade or business or any portion of a trade or business solely or primarily for the purpose of obtaining a lower tax rate. The director shall deposit all sums collected as civil penalties under this paragraph into the Employment Department Special Administrative Fund. An assessment under this paragraph is final unless within 20 days after the mailing of the notice of assessment the person files an application for a hearing under ORS 657.683.
(c) As used in this subsection, "knowingly" means having actual knowledge of or acting with deliberate ignorance or reckless disregard for the law.
(4) The director shall adopt necessary rules and procedures regarding the transfer of unemployment experience for purposes of establishing employer tax rates under this chapter to ensure that higher tax rates are not avoided through the transfer or acquisition of a trade or business or a portion of a trade or business. In adopting rules under this section, the director shall consider and strive to meet the minimum requirements in any guidance or regulations issued by the United States Department of Labor. [Amended by 1977 c.538 §6; 1999 c.513 §1; 2005 c.35 §2]