IndianaSB 371First Regular Session 124th General Assembly (2025)SenateWALLET

Workforce matters.

Summary

Amends the definitions of "discharge for just cause", "employment", and "gross misconduct" for purposes of unemployment insurance. Provides that an unemployment claimant: (1) is required to verify the claimant's identity before a claim can be filed, and as a condition for continued eligibility; and (2) has the right to request a wage investigation and to appeal the results of the investigation to a liability administrative law judge. Allows an unemployment claimant or employing unit to appeal regarding the claimant's status as an insured worker. Requires that all hearings before an administrative law judge or the unemployment insurance review board concerning disputed unemployment claims be set as telephone hearings, unless an objection is made. Allows a disputed unemployment claim to be directly filed with a liability administrative law judge. Provides that administrative records of the department of workforce development (department) are self-authenticating and admissible in an administrative hearing. Provides that the department may release certain confidential records to the extent permitted by federal law. Makes certain changes regarding the reemployment service and eligibility assessment program. Makes various changes regarding extended unemployment benefits. Provides that repayment of a benefits overpayment may be waived if certain conditions are met. Alters certain fee and payment provisions. Removes or alters notice and delivery requirements and extends certain deadlines. Requires the department to issue a written notice of violation to a person who fails to comply with certain authorization requirements. Provides that the department may assess a civil penalty against a person under certain circumstances. Requires civil penalties collected by the department to be deposited in the proprietary educational institution authorization fund. Establishes the unemployment insurance modernization fund (fund). Requires the department to annually submit a report to the budget committee detailing the expenditures made from the fund during the previous state fiscal year. Requires the department to annually submit a report to the budget committee concerning the status of the department's unemployment insurance program. Provides that the department may establish a reemployment pilot program. Makes conforming changes.

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Bill Overview

Analyzed Economic Effects

17 provisions identified: 5 benefits, 8 costs, 4 mixed.

Extended claimants face strict search penalties

Beginning July 1, 2025, extended-benefit claimants must make a sustained weekly job search and provide proof starting the week after written notice. Written, verifiable records must show search actions, application methods, work sought, dates, places, contacts, and results. The search standard requires employer contacts or hiring procedures throughout the week, covers all suitable work, and requires hiring-hall users with good prospects to search beyond the hall; approved training is exempt, and community-wide calamities can pause searches. Failing to search, provide proof, accept suitable work, or apply for referred suitable work blocks benefits that week and afterward until earnings reach at least the weekly benefit amount in each of four weeks; jury duty has a specified alternative compliance path. The law removes the older active-search disqualification, but these new search, proof, and refusal penalties still apply.

Workplace misconduct changes unemployment benefit eligibility

Beginning July 1, 2025, property damage counts as just cause for discharge when it involves willful and wanton misconduct, replacing willful negligence. Reporting under the influence or consuming alcohol or drugs during work is removed from the listed just-cause grounds. Separately, unauthorized alcohol or controlled-substance use on employer premises can count as work-related gross misconduct. A gross-misconduct discharge cancels all wage credits established before discharge, which can reduce or end benefit eligibility. The department must find gross misconduct more likely than not based on the evidence.

Repayment relief for low-income unemployment claimants

You may request relief from unemployment overpayment debt received without your fault, regardless of intent, when repayment violates equity and good conscience. The income test is met at no more than 65% of current federal poverty guidelines for household size in each required quarter. Review uses the first two of the last three completed quarters; household size uses those same quarters. Counting rules cover specified spouses or partners sharing a home, dependents, certain active-duty members, and joint-custody children present at least 50% of the time. After a denial or partial denial, a significant change making repayment unfair allows reconsideration after six months, with at most two requests per overpayment.

Training pilot authorizes extra weekly payments

Beginning July 1, 2025, Indiana may establish a pilot adding weekly training incentives to unemployment benefits; the law sets no amount. Participants must qualify for that week’s benefits and make satisfactory weekly training progress. The department must find they need training for sustainable work and are more likely to finish with the incentive. Approved training must prepare participants for high-wage, high-demand work, lead to a recognized credential, improve job prospects, and use an eligible provider. A separate fund accepts appropriations, federal grants, gifts, and donations, keeps year-end balances, and cannot use unemployment trust fund money.

Claimants face limits on repayment waivers

Beginning July 1, 2025, waiver requests must follow the department’s process within 15 days after the overpayment decision becomes final. The department cannot consider requests tied to final determinations under the listed state provision or federal determinations exposing claimants to false-statement prosecution. Workers whose employers reimburse benefits instead of paying contributions also cannot receive waivers, unless the program does not charge that employer. A later waiver does not refund money already repaid. A refund is available only when another state or federal unemployment law explicitly requires it.

Claimants must attend directed job services

Beginning July 1, 2025, claimants must complete department-directed work searches, reemployment services, and eligibility assessments. The law deletes detailed statutory directions on activity counts, documentation, referred jobs, and reemployment assurances, leaving work-search directions to department rules. Completed services need not be repeated, and good cause can excuse failure to participate or finish. A one-stop-center orientation must be scheduled during benefit weeks four through six and completed by the end of week six. The department may waive orientation, including for approved training, recall within 60 days of separation, qualifying placement services, or contracted supplemental unemployment benefits.

Claimants must verify identity before filing

Before filing a new unemployment claim, you must verify your identity if you have not already done so. You must use the Indiana workforce department’s required process. Regular and extended benefits are unavailable until identity verification is complete.

Organizations face unemployment coverage thresholds

The unemployment coverage rule for religious, charitable, educational, and other organizations uses a four-worker, 20-week threshold. At least four people must work in Indiana for part of a day in each of 20 different weeks. Those weeks can be nonconsecutive in the current or previous calendar year. Federal-law coverage conditions and service exclusions also apply. Meeting the coverage rule can create unemployment contribution duties.

Job prospects shape suitable work rules

Indiana classifies extended-benefit claimants’ chances of finding customary work within eight weeks as good or not good. Written notice is due by the initial claim week’s end; requirements start the next week, and unrealized good prospects become not good after eight weeks unless satisfactory evidence supports otherwise. Beginning July 1, 2025, the department makes weekly suitable-work referrals: existing suitability standards apply to good prospects, while physical and mental ability governs not-good prospects. Excluded jobs include those paying no more than weekly benefits plus supplemental benefits, paying below the higher state or federal minimum wage, lacking a written offer or department listing, or whose refusal cannot cause benefit denial consistent with federal law. The law repeals the former special extended-benefit suitability protections and referral duty, replacing that framework with these rules.

New triggers for extended unemployment benefits

Beginning July 1, 2025, Indiana replaces its former extended-benefit triggers. The active trigger requires 13-week insured unemployment of at least 5% and 120% of each prior two years’ matching rate; at 6%, no comparison is required. The rate divides average weekly regular claims over 13 weeks by average monthly covered employment in the first four of six earlier completed quarters. Benefits start the third week after an on indicator and end at the later of the third week after an off indicator or the period’s 13th week. Another period cannot start before the 14th week after the previous period ends; other listed tests apply only to expired historical periods.

More time to challenge unemployment decisions

Claimants and employers now have 15 days after notice is sent to request hearings on listed decisions, up from 10. Requested wage investigations must be prompt, and their decisions carry a 15-day appeal deadline. Beginning July 1, 2025, interested parties—not just employers—can protest listed contribution, account-charge, successor, refund, and employment-status decisions within 15 calendar days, plus three days for U.S. mail. Hearings default to telephone, but parties may object under the hearing rule and appear in person; judges may also choose in-person hearings. Department records are admissible without extra proof that they are genuine.

Stronger privacy rules protect unemployment records

Indiana’s workforce department may release confidential unemployment information only as federal confidentiality rules permit. Wage sharing with family and social services remains allowed for purposes specified in state law. The law removes separate permissions for some summary statistics and employer-specific disclosures. Anyone who recklessly violates unemployment-record confidentiality commits a Class B misdemeanor, not just specified employees.

State funds unemployment upgrades and benefits

Beginning July 1, 2025, Indiana has a fund to modernize and maintain its unemployment system. It accepts training-fund transfers, appropriations, grants, and gifts; year-end balances stay in the fund, and no total appropriation is set. Within 30 days after December 31, the state transfers the employment and training fund’s balance above $11.5 million. That money goes to modernization if the unemployment benefit fund holds at least $1 billion on December 31. Otherwise, it goes to the benefit fund.

Court-ordered employer records cost more

Indiana’s workforce department must charge $6 for each last-known-employer record released under a court order. The previous fee was a reasonable amount capped at $2 per record. Total charges depend on the number of records released.

Job counseling is no longer guaranteed

Beginning July 1, 2025, Indiana may offer counseling or training to people receiving unemployment benefits but is not required to. The workforce department decides how counseling is provided and how long it lasts. This provision no longer guarantees these services.

Unauthorized career schools face student-based fines

Beginning July 1, 2025, Indiana must notify operators when it discovers an unauthorized private career school. Operators have 15 days after written notice to obtain authorization. Otherwise, the department may fine the operator $100 for each attending student who lives in Indiana. Students do not pay this penalty. Collections go to the proprietary educational institution authorization fund.

Employer notices change alongside report penalties

Beginning July 1, 2025, employers lose the general right to first-class mail delivery of unemployment notices after requesting it. Delinquency or missing-report notices tied to extra contribution rates may go to a supplied email address or last known mailing address. Without email receipt or confirmation within five days, the department must mail the notice as soon as practicable. Employers face $25 per demanded report negligently or willfully left unsubmitted more than 10 days after a mailed request. That request no longer requires registered mail.

Sponsors & Cosponsors

Sponsor

Linda Rogers
Republican • Senate

Cosponsors

Blake Doriot
Republican • Senate
Doug Miller
Republican • House
Heath VanNatter
Republican • House
Liz Brown
Republican • Senate
Stacey Donato
Republican • Senate

Roll Call Votes

All Roll Calls

Yes: 303 • No: 67

House vote • 4/23/2025

Rules Suspended. Conference Committee Report 1: adopted by the House

Yes: 91 • No: 0

Senate vote • 4/23/2025

Conference Committee Report 1: adopted by the Senate

Yes: 47 • No: 0

House vote • 4/3/2025

Third reading: passed

Yes: 89 • No: 0

House vote • 4/1/2025

Amendment #3 (Hamilton) failed

Yes: 27 • No: 67

Senate vote • 2/20/2025