03/22/1995 01:37 PM Senate JUD

 SJUD - 3/22/95                                                                
                                                                               
        SB 122 NO UNEMPLOYMENT COMP FOR DIRECT SELLERS                        
                                                                              
 SENATOR MILLER moved the adoption of CSSB 122(JUD) in lieu of the             
 original bill.  There being no objection, the Judiciary committee             
 substitute was adopted.                                                       
                                                                               
 SHERMAN ERNOUF, legislative aide to Senator Kelly, testified on SB
, which was introduced by the Senate Labor and Commerce                    
 Committee at the request of several groups of direct sellers.  The            
 purpose of SB 122 is to direct exempt sellers of consumer products            
 from coverage under Alaska's unemployment compensation laws.  SB
 would resolve a long standing issue of contention between the             
 Department of Labor and direct sellers.                                       
                                                                               
 MR. ERNOUF discussed the two criteria required for exemption:  the            
 direct seller must be physically present in a prospective                     
 customer's home to sell or solicit a consumer product; and the                
 direct seller must be compensated by sales, commissions, or by                
 profit represented by the difference between the wholesale cost of            
 the product and the final sale price.  The committee substitute               
 adds the word "remuneration" to cover other situations that                   
 develop.  He added wholesalers who sell merchandise are not forced            
 to pay unemployment compensation payments.  He concluded by saying            
 SB 122 is a narrowly tailored consensus approach to resolve a long            
 standing problem.                                                             
                                                                               
 Number 571                                                                    
                                                                               
 SENATOR ADAMS asked if CSSB 122 (JUD) would have any impact,                  
 negative or positive, on the unemployment insurance (UI) trust                
 fund.  MR. ERNOUF replied the bill would affect such a small number           
 of people, it would have no effect on the UI fund.                            
                                                                               
 DWIGHT PERKINS, representing the Department of Labor, stated the              
 department does not believe CSSB 122 (JUD) will have a negative               
 effective on the UI fund.  Very few individuals have filed claims             
 under this program.  SENATOR ADAMS asked if it would affect                   
 unemployment insurance coverage.  MR. PERKINS replied it would have           
 no effect.                                                                    
                                                                               
 SENATOR ADAMS moved, and asked unanimous consent, that CSSB 122               
 (JUD) be moved out of committee with individual recommendations.              
 There being no objection, the motion carried.