The bill also provides that, during any period in which the employer’s regular operations are suspended due to an event outside of the employer’s control, the employer is not required to comply with the service employee work scheduling requirements created in the bill.
Enforcement of rights regarding work schedules
The bill provides that an employer may not interfere with, restrain, or deny the exercise of the right of an employee to request and receive work schedule changes and the right of certain service employees to a predictable work schedule, and may not discharge or discriminate against such an employee for enforcing the employee’s rights under the bill. An employee whose rights are violated may file a complaint with DWD, and DWD must process the complaint in the same manner that employment discrimination complaints are processed under current law. That processing may include the ordering of back pay, reinstatement, compensation in lieu of reinstatement, and costs and attorney fees.
The bill also provides that DWD or an employee whose rights are violated may bring an action in circuit court against the employer without regard to exhaustion of any administrative remedy. If the circuit court finds that a violation has occurred, the employer may be liable to the employee for compensatory damages, reasonable attorney fees and costs, and, under certain circumstances, liquidated damages equal to 100 percent of the amount of compensatory damages awarded to the employee. In addition to any damages imposed on an employer in an administrative proceeding or circuit court action, an employer that willfully violates the protections created in the bill may be required to forfeit not more than $1,000 for each violation.
Liquidated damages in wage claim actions
Under current law, if an employee files a claim in circuit court for unpaid wages, the court may award liquidated damages to the employee in addition to past due wages. Under current law, the liquidated damages are as follows: 1) if an employee files the suit before DWD has finished its investigation and attempted to settle the claim, a court may award not more than 50 percent of the wages due and unpaid and 2) if an employee files the suit after DWD has completed its investigation of a wage claim, a court may award not more than 100 percent of the wages due and unpaid. Under the bill, irrespective of whether DWD has completed its investigation of a wage claim, an employee is presumed to be entitled to 100 percent of the wages due and unpaid in liquidated damages in addition to the unpaid wages due. An employer may rebut this presumption by demonstrating that they acted in good faith and had a reasonable belief that they were in compliance with the law.
Compensation in job posting
Under the bill, an employer must include the compensation for the position in any job posting made by the employer.
Local employment regulations
The bill eliminates the preemptions of local governments from enacting or enforcing ordinances related to the following:
1. Regulations related to wage claims and collections.
2. Regulation of employee hours and overtime, including scheduling of employee work hours or shifts.
3. The employment benefits an employer may be required to provide to its employees.
4. An employer’s right to solicit information regarding the salary history of prospective employees.
5. Regulations related to minimum wage.
6. Occupational licensing requirements that are more stringent than a state requirement. See Local Government.
Certain state and local employment regulations
The bill eliminates the following:
1. The prohibition of the state and local governments from requiring any person to waive the person’s rights under state or federal labor laws as a condition of any approval by the state or local government.
2. A provision under which neither the state nor a local government may enact a statute or ordinance, adopt a policy or regulation, or impose a contract, zoning, permitting, or licensing requirement, or any other condition, that would require any person to accept any provision that is a subject of collective bargaining under state labor laws or the federal National Labor Relations Act.
Worker classification notice and posting
Current law requires DWD to perform certain duties related to worker classification, including for purposes of promoting and achieving compliance by employers with state employment laws. The bill requires DWD to design and make available to employers a notice regarding worker classification laws, requirements for employers and employees, and penalties for noncompliance. Under the bill, all employers in this state must post the notice in a conspicuous place where notices to employees are customarily posted. Finally, the bill provides a penalty of not more than $100 for an employer who does not post the notice as required.
Worker’s compensation
Expansion of PTSD coverage for first responders
The bill makes changes to the conditions of liability for worker’s compensation benefits for emergency medical responders, emergency medical services practitioners, volunteer firefighters, correctional officers, emergency dispatchers, coroners and coroner staff members, and medical examiners and medical examiner staff members (collectively, “first responders”), who are diagnosed with post-traumatic stress disorder (PTSD).
Under current law, if a law enforcement officer or full-time firefighter is diagnosed with PTSD by a licensed psychiatrist or psychologist and the mental injury that resulted in that diagnosis is not accompanied by a physical injury, that law enforcement officer or firefighter can bring a claim for worker’s compensation benefits if the conditions of liability are proven by the preponderance of the evidence and the mental injury is not the result of a good faith employment action by the person’s employer. Also under current law, liability for such treatment for a mental injury is limited to no more than 32 weeks after the injury is first reported.
Under current law, an injured first responder who does not have an accompanying physical injury must, in order to receive worker’s compensation benefits for PTSD, demonstrate a diagnosis based on unusual stress of greater dimensions than the day-to-day emotional strain and tension experienced by all employees as required under School District No. 1 v. DILHR, 62 Wis. 2d 370, 215 N.W.2d 373 (1974). Under the bill, such an injured first responder is not required to demonstrate a diagnosis based on that standard, and instead must demonstrate a diagnosis based on the same standard as law enforcement officers and firefighters. Also, under the bill, a first responder is restricted to compensation for a mental injury that is not accompanied by a physical injury and that results in a diagnosis of PTSD three times in his or her lifetime irrespective of a change of employer or employment, in the same manner as law enforcement officers and firefighters.
Worker’s compensation; penalties for uninsured employers
Under current law, an employer who requires an employee to pay for any part of worker’s compensation insurance or who fails to provide mandatory worker’s compensation insurance coverage is subject to a forfeiture. If the employer violates those requirements, for the first 10 days, the penalty under current law is not less than $100 and not more than $1,000 for such a violation. If the employer violates those requirements for more than 10 days, the penalty under current law is not less than $10 and not more than $100 for each day of such a violation.
Under the bill, the forfeitures for an employer who requires an employee to pay for worker’s compensation coverage or fails to provide the coverage (violation) are as follows:
1. For a first violation, $1,000 per violation or the amount of the insurance premium that would have been payable, whichever is greater.
2. For a second violation, $2,000 per violation or two times the amount of the insurance premium that would have been payable, whichever is greater.
3. For a third violation, $3,000 per violation or three times the amount of the insurance premium that would have been payable, whichever is greater.
4. For a fourth or subsequent violation, $4,000 per violation or four times the amount of the insurance premium that would have been payable, whichever is greater.
Under current law, if an employer who is required to provide worker’s compensation insurance coverage provides false information about the coverage to his or her employees or contractors who request information about the coverage, or fails to notify a person who contracts with the employer that the coverage has been canceled in relation to the contract, the employer is subject to a forfeiture of not less than $100 and not more than $1,000 for each such violation.
Under the bill, the penalty for a first or second such violation remains as specified under current law, the penalty for a third violation is $3,000, and the penalty for a fourth or subsequent violation is $4,000.
Currently, an uninsured employer must pay to DWD an amount that is equal to the greater of the following: 1) twice the amount that the uninsured employer would have paid for worker’s compensation coverage during periods in which the employer was uninsured in the preceding three years or 2) $750 or, if certain conditions apply, $100 per day.
The bill provides that the amounts an uninsured employer must pay to DWD for a determination of a failure to carry worker’s compensation insurance are as follows:
1. For a first or second determination, the amounts specified in current law.
2. For a third determination, the greater of the following: a) three times the amount that the uninsured employer would have paid for worker’s compensation coverage during periods in which the employer was uninsured in the preceding three years or b) $3,000.
3. For a fourth or subsequent determination, the greater of the following: a) four times the amount that the uninsured employer would have paid for worker’s compensation coverage during periods in which the employer was uninsured in the preceding three years or b) $4,000.
False or fraudulent worker’s compensation insurance applications
Current law specifies criminal penalties for various types of insurance fraud, which are punishable as either a Class A misdemeanor or a Class I felony, depending on the value of the claim or benefit. The bill adds to the list of criminally punishable insurance fraud the following: 1) the presentation of false or fraudulent applications for worker’s compensation insurance coverage and 2) the presentation of applications for worker’s compensation insurance coverage that falsely or fraudulently misclassify employees in order to lower premiums.
Also under current law, if an insurer or self-insured employer has evidence that a worker’s compensation claim is false or fraudulent, the insurer or self-insured employer must generally report the claim to DWD. If, on the basis of the investigation, DWD has a reasonable basis to believe that criminal insurance fraud has occurred, DWD must refer the matter to the district attorney for prosecution. DWD may request assistance from DOJ to investigate false or fraudulent activity related to a worker’s compensation claim. If, on the basis of that investigation, DWD has a reasonable basis to believe that theft, forgery, fraud, or any other criminal violation has occurred, DWD must refer the matter to the district attorney or DOJ for prosecution. The bill extends these requirements to insurers that have evidence that an application for worker’s compensation insurance coverage is fraudulent or that an employer has committed fraud by misclassifying employees to lower the employer’s worker’s compensation insurance premiums.
Worker’s compensation; substantial fault
Currently, under the worker’s compensation law, an employer is not liable for temporary disability benefits during an employee’s healing period if the employee is suspended or terminated from employment due to misconduct by the employee connected with the employee’s work. Current law defines “misconduct” by reference to the unemployment insurance (UI) law. The bill changes the definition of “misconduct” under the UI law, which change also applies for purposes of the worker’s compensation law as described above.
Reimbursements for supplemental worker’s compensation benefits
Under current law, worker’s compensation insurers must pay supplemental benefits to certain employees who were permanently disabled by an injury that is compensable under worker’s compensation.
DWD is authorized to collect up to $5,000,000 from insurers that provide worker’s compensation insurance to provide those supplemental benefits. This money must be used exclusively to provide reimbursements to insurers that pay those supplemental benefits and that request reimbursements. The bill creates a new, separate appropriation in the worker’s compensation operations fund, to be used exclusively to provide these reimbursements. The bill does not increase revenue to DWD or collections from insurers.
Unemployment insurance
Unemployment insurance; worker misclassification penalties
Current law requires DWD to assess an administrative penalty against an employer engaged in construction projects or in the painting or drywall finishing of buildings or other structures who knowingly and intentionally provides false information to DWD for the purpose of misclassifying or attempting to misclassify an individual who is an employee of the employer as a nonemployee under the UI law. The penalty under current law is $500 for each employee who is misclassified, not to exceed $7,500 per incident. In addition, current law provides for criminal fines of up to $25,000 for employers who, after having previously been assessed such an administrative penalty, commit another violation. Current law additionally requires DWD to assess an administrative penalty against such an employer who, through coercion, requires an employee to adopt the status of a nonemployee; the penalty amount is $1,000 for each employee so coerced, but not to exceed $10,000 per calendar year. Penalties are deposited into the unemployment program integrity fund.
The bill does the following: 1) removes the $7,500 and $10,000 limitations on the administrative penalties and provides that the penalties double for each act occurring after the date of the first determination of a violation; 2) removes the limitations on the types of employers to whom the prohibitions apply, making them applicable to any type of employer; and 3) specifies that DWD may make referrals for criminal prosecution for alleged criminal misclassification violations regardless of whether an employer has been subject to any other penalty or assessment under the UI law.
Increasing maximum weekly benefits
Under current law, a person who qualifies for UI receives a weekly benefit rate equal to a percentage of that person’s past earnings, but the weekly benefit rate is capped at $370. The bill changes the maximum weekly benefit rate in the following ways:
1. For benefits paid for weeks of unemployment beginning on or after January 4, 2026, but before January 3, 2027, the maximum weekly benefit rate is capped at $497.
2. For benefits paid for weeks of unemployment beginning on or after January 3, 2027, the maximum weekly benefit rate is increased based upon the change in the consumer price index and is then increased on the same basis annually thereafter.
Increasing benefit wage cap
Under current law, a person who qualifies for UI is ineligible to receive any UI benefits for a week if the person receives or will receive wages or certain other earnings totalling more than $500 (wage cap). The bill changes the wage cap in the following ways:
1. For weeks of unemployment beginning on or after January 4, 2026, but before January 3, 2027, the wage cap is increased to $672.
2. For weeks of unemployment beginning on or after January 3, 2027, the wage cap is increased based upon the change in the consumer price index and is then increased on the same basis annually thereafter.
Substantial fault
Under current law, a claimant for UI benefits whose work is terminated by his or her employer for substantial fault by the claimant connected with the claimant’s work is ineligible to receive UI benefits until the claimant satisfies certain requalification criteria. With certain exceptions, current law defines “substantial fault” to include those acts or omissions of a claimant over which the claimant exercised reasonable control and that violate reasonable requirements of the claimant’s employer. The bill eliminates this provision on substantial fault.
Misconduct
Under current law, a claimant for UI benefits whose work is terminated by his or her employer for misconduct by the claimant connected with the claimant’s work is ineligible to receive UI benefits until the claimant satisfies certain requalification criteria, and the claimant’s wages paid by the employer that terminates the claimant for misconduct are excluded for purposes of calculating benefit entitlement. Current law defines “misconduct” using a general, common law standard derived from Boynton Cab Co. v. Neubeck, 237 Wis. 249 (1941), and enumerates several specific types of conduct that also constitute misconduct. Under one of these specific provisions, misconduct includes 1) absenteeism on more than two occasions within the 120-day period before the date of the claimant’s termination, unless otherwise specified by his or her employer in an employment manual of which the claimant has acknowledged receipt with his or her signature, or 2) excessive tardiness by a claimant in violation of a policy of the employer that has been communicated to the claimant. In Department of Workforce Development v. Labor and Industry Review Commission (Beres), 2018 WI 77, the supreme court held that an employer could, under the language described above, institute an attendance policy more restrictive than two occasions within the 120-day period.
Current law also provides that absenteeism or tardiness count as misconduct only if the claimant did not provide to his or her employer both notice and one or more valid reasons for the absenteeism or tardiness. In Bevco Precision Manufacturing v. Labor and Industry Review Commission, 2024 WI App. 54, the court of appeals held that under Beres, this qualifying language did not apply if an employer had adopted its own standard on absenteeism and tardiness, as described above.
The bill does all of the following:
1. Eliminates the language referencing “excessive tardiness.”
2. Reverses the holding in Bevco by providing that a claimant’s notice and reason for an occasion of absenteeism or tardiness are to be analyzed under the common law misconduct standard. Under the bill, therefore, an employer may not establish its own policy for determining the reasonableness of absenteeism or tardiness. The bill does not, however, affect the general ability of an employer to institute a standard for absenteeism and tardiness more restrictive than two occasions within the 120-day period before termination.
3. Clarifies, in another provision defining misconduct, that “tribal government” has the meaning given under state and federal law for what is considered an Indian tribe.
Drug testing
Current state law requires DWD to establish a program to test certain claimants who apply for UI benefits for the presence of controlled substances in a manner that is consistent with federal law. A claimant who tests positive for a controlled substance for which the claimant does not have a prescription is ineligible for UI benefits until certain requalification criteria are satisfied or unless he or she enrolls in a substance abuse treatment program and undergoes a job skills assessment, and a claimant who declines to submit to a test is simply ineligible for benefits until he or she requalifies. The bill eliminates the requirement to establish the drug testing program.
Also under current law, an employer may voluntarily submit to DWD the results of a preemployment test for the presence of controlled substances that was conducted on an individual as a condition of an offer of employment or notify DWD that an individual declined to submit to such a test. If DWD then verifies that submission, the employee may be ineligible for UI benefits until he or she requalifies. However, a claimant who tested positive may maintain eligibility by enrolling in a substance abuse treatment program and undergoing a job skills assessment. The bill eliminates these preemployment drug testing provisions.
Acceptance of suitable work
Under current law, if a claimant for UI benefits fails, without good cause, to accept suitable work when offered, the claimant is ineligible to receive benefits until he or she earns wages after the week in which the failure occurs equal to at least six times the claimant’s weekly UI benefit rate in covered employment. Current law specifies what is considered “suitable work” for purposes of these provisions, with different standards applying depending on whether six weeks have elapsed since the claimant became unemployed. Once six weeks have elapsed since the claimant became unemployed, the claimant is required to accept work that pays lower and involves a lower grade of skill.
The bill modifies these provisions described above so that the claimant is not required to accept less favorable work until 10 weeks have elapsed since the claimant became unemployed.
Quits due to nonsuitable work
Under current law, unless an exception applies, if a claimant for UI benefits quits his or her job, the claimant is generally ineligible to receive UI benefits until he or she qualifies through subsequent employment. Under one such exception, if a claimant quits his or her job and 1) the claimant accepted work that was not suitable work under the UI law or work that the claimant could have refused, and 2) the claimant terminated the work within 30 calendar days after starting the work, the claimant remains eligible to collect UI benefits. Under the bill, this exemption applies if the claimant terminated that work within 10 weeks after starting the work.
Waiting period
Currently, a claimant must wait one week after becoming eligible to receive UI benefits before the claimant may receive benefits for a week of unemployment, except for periods during which the waiting period is suspended. The waiting period does not affect the maximum number of weeks of a claimant’s benefit eligibility.
The bill deletes the one-week waiting period, thus permitting a claimant to receive UI benefits beginning with his or her first week of eligibility.
Work search and registration
Under current law, a claimant for UI benefits is generally required to register for work and to conduct a work search for each week in order to remain eligible. Current law requires DWD to waive these requirements under certain circumstances, for example, if a claimant who is laid off from work reasonably expects to be recalled to work within 12 weeks, will start a new job within four weeks, routinely obtains work through a labor union referral, or is participating in a training or work share program. Under current law, DWD may modify the statutory waivers or establish additional waivers by rule only if doing so is required or specifically allowed by federal law.
The bill removes the waiver requirements from statute and instead allows DWD to establish waivers for the registration for work and work search requirements by rule. DWD may establish a waiver by emergency rule if the secretary of workforce development determines that the waiver is needed only on a temporary basis or that permanent rules are not warranted, and the bill allows the secretary to extend the emergency rule for up to 60 days at a time. Also, the bill specifies that the work search requirement does not apply to a claimant who has been laid off but DWD determines that the claimant has a reasonable expectation to be recalled to work.
Social security disability insurance payments
Under current law, in any week in any month that a claimant is issued a benefit under the federal Social Security Disability Insurance program (SSDI payment), that claimant is ineligible for UI benefits. The bill eliminates that prohibition and instead requires DWD to reduce a claimant’s UI benefit payments by the amount of SSDI payments. The bill requires DWD to allocate a monthly SSDI payment by allocating to each week the fraction of the payment attributable to that week.
Quits due to relocations
Under current law, unless an exception applies, if an individual quits his or her job, the individual is generally ineligible to receive UI benefits until he or she qualifies through subsequent employment.
Under one such exception, if the employee’s spouse is a member of the U.S. armed forces on active duty and is relocated, and the employee quits his or her job in order to relocate with his or her spouse, the employee remains eligible to collect UI benefits. The bill expands this exception so that it applies to an employee who quits employment in order to relocate with a spouse who is required by any employer, not just the U.S. armed forces, to relocate.
