
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC653a]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                       CHAPTER 7--SOCIAL SECURITY
 
 SUBCHAPTER IV--GRANTS TO STATES FOR AID AND SERVICES TO NEEDY FAMILIES 
              WITH CHILDREN AND FOR CHILD-WELFARE SERVICES
 
          Part D--Child Support and Establishment of Paternity
 
Sec. 653a. State Directory of New Hires


(a) Establishment

                           (1) In general

        (A) Requirement for States that have no directory

            Except as provided in subparagraph (B), not later than 
        October 1, 1997, each State shall establish an automated 
        directory (to be known as the ``State Directory of New Hires'') 
        which shall contain information supplied in accordance with 
        subsection (b) of this section by employers on each newly hired 
        employee.

        (B) States with new hire reporting law in existence

            A State which has a new hire reporting law in existence on 
        August 22, 1996, may continue to operate under the State law, 
        but the State must meet the requirements of subsection (g)(2) of 
        this section not later than October 1, 1997, and the 
        requirements of this section (other than subsection (g)(2) of 
        this section) not later than October 1, 1998.

                           (2) Definitions

        As used in this section:

        (A) Employee

            The term ``employee''--
                (i) means an individual who is an employee within the 
            meaning of chapter 24 of the Internal Revenue Code of 1986; 
            and
                (ii) does not include an employee of a Federal or State 
            agency performing intelligence or counterintelligence 
            functions, if the head of such agency has determined that 
            reporting pursuant to paragraph (1) with respect to the 
            employee could endanger the safety of the employee or 
            compromise an ongoing investigation or intelligence mission.

        (B) Employer

            (i) In general

                The term ``employer'' has the meaning given such term in 
            section 3401(d) of the Internal Revenue Code of 1986 and 
            includes any governmental entity and any labor organization.
            (ii) Labor organization

                The term ``labor organization'' shall have the meaning 
            given such term in section 152(5) of title 29, and includes 
            any entity (also known as a ``hiring hall'') which is used 
            by the organization and an employer to carry out 
            requirements described in section 158(f)(3) of title 29 of 
            an agreement between the organization and the employer.

(b) Employer information

                      (1) Reporting requirement

        (A) In general

            Except as provided in subparagraphs (B) and (C), each 
        employer shall furnish to the Directory of New Hires of the 
        State in which a newly hired employee works, a report that 
        contains the name, address, and social security number of the 
        employee, and the name and address of, and identifying number 
        assigned under section 6109 of the Internal Revenue Code of 1986 
        to, the employer.

        (B) Multistate employers

            An employer that has employees who are employed in 2 or more 
        States and that transmits reports magnetically or electronically 
        may comply with subparagraph (A) by designating 1 State in which 
        such employer has employees to which the employer will transmit 
        the report described in subparagraph (A), and transmitting such 
        report to such State. Any employer that transmits reports 
        pursuant to this subparagraph shall notify the Secretary in 
        writing as to which State such employer designates for the 
        purpose of sending reports.

        (C) Federal Government employers

            Any department, agency, or instrumentality of the United 
        States shall comply with subparagraph (A) by transmitting the 
        report described in subparagraph (A) to the National Directory 
        of New Hires established pursuant to section 653 of this title.

                        (2) Timing of report

        Each State may provide the time within which the report required 
    by paragraph (1) shall be made with respect to an employee, but such 
    report shall be made--
            (A) not later than 20 days after the date the employer hires 
        the employee; or
            (B) in the case of an employer transmitting reports 
        magnetically or electronically, by 2 monthly transmissions (if 
        necessary) not less than 12 days nor more than 16 days apart.

(c) Reporting format and method

    Each report required by subsection (b) of this section shall be made 
on a W-4 form or, at the option of the employer, an equivalent form, and 
may be transmitted by 1st class mail, magnetically, or electronically.

(d) Civil money penalties on noncomplying employers

    The State shall have the option to set a State civil money penalty 
which shall not exceed--
        (1) $25 per failure to meet the requirements of this section 
    with respect to a newly hired employee; or
        (2) $500 if, under State law, the failure is the result of a 
    conspiracy between the employer and the employee to not supply the 
    required report or to supply a false or incomplete report.

(e) Entry of employer information

    Information shall be entered into the data base maintained by the 
State Directory of New Hires within 5 business days of receipt from an 
employer pursuant to subsection (b) of this section.

(f) Information comparisons

                           (1) In general

        Not later than May 1, 1998, an agency designated by the State 
    shall, directly or by contract, conduct automated comparisons of the 
    social security numbers reported by employers pursuant to subsection 
    (b) of this section and the social security numbers appearing in the 
    records of the State case registry for cases being enforced under 
    the State plan.

                         (2) Notice of match

        When an information comparison conducted under paragraph (1) 
    reveals a match with respect to the social security number of an 
    individual required to provide support under a support order, the 
    State Directory of New Hires shall provide the agency administering 
    the State plan approved under this part of the appropriate State 
    with the name, address, and social security number of the employee 
    to whom the social security number is assigned, and the name and 
    address of, and identifying number assigned under section 6109 of 
    the Internal Revenue Code of 1986 to, the employer.

(g) Transmission of information

      (1) Transmission of wage withholding notices to employers

        Within 2 business days after the date information regarding a 
    newly hired employee is entered into the State Directory of New 
    Hires, the State agency enforcing the employee's child support 
    obligation shall transmit a notice to the employer of the employee 
    directing the employer to withhold from the income of the employee 
    an amount equal to the monthly (or other periodic) child support 
    obligation (including any past due support obligation) of the 
    employee, unless the employee's income is not subject to withholding 
    pursuant to section 666(b)(3) of this title.

      (2) Transmissions to the National Directory of New Hires

        (A) New hire information

            Within 3 business days after the date information regarding 
        a newly hired employee is entered into the State Directory of 
        New Hires, the State Directory of New Hires shall furnish the 
        information to the National Directory of New Hires.

        (B) Wage and unemployment compensation information

            The State Directory of New Hires shall, on a quarterly 
        basis, furnish to the National Directory of New Hires 
        information concerning the wages and unemployment compensation 
        paid to individuals, by such dates, in such format, and 
        containing such information as the Secretary of Health and Human 
        Services shall specify in regulations.

                    (3) ``Business day'' defined

        As used in this subsection, the term ``business day'' means a 
    day on which State offices are open for regular business.

(h) Other uses of new hire information

               (1) Location of child support obligors

        The agency administering the State plan approved under this part 
    shall use information received pursuant to subsection (f)(2) of this 
    section to locate individuals for purposes of establishing paternity 
    and establishing, modifying, and enforcing child support 
    obligations, and may disclose such information to any agent of the 
    agency that is under contract with the agency to carry out such 
    purposes.

        (2) Verification of eligibility for certain programs

        A State agency responsible for administering a program specified 
    in section 1320b-7(b) of this title shall have access to information 
    reported by employers pursuant to subsection (b) of this section for 
    purposes of verifying eligibility for the program.

       (3) Administration of employment security and workers' 
                                compensation

        State agencies operating employment security and workers' 
    compensation programs shall have access to information reported by 
    employers pursuant to subsection (b) of this section for the 
    purposes of administering such programs.

(Aug. 14, 1935, ch. 531, title IV, Sec. 453A, as added Pub. L. 104-193, 
title III, Sec. 313(b), Aug. 22, 1996, 110 Stat. 2209; amended Pub. L. 
105-33, title V, Sec. 5533, Aug. 5, 1997, 111 Stat. 627.)

                       References in Text

    The Internal Revenue Code of 1986, referred to in subsecs. (a)(2), 
(b)(1)(A), and (f)(2), is classified generally to Title 26, Internal 
Revenue Code.


                               Amendments

    1997--Subsec. (d). Pub. L. 105-33, Sec. 5533(1), substituted ``shall 
not exceed'' for ``shall be less than'' in introductory provisions and 
``$25 per failure to meet the requirements of this section with respect 
to a newly hired employee'' for ``$25'' in par. (1).
    Subsec. (g)(2)(B). Pub. L. 105-33, Sec. 5533(2), substituted 
``information'' for ``extracts of the reports required under section 
503(a)(6) of this title to be made to the Secretary of Labor''.


                    Effective Date of 1997 Amendment

    Amendment by Pub. L. 105-33 effective as if included in the 
enactment of title III of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996, Pub. L. 104-193, see section 
5557 of Pub. L. 105-33, set out as a note under section 608 of this 
title.


                             Effective Date

    For effective date of section, see section 395(a)-(c) of Pub. L. 
104-193, set out as an Effective Date of 1996 Amendment note under 
section 654 of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 653, 654, 666, 1320b-7 of 
this title.
