The Patriotic American
Tracking New Hires
Personal Responsibility and
Work Opportunity Reconciliation
Act of 1996

H.R.3734
PUBLIC LAW: 104-193, (became law 08/22/96)

Personal Responsibility and Work Opportunity Reconciliation Act of 1996
(Enrolled Bill (Sent to President))

SEC. 313.	STATE DIRECTORY OF NEW HIRES.

(a)	STATE PLAN REQUIREMENT- Section 454 (42 U.S.C. 654), as amended by
sections 301(b),  303(a), and 312(a) of this Act, is amended--
(1)	by striking `and' at the end of paragraph (26);
(2)	by striking the period at the end of paragraph (27) and inserting `;
and'; and
(3)	by adding after paragraph (27) the following new paragraph:
`(28)	provide that, on and after October 1, 1997, the State will operate
a State Directory of New Hires in accordance with section 453A.'.
(b)	STATE DIRECTORY OF NEW HIRES- Part D of title IV (42 U.S.C. 651-669)
is amended by inserting after section 453 the following new section:
`SEC. 453A. 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) 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 the date of the enactment of
this section may continue to operate under the State law, but the State
must meet the requirements of subsection (g)(2) not later than October
1, 1997, and the requirements of this section (other than subsection
(g)(2)) 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 2(5) of the National Labor Relations
Act, 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 8(f)(3) of such Act 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 453.
`(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)
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 be less
than--
`(1)	$25; 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).
`(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) 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 466(b)(3).
`(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 extracts of the reports required under section
303(a)(6) to be made to the Secretary of Labor 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) 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 1137(b)
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) for the purposes of administering such programs.'.
(c)	QUARTERLY WAGE REPORTING- Section 1137(a)(3) (42 U.S.C.
1320b-7(a)(3)) is amended--
(1)	by inserting `(including State and local governmental entities and
labor organizations (as defined in section 453A(a)(2)(B)(iii))' after
`employers'; and
(2)	by inserting `, and except that no report shall be filed with
respect to an employee of a State or local agency performing
intelligence or counterintelligence functions, if the head of such
agency has determined that filing such a report could endanger the
safety of the employee or compromise an ongoing investigation or
intelligence mission' after `paragraph (2)'.
(d)	DISCLOSURE TO CERTAIN AGENTS- Section 303(e) (42 U.S.C. 503(e)) is
amended by adding at the end the following:
`(5)	A State or local child support enforcement agency may disclose to
any agent of the agency that is under contract with the agency to carry
out the purposes described in paragraph (1)(B) wage information that is
disclosed to an officer or employee of the agency under paragraph
(1)(A). Any agent of a State or local child support agency that receives
wage information under this paragraph shall comply with the safeguards
established pursuant to paragraph (1)(B).'.