Personal Responsibility and Work Opportunity Reconciliation Act of 1996. The Personal Responsibility and Work Opportunity Act is a federal law which requires employers to report information on new hires to State New Hire Directories. The law requires each state to set up these new hire directories by October 1, 1997.

Purpose. The purpose of the Act is to locate individuals for purposes of establishing paternity and establishing, modifying, and enforcing child support obligations. The information may be accessed by the state agency or agent of that agency carrying out the program. The information may also be accessed by state agencies operating employment security and workers' compensation programs.

Reporting requirements. In general, each employer must 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 the identification number of the employer.

Multistate employers. An employer that has employees who are employed in 2 or more states and that transmits reports magnetically or electronically may comply by designating one state in which such employer has employees to which the employer will transmit the report. Employers should check on the law in each state in which they do business because requirements may vary from state to state.

Reporting format and timing. Each report required by the Act 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. The report must be filed no later than 20 days after the date the employer hires the employee; or in the case of electronic or magnetic transmissions, by 2 monthly transmissions (if necessary) not less than 12 days nor more than 16 days apart.

Penalties. The Act provides that states shall have the option to set a state civil money penalty which shall be less than $25, or $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.

Employers should discuss with competent counsel their rights and obligations in the states in which they do business.

1. 42 U.S.C. §651 et seq.