Rhode Island plans to use information from the Internal Revenue Service to track down employers who are failing to properly pay state unemployment insurance taxes.

The Rhode Island Department of Labor and Training has signed an agreement with the IRS to share information that will allow the state agency to identify businesses that should be paying into the state’s unemployment insurance trust fund but are not, said Raymond A. Filippone, who heads the state’s unemployment insurance program.

“It is very important for us. I think it’s a step in the right direction,” Filippone said in a telephone interview yesterday from Nashua, N.H., where he is attending a conference for state unemployment insurance directors.

Based on a statement issued by the state agency yesterday, and on comments by Filippone, the new agreement’s focus would include the following situations in which state unemployment insurance taxes are not being properly paid:

•A business may be registered with the federal government, but not with the state government.

•A company may be registered at the federal level as a business with employees, but at the state level as a sole proprietorship without employees.

•An employer may misclassify employees as independent contractors.

The agreement will help the state agency identify such employers and notify them about the requirement to pay the tax, Filippone said.

Under the current system, businesses that fail to properly report their situations and pay the required unemployment insurance taxes are not caught until after employees file for unemployment insurance benefits.

With the IRS agreement, “Now we can catch them before an employee contacts us with a claim,” Filippone said in a statement.

Adelita Orefice, director of the state Department of Labor and Training, said in a statement that, “Prevention, detection and elimination of abuse in the unemployment insurance program are top priorities for our department. We want to ensure that employers are paying only their fair share of employment taxes and are not subsidizing any dishonest employers.”

The state does not have an estimate of how much in additional unemployment tax revenue it might collect as a result of the agreement, Filippone said in the phone interview.

Nevertheless, he said it is bound to result in some additional collections. This, in turn, could benefit existing employers who currently pay unemployment taxes — they might wind up paying less in tax, or pay less of an increase that would otherwise be due, he said.

If a business has employees, “It has to pay . . . unemployment insurance tax,” said Patricia A. Thompson, former president of the Rhode Island Society of Certified Public Accountants.

The unemployment insurance program is run through a federal-state partnership and is designed to partially replace lost earnings of individuals who become unemployed through no fault of their own. It is also intended to stabilize the economy during downturns.

The program has been a key component in ensuring the financial security of America’s work force for more than 70 years, according to a report issued last month by the U.S. Government Accountability Office (GAO), the investigative arm of Congress.

For the year ended Sept. 30, 2006, the unemployment insurance program covered about 130 million workers and paid about $30 billion in benefits to about 7 million workers nationwide who lost their jobs, the GAO report said.

The program is paid for through state and federal employment taxes. In general, the taxes that employers pay are deposited into an unemployment insurance trust fund.

From that fund, the state pays benefits to workers who lose their jobs and qualify for benefits. The fund has a balance of about $192 million, Filippone said.

Broadly speaking, the tax that an employer pays is based, in part, on how many people have collected unemployment benefits in the past based on that employer’s account, said Thompson, tax partner with Piccerelli Gilstein & Co. LLP, a CPA firm in Providence.

Rhode Island is one of 29 states that will sign a memorandum of understanding with the IRS on Nov. 6. Besides Rhode Island, other New England states in the agreement include Massachusetts and Maine, Filippone said.

A spokesman for the IRS was not immediately available to comment about the agreement. Thompson said that the IRS could benefit from the information-sharing agreement in a number of ways.

For example, if an employer misclassifies a worker as an independent contractor, the employer does not pay federal payroll taxes that would otherwise be due, such as unemployment tax, Social Security tax and Medicare tax.

If the agreement uncovers such situations, the IRS could seek payment from the employers.

"Today's ruling of the European Court of Justice is good news for the internal market and the free movement of capital," Commission spokesman Oliver Drewes told a briefing in Brussels.

The law's demise could also end decades of cosy ties between management and labor at VW in a system called co-determination that gives workers a major say in how the company is run.

The court ruled as expected that the Volkswagen Law broke EU rules because it capped voting rights at 20 percent and let VW's home state of Lower Saxony veto strategic decisions with just 20 percent of the votes.

Porsche welcomed the ruling that lets the maker of 911 sports cars exercise all of its VW voting rights via its nearly 31 percent stake in Volkswagen ordinary shares.

Porsche has said it has secured enough options to let it "significantly" raise its holding in VW but has declined to say whether this meant it could already gain majority control.

Medina's niece and nephew have pleaded not guilty to helping Medina set up sham companies to help funnel casino revenue into Medina's personal holdings.

Colma's former mayor was sentenced to 18 months in prison in July after pleading guilty to accepting airline tickets from Medina while the casino had business pending before him.

Continuing its global merger march, Reed Smith LLP is uniting with a large Chinese firm to gain entree to legal work in that country's growing legal market. Reed Smith, which has about 150 attorneys in the Bay Area, merged with Richards Butler Hong Kong. The 110 attorneys in Hong Kong specialize in corporate transactions and litigation. The deal marks Reed Smith's entry into Asia and instantly makes the firm one of the five largest law firms in China. Reed Smith said it will apply to the Chinese government to open an office in Shanghai as well.

With this combination, Reed Smith will have more than 1,500 lawyers worldwide and it expects revenue in 2007 just shy of $1 billion.

"This merger gives us a leading presence in Hong Kong, an entree into mainland China and the ability to provide the high quality services our clients need," said Greg Jordan, firmwide managing partner at Reed Smith.

The Hong Kong merger is the third significant union executed by Reed Smith in the past 12 months. Last January, Reed Smith merged with Richard Butler London, which operated as a separate business entity from its Hong Kong counterpart. Three months later, Reed Smith merged with Chicago law firm Sachnoff & Weaver Ltd.

Including the Hong Kong merger, Reed Smith will have added 500 lawyers in the past year.

Reed Smith pushed into California in 2003 by its merger with Crosby Heafey Roach & May, the largest Oakland-based law firm.

California wants to implement a 2002 state law that would require automakers to begin making vehicles that emit fewer greenhouse gas emissions by model year 2009. It would cut emissions by about a quarter by the year 2030. But the law can take effect only if the EPA grants the state a waiver under the Clean Air Act.

"Unfortunately, the Bush administration has really had their head in the sand," Attorney General Jerry Brown said. "In this case, there has been an unreasonable delay."

The EPA held hearings this summer on California's waiver request, and administrator Steven Johnson told Congress he would make a decision by the end of the year. The schedule has not changed, EPA spokeswoman Jennifer Wood said Monday.

The agency is also crafting national standards that it will propose by the end of the year, Wood said.

Gov. Arnold Schwarzenegger in April warned the EPA he would sue if the agency failed to act on the waiver within six months. That deadline is Tuesday.

"We feel like it's a reasonable request," Schwarzenegger spokesman Aaron McLear said. "They've delayed for a long time, and it's time to take action."

Connecticut, Pennsylvania and Washington also plan to join California's lawsuit against the EPA, officials in those states said.

While the federal government sets national air pollution rules, California has unique status under the Clean Air Act to enact its own regulations — with permission from the EPA. Other states can then follow either the federal rules or California standards, if they are tougher.

Eleven other states — Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont and Washington — are ready to implement California's emissions standards if it gets the waiver. The governors of Arizona, Florida and New Mexico have said their states will adopt the standard.

The Association of International Automobile Manufacturers, which represents Honda, Nissan, Toyota and 11 other foreign car companies, has sued to block the standards from taking effect.

It argues that the tougher standards would raise the cost of cars and could force manufacturers to pull some sports utility vehicles and pickup trucks from showrooms. Their case is pending in federal court in Fresno.

The Alliance of Automobile Manufacturers has asked the EPA to deny the waiver, arguing there should be one federal standard for tailpipe emissions.

Gary Medrano, of Woodbridge, Va., filed the lawsuit on Monday in U.S. District Court for the Southern District of Illinois, saying his 2000 Ford F-150 XLT caught fire in October 2006 because of problems with the cruise control switch. The suit seeks class-action certification.

The 10-count complaint does not seek a specific amount of damages, but is asking for both compensatory and punitive damages.

The Dearborn, Mich.-based automaker has recalled more than 10 million vehicles since 1999 because of engine fires linked to the cruise control systems in trucks, sport utility vehicles and vans.

Ford spokeswoman Kristen Kinley said the company was reviewing the lawsuit, but could not comment on the case. A message seeking comment was left Friday with St. Louis attorney Jeffrey J. Lowe, who is representing Medrano.

Medrano said the fire in his pickup truck was extinguished by the fire department, but the vehicle and its contents were left completely unsalvageable.

The lawsuit said the National Highway Traffic Safety Administration has reported at least 218 similar fires from the cruise control deactivation switches. By June 2005, NHTSA had confirmed at least 65 fires were caused by the failure of the switch system.