Senate Approves Unemployment Solvency and Reform Package
December 5, 2011
Legislation designed to fix Michigan’s faulty unemployment system cleared the Senate this week along partisan lines. The chamber reached consensus on the two bills that would issue bonds to pay off the state’s $3.2 billion federal unemployment benefit loan debt. However, Republicans and Democrats were on opposite sides when it came to the bill that would enact numerous reforms to the administration of the state’s unemployment insurance system.
The legislation makes several positive changes for employers who are wholly responsible for financing the system, including shortening their experience window from five years to three years, which would permit companies to get rid of bad jobless claim years more quickly. Small businesses also can spread their unemployment tax payments out over the year.
For claimants, the legislation requires that after ten weeks of state assistance they take a job if it pays at least their area’s prevailing wage or is 120 percent more than their assistance check, even if the job is outside of their field of training. They would also have to conduct a systematic and sustained search for work, with various reports on their progress due to the state. Workers who fail to keep their training up-to-date, steal from the business or are let go after missing three consecutive days of work without informing their boss would also be ineligible for jobless benefits under the bill.
Additionally, the chamber also passed House Bill 4394, which deals with how unemployment benefits are calculated when a person works two jobs and is laid off from one. For example, under the bill, if an individual is working at two jobs and loses one but keeps the other, the employer where the individual continues to work would not be charged for the unemployment benefits provided to the individual for the loss of the other job. The bill also passed on a party-line vote.
The Senate package now moves to the House for consideration. The stage is set, meanwhile, for the House to begin moving its own identical package next week, with the goal of having legislation on the Governor’s desk before the holiday break. SBAM member are encourage to contact their respective lawmakers to ask for their support for the legislation. Additional information and sample letters may be found here.