Bills aiming to improve unemployment insurance program advance in Springfield

 

From Illinois Business Journal news services

SPRINGFIELD – Related legislation aimed at improving Illinois unemployment insurance system advanced in both the House and Senate on Tuesday.

Sponsored by state Rep. Jay Hoffman, D-Swansea, Senate Bill 1941 passed out of the House Labor and Commerce committee and will be considered by the House of Representatives on Dec. 2.

“This bill is the result of negotiations between business groups, labor groups, Democrats and Republicans, and it shows that compromise is possible and progress can be made,” Hoffman said. “The measure improves our unemployment insurance system by increasing benefits, preventing fraudulent benefit claims and preventing a tax increase on employers.”

Hoffman, who chairs the House Labor and Commerce committee, is the chief House sponsor of Senate Bill 1941, which represents an agreement between business and labor groups and makes several important changes. It eliminates the social security offset, which reduced unemployed workers’ weekly benefits by 50 percent of their social security payments each week. The change is expected to increase benefits by $25 million per year for Illinois seniors. Illinois was one of only two states that penalized seniors on social security.

Also, the bill prevents workers who are fired for misconduct from receiving unemployment benefits by expanding the definition of misconduct. The new definition of misconduct includes behavior such as falsifying employment documentation, repeatedly violating attendance policies, and refusing to obey an employer’s lawful instructions.

The bipartisan measure will eliminate a 2016 speed bump, which would have resulted in an unemployment insurance tax increase to employers of approximately $470 million and a decrease in unemployment insurance benefits by approximately $300 million. It also creates a moratorium on any unemployment insurance legislation through 2017 unless the bill is agreed upon by all parties.

“Our economy needs an unemployment insurance system that is fair to both employers and employees,” Hoffman said. “This bill does just that.”

Meanwhile, state Sen. Kyle McCarter, R-Lebanon, is hailing the Senate’s approval Tuesday of companion legislation.

The Senate approved House Bill 1285, co-sponsored by McCarter (and chief sponsored by Hoffman), to reform the state’s unemployment insurance  program.

“The measure gets us closer to making Illinois a competitive state once again and attracting job creators,” said McCarter.

Under HB 1285, gross misconduct on the part of a worker who has been terminated would disqualify that worker from receiving unemployment benefits. The legislation would also protect the unemployment benefits of older workers who are laid off and who also receive Social Security income. It also eliminates the 2016 UI tax increase on employers of $470 million and prevents $300 million in benefit reductions for laid-off employees also scheduled to take effect in 2016. The legislation is part of Gov. Rauner’s economic “Turnaround” Agenda.

McCarter, who has been advocating for unemployment insurance reforms since 2011, said persistence paid off.

“It’s certainly been a struggle to get to this point,” said McCarter. “When I first introduced similar reforms, I was told it had to be part of an ‘agreed bill process,’ which is an internal political process involving all interested and impacted parties, including business and labor. I was also told nothing would happen for five years. I persisted, filing bills in following years, including a package of four measures this year alone. I’m pleased that we’re perhaps a year ahead of schedule and while I would like to see additional reforms, we have something positive to show for all the effort.”

McCarter was appointed to an unemployment insurance working group earlier this year. The legislation approved by the Senate Tuesday is a result of that group’s efforts.

“I appreciate the opportunity to be part of the working group and to contribute to the effort that brought us to this point,” said McCarter. “There is still a lot of work to turn around our state especially in the area of workers’ compensation, which would have a much greater financial impact on payroll and our business climate.”

The Senate approved HB1285 on a vote of 58 to 0. It now heads back to the House for final approval.