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PA Chamber urges enactment of commonsense UC reform
S.B. 1030 would bring fairness, cost-control to insolvent UC system
After grappling with the issue for the past few years, it's time for Pennsylvania to begin fixing the problems plaguing its unemployment compensation system. PA Chamber members are urging lawmakers to approve S.B. 1030, which would bring equity to the system and control costs, both of which are in the best interest of job creators and those most in need of UC assistance. S.B. 1030, as amended by the House Labor and Industry Committee on June 7, would tighten guidelines for determining UC benefit eligibility. These guidelines would include requiring recipients to look for work as a condition of receiving benefits. Pennsylvania is the only state in the nation that doesn't require recipients to prove they are actually looking for work. The bill would also reform a liberal severance pay policy that allows claimants to collect severance benefits and UC at the same time, effectively enabling recipients to earn up to 150 percent of the pay they received while employed. The legislation also would clearly define willful misconduct, preventing individuals who are unemployed as a result of their own actions from collecting benefits. This reform measure would ensure that the system can continue to financially assist individuals who lose their job through no fault of their own, which is the entire premise of the UC Law. By allowing the UC system to work as intended, as S.B. 1030 would do, $137 million in savings would be realized. In addition, the bill would also allow for work share programs, which give employers options to prevent employee layoffs, keeping more workers employed. The reforms now proposed in Senate Bill 1030 represent a compromise between the original version of the bill and H.B. 916, which also addressed the UC Trust Fund's insolvency through a recalculation of benefit formulas. Pennsylvania has borrowed nearly $4 billion from the federal government through March 2011 for UC benefits, the third-highest amount behind California and Michigan. While PA Chamber members welcome the reforms contained in S.B. 1030, they urge legislative leaders to revisit the issue of the UC Trust Fund's insolvency in the near future. The PA Chamber's most recent Setting the Record Straight Column explains why Senate Bill 1030 is currently the most viable option before the legislature to bring fairness and equity to the UC system, and control costs.
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