The Missouri legislature has proposed shortening the length of time a person can stay on unemployment benefits by tying that limit to the unemployment rate.
The plan would allow unemployment benefits for up to 20 weeks when the average unemployment rate is nine percent or higher, to as few as 13 weeks when the rate drops below six percent.
Backers say the bill is needed to bolster the state’s unemployment fund, that has become insolvent during recent downturns in the economy.
The Missouri Chamber of Commerce backed the bill through its path to the governor’s desk.
“Following the last recession, Missouri’s unemployment insurance system became insolvent and had to borrow money from the federal government to cover claims, and employers paid millions in interest alone on the borrowed funds,” Chamber president Dan Mehan said.
He said Missouri is the only state that has had to borrow funds from the federal government to cover benefits to unemployed workers in the past five economic downturns.
“We need to take steps to keep the fund from chronic insolvency. This bill does that,” said Mehan.
Opponents like Representative Sheila Solon (R-Blue Springs) said the bill would make it harder for people who have lost a job to make ends meet or get an education toward a new career.
“Unemployment insurance is not welfare. It’s insurance. It provides help to people who have lost their jobs through no fault of their own to cover the gap until they can find a job,” said Solon. “It helps put gas in their car, food on the table, and it helps pay the rent or their mortgage so they don’t lose their home.”
The state Senate amended the bill to include severance and termination pay in the definition of wages. The result would be that a person would not start receiving unemployment benefits until after severance or termination pay runs out.
House Democrat leader Jake Hummel (D-St. Louis) argued that would hurt a person’s ability to change professions after being laid off.
“When these people get laid off what they’re doing is they’re taking these packages, these payouts, they’re going to school, and learning a new skill,” said Hummel. “It seems like we’re pulling the rug out from under them at a time when they need it most.”
The House passed the original bill 112-47 in February, but the version with the Senate amendments received only 88 “yes” votes. Its House sponsor, Representative Scott Fitzpatrick (R-Shell Knob) says he thinks the difference in vote totals is a result of the amendment adding severance and termination pay to the definition of wages.
“I think it was probably the amendment that Senator (Mike) Kehoe added that got some folks in the organized labor community concerned and they started contacting people on this side of the building, and that, I think, resulted in a lower vote total.”
The second House vote is 21 short of the total supporters would need to overturn a veto by Governor Jay Nixon (D) if that is the action he takes on the bill.
The Senate passed the bill 21-8.