I wish I understood how the unemployment fund worked better so that I could better understand who wins and who loses under these changes. Mary Beth Schneider is reporting that a tentative agreement has been struck by the House and Senate conferees.
From the reporting, it sounds like the compromise was made primarily on the business side of the ledger without much in the way of concessions on the labor side of the ledger. But I could be entirely wrong about that.
Rep. David Niezgodski, D-South Bend, said the plan includes no cuts in benefits. It would raise about $400 million by increasing taxes on employers. Under the plan, the taxable wage base would increase to $10,000 from the current $7,000. The tax rate would be 0.75 percent to 10.2 percent, up from the current 1.1 percent to 5.6 percent.
The “seasonal worker” limitations would be dropped — this would have meant that construction workers, idled during the winter months would have been limited or unable to receive unemployment benefits.
The very influential Indiana Manufacturers Association is apparently not pleased and hopes the deal falls apart, saying that “that putting all the brunt of fixing the system on businesses is the wrong step in a recession.”
You are right — the compromise is really not a compromise, but rather a capitulation by Senate republicans on all of their original (and good ideas) — Bauer, the Demos and Labor will come out big on this, and the sad thing is that the program is still broke. This will only raise a small amount of money that’s needed to equalize the fund and pay back the $700 million or so the state has already borrowed from the feds. There were a lot of good ideas that would have tightened up eligibility and made the system better, but you won’t find them in the agreement. It’s really too bad….and I am not crying too much for the IMA, as a lot of their members have abused the system as well, especially the big three automakers etc. Nonetheless, the fact that the “solution” is being funded totally by the employers is a sign that this is not really a compromise.
Seems like one of those problems where an easier solution would have been possible if the parties had negotiated with each other in good faith years ago. But, even now, it’s taking the brink of catastrophe to get even half a fix accomplished. Labor/Management relations really are poisoned.