Senate Passes Unemployment Insurance Reform Bill

by | Feb 10, 2014

BOSTON – The Senate on Thursday voted 33-4 to pass legislation that will lower costs for businesses and support the growing economy in the Commonwealth announced Senator Michael O. Moore (D-Millbury). The bill introduces an updated rating table, puts in place a multi-year rate freeze and expands the seasonal employer exemption.

“This bill takes the necessary and much-needed steps toward a balanced reform of the Commonwealth’s Unemployment Insurance program,” Senator Moore stated. “This legislation helps provide financial predictability, lowers costs and foster a healthy economy that supports the business community, while protecting those most in need by preserving the current state benefits. I am proud of the Senate for taking action today on this legislation that supports both the unemployed and our businesses, which will further help support the Massachusetts economy.”

The Senate’s bill expands the experience rating table to allow stable employers to pay lower rates and require negatively rated employees to pay higher rates, from $153.30 per employee to $2,337.30 per employee. The expanded rating table also increases the taxable wage base to $21,000 from the current $14,000.

In addition to a one-year freeze at Schedule E for 2014, this bill also freezes rates for 2015, 2016 and 2017. The rate freeze for 2014 will save employers a projected $421 million alone.

The bill reduces unemployment insurance costs for employers by expanding the seasonal employer exemption to 20 weeks. Under current law, to qualify for certification a seasonal business must be in operation for fewer than 16 weeks or employ workers in one or more functionally distinct job titles for fewer than 16 weeks.

Business owners will be allowed to collect unemployment benefits if they leave their company but will be required to pay back any money collected if they return to the same company within the same benefit year. Individuals will also be allowed to collect benefits if they quit a second job before they were laid off from their primary job.

The bill also authorizes the Department of Unemployment Assistance to participate in a federal program that allows the interception of federal tax refunds to recover benefit overpayments.

The bill also does the following:

  • Adds whistleblower protections for employees who testify about their employers’ defrauding the system;
  • Requires the Department of Unemployment Assistance to hold at least one annual public hearing to receive input from employers;
  • Requires the Department of Unemployment Assistance to provide eligibility determination within 30 days;
  • Prohibits crewmembers on commercial fishing vessels from being denied unemployment benefits if unemployment is the result of federal fisheries management restrictions;
  • Clarifies language to prevent a company from shedding its experience rating by reorganizing or renaming itself; and,
  • Requires all public contractors to certify that they do not owe back Unemployment Insurance payments.

The bill now goes to the House of Representatives for consideration.