Employees would pay into fund for jobless
A proposal to shore up Ohio’s unemployment-compensation fund would draw millions of dollars from workers because they would be required for the first time to contribute to jobless benefits.
Under House Bill 382 introduced by state Rep. Kirk Schuring, R-Canton, new premiums charged to employees would begin in 2019, generating $125 million that year. That would equal 10 percent of the
unemployment taxes paid by employers, who also face a rate increase.
Total premiums paid by workers would increase to $140 million by 2030, remaining at 10 percent of employer contributions to the fund.
For a worker, the annual premium would range from $5.50 to $112.20 a year, or $0.46 to $9.35 a month, according to data provided by Schuring.
Rates were calculated based on employee earnings and how frequently their employer uses the unemployment-compensation system. Workers for employers that seldom impose layoffs — retailers are an example — would pay the lowest rates, while workers for employers such as construction companies that frequently let employees go would pay the highest.
Schuring, who was tasked by the House GOP leadership with crafting an unemployment-fund fix, said his aim is to restore solvency to Ohio’s system with equal contributions from businesses and workers.
The rates are “not burdensome,” Schuring said, adding, “It’s common practice for benefit costs to be shared by employers and employees, like health care.”
An analysis by the nonpartisan Legislative Service Commission found that from 2019 to 2030, employees on average would cover 50.5 percent of the cost of the bill, while employers would pick up the rest. If there is a recession during that time, employees would pick up an estimated 51.5 percent of the cost.
If the bill is passed into law, Ohio would become the fourth state to require employee contributions, following Alaska, New Jersey and Pennsylvania.
Although both business and labor groups say the bill needs work, advocates for workers say they generally support modest contributions from employees as part of a broader fix.
“We favor an employee tax to avoid a benefits cut,” said Zach Schiller, research director at Policy Matters Ohio, a liberal research group in Cleveland that made such a proposal last year. “That said, we have concerns about elements in the bill.”
While not endorsing the bill, Matt Szollosi, executive director of the Affiliated Construction Trades of Ohio, which represents construction workers, said he also supports the idea of employee contributions to avoid deeper cuts in jobless benefits.
“Our workers rely on benefits, so this is appealing to us,” Szollosi said.
Still, Szollosi said, premiums charged to employers and employees might be overly complicated and place heavy administrative burdens on employers.
He also questioned whether the bill would meet its goal of restoring the fund to solvency.
The House recently began hearings on the bill and is certain to require changes before the bill could win passage in the Republicancontrolled legislature. In addition to creating the premium for workers, the bill would reduce jobless benefits and increase employer taxes, drawing criticism from both sides.
Schuring, who earlier this year led meetings with business and labor that failed to produce a compromise, acknowledged that the bill needs changes but said the legislation is necessary. “It’s a starting point.”
In the aftermath of the Great Recession, Ohio’s fund went broke, and businesses paid years of higher federal unemployment taxes to pay off the state’s $3.4 billion debt to the federal government.
State officials have cautioned that under current law, the unemployment-compensation fund is projected to become insolvent in 2021 with no recession, and in 2020 with a moderate recession.The bill, if passed, would allow the fund to remain solvent through 2030 without a recession, and insolvent in 2021 with a moderate recession, although it would recover quickly.
Among other changes, the bill would raise the wage base on which employers pay tax from $9,500 to $11,000, freeze benefit levels for 10 years, and reduce the weeks of available benefits from 26 to 24 with some exceptions. Those moves would generate about $370 million a year from 2019 to 2030.
A companion proposal would create a proposed bond issue that, if approved by voters, would allow the state to issue debt to raise money if the unemployment fund is depleted, instead of again borrowing from the federal government.
PORTLAND, Ore. — Regulators in Oregon have shuttered a day care after a second baby died there in as many years, an unprecedented number of deaths at a single day care center for the state.
Authorities said the 10-month-old boy died two days after he was found not breathing at Broadway Children’s Center in Portland on Oct. 4. A medical examiner has not yet said what caused it. No one has been arrested or accused of wrongdoing, The Oregonian/OregonLive reported .
A 7-month-old died at the facility in April 2016. Investigators determined that death to be sleep-related and said there was no abuse or neglect involved.
The infants were under the care of the same person when they died, and the state said this month’s death occurred under “similar circumstances” as the previous one, the newspaper reported. The state said Friday it plans to close the center permanently.