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Senate Passes Unemployment Insurance Reform Bill

The Senate on Thursday voted 33-4 to pass legislation that will lower costs for businesses and support the growing economy in the Commonwealth. The bill introduces an updated rating table, puts in place a multi-year rate freeze and expands the seasonal employer exemption.

“The bill passed yesterday in the Senate creates much-needed reforms to our unemployment insurance system and thoughtfully balances the interests of businesses with the needs of those who collect benefits in the Commonwealth,” said Senator Ken Donnelly (D-Arlington). “I was pleased to join my colleagues in voting in favor of this measure and I look forward to seeing the changes implemented in order to create a system that is less onerous for businesses and more effective for the unemployed.”

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.

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. For more information, visit the Legislature’s website.

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