House UC Bill Would Cut over $600 million in UC Benefits, Asks Employers to Pay Nothing

May 18, 2011

Pennsylvania HB 916 makes fundamental changes to almost every aspect of the benefits side of the unemployment compensation (UC) program.  It would harm Pennsylvania’s hundreds of thousands of unemployed workers by cutting over $600 million in UC benefits, but not fix the structural defects in the financing that caused the current insolvency of the UC Trust Fund.  To the extent that it addresses trust fund insolvency, it unfairly puts the entire burden on the unemployed through benefits cuts and puts no responsibility on the employer community.

HB 916 would harm Pennsylvania’s unemployed workers in the following ways.

  • Lowering benefits amounts ($463 million in cuts annually) and reducing the number of weeks that some unemployed could get benefits ($48 million in cuts annually).
  • Changing the definition of “willful misconduct” to deny UC benefits to workers whose mistakes were not intentional.
  • Denying UC benefits to workers forced to leave their jobs for family or medical reasons — those fleeing domestic violence, dealing with lost child or elder care, providing care for sick family members, or suffering from medical conditions that prevent them from performing their jobs.
  • Offsetting 100% of severance payments, even if those payments are required by law or contract.

HB 916 does not address the main problem of UC trust fund insolvency:  The taxable wage base (TWB) of $8,000 on which employers pay taxes has not been raised since 1984.  There simply is not enough revenue in the UC system to pay benefits.  HB 916 would allow employers to continue not paying their fair share.

  •  If the TWB had been indexed for inflation, it would now be $21,500.
  • Nationally, the average TWB is $12,200.  39 states have a higher TWB than Pennsylvania, with14 states over $20,000.  Pennsylvania is out of the mainstream in having such a low TWB.
  • State UC taxes cost Pennsylvania employers an average of only 15 cents per hour, out of an average total hourly compensation rate of $21.36.

HB 916 harms Pennsylvania’s unemployed, who already are suffering despite getting UC benefits.

  • UC benefits provide no more than 50% wage replacement for the unemployed.
  • The average UC check in Pennsylvania is $314 per week, less than the poverty level for a family of 3 of $352 per week.

The UC issue that actually requires urgent attention of the General Assembly is the need for a technical amendment that will allow federally funded Extended Benefits (EB) to continue after June 11th.

  • Unless such a bill is passed by June 11th, 45,000 long-term unemployed Pennsylvanians will be cut off of their federally funded EB benefits on that date.  An addition 90,000 workers will lose EB benefits by the end of 2011.
  • These EB benefits are not paid out of the UC Trust Fund, but with federal funds.

Please act now to send a message to your State Representative.  Here’s how:

1.  Click here to send a click-to-send email message.  On the message page just enter your full PA home address (including St., Rd., Ave. etc.) and click “Participate” to send your message today: Stop the UC Cuts in PA!  Vote ‘NO’ on HB 916.

2.  Call your State Representative.  Click this link to find your legislator and their office phone numbers.  Call and tell them:  Stop the UC Cuts in PA!  Vote ‘NO’ on HB 916.

We want every State Representative to receive both a phone call and an email message — and that’s particularly important if you’re in Montgomery, Chester, Bucks or Delaware Counties!

Overwhelming the overwhelmed: Proposed budget cuts to beleaguered welfare offices are penny wise and pound foolish

May 3, 2011

This op-ed originally ran in the Pittsburgh Post-Gazette on Thursday, April 21, 2011.

Valerie Bowens works part-time and takes care of her 82-year-old mother. On three separate occasions over the past nine months, the welfare office has tried to stop their food stamps and Medicaid.

Each time, the reason given was because paperwork they had submitted was lost or the office mistakenly thought they had moved. Each time, Ms. Bowens took time away from work and went to the office to try to fix the problem. She has submitted duplicate papers and spent countless frustrating hours on the phone and in the waiting room trying to fix the problems.

If you have been to a county assistance office lately, you know that Ms. Bowens is not alone. Read the rest of this entry »