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House, Senate Approve Unemployment Insurance Rate Freeze

Posted by Brad MacDougall on Jan 18, 2012 6:01:00 PM

The Massachusetts Legislature overwhelmingly approved a supplemental budget last week that would freeze Unemployment Insurance tax rates for 2012 and head off an automatic 31 percent tax increase for employers.

Unemployment InsuranceThe $130.7 million measure also eliminates a sunset provision that would have ended the popular Workforce Training Fund Program on December 31 and require state officials to post online the full cost-benefit analysis of new regulations.

The Senate passed its version of the bill 35-0 on Friday, while the House of Representatives passed its own bill by a 154-to-1 margin on Wednesday. Because of minor differences between the House and Senate bills, AIM will continue to work with both chambers to ensure that the final legislation that is sent to the Governor includes all the measures that employers support.

“Employers commend the Legislature for acting quickly to freeze Unemployment Insurance rates at the current Schedule E, a move that will avoid an automatic jump in UI costs from $715 per employee to $935 per employee,” said John Regan, Executive Vice President of Government Affairs at Associated Industries of Massachusetts.

“We urge Governor Patrick to sign it. We also hope that 2012 will be the year that policymakers make meaningful structural reform to the UI system.”

AIM maintains that the Unemployment Insurance increase is unnecessary since the fund used to pay jobless benefits in Massachusetts posted a balance of nearly $100 million at the beginning of the year. AIM projects that the surplus will grow to between $300 million and $400 million even if rates are frozen.

The UI rate increase was effective at the beginning of the year, but the Legislature still has time to approve a freeze because employers don’t have to start paying the tax until the end of the first quarter.

Three key state senators wrote a letter to Senate President Therese Murray January 5 urging the branch to freeze the rates at their current level. The letter - signed by Sen. Barry Finegold (D-Andover), Sen. Michael Rodrigues (D-Westport) and Minority Leader Bruce Tarr (R-Gloucester) - argued that freezing unemployment insurance rates would ensure economic stability for small business owners and create a climate for job growth as businesses recover from the recession.

AIM is also pleased that Legislators are looking to lift the sunset provision on the commonwealth’s flagship program for improving the skills of Massachusetts residents. The Workforce Training Fund Program has provided $193.2 million in grants since its inception to some 2,500 Massachusetts employers to train 277,351 workers. 

Click on these links to review the House (H.3878) or the Senate (S.2108) versions of the FY12 Supplemental Budget.

Topics: Unemployment insurance, Issues, Massachusetts Unemployment Insurance, Workforce Training, State Budget

Unemployment Fund Surplus Shows State Was Right to Freeze Rates

Posted by John Regan on Oct 13, 2011 12:08:00 PM

Massachusetts lawmakers who voted to freeze unemployment insurance rates in January endured a torrent of criticism from union leaders who insisted that a rate increase was needed to stabilize the fund used to pay jobless benefits.

Massachusetts Unemployment InsuranceLegislators and the Patrick administration instead agreed with AIM that the Unemployment Insurance Trust Fund was not in danger of insolvency and that the $400 million rate increase would create far more economic benefit in the private sector.

It turns out that the Legislature and the governor were right.

At a time when states such as California, Michigan and Rhode Island are paying hundreds of millions of dollars to borrow federal money to cover shortfalls in their unemployment systems, the overall Massachusetts UI Trust Fund showed a nearly $300 million balance at the end of September. The fund is projected to end 2011 with a reserve of $63 million and Moody’s Analytics projects that the surplus will grow to $718 million by the end of 2012.

The Massachusetts jobless fund emerged from the recession in better shape than those in other states because the commonwealth’s knowledge-based economy proved more resilient during the downturn than the nation as a whole. Unemployment in Massachusetts remained more than a full point below the national average throughout the recession and, at 7.4 percent, remains more than one-third lower than the 12 percent jobless rate in California.

The fund initiated some short-term borrowing from the federal government to cover cash flow during the recession, but the commonwealth paid all the money back and currently owes no interest to Washington. California last week faced an interest payment of $300 million, while Michigan and Pennsylvania had to ante up $100 million each.

The current surplus is welcome news to employers and policymakers, but it still falls short of recommended federal standards for the solvency of an unemployment insurance fund.  That means employers face the prospect of an automatic rate increase for 2012 that would raise UI taxes from the current average of $713 to $879 per employee – a total projected hike of $400 million.

The thousands of member employers of AIM believe that Massachusetts can rebuild trust fund balances to healthy levels without raising rates. Instead of boosting taxes sharply one year, then lowering them the next as the trust fund balance grows, the state could achieve the same outcome by “smoothing the rates,’’ or freezing them at today’s relatively high levels for the next several years.

“The economy remains fragile and the spreading European debt crisis poses a grave threat to Massachusetts. If a rate hike is unnecessary, why would you do it?’’ said Richard C. Lord, President and Chief Executive Officer of AIM.

AIM urges lawmakers and the administration to again make the right call and freeze UI rates for 2012.

 

Topics: Unemployment insurance, Massachusetts economy, Massachusetts Unemployment Insurance

Unemployment System Computer Bug Exposes Employer Information

Posted by Christopher Geehern on May 17, 2011 4:22:00 PM

A virus that infected computers throughout the Massachusetts unemployment system may have compromised the confidential information of job seekers and up to 1,200 Massachusetts employers, officials said this afternoon.

Data breachThe breach may have exposed employer identification numbers, bank records, email addresses, and residential and business addresses, state officials reported today. Only employers that manually file could be impacted by the possible data breach.

The Massachusetts Executive Office of Labor and Workforce Development (EOLWD) said anyone who conducted business between April 19 and May 13 requiring that a staff person access personal files online should take precautions including putting a fraud alert on their credit report. Officials are in the process of individually notifying all residents who could be impacted and have advised all relevant and necessary state and federal agencies of the situation.

 “We are doing everything possible to provide assistance in how to protect their identities and credit to those affected," said Joanne F. Goldstein, Secretary of Labor and Workforce Development.

"We take our customers privacy very seriously. Unfortunately, like many government and non-government organizations we were targeted by criminal hackers who penetrated our system with a new strain of a virus. All steps possible are being taken to avoid any future recurrence.”

EOLWD said the breach took place after the W32.QAKBOT virus infected approximately 1,500 computers at the Department of Unemployment Assistance, the Department of Career Services and One-Stop Career Centers.  Businesses that file their quarterly statements manually (about 1,200 of 180,000) may have had identifying information transmitted through the virus.

Officials could not estimate the total number of individuals and businesses affected by the breach.

EOLWD has set up a hotline, 1-877-232-6200 that will be staffed starting today for the next two weeks.

The extended hours are listed below.

Tuesday, May 17 – Friday, May 20: 7:00 a.m. – 7:30 p.m.

Saturday, May 21: 8:00 a.m. – 1:30 p.m.

Monday, May 23 – Thursday, May 26: 7:00 a.m. – 7:30 p.m.

Friday, May 27: 7:00 a.m. – 5:00 p.m.

EOLWD’s website will also include information to help individuals take any necessary further steps. Individuals are urged to put a fraud alert, also called a credit freeze, on their credit reports so that no credit can be issued without the express consent of the individual. Instructions on how to do this can be found at http://1.usa.gov/jcLaDY

Topics: Associated Industries of Massachusetts, Massachusetts Unemployment Insurance

Patrick Signs Unemployment Insurance Rate Freeze

Posted by John Regan on Feb 18, 2011 1:07:00 PM

Governor Deval Patrick today signed an Unemployment Insurance rate freeze that will limit the average UI tax increase for Massachusetts employers to $61 per employee and keep more than $400 million in the private sector.

Unemplopyment Insurance rate freezeThe measure takes effect immediately and averts an average 40 percent jump in UI taxes that was set to hit employers next month after rates automatically increased from Schedule E to Schedule G. Schedule G would have increased overall UI contributions from Massachusetts employers from $1.576 billion to $2.235 billion.

Patrick signed the UI freeze two days after the bill received final approval from the Massachusetts Legislature. It marks the third consecutive year in which lawmakers have frozen UI rates and comes amid significant improvements to the financial strength of the trust fund that pays benefits to jobless workers.

"Without this legislation employers would have seen an average increase of $228 per employee,” Patrick said. “We want to encourage a positive climate for employers and by signing this bill we are helping to position the state for continued economic recovery.”

Massachusetts employers still face an average increase of 10 percent in UI taxes this year because of unfavorable experience ratings posted during the prolonged recession. They also face a 50 percent jump in assessments for the fund that provides medical insurance to unemployed people.

AIM has maintained for months that a UI rate increase would have been unnecessary and excessive. A significant decrease in the number of claims for unemployment prompted state officials in December to revise their estimate of the Trust Fund balance from a negative $302 million to a positive $12.7 million.

"I thank Governor Patrick and the Legislature for freezing scheduled unemployment insurance rates for 2011," said Richard C. Lord,President and CEO of Associated Industries of Massachusetts.

"This action heads off a scheduled 40 percent increase in UI taxes at a time when many businesses are continuing to struggle through a tough economy. This is the type of action AIM advocates for and will help lead to a strong economic climate in Massachusetts. We look forward to further meaningful discussions of related reforms."

Lord said those reforms should include reducing the maximum duration of benefits to 26 weeks and increasing from 15 to 20 weeks the period that employees must work to qualify for benefits.

Legislative leaders said the freeze was critical to keeping the economic recovery on track.

“This effort will help give our businesses some additional breathing room as they work to overcome this challenging economic environment. We need to continue to foster environments where jobs can grow and be created, and this is another step in that direction,” said Senate President Therese Murray.

“As we struggle to survive in these challenging times, it’s important to ease the burden on businesses, which fund our unemployment system,” House Speaker Robert A. DeLeo said. “This rate freeze signals our commitment to stimulating business and creating jobs in the Commonwealth.”


 

Topics: Associated Industries of Massachusetts, AIM, Unemployment insurance, Massachusetts Unemployment Insurance, Deval Patrick

Lawmakers OK Unemployment Rate Freeze; Bill Heads to Governor

Posted by John Regan on Feb 16, 2011 2:43:00 PM

Beacon Hill lawmakers approved and sent to Governor Deval Patrick today an Unemployment Insurance rate freeze bill that will limit the average UI tax increase for employers during 2011 to $61 per employee.

Unemployment insurance rate freezePatrick is expected to sign the measure. It heads off an average 40 percent jump in UI taxes set to hit employers next month after rates automatically increased from Schedule E to Schedule G. Schedule G would have increased overall UI contributions from Massachusetts employers from $1.576 billion to $2.235 billion.

The House of Representatives approved the freeze early this afternoon by a margin of 152 to 0 and the Senate gave final approval just after 2:30 p.m. Both chambers added an emergency preamble that will allow the measure to take effect immediately upon the governor’s signature.

“It’s gratifying that Massachusetts legislators have used their first major votes of the 2011-2012 session to create jobs and sustain the economic recovery. Lawmakers recognize that financial position of the Unemployment Insurance Trust Fund is improving and does not require a dramatic increase in employer payments,” said Richard C. Lord, President and Chief Executive Officer of AIM.

AIM has maintained for months that a UI rate increase is unnecessary and excessive. A significant decrease in the number of claims for unemployment prompted state officials in December to revise their estimate of the Trust Fund balance from a negative $302 million to a positive $12.7 million.

The automatic UI tax increases would have come on top of a 50 percent jump in the assessment on employers for a fund that provides medical insurance to unemployed people. The Unemployment Health Insurance Rate Review Board voted in December to raise the employer contribution rate for the Medical Security Trust Fund from $33.60 to $50.40 per employee in an attempt to close a deficit that is projected to reach $95 million by midyear.

Lord said AIM will continue to push for structural reforms to the UI system, including reducing the maximum duration of benefits to 26 weeks and increasing from 15 to 20 weeks the period that employees must work to qualify for benefits.

Several legislators agreed during today's debate that long-term changes are required.

"I'm concerned that we need to do more.  Our costs are almost twice what the national average is ... We have some of the most generous benefits.  It's not bad being number one but when it’s the most expensive benefit package, it's not a great place to be in to create jobs," said Representative George N. Peterson Jr. of Grafton.

Topics: Massachusetts Legislature, Associated Industries of Massachusetts, AIM, Unemployment insurance, Massachusetts Unemployment Insurance

Vote Sets Up House Debate on Unemployment Insurance Rate Freeze

Posted by Brad MacDougall on Feb 15, 2011 1:47:00 PM

The Massachusetts House of Representatives today reported an Unemployment Insurance rate freeze bill from the Ways and Means Committee, paving the way for expected final approval during a formal session Wednesday.

Unemployment Insurance rate freezeA handful of representatives agreed without discussion this morning to send to third reading a bill that would reduce the automatic UI tax increase that took effect January 1 from $228 to $61 per employee.  The freeze is similar to one approved on Thursday in the state Senate.

Legislative leaders have signaled that they may send the UI legislation with an emergency preamble to Governor Patrick’s desk on Wednesday. The governor also supports freezing UI rates at the current Schedule E.

“Given the current state of the Commonwealth’s economic circumstances and our collective desire for the private sector to create jobs, AIM believes that moderation of the current statutory tax rate is financially, politically, and economically prudent,” AIM Executive Vice President John R. Regan wrote in a letter to House members urging them to support the freeze.

A UI rate freeze would still leave Massachusetts employers paying approximately 10 percent more in unemployment taxes in 2011 than they did last year because of weakened experience ratings. But the jump is far less than the 40 percent increase that employers would suffer if the automatic move in UI rates to Schedule G was allowed to stand.

A rate increase is unnecessary and excessive now that the financial position of the UI Trust Fund is improving after two years of heavy demand caused by more than 8 percent unemployment. A significant decrease in the number of claims for unemployment prompted state officials in December to revise their estimate of the Trust Fund balance from a negative $302 million to a positive $12.7 million.

 

Topics: Associated Industries of Massachusetts, AIM, Unemployment insurance, Massachusetts Unemployment Insurance, Massachusetts House of Representatives

State Senate Accelerates Recovery with Vote to Freeze UI Rates

Posted by John Regan on Feb 10, 2011 4:02:00 PM

The Massachusetts Senate took a major step to accelerate the economic recovery today by approving legislation to freeze Unemployment Insurance rates and head off a 40 percent average UI tax increase.

Unemployment Insurance Rate FreezeThe measure now moves to the House of Representatives, where Speaker Robert DeLeo yesterday expressed the need “to ease the burden on businesses.” Governor Deval Patrick also supports the freeze, setting the stage for resolution of the unemployment insurance crisis well before first-quarter UI bills go out to employers next month.

The Senate approved the freeze by a nearly unanimous vote. Lawmakers said that a large and sudden increase in UI rates would cripple the fragile economic recovery and is not needed to maintain the solvency of the fund used to pay benefits to jobless workers.

A UI rate freeze would still leave Massachusetts employers paying approximately 10 percent more in unemployment taxes in 2011 than they did last year because of weakened experience ratings. But the jump is far less than the $260 per-employee increase that employers would suffer if the automatic move in UI rates to Schedule G that took effect on January 1 were allowed to stand.

Employers will pay an average increase of $65 per worker under the freeze measure.

“Employers commend the members of the Senate who voted to approve this measure, which will help  put Massachusetts residents back to work,” said Richard C. Lord, President and Chief Executive Officer of AIM.

“We particularly appreciate the leadership of Senate President Therese Murray; Ways and Means Chair Stephen Brewer and Vice Chair Steven Baddour; Labor and Workforce Development Chair  Dan Wolf; and Minority Leader Bruce Tarr – all of whom worked with AIM to resolve this important issue.”

A rate increase is unnecessary and excessive now that the financial position of the UI Trust Fund is improving after two years of heavy demand caused by more than 8 percent unemployment. A significant decrease in the number of claims for unemployment prompted state officials in December to revise their estimate of the Trust Fund balance from a negative $302 million to a positive $12.7 million.

"Many of us ran on programs last year of jobs, jobs, jobs. This is a very important action we can take to set the tone for this commonwealth. Paul Tsongas once said you cannot love the employee and hate the employer," Brewer told his colleagues during the Senate debate.

Governor Patrick, who recently expressed reservations about a freeze, expressed support for the Senate bill in a statement Wednesday night.

“The Patrick-Murray administration supports the rate freeze, and believes that additional reforms are necessary in the future,” said Alex Goldstein, press secretary to the governor.

AIM looks forward to working with the governor and state lawmakers to accomplish those additional reforms. Employers seek structural changes to the UI system that include reducing the maximum duration of benefits to 26 weeks and increasing from 15 to 20 weeks the period that employees must work to qualify for benefits.

Topics: Associated Industries of Massachusetts, AIM, Massachusetts senate, Unemployment insurance, Massachusetts Unemployment Insurance, Senate President Therese Murray

Senate Committee Approves Unemployment Insurance Rate Freeze

Posted by John Regan on Feb 9, 2011 4:11:00 PM

The Senate Ways and Means Committee today approved legislation freezing Unemployment Insurance rates, a move that could head off a devastating 40 percent average UI tax increase facing employers next month.

Unemployment InsuranceThe full Senate is expected to debate the measure on Thursday. House Speaker Robert DeLeo indicated that his chamber would move quickly on the bill and a spokesman for Governor Deval Patrick told Statehouse News Service tonight that "The Patrick-Murray administration supports the rate freeze, and believes that additional reforms are necessary in the future."

A UI rate freeze would still leave Massachusetts employers paying approximately 10 percent more in unemployment taxes in 2011 than they did last year because of weakened experience ratings. But the jump is far less than the $258 per-employee increase that employers would suffer if the automatic move in UI rates to Schedule G that took effect on January 1 were allowed to stand.

Many lawmakers believe that a large and sudden increase in UI rates would cripple the fragile economic recovery and is not needed to maintain the solvency of the fund used to pay benefits to jobless workers.

AIM, which has lead efforts by employers to secure a rate freeze, commended Senate leaders and members of the Ways and Means Committee  for a vote that will strengthen the state economy and accelerate job growth. The association looks forward to working with legislative leaders and Governor Patrick to finding long-term solutions to the unemployment insurance situation.

“Senate President Therese Murray, Ways and Means Chair Stephen Brewer and Vice Chair Steven Baddour have sent an unmistakable message that the commonwealth is committed to  putting people back to work,” said Richard C. Lord, President and Chief Executive Officer of AIM.

Lord said a rate increase is unnecessary and excessive now that the financial position of the UI Trust Fund is improving after two years of heavy demand caused by more than 8 percent unemployment. A significant decrease in the number of claims for unemployment prompted state officials in December to revise their estimate of the Trust Fund balance from a negative $302 million to a positive $12.7 million.

“If Massachusetts continues to see a decline in benefit payments, even on the current schedule, the fund could be solvent at the end of 2011. And even if the fund is insolvent at the end of 2011, President Obama is expected to recommend allowing states to continue to borrow from the federal government – interest free – through the end of 2012,” Lord said.

The freeze would spare employers from a move to Schedule G that would raise average annual Unemployment Insurance rates from $646 to $904 per employee.  Schedule G would have increased overall UI contributions from Massachusetts employers from $1.576 billion to $2.235 billion.

All of those increases would come on top of a 50 percent jump in the assessment on employers for a fund that provides medical insurance to unemployed people. The Unemployment Health Insurance Rate Review Board voted in December to raise the employer contribution rate for the Medical Security Trust Fund from $33.60 to $50.40 per employee in an attempt to close a deficit that is projected to reach $95 million by midyear.

Lord said AIM will continue to push for structural reforms to the UI system, including reducing the maximum duration of benefits to 26 weeks and increasing from 15 to 20 weeks the period that employees must work to qualify for benefits.

Topics: Associated Industries of Massachusetts, AIM, Massachusetts senate, Massachusetts Unemployment Insurance, Senate President Therese Murray

Battle to Moderate Unemployment Tax Rates Reaches Washington

Posted by John Regan on Nov 15, 2010 1:30:00 PM

The battle to moderate a pending 40 percent increase in average unemployment insurance taxes facing Massachusetts employers on January 1 now stretches from Boston to Washington, DC.

unemployment insuranceAssociated Industries of Massachusetts this morning joined business organizations from throughout the country in asking Congress to continue to waive the interest on loans used by Massachusetts and 31 other states to pay unemployment insurance claims. AIM also asked Congress to waive penalties under the Federal Unemployment Tax Act levied on employers in states borrowing from the federal government to meet their obligations to jobless workers.

The National Governors Association made similar requests for an extension of interest free borrowing and penalty waivers in July.

The activity in Washington comes as AIM works with the Patrick administration to find ways to ease the average $258-per-employee increase set to hit Massachusetts businesses as the anemic job recovery drains the state fund used to pay unemployment benefits.  Analysts fear an increase of that magnitude could create a dangerous downward economic spiral by suppressing job growth and creating even more demand in the unemployment system.

Projections from the Massachusetts Division of Unemployment Assistance show that the Unemployment Insurance Trust Fund, which ran a balance of more than $2 billion prior to the recession, is currently down to $148.5 million and will begin 2011 some $202 million in the red. That deficit would trigger a move to the highest rate schedule permitted under Massachusetts law, raising the average UI cost per employee from the current $646 to $904.

A move to schedule G would increase total contributions from Massachusetts employers from $1.576 billion to $2.235 billion. Employers also face a potential increase in the recently doubled $33.60-per-employee tax they pay to fund health benefits for jobless people.

The request to Congress by AIM to waive interest on UI borrowing reflects the association’s position that repayment of federal loans should be stretched out over several years to prevent rate shock to employers while the economy strengthens.

In the long run, AIM believes the funding problems underscore a need for structural reforms to the most generous unemployment system in the country. Massachusetts is the only state, for example, to provide 30 weeks of jobless benefits at the standard benefit amount. The association offered a comprehensive reform plan to the Massachusetts Legislature last year and expects to do the same in 2011.

Average UI rates paid by Massachusetts employers increased by $111 per employee this year after Governor Deval Patrick and the Legislature headed off a much larger jump by freezing the system at Schedule E. The rate freeze still produced increased costs because of deteriorating experience ratings as employers reduced payrolls in the wake of the sluggish economy.

Topics: Associated Industries of Massachusetts, AIM, Unemployment insurance, Massachusetts unemployment, Massachusetts Unemployment Insurance

Looming Unemployment Tax Increase Points to Need for Reform

Posted by John Regan on Oct 20, 2010 9:28:00 AM

The Massachusetts unemployment insurance system is creaking under the weight of a persistently weak economy and employers are about to pay the bill - a 40 percent average increase in UI rates as of January 1, 2011.

Unemployment insuranceAIM has initiated discussions with the Patrick Administration about moderating the $258-per-employee increase while continuing to ensure benefits for people who have lost their jobs. 

At the same time, AIM believes the funding problems underscore a need for long-term, structural reforms to the most generous unemployment system in the country. Massachusetts is the only state, for example, to provide 30 weeks of jobless benefits at the standard benefit amount.

“The projected increases in contribution rates are worse than they need to be because Massachusetts maintains an unemployment insurance system that is out of the mainstream compared to the rest of the 49 states,” said Richard C. Lord, President and Chief Executive Officer of AIM.

“Without structural reform, the wild swings in the Unemployment Insurance Trust Fund will continue to impede creation of the very jobs we so desperately need to put people back to work.”

Projections from the Massachusetts Division of Unemployment Assistance show that the Unemployment Insurance Trust Fund, which ran a balance of more than $2 billion prior to the recession, is currently down to $236 million and will begin 2011 some $302 million in the red. That deficit would trigger a move to the highest rate schedule permitted under Massachusetts law, raising the average UI cost per employee from the current $646 to $904.

A move to schedule G would increase total contributions from Massachusetts employers from $1.576 billion to $2.235 billion. Employers also face a potential increase in the recently doubled $33.60-per-employee tax they pay to fund health benefits for jobless people.

Average UI rates paid by Massachusetts employers increased by $111 per employee this year after Governor Deval Patrick and the Legislature headed off a much larger jump by freezing the system at Schedule E. The rate freeze still produced increased costs because of deteriorating experience ratings as employers reduced payrolls in the wake of the sluggish economy.

State projections show the UI system breaking even in 2012 and posting surpluses of $752 million in 2013 and $1.672 billion in 2014.

On the issue of UI reform, AIM has testified repeatedly and consistently in favor of changes that include:

  • Reforming the statutory rates for UI by lowering rates for those companies who do not lay-off employees and providing much needed relief for those companies;
  • Increasing the number of weeks of work for eligibility to collect UI benefits from 15 weeks to 20, as well as requiring earnings for eligibility over two quarters, bringing Massachusetts into line with the majority of other states and saving the UI system an estimated $30 million;
  • Changing the statutory trigger mechanism, reducing the maximum duration of benefit weeks to 26 when the state's economy is performing well, from 5.1 percent unemployment in each of the 10 local labor market areas in the state to a straight 5.1 percent unemployment rate statewide. (Reducing the maximum duration of benefits from 30 to 26 weeks saves the UI trust fund between $50 and $90 million per year and would bring Massachusetts into sync with all other states);
  • Requiring the UI contribution rate of new employers to be set at the so-called zero positive rate, more accurately reflecting their actual contribution status;
  • Changing the method of computation for taxes - Massachusetts is one of only three states that determine UI taxes based upon only the prior 12 months of payroll. Forty-seven states use payroll paid for the past three to five years. The current Massachusetts system is simply poor tax policy since it creates an incentive to decrease, not to increase payroll. The Massachusetts UI tax system represents economic stimulus in reverse.

Topics: Massachusetts Legislature, AIM, Massachusetts Unemployment Insurance, Deval Patrick

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