FOR IMMEDIATE RELEASE
State Rep. William Keller
Bill would attack worker income in tough times
HARRISBURG, May 10 – State Rep. Bill Keller, D-Phila., today criticized House Republicans for continuing to introduce and pass legislation that would penalize and hurt working families during tough economic times.
Today the House Labor and Industry Committee, of which Keller is Democratic chairman, approved legislation (H.B. 916) that would make a number of changes to the state's unemployment compensation law, including making it harder for workers to qualify for benefits, cut benefits for unemployed workers who do qualify and slow the growth of benefits for future UC claimants. All Democrats voted against the bill.
"The changes to the UC system that are proposed in this legislation would do nothing more than penalize workers and attack those who are unemployed through no fault of their own," Keller said. "At a time when unemployment remains high and people continue to struggle to provide for their families, House Republicans want to kick them when they're down. People use these benefits to put food on their table and keep a roof over their head…not to get rich."
Keller said the bill would not help Pennsylvania's Unemployment Compensation Trust Fund become solvent, as the bill's supporters are claiming, and would only generate about $360 million annually. The fund is structurally deficient and has borrowed $3.8 billion from the federal government since 2009.
According to Keller, the bill does not increase employer contributions or the taxable wage base on which employers are taxed. Since 1984, employers pay UC taxes on a small percentage of the first $8,000 of an employee's wages. He said the $8,000 wage base is one of the lowest in the country and a prime reason that the fund is insolvent. If the wage base was indexed to when it was last raised in 1984, it would be more than $17,000.
UC is historically an employer-funded benefit. Pennsylvania is one of only three states where workers also pay taxes into the fund, and workers pay a rate on their entire wages, not just the first $8,000 like employers. House Bill 916 also would raise the amount of wages workers need to earn each week to establish credit weeks for eligibility from $50 to $116.
Keller said to become truly solvent, the fund would need to take all sides of unemployment compensation into account, workers and employers. He said true reform would contain reasonably reduced benefits, contributions from workers and an increase in the taxable wage base for employers.
"Right now, and under this bill, Republicans are only willing to make changes on the backs of working people," Keller said. "The employer contribution rate has remained the same for more than 25 years and is a significant contributing factor to our solvency issues. Pennsylvania must find a solution that takes all sides and all contributing factors into account. Continuing to attack working people and middle-class families while the major cause of the problem goes unaddressed is unacceptable."
Keller amended the bill with a provision that would make a technical change to the state's UC law so that Pennsylvania could continue to qualify for federal extended benefits, the benefits available after claimants exhaust their regular state-funded benefits and federally funded emergency unemployment compensation benefits.
The bill now goes to the full House for consideration.