Will Wisconsin Accept Federal Funding for Work Sharing?

Tuesday, January 29, 2013 at 6:30 PM by

Work Sharing Bill Could Be the One Easy Issue in a Very Contentious Session on Unemployment Insurance Policy

In the last couple of years, Wisconsin hasn’t exactly been aggressive in pursuing opportunities for federal funding.  However, I’m guardedly optimistic that state policymakers will decide to take advantage of federal start-up funds to help initiate a work sharing program that allows employees whose hours have been reduced to collect partial unemployment insurance (UI) benefits.

As I explained in a WCCF blog post yesterday, State Senator Julie Lassa (D-Stevens Point) presented a draft of work-sharing legislation at a recent meeting of the Unemployment Insurance Advisory Council, which advises the Legislature and Governor on UI issues.  The council agreed to forward the proposal to the U.S. Department of Labor for review – to ensure that Wisconsin would qualify for federal start-up funding under a law passed by Congress about a year ago that encourages states to adopt this type of work-sharing legislation.

The UI Advisory Council consists of an equal number of labor and business representatives, and for many decades the unwritten practice has been that the Legislature doesn’t make any changes in the UI statutes that haven’t been endorsed by the Council.  That process avoids substantial policy swings  that could cause erratic change in the UI program and in the employer taxes that fund it.  There was a significant exception to that unwritten rule last session, and the usual consensus procedure may be in grave danger this year and in the future if the majority party decides to end run the Council.   

Thus far, the work sharing bill seems to be getting a positive reception from both the business and labor members of the Council.  It could represent the calm before a very stormy session on UI issues because some GOP lawmakers have said that they want to pass a sweeping set of changes sought by the business community, regardless of whether those measures are approved by the UI Council.  As Shawn Johnson reported in a recent Wisconsin Public Radio story:      

 “Some in labor worry the move would do to unemployment law what the governor did to public sector collective bargaining.” 

One of the most controversial measures would make it easier for employers to deny unemployment benefits to people they fire.  It would substantially change the standard established in a Wisconsin Supreme Court decision 72 years ago, which gradually became the practice in many states.  Another part of the sweeping changes would repeal 11 longstanding exceptions to the rule that prohibits employees from receiving UI benefits if they quit their job.  For example, an employee would no longer be able to get benefits if they quit a job after being required to work a new shift for which they cannot get child care. 

We’ll follow up on the work sharing bill and the much more controversial UI measures as the session proceeds.   For more information about work sharing and the federal law that encourages states to allow it, see this recent report by the National Employment Law Project. 

 Jon Peacock 

Categories: Blog, ECONOMIC SECURITY, unemployment benefits | Comments Off on Will Wisconsin Accept Federal Funding for Work Sharing?

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