UC changes with $42.3 million annual savings for employers ready for floor debate

Either chamber now is set to consider legislation that could save Alabama employers about $42.3 million annually.

The House Commerce and Small Business Committee on Wednesday approved a substitute version of HB364 by Rep. Danny Garrett, R-Trussville, that makes it identical to SB193 by Sen. Arthur Orr, R-Decatur. The House bill is ready for House consideration and the Senate bill for consideration in the Senate.

The now companion bills reduce the duration of Alabama’s unemployment payouts while increasing benefits.

Orr has introduced similar legislation for the past two years. Both years, it passed the Senate but never received House approval.

Under the current legislation, starting Jan. 1, 2020, the number of weeks Alabama’s jobless could collect unemployment compensation would float between 14 and 25 based on the unemployment rate in the state and other factors, including up to five weeks of job training. In good times, when unemployment is low, and jobs are available, the number of weeks someone could be on unemployment would decrease.

The bill also increases the amount of weekly benefits from $265 to $275.

The decreased weeks and increased benefits would save Alabama employers about $42.3 million annually, according to the legislation’s fiscal note. The state’s Unemployment Compensation Trust Fund is funded through employer contributions. Since 2010, Alabama employers have been paying taxes into that fund at the highest rate possible. Garrett told committee members that the fund currently is at $624 million but would have to reach $800 million before Alabama employers could move into a lower rate schedule.

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