Missouri representatives voted to lower unemployment compensation | News

JEFFERSON CITY — Missouri representatives have given initial approval to a bill that would reduce the number of weeks for unemployment compensation, depending on the average unemployment rate in Missouri.

Supporters said it makes sense to reduce the length of the benefit when the economy is doing well, but opponents argue that Missouri already is among the states that offer the shortest period for unemployment, and this proposal would make things worse for the state’s most vulnerable.

House Bill 649 would make it so that if the unemployment rate decreases, so do the number of weeks available for unemployment benefits.

Specifically, the legislation states that Missourians receive 20 weeks worth of compensation if the state’s unemployment rate is higher than 9%. That number goes down to 19 if the unemployment rate drops below 8.5%. With every half of a percentage that Missouri’s unemployment rate decreases, unemployment benefits drop by a week.

“The theory is, if there’s lower unemployment, you should be able to find a job sooner,” said bill sponsor Rep. Dan Shaul, R-Imperial.

Missouri is already one of seven states that does not provide 26 weeks of unemployment benefits. Lawmakers have opposing views as to whether this is a sign of Missouri’s economic success or an attempt to put additional hurdles up for Missourians who are struggling the most financially.

“It’s Missouri again, racing to the bottom and how we treat people that are struggling in our state,” said Rep. Peter Meridth, D-St. Louis.

“Just because the economy’s good doesn’t mean it’s good for everybody,” Merideth said. “So now we’re just going to kick those people that are struggling and say, good luck to you, pull yourself up by the bootstraps, right?”

Shaul said the need for the bill dates back to 2014 when the language written on the current law was originally passed by the House and Senate. The governor vetoed it, and the Senate overrode that veto. But the move was challenged, and the Missouri Supreme Court struck it down for procedural reasons, stating that the Senate should not have overridden the veto during a special session, but instead during the annual veto session.

Tax break

The bill also creates the “Employment Security Business Tax Reform Act of 2021,” which would lower the amount that new businesses pay to the unemployment trust fund. The cost of those taxes is dependent on a formula determined by the Division of Employment Security.

This bill allows new businesses to pay a lower unemployment tax rate as they are establishing their companies.

Some lawmakers said the bill would be an effective strategy for encouraging new businesses in Missouri, while others said reducing the amount that new businesses pay would result in existing businesses spending more.

Merideth took issue with lower unemployment taxes at the same time that workers would be given fewer unemployment benefits.

Missouri already has among the lowest number of weeks allowed for unemployment benefits, he said, “and we’re concerned about making sure our businesses are safe.”

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