Bill cutting unemployment benefits heads to the House floor for vote

A bill that would cut the duration of unemployment benefits in the state is heading for a vote by the full West Virginia House of Delegates.

After a 3.5 hour discussion Monday afternoon, the House finance committee voted 14 to 9 to advance Senate Bill 841 to the floor of the House with a recommendation that it pass. 

The bill would reduce the length of time a worker can stay on unemployment benefits from 26 to 24 weeks. The amount of a worker’s benefits would start at 70 percent of their average weekly wage and be reduced by 5% each four-week period after that, through the sixth four-week period, when workers would receive 45% of their average weekly wage. 

The bill would also cap the amount of benefits for higher wage workers. Benefits for those making over $53,000 would still be based on a $53,000 per year salary. 

Sean O’Leary, senior policy analyst for the West Virginia Center on Budget and Policy, said the bill would reduce the total benefits of workers who stay on unemployment the entire time by $3,100, mainly due to change from 26 to 24 weeks. 

The legislation would allow workers to have part-time jobs while continuing to search for full-time jobs and receiving unemployment benefits. 

Monday’s vote followed testimony from Workforce West Virginia officials, who said the legislation would stabilize the state’s unemployment fund and help make it solvent. 

Opponents of the legislation have pointed out that the bill comes after recent layoff announcements of 900 workers after the Cleveland-Cliffs plant in Weirton idled, and the recent closure of Allegheny Wood Products. The bill would not take effect until Jan. 1, 2025.

Speaking in support of the bill, Del. Bob Fehrenbacher, R-Wood, said stability of the unemployment fund is a primary motivation. 

“The modeling that’s been done suggests that this does provide more solvency even under significant economic conditions and the business downturn and an increase in unemployment,” Frehrenbacher said. He added that the bill provides unemployed workers a “solid payout.”

“The recent announcements [of layoffs] are very unfortunate, but this puts the state in a sound position,” he said. “The stability and predictability of the fund and as it relates to employers is significant and it also takes care of those that are unemployed. And as we heard in testimony, the 50% plus of the employees will actually see an increase versus what the current system offers and for those and other reasons. I support passage of this amendment.”

Speaking against the bill, Del. Larry Rowe, D-Kanawha, said it is wrong and unfair to say the bill would pay more to workers than under current law. He pointed to the cap on benefits for employees making over $53,000. 

“Now it’s pretty clear that the folks who are paying for this stabilization are the workers, and primarily union workers, construction workers, and people who are in a lot of those trade jobs and making substantial [money],” Rowe said. “The folks who are not in those higher-paying jobs get a little bit more but not very much more on their paycheck.”

Rowe pointed out that a recent study from John Deskins, director of the Bureau of Business and Economic Research at West Virginia University said the state’s unemployment fund would be exhausted after 22 months in a severe recession with a 10 percent or higher unemployment rate. 

“This is a stabilization of a fund that’s in pretty good shape,” he said. 

Before saying he would vote for the bill, Del. John Hardy, R-Berkeley, called it “the kind of hot mess you get when things are jammed from our neighbors across the hall, things are put together quickly and sent to us.” 

The bill would increase the amount that employers pay into the unemployment fund. 

“I’ve heard a lot of people talking about our employees,” Hardy said. “I’m gonna talk a little bit about our employers. Now, I have to go back home and I have to tell the job creators and our employers …. that our unemployment rate is at 4.3%, a very low and very low rate of unemployment right now. But what we’re going to do is we’re going to raise the amount of money that [employers are] going to pay.”

Hardy said that he would vote for the legislation so that “I’m not going to let perfect be the enemy of good” in securing the long-term business of the state. 

“So I’m going to put my arm floaties on, and hold my nose and jump into the deep end and support this piece of legislation,” Hardy said. 

House minority leader Sean Hornbucke, D-Cabell, urged rejection of the bill because of what he saw as a lack of consensus with testimony about the bill. 

“There was no agreement via testimony between if the overall benefit to West Virginians will be up or down,” Hornbuckle said. “There was no consensus on that. There was also through testimony we heard of downward pressure, downward pressure, but we also know for a fact that over the past decade, we’ve actually seen growth, we’ve seen growth [in the unemployment fund]. So those two schools of thought seem to be in conflict with each other.”

In a statement after the committee vote, AFL-CIO President Josh Sword called the bill “ an astonishingly cruel bill to steal earned unemployment benefits away from West Virginia workers.”

“Workers, many of whom have worked at places like Cleveland Cliffs and Allegheny Wood Products for decades but are losing their jobs due to no fault of their own, should not be the victims of politicians in Charleston playing political games,” Sword said.  “These hard-working people should be able to rely on a consistent unemployment benefit, one they earned just like health care and retirement, and this legislation would not only cut the number of weeks it’s available, but also would decrease the benefit over time. 

“We cannot understand why this bill, which will also raise taxes on employers, is being pushed in the final week of the legislative session, particularly when the fund is perfectly healthy, and could sustain crisis-level unemployment for multiple years,” he said.