Labor and Public Employees Committee

JOINT FAVORABLE REPORT

Bill No.:

SB-936

Title:

AN ACT TEMPORARILY EXTENDING THE LOOK-BACK PERIOD TO DETERMINE ELIGIBILITY FOR UNEMPLOYMENT COMPENSATION.

Vote Date:

3/1/2011

Vote Action:

Joint Favorable Substitute

PH Date:

2/15/2011

File No.:

SPONSORS OF BILL:

Connecticut Legal Services

REASONS FOR BILL:

The bill seeks to take advantage of the temporary federal authorization to extend the look-back period (3 years instead of 2 years) for unemployment benefits once the federal period ends (fall 2011). This bill allows claimants to be eligible for additional weeks of extended benefits under federal law.

SUBSTITUTE LANGUAGE:

The substitute language contained recommended changes suggested by the Connecticut Department of Labor that complements the Extended Unemployment Compensation Benefits provided for in Public Law 111-132 that was signed into law by President Obama on December 17, 2010.

RESPONSE FROM ADMINISTRATION/AGENCY:

Dennis C. Murphy, Acting Commissioner, Department Of Labor:

Commissioner Murphy testified that this would allow CT to modify the law to correspond with the temporary federal authorization. Since extended benefits are paid only in times of high/rising unemployment, by modifying this law now, claimants would be able to receive extended benefits if Congress further extends the authorization period. This modification must be done before the date that triggers “off” extended benefits in CT. The additional look-back year could potentially allow payments up to 20 weeks longer, or 99 weeks as compared to the 79 weeks now allowed. There would be no expense for private sector employers and the impact on the State's General Fund would be minimal.

NATURE AND SOURCES OF SUPPORT:

Susan Nofi-Bendici, Deputy Director, New Haven Legal Assistance Association, Inc.:

Ms. Nofi-Bendici stated that this temporary adjustment is needed so CT would be able to stay on the Extended Benefit program. She noted that usually EB is a 50-50 split between the state and federal government, but passing this bill now would enable long-term unemployed residents to receive benefits funded entirely through federal funds.

George Wentworth, Attorney, National Employment Law Project:

Mr. Wentworth explained that normally extended benefits (EB) are funded equally by the state's unemployment trust fund and the federal government. To qualify, for the past 3 months the average unemployment rate in the State must be 6.5% or higher for claimants to receive an additional 13 weeks of benefits. If the rate is 8% or higher, claimants may receive 20 additional weeks of EB. The federal law requires states to trigger off EB if the rate of unemployment was not at least 110% of what it was for the same 3-month period in either of the previous 2 years. The national unemployment rate has been over 9% for a record 21 consecutive months. Due to the American Recovery and Reinvestment Act of 2009, the program has been fully federally funded. Connecticut, like many other states, has plateaued at a high rate of unemployment for many months but does not satisfy the 110% rule. We were likely to have EB payments cut off, but in December, Congress reauthorized full federal funding through the end of 2011. It also gave states the authority to change their laws to avoid losing these funds. By passing this bill, CT would take advantage of this full funding while our unemployment is still severe.

Kia F. Murrell, Assistant Counsel, Ct Business and Industry Association:

Ms. Murrell testified that this is an important step toward lessening the harsh blow of today's economy because extended benefits are now federally funded at 100% rather than the 50/50 ratio. Since the system is funded entirely by employers, any/all efforts to alleviate pressure on Connecticut's businesses should be welcomed. This bill, extending the look-back period from 2 to 3 years, would allow CT to receive benefits for a longer time and allow Connecticut's DOL to add a relatively good year of activity to the EB computation formula.

NATURE AND SOURCES OF OPPOSITION:

None Submitted.

Reported by: Marie Knudsen

Date: March 8, 2011