Governor on unemployment system freeze that he let go into law: ‘This bill didn’t do much’

Gov. Jim Justice says a bill making changes to West Virginia’s unemployment system wasn’t good enough to embrace and not bad enough to reject.

Gov. Jim Justice

Justice took no action at all on Senate Bill 841 prior to a midnight deadline a week ago for executive action, and so now it becomes law. Today, in response to a MetroNews question, the governor made his first remarks about the bill.

“This bill didn’t do much, and we all know that as we go forward there’s going to be a lot more that has to be done, so that’s one thing. I don’t think this bill’s a bad bill or I would have vetoed it. I think it’s OK,” he said, drawing out the final word for emphasis.

“It basically only freezes the amount of the benefits. It freezes what’s going to the employer or what the employer’s obligation is. But we all know there is a great deal that still we’ve got to get to, so we’re going to have to revisit this a whole lot more.”

As the governor described, the bill freezes employer contributions and freezes benefits for people who lose their jobs. The changes would become effective July 1.

Scott Adkins

The administration’s representative for the unemployment system testified during the regular legislative session that changes are needed. Scott Adkins, acting director of Workforce West Virginia, testified before lawmakers that reform is necessary to shore up the state’s unemployment trust fund, which has a balance of just shy of $400 million.

State officials, during those legislative meetings, cited economic models showing that a prolonged unemployment rate of 10% could bankrupt the trust fund in 91 weeks.

“We’re trying to be proactive because we’re going in the wrong direction on that trust fund balance,” Adkins told senators weeks ago. “Severe recession — 18 months, and we’ll be looking to this body for funding or we’ll be looking to the feds.”

The final version of the bill freezes employer contributions to the unemployment trust fund at $9,500.

For people who are unemployed, the bill sets a maximum benefit of $662 and keeps the maximum number of weeks at 26. That also represents a freeze of current benefits.

The bill would require at least four work search activities a week such as registering with the state’s labor exchange system or taking a civil service exam.

The West Virginia Chamber of Commerce expressed support for that change, saying it provides predictability for employers.

“The West Virginia Chamber is happy to see Senate Bill 841 become law. This bill will provide stability to the state’s unemployment system and prevent a series of cascading tax increases on businesses across the state,” according to a statement from the Chamber.

Josh Sword

Speaking on MetroNews’ “Talkline” today, West Virginia AFL-CIO President Josh Sword blasted the bill going into law.

“I don’t think we’re terribly surprised that he took no action but we still are very disappointed,” Sword said.

“As we’ve mentioned before, they prioritized fixing a problem that does not exist. The fund is healthy; unemployment rates are low. They know it’s flawed. It was pointed out the last day of the session, so I’m not sure. I guess they thought this was their first chance to get in and start stealing benefits away from workers who earned that benefit over their work life.”

Sword concluded, “We’re gonna roll up our sleeves and get to work this election and try to elect people who care more about workers than the leaders that are up there now.”

An ongoing criticism while the legislature considered the unemployment bill was its introduction up against the backdrop of hundreds of job losses at Cleveland-Cliffs in Weirton and Allegheny Wood Products at locations around the state.

Justice, in his remarks today, described that as a bad look.

“It seemed like that this was just kind of maybe bad timing, maybe rubbing it in those people’s face and everything — and so it just didn’t feel really great in regard to that. You know, there’s surely not a crisis at the moment that we had to react and do something right now.

“From my standpoint, I surely didn’t feel bad about it to the tune of thinking a veto was necessary. But I just didn’t feel good about it, so that’s why I wanted to just step aside and let it go to law.”

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