Florida businesses, plagued by increases in their unemployment compensation tax rates in recent years, could see some relief this year after the state Senate passed a bill Tuesday tying the maximum weeks of benefits to the state unemployment rate.
Under SB 728, the state's 26 maximum weeks of unemployment compensation would only be available if the jobless rate was 12 percent. For every 0.5 percent drop in the rate, one week would be shaved off the maximum allowable weeks of benefits. With the current state unemployment rate of 11.1 percent, workers would only be eligible for 24 weeks of unemployment compensation insurance when the bill takes effect July 1.
"If unemployment is at 5 percent, the theory is that it's a lot easier to get a job than when it's at 12 percent," said Sen. Nancy Detert, R-Venice, who sponsored the bill.
The vote came down 29-10, largely along partisan lines, with Democrats bemoaning the adoption of provisions of a similar House bill that were not originally included in the Senate version. HB 7005 would have cut six weeks from the maximum allowed to claimants, whereas the Senate wanted to keep the maximum at 26 weeks, but added an amendment that ties the number of weeks to the unemployment rate as a way to compromise with the opposite chamber.
"A lot of the things that we had in our Senate position are not in this bill," said Sen. Oscar Braynon II, D-Miami. He added that the unemployment rate would not likely matter to people trying to find work. "It's like saying that when the crime rate is down and your house is broken into, you really don't care if the crime rate is down."
The bill also requires claimants seeking benefits to take a skills test in order to help match them to an appropriate job and be required to show up in person to prove they are actively looking for work. Employers would also be able to effectively appeal claims filed by workers. Many business owners say the appeals process is unfairly slanted in favor of claimants.
"I've never won an unemployment compensation appeal -- including times when I've had employees show up drunk," said Sen. Jack Latvala, R-St. Petersburg, who owns a small business.
Until the recession hit, Florida's unemployment compensation trust fund had been consistently funded at $2 billion. As foreclosures skyrocketed and businesses closed their doors, the jump in claims drained the fund, reaching zero by August 2009. Since then, the state has racked up a $2 billion debt with the federal government.
Business groups asked the Legislature last year to put off paying back interest on the debt for one year in the hopes that unemployment rates would drop. President Barack Obama offered to allow Florida to skip payments for another year, but Gov. Rick Scott rejected that option earlier this year. Businesses began paying special assessments on the interest.
In addition to the interest payments, the minimum unemployment compensation tax rate per employee nearly tripled this year, rising from about $25 per worker to about $75.
Detert said the measure is simply a way to try to shore up the compensation trust fund and reduce hurdles to businesses looking to hire workers.
"The best way to help unemployed people is to see that businesses are healthy so we can find you a job," Detert said.
The bill will now head back to the House, which passed a different version last month.
Reach Gray Rohrer at grohrer@sunshinestatenews.com or at (850) 727-0859.
