Unemployment Compensation Reform Kicked to Next General Assembly


OMA has spent much of the year fighting for substantive reforms that would lead to solvency in Ohio’s unemployment compensation trust fund before the next recession.  As the lame duck session of the 131st General Assembly wound down, it became clear that the timing for an overhaul was not right, but an important employer penalty provision was removed. As a placeholder to pick up this important economic issue for Ohio, OMA and like-minded business groups signed a letter of intent to negotiate in good faith in the early part of the 132nd General Assembly for meaningful solvency legislation. In the meantime, an amendment to SB 235 was added that takes some baby steps to improve system solvency.  If implemented, these provisions would take effect in 2018: 1) two year freeze on benefits, 2) two year increase in taxable wage base from $9,000 to $9,500, and 3) most importantly, the elimination of the current penalty provision allowing that if Ohio borrows funds from the federal government to cover future unemployment compensation liabilities, all employers are subject to an immediate contribution rate increase. Parties agreed to an April 1, 2017 deadline to work out a final solvency plan.  Labor and business have also agreed to foot the costs of an actuary to analyze proposals arising from further negotiations. As we’ve said before: stay tuned.  Thank you to members who made time to write and call your state representatives and senators.   12/8/2016