Illinois' unemployment insurance program will see some changes next year ... the result of something that's rare in Springfield these days as a budget stalemate persists: hard-fought negotiations giving way to a compromise.
Gov. Bruce Rauner's administration, labor, and business, all agreed on something: changes to the unemployment insurance program.
The measure awaiting the governor's signature would make it easier for businesses to prove worker misconduct. That could decrease employer’s costs by exempting them from having to pay benefits.
Republican State Rep. David Harris of Arlington Heights says the agreement could be a template for breaking the standoff between lawmakers and the governor.
"I think we ought to use it as an example, that if there's a willingness on the part of the legislature and the second floor to get to yes, to come to an agreement, here's a case where we can do it,” he said. “Let us use that as an example of what we can do on the budget and other issues that are tying us up in other areas."
"This is an agreement that was reached between the department, organized labor and business," said State Rep. Jay Hoffman, a Belleville Democrat.
It's a big deal for workers who get laid off. It's a big expense for businesses. Plus, given the political climate in Springfield, any compromise is worthy of attention.
What exactly does this deal do to unemployment insurance Illinois? First, it does away with something called the "Social Security Offset."
Sean Stott, the government relations director for the Laborers' International Union -- Midwest Region, explains how it'll benefit workers.
"For working people, the one item that was gained in these negotiations -- it's primarily for older workers who are receiving Social Security,” Stott said. “Currently they receive their unemployment benefits reduced by the amount of money that they receive from the federal government in Social Security benefit."
Not any more. With the deal, older workers who've been laid off will no longer get a smaller unemployment benefit just because they're on social security.
Paying out more benefits, though, will cost employers more -- they think about $25 million.
So the deal also does something that makes the business side happy, something Rob Karr, head of the Illinois Retail Merchants Association, says employers hope will lower their expenses.
"We have redefined misconduct,” Karr explained. “So employees who do certain things under misconduct, they will be less able to obtain their benefits if they did something wrong in the workplace -- like ignored employer policies on attendance or used illegal substances on the job.
“Those types of things would more likely get them disqualified from unemployment benefits. Which means -- we think -- that's enough to offset the increase in the unemployment insurance taxes."
So there you have it: The terms of the deal. It was reached, in a way, because their hands were forced.
"Every time we do an agreed-bill process -- and we've done a number of these over the course of decade, all successfully -- we intentionally insert what are called ‘rest stops’ or ‘speed bumps’,” Karr explained. “They force both sides back to the table, if nothing else to review the program, see how it's working. Each side then has the opportunity to ask for additional tweaks to the program."
Stott lays out what's at stake in that process:
"There's always been an item placed in the law that would be distasteful to both business and labor,” he said “That item was looming on the horizon, very shortly -- the beginning of next year.
Basically, it’s a provision where workers would have gotten less and businesses would have had to pay more.
“Employer unemployment taxes would have gone up,” Stott said, “and workers who were unemployed would have seen their benefits reduced. And neither side, of course, wanted to see that happen. And, as a result, that brought both parties back together."
Legislators like Republican Rep. David Harris say this should be the path for future deals.
"Let us use that as an example of what we can do on the budget and on other issues that are tying us up in other areas," he said
That could be easier said than done.
Stott, with the laborers union, says unemployment is different from Gov. Rauner's calls for limiting collective bargaining.
"If both sides are reasonable in what their requests are, there may be some ability to work together to get a compromise,” Stott said. “Unfortunately, a lot of the things that we have seen come out of the governor's office are not reasonable.
“When it comes to taking away collective bargaining rights for workers in local governments, when it comes to cutting wages for construction workers on local construction projects,” he said, “there's nothing there that labor can see as a path to coming to a resolution on.”
On a more optimistic note, it did work with unemployment insurance.
"I think the fact that the speed bumps force you back to the table is an inherent encouragement, right, for both sides,” IRMA's Rob Karr said. “But both sides could have ignored it. The governor's office could not have convened it
“They chose to convene the agreed-bill processes; they chose to oversee it, and they did so in a very mild-mannered approach,” he added. “And I think that does show an example of what can happen when all sides choose to make it happen."
The next speed bump hits in 2018, so these players will be back at the table in 2017.
Rauner is expected to sign the insurance measure into law.
"We're pleased that the unemployment insurance reform bill passed,” he said. “It's an important step in improving the competitiveness of our economy, to grow jobs here in the state of Illinois."
