Jan-17-12 GOVERNOR CHRISTIE EXTENDS UNEMPLOYMENT BENEFITS; RELEASES ADDITIONAL TASK FORCE RECOMMENDATIONS TO MAKE STATE TRUST FUND SOLVENT AND BENEFITS SUSTAINABLE
The “Extended Benefits” legislation was needed for New Jersey’s unemployed claimants to take advantage of continued federal unemployment benefits approved by Congress last month. The continuation of those benefits will not impact New Jersey’s Unemployment Insurance Trust Fund because the federal act provides 100 percent federal funding of the benefits throughout the extension.
The legislation signed by Governor Christie also contains a provision allowing New Jersey claimants to take advantage of any future extension of benefits by the federal government as long as the federal government provides 100 percent funding and New Jersey still qualifies for the federal Extended Benefits program.
Details on who is impacted by the “Extended Benefits” legislation may be found at:
While giving additional relief to New Jersey’s unemployed, Governor Christie also released the latest report of the New Jersey Unemployment Insurance Task Force, which recommended six reforms to improve the solvency of the state’s UI Trust Fund.
The Task Force’s January 2012 Report is the second annual report released since the advisory group was created in 2010 by Governor Christie to study and assess the deficit crisis impacting the state’s UI Trust Fund.
The six recommendations include:
• Change Employer Experience Rating in Tax Rate Table
• Identify Seasonal Industries and End UI Eligibility for Seasonal Employees at the End of Their Work Season
• Implement Stricter Work Search Requirements for UI Claimants
• Change State Law and Regulations to Include Workers’ Compensation and Severance Pay in the Determination of Unemployment Benefits
• Retain the Current “Suitable Work” Requirements and Upgrade Information Technology
• Change State Law to Eliminate Base-Year Criteria for “Benefits Charging”
In 2009 and 2010, New Jersey was forced to borrow up to $2.1 billion from the Federal Unemployment Account to meet the state’s Unemployment Insurance benefit obligations. Under the state’s UI law, New Jersey employers began shouldering the tax responsibility to restore the Fund and, unless action was taken, faced an average tax increase of $400 per employee by June 2010.
Governor Christie signed legislation in June 2010 to hold the average increase for employers to $130 per employee and to restrict UI eligibility for workers fired for severe or gross misconduct. Then, in June 2011, Governor Christie signed further legislation to hold an average $300-per-employee tax increase to $100 per employee for employers. The legislation also raised the UI Trust Fund reserve ratios to sufficiently build up reserves and reduce the likelihood that any future recession will result in the deep deficits that posed the high employer tax increases.
In addition, in March 2011, the state Department of Labor and Workforce Development launched an anti-fraud program that is expected to prevent at least $98 million in improper unemployment benefit payments within one year and improve the solvency of the UI Trust Fund. New Jersey received two innovation awards in 2011 by the U.S. Department of Labor because the anti-fraud effort was the first of its kind to address the most common form of unemployment fraud: people continuing to file UI claims after they have returned to work.
By the end of 2011, the State’s federal loan balance decreased to $1.47 billion. The loan is expected to be paid off in the summer of 2013. Currently, 28 states have outstanding loans from the federal fund totaling $39 billion.
The Task Force report and additional details may be found at: