The House Advances ABI’s Top Legislative Priority in Unemployment Insurance Reform
February 3, 2022
This week, the House Labor Committee approved HSB 631, which is a comprehensive workforce bill that aims to return Iowans who are without employment back to the workforce more quickly. This legislation has been renumbered as HF 2279.
- ABI’s top priority in 2022 is modernizing Iowa’s unemployment insurance system and turning that into a re-employment system.
- The Iowa Legislature took a significant step forward on this issue by passing HSB 631 out of subcommittee on Tuesday and then approving it through full committee on Wednesday.
Workforce: Division 1 of the bill does a number of important things including:
- Minimizing the maximum amount of time an individual can be on unemployment from 6 months to 4 months.
- Reinstates the one-week waiting period.
- Defines “misconduct.”
- Enhances suitable work requirements.
Tort Reform: Division 2 of the bill enacts hard caps on noneconomic damages for medical malpractice cases and also hard caps on cases against the owner or operator of a commercial motor vehicle, which ABI also supports.
This is a critical bill that will help address workforce challenges in this state. The legislation could be debated as soon as next week in the Iowa House. Contact your House member and ask them to support HSB 631. You can find your legislator here. Iowa House Republicans are holding forums and you can find that schedule here. You can find the forums for the Iowa House Democrats here.
Division I of the bill reforms UI in several ways and incorporates several of the proposals Gov. Kim Reynolds’ highlighted in her Condition of the State Address. ABI was supportive of the Governor’s focus on UI.
ABI Vice President of Public Policy JD Davis testified at Tuesday’s subcommittee meeting on behalf of the association in favor of the bill. He highlighted how the bill modernizes the UI system and focuses on re-employment for Iowans in several ways:
- Reduces benefits period from 6 months to 4 months:
- The state of Iowa has been focusing largely on re-employment, which ABI has been supportive of.
- As an example, the Iowa Workforce Development implemented a Re-employment Case Management (RCM) Program this year.
- ABI’s member businesses continue to report workforce challenges, as you can learn from the results from ABI’s 2022 Q1 Quarterly Business Survey.
- By reducing the unemployment benefits period to 4 months, Iowans will be able to return to work faster.
- Reinstates one-week waiting period for unemployment benefits:
- Thirty-nine (39) states require claimants to wait one week before they can receive unemployment benefits.
- This is a sound decision fiscally because adding a one-week waiting period would save the UITF by $23 million annually.
- Employers contribute to the UITF through a payroll tax. Without federal help in 2020, Iowa’s businesses would have been on the hook. Iowa’s UITF received federal funding during the height of the pandemic in 2020, which is generally reserved for states that have a one-week waiting period policy.
- Any party can directly appeal an administrative law judge’s decision to the district court:
- By allowing parties to directly appeal to the district court, beneficiaries and employers have an option if they want to have a final resolution sooner, rather than later.
In addition to UI reform, Davis noted ABI is supportive of other bills targeting initiatives to improve workforce, including child care and housing.
Click here to find the full text of the bill.
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