Legislature(2005 - 2006)BELTZ 211
01/19/2006 01:45 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB136 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 136 | TELECONFERENCED | |
| + | HB 108 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
January 19, 2006
1:52 p.m.
MEMBERS PRESENT
Senator Con Bunde, Chair
Senator Ben Stevens
Senator Johnny Ellis
Senator Bettye Davis
MEMBERS ABSENT
Senator Ralph Seekins, Vice Chair
COMMITTEE CALENDAR
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 136
"An Act relating to the calculation and payment of unemployment
compensation benefits; and providing for an effective date."
HEARD AND HELD
CS FOR HOUSE BILL NO. 108(FIN) am
"An Act relating to the regulation of water and sewer utilities
of political subdivisions that are not in competition with other
water and sewer utilities; and providing for an effective date."
BILL POSTPONED
PREVIOUS COMMITTEE ACTION
BILL: SB 136
SHORT TITLE: UNEMPLOYMENT COMPENSATION BENEFITS
SPONSOR(s): SENATOR(s) ELLIS
03/08/05 (S) READ THE FIRST TIME - REFERRALS
03/08/05 (S) L&C, FIN
05/01/05 (S) SPONSOR SUBSTITUTE INTRODUCED-REFERRALS
05/01/05 (S) L&C, FIN
01/19/06 (S) L&C AT 1:45 PM BELTZ 211
WITNESS REGISTER
REPRESENTATIVE HARRY CRAWFORD
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Supported SB 136.
COMMISSIONER GREG O'CLARAY
Department of Labor & Workforce
Development
PO Box 21149
Juneau, AK 99802-1149
POSITION STATEMENT: Commented on SB 136.
CRAIG HATELY, Business Agent
Local 367, Plumbers and Pipefitters
Anchorage AK
POSITION STATEMENT: Supported SB 136.
RANDY WHITNEY
Local 367 Member
Juneau AK
POSITION STATEMENT: Supported SB 136.
ROYCE ROCK
Carpenter's Union
Anchorage AK
POSITION STATEMENT: Supported the intent, but not the figures in
SB 136.
DON ETHERIDGE
Alaska State AFL-CIO
8459 Kimberly Street
Juneau AK 99801
POSITION STATEMENT: Supported SB 136.
ACTION NARRATIVE
CHAIR CON BUNDE called the Senate Labor and Commerce Standing
Committee meeting to order at 1:52:46 PM. Present were Senators
Ben Stevens, Johnny Ellis and Chair Con Bunde.
SB 136-UNEMPLOYMENT COMPENSATION BENEFITS
CHAIR CON BUNDE announced SB 136 to be up for consideration.
SENATOR JOHNNY ELLIS, sponsor of SB 136, presented the sponsor
statement saying SB 136 would increase the maximum unemployment
benefit from $248 to $300 per week. He said this increase would
provide needed relief to Alaskan workers who are trying to put
dinner on the table for their families. In 2004, Alaska ranked
th
49 in the country for average weekly benefit amount. Alaska has
thth
fallen from 47 to 48 in the past year for maximum weekly
benefit amount. The average weekly unemployment check in Alaska
is $193.91 as opposed to the national average of $262.50. Alaska
compares unfavorably with almost the rest of the entire United
States. It has not increased unemployment benefits since 1997
and this benefit is not linked to inflation. Increasing
unemployment benefits is good not only for workers, but also for
the economy and provides the necessary incentive to insure that
well-trained Alaskan workers stay here for future employment
opportunities.
REPRESENTATIVE HARRY CRAWFORD said he supported SB 136 and that
he had a companion bill to it that was currently in House Rules.
Last year, a compromise was suggested to require 12 weeks of
waiting for quitting a job or being fired, but he convinced its
proponents to drop the issue in return for reducing the maximum
benefit amount from $336 to $300. He explained that a 12-week
waiting period in the construction trades would result in:
What that would mean in the construction trades is
nobody would ever get laid off again. We'd all get
fired or life would be so miserable, we'd have to
quit. So, it basically would mean that unemployment
insurance wouldn't be available to the majority of the
people in the construction trades if we were to put a
12-week penalty.
1:57:42 PM
CHAIR BUNDE asked why he assumed employers would resort to
draconian behavior.
REPRESENTATIVE CRAWFORD replied that from his 35 years of
experience, some contractors do whatever they can to cut costs
because construction is a very competitive business. He
explained:
That's why we've really reached a crisis proportion
here. I mean we're losing good trained people to the
Lower 48 because people can't afford to stay here in
the winter time or when the work gets slack.... We
have cyclical businesses and that's what unemployment
insurance (UI) is for - is to help people through
those times when the cycle is down and they can't find
work.
Many people who normally support him say that a $300 benefit is
way too low for them to support. He's been told it costs $40,000
to $60,000 to train an apprentice ironworker up to journeyman
status and Alaska is losing those folks to the Lower 48 because
their hourly scale and UI benefits are both higher and the cost
of living is no more expensive and sometimes less than it is
here in Alaska.
CHAIR BUNDE asked if he thought there should be any restriction
on collecting unemployment insurance for people who are fired
for cause.
REPRESENTATIVE CRAWFORD replied that six weeks is long enough to
wait. More than that would result in a slave labor force.
CHAIR BUNDE asked him to come back to the committee with a
compromise on the firing for cause issue that would be
acceptable to the other body.
2:03:47 PM
GREG O'CLARAY, Commissioner, Department of Labor and Workforce
Development (DOLWD), underscored the value that UI payments
contribute to Alaska's economy.
2:04:36 PM
SENATOR BETTYE DAVIS arrived.
2:04:43 PM
He reported that UI payments added $111,149,000 to the Alaskan
economy in 2004. He pointed out that this is one of the few
government programs where employees contribute a portion to
their paycheck.
Alaska is ranked less than 40th among other states. Every state
on the West Coast has higher UI benefits even calculating in
Alaska's dependents' allowance.
2:07:25 PM
SENATOR ELLIS moved to adopt CSSB 136, version F. He explained
that the CS changes the effective date. There were no objections
and it was so ordered.
COMMISSIONER O'CLARAY related that he is ever mindful of the
challenges to small businesses in the state and this bill does
not have a major impact on employers according to figures
presented to the committee.
2:08:58 PM
CHAIR BUNDE commented that Alaska doesn't pay too much in UI
benefits, but the program here is easier to get into and stay on
than in the Lower 48. He asked if that is accurate and if he had
any suggestions for balance.
COMMISSIONER O'CLARAY replied that he didn't know how easy it is
to file a UI claim, because first of all you have to be jobless,
which isn't easy for someone who is trying to raise a family in
this state. It also usually comes without a lot of notice. He
believed the department's appeals process was fair and even-
handed. The difficulty he has with criticism of this particular
program is that Alaska is a non-contiguous state. People have to
board a plane, jump on a ferry or drive a long highway to seek
other work.
He has been asked why Alaska has an unemployment problem when
papers in every major town in Alaska are advertising for jobs.
His answer to that is that people aren't trained for alternative
work and he has encouraged a more targeted work search when
someone is unemployed saying, "There is no substitute for
employment."
2:13:06 PM
CHAIR BUNDE asked for suggestions for a compromise on a maximum
draw that might be reduced in exchange for a higher weekly
benefit.
COMMISSIONER O'CLARAY replied there is already a disincentive
for someone to voluntarily quit or to be discharged for
misconduct by having to wait longer and by receiving three times
less the weekly benefit amount. He added that he adjudicates
that particular point for claimants and employers regularly.
2:15:44 PM
CRAIG HATELY, Business Agent, Plumbers and Pipefitters, Local
367, supported SB 136 saying that union members are routinely
out of work in the winter and UI benefits help them put bread on
the table at that time of year.
RANDY WHITNEY, Local 367 member, supported SB 136, but thought
the benefits should be higher. Investments are made in training
apprentices and those people leave all the time because there
isn't enough work here. He said, "I don't see it as armchair
money...." Hardly anybody can make it on $300 a week.
CHAIR BUNDE asked him if people get jobs with other skills when
they are not able to work in their primary trade.
MR. WHITNEY replied that some have other skills that don't even
bother with unemployment, but others would have to leave the
state to get work.
ROYCE ROCK, Carpenter's Union, thanked the committee for
bringing this bill forward. He pointed out that the "Trends"
magazine said in 2002 that Alaska benefits were 39percent of the
state's average weekly wage. At that time an ad hoc group of
labor and management agreed on a figure that started out at $272
with a minimum income of $29,750 that the next year would have
gone to $296 with an income of $32,750. In 2004, it would have
gone to $320 with an income of at least $35,750. But this bill
raises the wage up to $37,500 to receive the maximum benefit of
$300. So, in his eyes the benefit is dropping down to 2003
levels, but what you have to make is getting raised to get that.
He said, "I support an unemployment bill.... This just isn't
enough."
He pointed out that the construction workers average income is
$1118 per week and said, "It's not keeping people out of work
just because the money is so good." He asked the committee to
pass an unemployment bill this session, but to increase the
weekly benefit. The UI fund has a lot of money in it that gets
used for other things and more of it needs to get used for UI
payments.
CHAIR BUNDE commented that he didn't think someone would quit a
job on which they were making $1100 a week so that they could
get a $300 a week benefit, but if they were in that position, he
thought they may be less inclined to look for different work if
there were the $300 a week to fall back on. He asked how he
thought people could be encouraged to look for work more
aggressively.
MR. ROCK replied that union members would go through their
unions to find work, but he didn't agree with the chair's
philosophy that getting benefits should be tougher than what it
is today. Figures don't indicate abuse of the system; it is only
a perception.
2:24:49 PM
DON ETHERIDGE, Alaska AFL-CIO, supported SB 136, but also wanted
to see additional increases to the benefits. He didn't support
increases to the length of waiting time to be eligible to draw a
benefit. He personally knows of people who do take work in the
wintertime.
CHAIR BUNDE announced he would hold the bill for a second
hearing as is his philosophy.
CHAIR BUNDE adjourned the meeting at 2:28:00 PM.
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