Published May 2005

It’s time for workers
to contribute
to unemployment benefits

By Don Brunell
Guest Editorial

Since 1939, when Washington issued the first $15 unemployment check, there has been a tug-a-war over benefits and who pays. It not only pits employers against unions but employers against employers.

For example, over the years unions lobbied the Legislature for higher weekly payments while employers, who pay all the unemployment taxes, focused on costs. Those costs have grown to where our workers receive some of the highest benefits in the nation while our employers pay THE highest taxes.

The other problem is employers with relatively few layoffs have traditionally subsidized seasonal employers through higher rates. Over the years, as unemployment taxes rose, the chasm between stable industries with few layoffs and seasonal employers (construction, agriculture and fishing) with temporary work not only grew but became bitterly divisive.

The 2003 bipartisan reforms started to address that problem, yet the ink on those unemployment insurance reforms was barely dry when Gov. Gregoire and Democrats cut the heart out of them in the recent legislative session.

EHB 2255 unravels key 2003 reforms and according to the Department of Employment Security estimates it may cost the unemployment insurance trust fund more than $200 million. But no one knows for sure because accurate cost data weren’t available. Meanwhile, if the UI trust fund dips below certain levels, employer taxes automatically increase as they did in 2003 and 2004.

What worries employers most is if there is no agreement in the next year, the unions will pressure the Legislature to make their changes permanent.

So, how do we ease the tension on the rope so the tug-a-war ends?

If the governor and legislators want to keep employers in Washington and still pay high unemployment benefits, workers will have to pay a portion of the premium just as they do for workers’ compensation.

Three other high-cost, high-benefit states — Alaska, New Jersey and Pennsylvania — have workers contribute to their unemployment insurance. While unions may resist worker contributions, it may be the only way to maintain high benefits and keep jobs in Washington.

Don Brunell is president of the Association of Washington Business, Washington state’s chamber of commerce. Visit AWB on the Web at www.awb.org.

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