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*** UPDATED x1 *** Biz and labor reach unemployment insurance deal

Monday, Nov 9, 2015

* As subscribers know, talks on this topic appeared horribly snagged last week. No longer…

Governor Bruce Rauner announced today that his administration has reached an agreement with business groups and labor organizations to reform and improve Illinois’ unemployment insurance system.

“We have a lot of work left to turn around Illinois, but today’s agreement is a step towards making us more competitive so we can increase investment in the state and grow jobs,” Governor Rauner said. “I want to thank the legislators involved in crafting this agreement and urge the legislature to swiftly pass legislation and send it to my desk.”

“For more than 30 years, governors and legislative leaders have brought business and labor together to negotiate changes to Unemployment Insurance for the benefit all in the state of Illinois,” Illinois AFL-CIO Secretary-Treasurer Tim Drea said. “Because it is so vital to the economy and safety net for working families, Unemployment Insurance negotiations are always difficult, but all parties were committed to the process and an equitable agreement was achieved.”

“On behalf of the employer community, we would like to thank our counterparts in labor, the Rauner Administration and the representatives of the four legislative caucuses who all played valuable roles in reaching this agreement,” said Rob Karr, President & CEO of the Illinois Retail Merchants Association. “While the discussions were rigorous, they were always fair and ultimately productive.”

Under the agreed framework an individual would be ineligible to receive unemployment insurance benefits following separation with an employer if a worker:

    • Damaged an employer’s property through grossly negligent conduct;
    • Consumed alcohol, illegal or non-prescribed drugs during work hours in violation of an employer’s policies;
    • Provided false information in an employment application;
    • Endangered the safety of himself/herself or co-workers through grossly negligent conduct;
    • Knowingly and repeatedly violated reasonable written attendance policies of an employer;
    • Refused to obey an employer’s reasonable and lawful instructions unless the refusal is due to the lack of ability skills or training of the worker or if the instruction would result in an unsafe act; or
    • Did not maintain required licenses, registrations and certifications required by law for the specific job.

Under current law, a worker could still be eligible for unemployment insurance benefits if any one of the above items occurred in the workplace. For the first time ever, these common-sense reforms will be implemented, creating a more fair and stable unemployment insurance system.

Additionally, the framework allows recently separated workers who are eligible for Social Security to receive a full unemployment insurance benefit. Under current law, 50 percent of the amount an older worker receives for Social Security is subtracted from the potential unemployment insurance benefit. Illinois and Minnesota are the only two states in the nation to allow this practice. This reform will return $25 million to Illinois seniors.

Governor Rauner had made strengthening misconduct and abuse provisions central components of his unemployment insurance reform proposal.

*** UPDATE *** Press release…

After many hours of negotiations, the Illinois Chamber of Commerce is supporting an agreement between business leaders and organized labor on unemployment insurance changes that has been reached. “For the business community, the two key issues in the agreement are a benefit change for seniors and a change to ‘misconduct’ for employers,” said Todd Maisch, president and CEO of the Illinois Chamber.

Both changes are important philosophical revisions for both business and labor, but neither are big ticket items from a dollar perspective.

The benefit change will eliminate the offset of Social Security for determining benefits based on an individual’s income. “With this change, some seniors may now become eligible for unemployment insurance benefits where they would have previously been disqualified because of Social Security income,” explained Maisch. Others will receive higher benefits because their Social Security income would have reduced their benefit amount. Illinois is the last state in the nation to offset unemployment insurance benefits with social security.

“The proposed revisions to “misconduct” include eight typically egregious circumstances for which employers may protest a benefit claim,” said Maisch. With this compromise, employers will not have to prove that the reason for the discharge was “willful and deliberate” and caused harm to the employer or was repeated after warning or instruction from the employer.

The bigger dollar issues for the unemployment system are the elimination of changes to the law that were set to take effect on Jan. 1, 2016. If there had not been any agreement to change the law, employer unemployment insurance taxes would have increased an annual $470 million, and benefits to unemployed workers would have been reduced by approximately $300 million per year.

Finally, there will be a moratorium on any UI legislation through Jan. 1, 2018. This compromise plan needs state lawmaker approval and the governor’s signature.

- Posted by Rich Miller        

43 Comments
  1. - so... - Monday, Nov 9, 15 @ 1:27 pm:

    But Rauner is hopelessly ideological and can’t compromise


  2. - Blue dog dem - Monday, Nov 9, 15 @ 1:31 pm:

    The RAUN Man must be desperate. This is a nothing deal. He has backed himself into such a tight corner, he looks to be begging to save face. Madigan wins. Again.


  3. - burbanite - Monday, Nov 9, 15 @ 1:33 pm:

    I don’t really see this as much of a change. But if the Gov sees it at a win, great.


  4. - Oswego Willy - Monday, Nov 9, 15 @ 1:34 pm:

    Like Gov. Edgar talks about recently;

    The “doable”

    More like this please.


  5. - RNUG - Monday, Nov 9, 15 @ 1:34 pm:

    Okay. We’re spending an estimated $25M MORE by eliminating the Social Security offset. So how much are we going to SAVE by the other changes?


  6. - Georg Sande - Monday, Nov 9, 15 @ 1:36 pm:

    Another agreement with Labor? That makes the incessant “Rauner hates Labor” narrative all the harder to force-feed people.

    Let’s ignore this and prior Labor agreements and instead resume with the stale talking points against Rauner in 5, 4, 3, …


  7. - Ducky LaMoore - Monday, Nov 9, 15 @ 1:37 pm:

    ===Governor Rauner had made strengthening misconduct and abuse provisions central components of his unemployment insurance reform proposal.===

    Yeah, and if he attacked the union for the same things, I would agree with him. Instead, he wants to destroy the union. AFSCME rules that allow you not to be fired until what, 15 or so “suspensions.” Except you are expected to show up to work for the first 14 suspensions. So you can be punished for not showing up to work while suspended? YES! Fight that fight, and you would have way more allies.


  8. - Nick Danger - Monday, Nov 9, 15 @ 1:39 pm:

    Apparently Blue dog and burbanite were not part of the negotiations nor have spent much time in a UI adjudication hearing. Check with the legislators involved. The Art of Compromise was at work…called the Agreed Bill process. Both sides got something and gave something. Amazing what happens when heels are not dug in.


  9. - pool boy - Monday, Nov 9, 15 @ 1:40 pm:

    How could anyone argue in favor of keeping these? I wish I was a fly on the wall during these talks.


  10. - Blue dog dem - Monday, Nov 9, 15 @ 1:43 pm:

    Nick-been there, done that. I stand by my claim. RAUN Man loses. Spin it any way you want.


  11. - Anon - Monday, Nov 9, 15 @ 1:44 pm:

    The only thing that bugs me is what burden of proof does the employer have to provide to make these claims?

    I come from a state where this practice exists, and there are some employers who simply dispute every single unemployment claim out of spite.

    What kind of penalties would exist for employers that commit fraud or make false statements in an effort to deny rightful benefits to former employees?

    What kind of process exists to make sure the worker’s rights are protected?


  12. - Ducky LaMoore - Monday, Nov 9, 15 @ 1:44 pm:

    ===Let’s ignore this and prior Labor agreements and instead resume with the stale talking points against Rauner in 5, 4, 3, … ===

    Okay fine. How about this:
    Isn’t it amazing what a few crappy internal polls can do to make you actually do your job. Good enough?


  13. - 1776 - Monday, Nov 9, 15 @ 1:48 pm:

    The Cap Fax article last week was wrong. It was never horribly snagged.


  14. - Juvenal - Monday, Nov 9, 15 @ 1:53 pm:

    According to the terms set by Team Rauner and the Chicago Tribune editorial board, Blue dog is correct.

    Anything that organized labor and Democrats agree to is, by definition, “Surrender.”


  15. - Name/Nickname/Anon - Monday, Nov 9, 15 @ 1:54 pm:

    I just hope justice is served and Cook County Board Presidents that lose re-election can get their unemployment benefits now.


  16. - Beaner - Monday, Nov 9, 15 @ 1:56 pm:

    The Rauner Agenda for full employment for Attorneys continues. You want your stinking benefits? Well pony up the money hire an Attorney and go to Court. Maybe you be allowed to receive your benefits…if you are lucky.


  17. - Nancy Solomon - Monday, Nov 9, 15 @ 2:00 pm:

    What wonderful news. By the way,Minnesota does not and has never enforced its offset provision. Illinois is the ONLY place in the entire United States, districts, commonwealths and territories that still enforced the offset — until it gets voted away on a few days. We hope. Thanks for your coverage.


  18. - Nick Danger - Monday, Nov 9, 15 @ 2:00 pm:

    Blue dog 1:43 say whaa?… Me thinks you’re about the spinning. Win or lose only is your mantra? No room for compromise? I hope you’re not part of the budget negotiations.


  19. - Anonymous - Monday, Nov 9, 15 @ 2:01 pm:

    Don’t you love it when Rauner claims wild success for things that Governors like Edgar and Thompson would have accomplished in the first few weeks of their terms? Silly and unnecessary spin.


  20. - ANONIME - Monday, Nov 9, 15 @ 2:05 pm:

    The employer has always had the right to dispute any unemployment claim. In fact, I know of one employer who always disputed the claim and always won because ‘they knew how to do it right’ according to the local unemployment insurance office. They never paid out a claim to any of those employees. the employee could have fought it, but didn’t have money to do that since they were not earning anything. So, I don’t see how this makes things any different except helps the employer so they don’t have to do as much to deny the claim. There are problems on both sides of the unemployment issue - always have been and always will be.


  21. - DuPage - Monday, Nov 9, 15 @ 2:08 pm:

    =allows recently separated workers who are eligible for social security to receive a full unemployment benefit.=

    Correct me if I got it wrong. My understanding was you could not quit to retire and collect UC. You were only eligible if you happened to be laid off and were old enough to collect social security.

    Also, does this also apply to pensions?


  22. - Oswego Willy - Monday, Nov 9, 15 @ 2:10 pm:

    ===Don’t you love it when Rauner claims wild success for things that Governors like Edgar and Thompson would have accomplished in the first few weeks of their terms?===

    Aw, let them have their moment.

    What’s exciting for me is the continual requirement of dismantling collective bargaining and prevailing wage and… Rauner doesn’t hate Labor.

    That’s fun too.


  23. - Oswego Willy - Monday, Nov 9, 15 @ 2:13 pm:

    In Mundelein, coming soon… A new store…

    “Just Munchies!”


  24. - 360 Degree TurnAround - Monday, Nov 9, 15 @ 2:14 pm:

    I think the best narrative that can be taken from this is: collective bargaining does/can/will work.


  25. - steve schnorf - Monday, Nov 9, 15 @ 2:22 pm:

    Good on the Gov, labor, and the employers!


  26. - Formerly Known As... - Monday, Nov 9, 15 @ 2:41 pm:

    Another ==win== for Rauner in this ==epic struggle==.

    Add it to the GA pay increase, the AFSCME override, several union deals, $ for state employees and avoiding a gov shut down.

    Rauner and Madigan must compromise, but until then Rauner is ahead on points while Madigan still looks for his first clear ==win==.


  27. - Anonymous - Monday, Nov 9, 15 @ 2:49 pm:

    Oh stop the bad-mouthing.

    Good compromise between strong advocates acting professionally. That some on each side claim it’s a loss, is the greatest praise.

    This was the probably easiest of the Turnaround Eight to come together on, but call it real progress.


  28. - walker - Monday, Nov 9, 15 @ 2:52 pm:

    Anon 2:49 above was me. mark


  29. - DonaldTrump - Monday, Nov 9, 15 @ 2:54 pm:

    Glad the SS offset is gone. How about reducing the number of weeks. Illinois is at the high end there. Or the dollar amount (only a couple of states are higher). Folks working in other states know that they need to work one day in Illinois to get the higher longer Illinois benefit. Rauner and the citizens and employers of Illinois lost this one.


  30. - Blue dog dem - Monday, Nov 9, 15 @ 3:01 pm:

    Nick-some call it compromise. I tend to call it POLITICS. When to sides make a big deal out of reaching a DEAL, but yet nothing of significance really happened, go ahead and feel good about it. I am not even going to give it a ‘warm and fuzzy’.


  31. - Rich Miller - Monday, Nov 9, 15 @ 3:08 pm:

    ===some call it compromise. I tend to call it POLITICS===

    You sound like a Raunerite.


  32. - Grandson of Man - Monday, Nov 9, 15 @ 3:22 pm:

    “Good compromise between strong advocates acting professionally. That some on each side claim it’s a loss, is the greatest praise.”

    I like very much when interests often in deep opposition to one-another reach agreements and make deals.

    “This was the probably easiest of the Turnaround Eight to come together on, but call it real progress.”

    I hope Rauner can somehow drop the controversial and deeply divisive stuff that can’t pass and finally work on what can pass. This impasse is terrible in many ways and is bad for business.


  33. - Demoralized - Monday, Nov 9, 15 @ 3:22 pm:

    @DonaldTrump and @ Blue dog dem

    Apparently you haven’t learned anything from this current situation. You’d rather get your way on everything rather than actually get something that’s doable done. Go away. You are part of the problem, not the solution.


  34. - burbanite - Monday, Nov 9, 15 @ 3:39 pm:

    Nick Danger, I am no expert but I have done several UI hearings for employers and never lost one. From the IDES website: “Your unemployment must be involuntary. You may be disqualified if you: quit your
    job voluntarily without good cause attributable to your employer; were discharged
    for misconduct in connection with your work; were discharged for a felony or theft
    in connection with your work; or are out of work because of a labor dispute.” Misconduct in connection with your work has always been a catchall. So I really don’t see a big difference. Just my opinion, doesn’t mean I am not happy that those who negotiated it see it as a win, I think that is great. If business thinks this helps them, wonderful.


  35. - RNUG - Monday, Nov 9, 15 @ 4:20 pm:

    == So how much are we going to SAVE by the other changes? ==

    Answering my own question, it’s either $470M or $300M according to the Crain’s story I just read.


  36. - ChicagoVinny - Monday, Nov 9, 15 @ 4:22 pm:

    If he can declare victory on this and that gets us closer to a budget, fine with me.


  37. - cdog - Monday, Nov 9, 15 @ 4:48 pm:

    These are reasonable adjustments to the law. And, they will be helpful to employers. A gracious thank you to the negotiators.

    As an employer who has never lost a claim, it is not easy to do. Terminating people sucks, but keeping crazy people in your shop sucks worse.

    When the process gets going, both sides have access to legal assistance. If someone has been wrongfully terminated, from my experience, they stand a very good chance of receiving their benefits, even if the employer protests the claim. For what it’s worth, the culture in the awarding of unemployment benefits seems to benefit the terminated employee.

    The key to always prevailing as the employer, has always been to show evidence of a good faith effort in giving the errant employee a few chances to correct the problem. Some times it works, some times it doesn’t. (Like Cool Hand Luke’s warden said, “Some folks…you just….can’t…reach.” )


  38. - Juice - Monday, Nov 9, 15 @ 4:49 pm:

    RNUG, those aren’t really savings in the traditional sense. The provisions to dramatically increase taxes and reduce benefits was put in place a few years ago after changes were made to make sure everyone had an incentive to come back to the table in case one side was being unfairly hit for those changes. Based off the agreement, it would appear both sides were ok with how things were going, so decided to give some clarification on misconduct (no idea if it was actually needed) and $25 million to baby boomers.


  39. - 1776 - Monday, Nov 9, 15 @ 6:29 pm:

    The misconduct change is big because it lowers the legal standard from willful and wanton to a lesser standard.


  40. - Blue dog dem - Monday, Nov 9, 15 @ 6:56 pm:

    Rich, man you can hurt a guy. If I’m a Raunernite, then the RAUN Man is in trouble


  41. - Oswego Willy - Monday, Nov 9, 15 @ 7:04 pm:

    - Blue dog dem -,

    I think you’re confused half the time.


  42. - MasterPiece - Monday, Nov 9, 15 @ 7:29 pm:

    Changes to the UI Act have ALWAYS been made by a joint labor/employer committee, and ALWAYS by agreement from that committee. This has nothing at all to do with Rauner. Nothing. At. All.


  43. - Ghost - Monday, Nov 9, 15 @ 7:55 pm:

    now this, this is excellent common sense smart buisness reforms. more like this please. If this is what Rauner wanted, instead of his anti union crap, i would be behind him 100 percent. nothing wrong with eliminatng abuse.


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