RALEIGH — Legislation increasing how much North Carolina’s unemployed must look for work to retain jobless benefits and lowering a state tax on businesses sooner appears headed to Gov. Pat McCrory’s desk after the Senate voted for the measure Wednesday.
The bill makes additional adjustments to the state’s unemployment insurance system, which underwent a broad rewrite in 2013 to accelerate that repayment of $2.5 billion owed to the federal government on benefits paid out during the Great Recession. That law lowered benefit maximums by one-third and led to some higher federal and state unemployment taxes.
The new measure approved 38-7 after little debate needs one more Senate vote, likely today, before going to McCrory. His office didn’t respond Wednesday to an email seeking comment whether he’ll sign the bill into law.
The House approved the measure last week after lively debate on a provision that raises the minimum number of weekly job contacts a displaced worker must make from two to five to keep qualifying for benefits.
Recipients already must be “actively seeking work” to keep receiving their financial assistance. Current law defines the phrase in part by someone making at least two job contacts with employers on different days. The bill sets no day restrictions on the five contacts.
Critics say five contacts will be hard on unemployed people who lack transportation or easy Internet access to touch base with employers. They also fear companies may get overwhelmed with paperwork by people applying for jobs to keep benefits coming in.
Supporters say five contacts shouldn’t be burdensome to someone whose primary purpose should be to land a new job.
Four other states — Colorado, Florida, Nevada and Oregon — require at least five or more employer contacts in some situations, according to a U.S. Department of Labor document. But three of the four lower that number depending on the region or labor market.
The proposed North Carolina law provides no such exception. That could make it very difficult for people in rural areas, where few employers are based, to meet the qualification, said Rebecca Dixon, a staff attorney with the National Employment Law Project.
“There could be unintended consequences,” Dixon said, adding that North Carolina policymakers “should really consider whether it’s flexible in areas where there’s not a lot of employers.”
The state’s $2.5 billion in debt was repaid completely in the spring, meaning federal unemployment taxes for state businesses have now decreased to pre-debt levels. The 2013 law also required a state tax surcharge to continue until a reserve exceeded $1 billion.
The new legislation would direct the surcharge end several months earlier next year than current law allows if the $1 billion level is met by next March. The change will save $240 million for employers, House Speaker Tim Moore’s office said.
The bill also appears to resolve a year-old standoff between McCrory and legislative leadership over his appointees to the Board of Review, which considers final benefit appeals. In June 2014, McCrory vetoed a measure containing board changes that would have shortened the terms of the members he chose, forcing one of them to vacate his post almost immediately.
Under this bill, terms of board members would become staggered, but current member Keith Holliday wouldn’t have to leave the job for another year. The board members also would finally be confirmed by lawmakers.