Unemployment Reform Bill Passes House, Heads to Governor

Date: December 03, 2015

Legislation aimed at giving employers a greater ability to deny unemployment benefits to those who abuse workplace rules is one step closer to becoming law.

HB 1285, which passed the Illinois House this week, changes the “misconduct” definition under Illinois’ unemployment insurance law, something Gov. Bruce Rauner campaigned on and a change the business community has been advocating for decades.

The bill prevents unemployment insurance benefits from going to claimants who violate workplace rules and policies or who commit other egregious acts.  Employers have long been frustrated when they fire someone who has violated workplace rules or who puts themselves or others at risk, only to have those employees be eligible for unemployment benefits, which cost the employer in higher UI taxes.

For decades, employers have tried to get a change in the state’s UI “misconduct” definition.  Under the agreement, some of the most common violations like excessive tardiness and absenteeism will be addressed, along with drugs and alcohol, negligent acts in the workplace, providing false documents during the hiring process as well as failing to maintain employer required licenses needed to perform the job.  Key is making this change beneficial is for employers to have an employee handbook outlining key workplace rules.

In exchange for the new misconduct language, organized labor asked to remove the Social Security offset, which allows Illinois to count as income social security benefits thereby reducing UI benefit payouts to those who qualify. Illinois was one of only a few states who still as a Social Security offset in place.

Also removed were “speed bumps” that would have significantly hiked UI taxes and reduced UI benefits starting in 2016.

Now that the bill has passed both chambers, Governor Rauner is expected to sign it into law.

NFIB/Illinois plans on having a webinar at the beginning of 2016 to provide information on how small employers can best utilize these new changes in the UI law.

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