Governor Announces Municipal Unemployment Proposals

Governor Patrick has announced new legislation aimed at closing loopholes in the municipal unemployment system that first came to light locally last year.

Patrick noted that he convened a task force last spring to address loopholes in the unemployment system that have cost municipalities tens of thousands of dollars, and that the task force released its recommendations in November.

Lynnfield Town Administrator Bill Gustus and 23 other colleagues from municipal government wrote to Governor Patrick last March seeking relief on the issue. A retired Lynnfield Police officer received a considerable amount of regional media attention at the time because his unemployment case – while also collecting a pension – is the one that led Gustus to draft the letter to the Governor. 

Soon after, that could be deemed questionable – for example, by school bus drivers during summer vacation months.

The Governor introduced a bill last April also aimed at some of the problems with the municipal unemployment system and Gustus was quoted in the Boston Herald as comparing it to using a flyswatter to try to kill an elephant.

"We are confident that the proposed changes will produce significant financial and administrative relief for municipalities while maintaining integrity of the UI system and respecting the rights of those unemployed workers with valid UI claims,” said Joanne Goldstein, secretary of the executive office of labor and workforce development, in the Governor’s announcement.

The Governor also provided a rundown of whatt his legislation will do, as follows:

• Create a 65% UI offset to retirees collecting a defined benefit pension, thereby significantly limiting a returning retiree’s access to unemployment when laid off and collecting a pension.

• Eliminate the disparity between those employed directly by a school department and those providing services to the school but paid directly by the municipality.  All public employees providing services to a school who have “reasonable assurance” of continued employment are ineligible to receive UI benefits when school is not in session.

• Prevent municipalities from being charged for wages earned by election workers who make less than $1,000 a year.  Currently, municipalities could be responsible for paying some portion of UI benefits to these employees, if they earn enough wages from other employment.

• Allow the Department of Unemployment Assistance (DUA) to participate in the United States Treasury Offset Program so that the agency can intercept the federal tax returns of anyone who owes DUA funds as a result of an overpayment.  As with the state program, the federal program will have procedures for notice and opportunity to present evidence as required by federal law and regulations.