Projections change as Senate Labor panel approves UI contribution hike

TRENTON – The Senate Labor Committee approved S1121, which changes the unemployment insurance (UI) tax rate for certain employers.

Prior to last Friday, the bill was expected to capture tens of millions of dollars from employees to restore the depleted UI fund account; but the state Department of Labor adjusted a result of the UI task force report on their website on Friday, Sen. Fred Madden, (D-4), Washington Township, said, bringing the total in increased contribution expectations from $22 million to $220 million.

Madden, who sponsored the bill and chairs the committee, said, obviously, “$220 million savings is a lot better that $22 million of savings,” especially for a “fund that’s $1.4 billion in the red.”

State Sen. Dick Codey, (D-27), Roseland, asked whether Madden himself received an explanation. No, said Madden: “They knew that myself and the Governor’s Office were back and forth in negotiations…Coincidentally, (the department) is absent today. You can read into it however you wish.”

Reached immediately after the hearing, a Department of Labor spokesman said an official response is forthcoming.

A possible explanation surfaced in testimony from Melanie Willoughby, N.J. Business and Industry Association senior vice president of Government Affairs. She said that the $220 million figure may include roughly $195 million currently being collected; the remainder would appear to be around the $22 million previously reported.

Nonetheless, business and industry representatives spoke in favor of the bill, which the bill sponsor framed as a matter of adjusting the “equity” of UI contributions.

The two Republicans on the committee, state Sens. Tony Bucco, (R-25), Boonton, and Dawn Addiego, (D-6), Evesham, abstained from voting. Bucco said he would weigh the bill on the floor again and decide how to vote then. Addiego said, “I do have some concerns, but I understand the concept of what you’re trying to do here.” She also promised to revisit it. The bill passed, 3-0-2.

A technical amendment was approved in the passage, which was a result of negotiations between Madden and the front office, “between the Governor’s Office and Department of Labor,” Madden said.

He said the $220 million-verses-$22 million issue was really not an issue at all, in that even at the lesser amount of captured funding the bill would still be worth it.

The committee also approved S873, sponsored by state Sen. Sandra Cunningham, (D-31), Jersey City, with a 5-0 vote. The bill would allow for an increase in basic skills training funding provided by the N.J. Community College Consortium for Workforce and Economic Development.

At the request of bill sponsors, Madden held from the agenda S249, which concerns workers’ compensation insurance requirements for certain corporations, and S787, which extends “whistleblower” protections to employee disclosure of governmental mismanagement, waste and abuse.

Projections change as Senate Labor panel approves UI contribution hike