It’s the most wonderful time of the year – but it would not have been for business, had the Pennsylvania Senate acted on House-passed, anti-employer legislation before the General Assembly recessed before the holidays.
The first bill, H.B. 1449, the so-called “Responsible Contractor” law (which has, fortunately, stalled in the Senate), would exclude the majority of Pennsylvania contractors from bidding on state projects. This move could have severe repercussions, limiting the pool of experienced and capable contractors and potentially driving up project costs both for the Commonwealth and its taxpayers.
Additionally, House Bill 1481, which would allow striking individuals to collect unemployment benefits, would shift dramatically away from the traditional purpose of unemployment compensation. Only two states (New York and New Jersey) allow striking workers to collect unemployment. California’s Democratic governor, Gavin Newsom, recently vetoed similar legislation.
We continue to emphasize that this proposal contradicts the fundamental purpose of UC – providing temporary financial assistance to individuals who lost their jobs through no fault of their own while they search for new employment. Any expansion of this could be a breaking point on an already strained system, and the PA Chamber has urged lawmakers to vote no, while stressing that allowing people who choose to go on strike to access UC benefits would violate nearly 90 years of state and federal precedent.
It’s also worth noting that unemployment benefits are funded through taxes on employers. Pennsylvania employers already pay some of the highest UC taxes in the country – over 50 percent higher than the national average. Under this bill, an employer’s taxes would essentially be used to subsidize (and prolong) a strike against them.
One of the reasons labor disputes often get resolved quickly is because it’s in both parties’ best interests to reach an agreement. Extending UC benefits to striking workers would remove a major incentive for swift resolution, and tilt the playing field against employers in such a dispute.
Finally, Pennsylvania’s UC trust fund remains below a healthy solvency level under federal standards and is not prepared to withstand a potential recession. Employers are already paying an additional tax as a result and this proposal will exacerbate the current strain on the fund.
As the Statewide Voice of Business, the PA Chamber strongly opposes these bills and is working with our allies in the local chamber and broader business community to educate lawmakers about how these bills would make Pennsylvania less competitive.