Governor to sign bill raising unemployment benefits

By Ron Harris Associated Press Writer
Monday October 01, 2001

Maximum benifits would jump by $100 per week next year 


SAN FRANCISCO – Gov. Gray Davis has agreed to sign SB40 Monday, the bill that would increase unemployment benefits beginning next year, senior administration officials announced Sunday. 

The current maximum unemployment benefit totals $230 per week. The bill would raise maximum unemployment benefits to $330 per week beginning Jan. 1, 2002. For claims filed in 2005, as part of the stepped approach, the benefits would increase to a $450 per week maximium. 

California currently ranks 48th out of the 50 states in the level of unemployment benefits offered and is looking to dramatically improve that lowly position, according to the governor’s office. 

The bill was authored by Sen. Richard Alarcon, D-San Fernando. Supporters included the state’s labor unions. Business groups were mostly opposed, although they conceded that some increase is justified. 

Opponents of the bill argued that such increases would place a severe tax burden employers who are the sole source of funding. The benefits would first be paid from a temporary unemployment insurance fund surplus, with business tax contributions needed to fund the increased benefits in 2004 and 2005. 

Giving the unemployed more money would allow them to return to work sooner and not force them into lesser paying positions to make ends meet, Alarcon said Sunday. 

“We want our workers to be at their productive peak when their working and not taking a job that they were forced to take,” Alarcon said. 

The state Department of Finance puts California unemployment figures at 5.7 percent in 2002 and 5.6 percent in 2003. Given those projections, the benefits increase will not cost employers any extra money in taxes over the next two years, the governor’s office maintained. 

State labor leaders were pleased with the Davis’ decision. 

“We want to applaud the governor,” said Art Pulaski executive secretary treasurer of the California Labor Federation, AFL-CIO. “It is important because it will help some of the most affected Californians suffering under the current economic problems.” 

“It’s going to give $100 a week more into the pockets of hundreds of thousands of workers who have lost their jobs from the troubled economy,” Pulaski said. 

In 2002, the maximum unemployment weekly benefits would improve to $330, followed by increases to $370 per week in maximum benefits beginning in 2003, $410 in 2004, and $450 at the start 2005. 

Unemployed workers would be eligible for 26 weeks of coverage. It has been nine years since the last such increase in state benefits. 

The governor’s office said the bill would go a long way toward offering added financial security for recently fired airline and technology industry workers throughout the state. 

The decision offers a second sliver of good news for airline and airport workers in particular. On Thursday, Davis issued an executive order waiving the one-week waiting period for unemployment benefits claims of airline and airport employees. 

Thousands of those employees have been laid off since the Sept. 11 terrorist attacks. 

Shelley Kessler of the San Mateo County Central Labor Council, overseeing worker concerns and San Francisco International Airport, looked forward to improved benefits for local employees there. 

“The airport is the largest financial engine of San Mateo County,” Kessler said. “With the advent of Sept. 11 and the economic downturn, there are a lot of workers who are in the process of losing their jobs.” 

San Francisco Bay area labor leaders predicted that 5,000 of the roughly 30,000 workers at SFO would lose their jobs due to recent cutbacks in the wake of the attacks. 

Kessler urged Davis to consider making the benefit improvements available immediately to airline workers and airport employees who have lost their jobs. 

Unemployment benefits are paid from an employer-supported fund to workers who lose their jobs through no fault of their own and have made a certain amount in wages during a 12-month base period.