Veto #12: Unemployment changes

Posted June 30, 2011

Gov. Bev Perdue has vetoed her twelfth bill: Senate Bill 532, which would move the Employment Security Commission under the Department of Commerce and make a long list of other changes to state laws on unemployment benefits.

Perdue's veto message was accompanied by supporting documents from the U.S. Dept. of Labor, including an explanation of the various ways the bill would have violated federal labor laws. As a result, state employers would have lost a tax credit, resulting in a higher federal tax bill.  

It was also accompanied by an executive order moving the ESC to Commerce (an idea Perdue promoted last winter).

Here's the veto message: 

“This bill will raise unemployment taxes on various businesses of all shapes and sizes across the state. It will also greatly increase the amount of time a company has to respond to an unemployment claim, which violates federal policy and could delay benefits for people who are entitled to receive them,” Gov. Perdue said. “Finally, this bill will likely cost North Carolina millions of federal dollars that unemployed people and their families need so desperately.”

Gov. Perdue received information from the U.S. Department of Labor, which indicated passage of this bill would have significant consequences for workers and business owners. In communications with the N.C. Employment Security Commission, the department stated that if Senate Bill 532 were to become law, all employers in the state required to pay the Federal Unemployment Tax (FUTA) would see their FUTA tax rate rise from 0.8% to 6.2%.

Following the veto, Gov. Perdue issued Executive Order # 95 in order to correct many issues and to maintain the integrity of the Employment Security Commission’s process for administering unemployment benefits.

Perdue has ten bills left to go before midnight tonight, when they'll become law whether she signs them or not. 

UPDATE: House Speaker Thom Tillis issued the following response to the veto:

“The concept behind SB 532 is one that Governor Perdue originally supported. The language used in her veto statement is fake and plastic. This bill actually prevents unemployment benefits from being paid to employees who steal money from their employers. For that reason and many others, the bill passed the House with 104 votes – an overwhelming bipartisan majority. This veto is almost as incredibly hard to explain as her decision to veto the voter ID bill.”

The statement doesn't address whether Tillis agrees with the information from the US Dept. of Labor. 


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