Youngstown Daily Legal News

Unemployment benefits to individuals whose military spouses get transferred sought

TIFFANY L. PARKS
Special to the Legal News
Published: April 21, 2015

Two state lawmakers are sponsoring a bill that would extend unemployment compensation benefits to individuals who quit their job to accompany their spouse on a military transfer.

House Bill 105 would add the following as a nondisqualifying reason for separation from employment and therefore permit an individual who otherwise qualifies to be eligible for unemployment compensation benefits: “the individual’s spouse is a member of the United States armed services, the spouse is the subject of a military transfer and the individual left employment to accompany the spouse.”

If the individual was previously employed by a contributory employer, which include most private-sector employers, the benefits would be paid from the mutualized account in the Unemployment Compensation Fund and not charged to the employer.

If the employer was a reimbursing employer, like most public-sector employers and nonprofit organizations, the employer pays the benefits by reimbursing the fund.

HB 105 is sponsored by Reps. Hearcel Craig, D-Columbus, and Rick Perales, R-Beavercreek.

The pair recently offered sponsor testimony for the bill before the House Armed Services, Veterans Affairs and Public Safety Committee.

“This change is just one thing we can do to lighten the burden on military families and to show our support for those who protect and serve our country,” Craig said. “It is our duty to protect the families of the service men and women who sacrifice so much for our freedoms.”

Twenty-six states specifically provide this benefit for relocating spouses and five states, including Ohio, Utah, North Dakota, South Dakota and Vermont, exclude this benefit.

The remaining states have a case-by-case appeal process or do not explicitly exclude relocation with a military spouse.

Data indicates that 51 percent of military spouses are employed, excluding the 13 percent rate of dual military couples.

“I know, as well as anyone, the budgetary concerns of our current state government,” Craig said. “I would not come before this committee and recommend a bill that is not conscious of these concerns.”

Perales said HB 105 presents a cost-effective scenario to help Ohio military families.

According to the Ohio Legislative Service Commission, he said the estimated number of military spouses who would be eligible for benefits is currently 44.

However, LSC does not take into account the 30 percent who are employed by reimbursing employers.

Signing the bill into law would incur an annual cost of approximately $236,236 if all eligible military spouses would apply for and receive benefits.

Perales noted that military moves and transfers generally occur once every three to five years.

“Therefore, if 14 (44 divided by three) eligible individuals would apply for and receive unemployment benefits the yearly cost could be approximately $75,166,” he said.

“Once again, these figures do not take in account reimbursing employers but for clarification, LSC and the U.S. Department of Labor used the same figures in determining the actual cost. LSC’s figure shows the highest possible scenario.”

According to the federal labor department, the estimated number of military spouses who would be eligible for benefits would be 33.

Perales said Ohio businesses would not be penalized under HB 105.

“Military spouse benefits would be paid out of the state’s mutualized account. The mutualized account is separate from the employers accounts in the trust fund and maintained for the primary purpose of recovering the costs of unemployment benefits that were paid and not chargeable to individual employers,” he said.

“The one and only concern we have heard is from the Ohio Department of Job and Family Services. As you know, the state borrowed funds from the federal government during the recession to help pay for unemployment benefits.”

Currently, Ohio owes approximately $1.15 billion on the debt.

“With this outstanding balance, the state is limited in what legislation and administrative action it can take regarding the unemployment program,” Perales said. “HB 105 expands the eligibility that could result in a net decrease in solvency of the state’s unemployment compensation system.”

However, according to the federal labor department, the totality of all actions taken by the state in the prior 12-month period would be factored into the solvency of the state’s mutualized account.

“For example, any increase in the taxable wage base or tax rates would neutralize the decrease in the solvency of the state’s unemployment compensation system making this legislation harmless in regards to the Federal Unemployment Tax Act,” Perales said.

HB 105 is co-sponsored by Reps. Michael Ashford, Jack Cera, Teresa Fedor, Jeffrey Rezabek, Michele Lepore-Hagan, Debbie Phillips and Alicia Reece.

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