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Committee on Economic Security


Unpublished CES Studies

pen nib   Volume IX. Committee Publications

Press Release



MARCH 22, 1935

The legislatures of the States of Washington and Utah have passed unemployment insurance laws designed to conform to the pending Economic Security Bill, Edwin E. Witte, Executive Secretary of the President's Economic Security Committee, announced today (Friday). These are the first State unemployment insurance laws to carry out the Federal Economic Security Program.

"The Washington measure passed the Senate of that State by a vote of 38 to 7 and the House by a vote of 89 to 4," Mr. Witte said. "It has been signed by the Governor on March 21. The Utah measure has passed the House by a unanimous vote, has been approved by the Senate, and is now before the Governor for his signature. Both are permissive acts, becoming effective when the Federal Government enacts its unemployment insurance law.

"The Washington unemployment insurance act provides for a State-wide pooled fund for all employees covered in the State; that of Utah is an employers-reserve act, along the lines of the Wisconsin law with each employer having his own account. Both types of laws are permissible under the pending Economic Security Bill.

"Seventy-seven unemployment insurance bills had been introduced up to March 1 in 24 of the State legislatures meeting. In New York the Byrne-Killgrew unemployment insurance law has passed the House. In a number of States unemployment insurance bills have not been prepared but have been held back pending action by the Federal Government. This has been true of several States which have had special commissions working on unemployment insurance.

"The legislature of Wyoming before adjourning late in February passed a resolution authorizing the Governor to accept Federal aid for old-age pensions, mothers pensions, and other purposes as provided in the Federal Economic Security Bill.

"Montana, Arkansas and Oregon have already passed old-age pension laws designed to conform to the pending Federal bill. Montana and Oregon have had old-age pension laws for several years, but revised them to conform to the terms of theEconomic Security Bill. Arkansas has not had an old-age pension act but passed one to accept the pending Federal bill. Old-age pension bills have been introduced into the legislatures of every State now meeting, except one. In a number of States old-age pension bills designed to conform to the Federal bill have passed one house. In some States as many as 20 to 30 separate pension measures have been introduced.

"The Washington unemployment insurance law covers all employers in establishments having four or more persons in their employment. It levies a tax of 3 percent upon employers, but this amount may be less during the first two years of operation. The bill also provides for contributions of 1 percent of wages by the employees. The employee who becomes unemployed is paid benefits of 50 percent of his full-time weekly wage with a maximum of $15 per week. The maximum length of benefits in any year is fixed at 15 weeks. A waiting period of 6 weeks is required before benefits may be paid, but this is required only once within a year. An employee to be eligible for benefits must have accumulated 40 weeks of employment within the preceding two years or 26 weeks within the preceding year.

"The act is to be administered by a commission of three persons appointed with overlapping terms. Provision is made for State and local advisory councils of employers representatives of employers, employees, and the public. The personnel of the commission is to be recruited on a 'non-partisan merit basis.' Provision is made that rates of contributions of employers shall be adjusted according to their employment experience under limitations fixed by the State law.

"The Utah law is similar to that adopted in 1932 in Wisconsin. Each employer has his own reserve account, but provision is made that the commission may require a pooling of the accounts of all employers in a particular industry, or in a particular locality, or in an industry within a locality where this is necessary to give adequate protection to the employees. The rate of contribution required in Utah is 3 percent, but after accumulation of a reserve amounting to $75 per employee the rate is dropped to 1 percent, and after accumulation of $100 per employee contributions are not required as long as such reserve is maintained.

"The benefits payable are 50 percent of the average full-time weekly wages with a maximum of $18 per month and a minimum of $6 per month. A waiting period of two weeks is required before an employee is eligible to receive benefits unless the employee has already served this waiting period during the preceding 13 weeks. An employee is entitled to receive one week of benefits for each three weeks of employment during the preceding year but in no case more than 16 weeks of benefits within 12 months. The act is to be administered by the industrial commission with State and local advisory councils representing employers, employees, and the public. Provisions are made concerning the investment of the funds to permit investment the United States Treasury.

"These two acts are quite different in their provisions, but both provide protection to the employee against unemployment. Employee contributions are not required in either act, but are permitted in Utah upon voluntary agreement by employees."
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