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Unemployment insurance reforms protect system for workers, employers

Ray Allen is the Wisconsin Department of Workforce Development secretary

Ray Allen is the Wisconsin Department of Workforce Development secretary.

Since Gov. Scott Walker took office in 2011, Wisconsin’s improving economy, along with a redoubled focus to protect unemployment insurance as a short-term safety net for those who are eligible, has stabilized the UI Trust Fund, reduced the tax burden on Wisconsin employers, and helped members of the workforce who are out of work through no fault of their own find new employment quickly.

The positive impact is unmistakable. Today, more than 3 million people in Wisconsin are employed — the most in our state’s history, our unemployment rate is 4.5 percent — a half-point below the national rate, and the employer-funded UI Trust Fund ended 2015 with a positive balance of $743 million, reducing the UI tax burden for employers by $97 million a year as unemployment claims reach their lowest point in a quarter century.

Under Walker’s leadership, in partnership with the Legislature and other key stakeholders, Wisconsin has achieved these results through a combination of job-creation strategies, accountability measures to protect the UI system from attempts by anyone — employee and employer alike — to abuse the UI system, and through UI policy reforms that reflect common sense and balance eligibility rules governing Wisconsin’s UI program with other states.

One such UI reform — the substantial fault standard that took effect in January 2014 — was the subject of a recent appeals court ruling that questioned how the standard was applied by an employer. Substantial fault may arise when an employee violates a requirement but the violation does not rise to the level of misconduct.

The substantial fault standard brings greater clarity to both employer and employee for UI eligibility. The law makes clear that substantial fault does not include minor violations of rules unless the employee repeats the violation after warning. This standard also does not apply to unintentional mistakes made by the employee, or for not performing work because the employee lacks skill, ability, or was not supplied the equipment.

In Wisconsin, individuals who lose their employment through no fault of their own and are deemed eligible for unemployment benefits under state and federal law, have a reliable and clearer UI system that provides short-term assistance while they actively seek new employment. Employers have experienced a reduction in UI taxes due to the Trust Fund’s improvement, adding to the positive business climate created under Walker’s leadership.

A system that motivates workers to support themselves and their families, brings greater fairness to employers who pay into the UI Trust Fund, and supports a climate that has highest number of people employed than ever before in our state’s history, is a system that will move our economy and state forward.

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