LANSING -News reports in January touted that House Republican lawmakers who control the state legislature finally opened up their hearts - and state coffers - to provide relief to Michigan's growing number of jobless workers.

Republicans are pushing a proposed benefit increase of up to 38 percent for jobless workers, to a maximum if $415 per week. Republican House Speaker Rick Johnson called the increase "the right thing to do," with state unemployment at its highest rate in six years. But their proposal includes instituting a waiting week for benefits - which effectively institutes a decrease of benefits for short-term jobless workers.

"It's a testament to double-talk," said Michigan AFL-CIO Legislative Director Tim Hughes.

Currently, jobless workers can earn a maximum benefit of $300 per week. That amount was set in 1995, when anti-worker legislation was signed into law that froze the maximum benefit, cut benefits across the board and made it harder for part time, low-wage and seasonal employees to qualify for benefits. The maximum amount has never been increased because Republicans who drafted the law made no allowance for increases, not even for inflation.

The new Republican plan is a real kick in the rear for jobless workers who are out of work for three weeks or less. Workers who are currently jobless earn a maximum of $300 each week for the first three weeks of benefits, for a total of $900 over three weeks.

If this Republican plan is implemented as proposed, the same jobless worker would get $0 in benefits for the first week, $415 for the second week and an additional $415 the third week for a total of $830 for all three weeks - a net loss of $70.

"They say they're doing this to help workers, but this doesn't add up at all," Hughes said. "It is important that we address this issue in a way that helps all unemployed workers, while hurting none."

According to Hughes, the House Republican plan would:

• Eliminate the first week of UI benefits for more than 77% of all laid-off workers. The plan includes a so-called waiting week would more accurately be called a "no benefit" week, since benefits for that week would only be paid if the worker remained unemployed for at least 26 weeks. According to the Michigan Unemployment Agency, only 22.68% of all laid-off workers are unemployed for the full 26 weeks of eligibility.
• Cut benefits for 40 percent of Michigan's laid off workers. The Republican proposal only raises the maximum UI benefit. According to the Michigan Unemployment Agency, 40 percent of laid off workers receive less than the maximum benefit. These jobless workers would receive no increase under the plan, but would lose a week of benefits due to the proposal's "no benefit" week.
• Hit building trades workers particularly hard. Members of the building and construction trades unions are frequently laid off for short periods of time. Under the Republican plan with the "no benefit" week, workers would have to be unemployed for at least 3.5 weeks before they would see a net increase in their jobless benefits. For thousands of unemployed construction workers, this plan is a benefit cut, not an increase.

The Republican package also includes a measure creating a "Worker Financial Security 
Account" that allows employees to pay into a savings plan similar to a 401(k), and to make tax-free withdrawals during periods of unemployment.

Other parts of the GOP plan include providing an income tax deduction to unemployed parents who are paying college tuition for their children and waiving penalties and 
interest on delinquent income tax payments owed by unemployed workers for up to 
six months, provided the income tax returns are filed on time.

A better way to raise unemployment benefits, Hughes said, can be found in HB 4188, currently in the House Employment Relations, Training and Safety Committee. It includes the following key provisions:

• It provides for indexing of the maximum benefit to 58% of the state's average weekly wage, as provided by law prior to 1995. This would result in the same maximum benefit of $415 as called for in the Republican proposal, but with an inflation adjusted maximum benefit in future years so the maximum benefit would not lose its purchasing power in future years.
• It gives an increase to all unemployed workers, not just higher wage earning workers who qualify for the maximum benefit. Laid off workers currently receive 4.1 percent of their gross high quarter wages up to the maximum of $300. That figure should be raised to 4.3 percent, giving an increase to every laid-off worker.

"We look forward to working with House Republicans in the weeks ahead to develop a proposal that labor can support," said Michigan State AFL-CIO President Mark Gaffney.