Missouri Lowers Maximum Weeks of State Unemployment Insurance Benefits from 26 to 20
May 20, 2011 - NORTON, MA - Governor Jay Nixon recently signed House Bill 163 that trades a shorter period of initial state unemployment insurance (“UI”) benefits for immediate reinstatement of extended benefit payments to the long-term jobless.
The House Bill cuts the number of weeks an individual can claim state UI benefits from 26 to 20. However, any individual who exhausts their original 20 weeks of state UI benefits will be eligible to receive an additional 56 weeks of federal UI benefits for a total of 76 weeks. According to estimates from the Missouri Department of Labor, the cut in initial UI benefits will save the state $108 million annually and save employers $125 million a year from taxes that support the program.
The bill also restores an additional 20 weeks of extended benefits to individuals who exhausted their original 26 weeks of state UI benefits and 73 weeks of emergency federal UI benefits for a total of 99 weeks. Missouri labor officials estimate that this extended assistance will offer immediate help to 10,000 individuals who are looking for work, and could help up to 24,000 additional Missourians before January 7, 2012 when all federal extended UI benefits are scheduled to end unless Congress acts on further extension.
With the change to Missouri’s state UI benefit weeks, TMS has prepared our SUB-Pay Plan administration systems to accommodate the reduction of UI weeks even though an individual can receive up to 93 weeks of total UI benefits. We will continue to advise our clients of further legislation throughout the year as the January 2012 deadline for federal UI benefits approaches.
About Total Management Solutions
For 24 years, Total Management Solutions has set the standard for Supplemental Unemployment Benefit (“SUB-Pay”) Plan development and administration for Fortune 1000 companies. Introduced by organized labor and the Department of Labor in the early 1950's, and first issued in a Revenue Ruling by the IRS in 1956, SUB-Pay Plans enable corporations to utilize its paid-in asset of state unemployment insurance taxes to supplement state unemployment insurance benefits with separation pay. When combined, these two benefits reduce a corporation's severance costs by 7.65%-45% while providing their separated or furloughed employees with up to 100% of their pre-layoff wage, plus a 7.65% tax savings, while they transition to reemployment.