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Update on the override of Missouri House Bill 150

Last month, the Missouri Supreme Court ruled that the veto override of House Bill 150 was unconstitutional. The Court determined that the General Assembly’s veto override was not timely, thus preventing implementation of the contents of the bill. HB 150 was a piece of legislation that dealt with two important areas of Missouri Employment Security Law. It made severance pay deductible from the claimant’s benefit amount, preventing a claimant from collecting UI benefits during their severance period. It also introduced a graduated number of weeks a claimant could collect benefits based on the statewide unemployment rate. As a result of this decision, severance pay will no longer be deductible and the number of weeks of UI will revert to 20 weeks.

Enforcement of the bill’s contents began on January 1, 2016 and many claims were adjudicated under the provisions of HB 150. The obvious question is how will this impact each employer.

The state is in the process of contacting each claimant who potentially was impacted by HB 150. Considering that HB 150 limited the number of weeks available to a claimant to collect UI benefits, the percentage could be very high. The state will review each claimant’s request and make individual determinations on each claim. Employers should anticipate retroactive charges to their account.

If the claimant can show that they were still unemployed past the 13-week limit imposed by HB 150, benefits will be paid retroactively. Normally, a claimant must meet certain weekly eligibility requirements in order to receive their benefit. It is unclear on how, or if, the state will handle these requirements retroactively. The first line of defense will be to complete all benefit audits that we receive. These will catch claimants who have fraudulently claimed weeks after they had become subsequently employed.

In the case of severance pay, these will be re-adjudicated immediately removing the ineligibility issue imposed on their benefits. Any claimant whose claim adjudication resulted in payment of benefits will receive retroactive payment of benefits. As previously stated employers will see a charge for these claims.

Unfortunately, this is going to be an administrative nightmare for the state. They are going to have to resolve these issues quickly as the first six months of 2016 has a significant impact on each employer’s 2017 UI rate. Reimbursable employers may see a larger than normal quarterly benefit charge amount depending on how many claimants are impacted by the change. We will be communicating with you throughout the process to protest any charges that we feel are unwarranted.

The goal is to reintroduce the legislation about in the upcoming legislative session. If you have any questions regarding this issue, please do not hesitate to contact me or your individual claims manager.

Regards,
Jeff Oswald, UIS
816.524.5999

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