Evening star., 1935-04-05
Revised Ellenbbgen Bill.

The new unemployment insurance
bill for the District which Repre-
sentative Ellenbogen Of Pennsylvania
: has placed before the House District
Committee is in some respects an i'm
provement over the measure as at first
introduced. The new bill takes into
account the fact that an employer
who is successful in stabilizing his
own employment should not be as
sessed for unemployment or pay roll
taxes at the same rate that the en-
ployer who fails in that respect is
assessed After 1910 a sliding scale
of pay roll taxation is established,
with the promises of benefits by tax
reduction held out to the employer
who stabilizes employment under his
control.
That is an improvement over the
original bills provision of an arbi-
trary three per cent pay roll tax that
would apparently continue indefi-
II nitely, regardless of the employers
success in retaining men in employ
ment. 1t is not as satisfactory as
the Wisconsin plan, under which en-
ployers are taxed until they accumu-
late specified reserve per employe,
when the tax automatically is re-
.duced
The new bill sets up District Un-
employment Insurance Commission of
three members, to be appointed by
the District Commissioners, to assist
the National Social Security Board
to be established by national legisla-
tion. There is thus assured more
local representation in the admins
tration of the act than was originally
contemplated, for the three members
of the commission must be residents
) of the District, representing employers,
employees and the local community.
But the duties of this new commission
are confined to nominating a director
who will administer the local act, con-
f1rmation of such nomination being
left to the National Board, and to
assisting the National Board The
bill provides that this National Board
shall administer this act" and on
the next page declares that the local
director, nominated by the local COM
mission, is to administer this act"
The truth of the matter is that the
National Board will administer the
act, and the local director and local
commission will probably advise and
assist, without real authority.
While the bill requires no contri-
button from the employe to unem-
ployment insurance funds, on the
theory that the pay roll tax will be
passed on to the consumer, there is
specific provision against wage cutting
by employers as method of passing
on the cost of the tax to employees. If
such a prohibition can be maintained
in court, it will be fortunate. But
there is no definite assurance that it
can be.
The bill continues to provide for a
contribution from District revenues,
possibly to be raised through the in
come tax proposed by Mr.. Ellenbogen.
Would it not be good plan to elm
mate this provision until the expert
ence of year or more with admin
istration of the bill demonstrates the
absolute necessity for this additional
taxation? The contribution by the
local government is not contained in
State legislation which has been under
study in the legislatures this year.
Certainly the bill should be held
up now until national legislation,
which it Is supposed to supplement, is
out of the way. Nobody knows what
the fate of that national legislation
will be or the final form it will take
If 1t is enacted.