Evening star., 1935-02-17


unemployment benefit allowance from
his employers account. For the first
two years Of operation Of the plan
the employer would continue to pay
in the per cent payroll tax, but
thereafter he would only have to con-
tinue to pay at that rate If the bal
ance in his account amounted to less
than $65 Of reserve per employe.
Whenever an account contained from
SOS to $99 Of reserve per employe that
employer would have his payroll tax
cut to per cent. And whenever his
reserve amounted to 500 or more
per employe no further tax payment
would be required until the reserve
began to 60 down.
Rate Of Contribution Reduced.
Thus, when employees were being
kept steadily at work and, therefore,
no drain on the employers reserve,
the rate of contribution would be
temporarily reduced or discontinued.
Since the House bill contemplates
placing all contributions in one fund,
there are no similar provisions for re-
0uS4IlS VI CIlc IhA VI III
employer while his reserve remained
at a certain level. The House bill,
instead, provides that for three years
the Social Insurance Board (created
to administer the law would study
the workings of the system relative
to the financial aspects and the suff1-
cheney of contributions" and submit
report Of its recommendations to
Congress by February Is. 1899.
In addition to providing for Sepa-
rate accounting of the funds Of all
employers under the general compul-
sorry part of the plan, the Wagner bill
| of last year allowed an employer or
a group in the same industry to sub
NIT their own plan for handling un-
employment benefits. II the Secre-
tary of Labor found that such plans
were at least equal to and as beneficial
as the terms governing the general
fund, such employer or group could
be exempted from the general pro-
visions of the act. In such instances
| the Secretary could require the en-
ployer to furnish security to assure
payment Of all promised benefits
under that separate plan.
Revoking of Exemption.
If the employer failed to give such
security, or failed otherwise TO COM
ply with the rules. the secretary could
revoke the exemption on 10 days
notice. In that event, such an en-
ployer or group would at once have
to pay into the general fund an
amount equal to the balance he would
have had in his account had he been
operating under the general plan up
to that time. Although separate ac-
counts would be kept for each en-
ployer in the general fund. the sec
retary would have discretionary
power to pool the contributions of
employers in any industry whenever
it appeared the carrying out of the
purposes Of the law required wider
base than the individual accounts.
Under the Wagner bill in the last
Congress, an employe would give no.
tice Of his unemployment either at
the district employment Office, or at
separate employment Offices which
industries would have the option of
establishing. subject to approval by
the secretary.
Assessment on Fund.
The expenses incurred by the De-
partment of Labor in administering
that proposed law, plus half the ex-
penses Of the employment offices,
would be estimated annually and OBJ
tanned by an assessment on the un-
employment fund. The secretary
would assess these expenses on the
general fund and on the funds OF en-
ployers operating under separate
plans. in the proportion that the
benefits peid from the general fund
or by any exempted employer bore
to the tota! benefits paid that year.
No employer could be assessed more
than three-tenths of l per cent Of
his yearly pay roll, however, for these
expenses of administration.
Some notifications undoubtedly
would have to be made in the Senate
bill Of the last Congress to conform
to the standards being laid down in
the pending national social security
bill, which standards will have to be
met in the local laws before a State
or the District could share in the
advantages of the Federal act. In
order to induce the States to enact
unemployment reserve laws, the ma
tional bill proposes to levy 3 per
cent pay roll tax, against which an
employer would be given credit up to
80 per cent of a similar tax paid under
his local law.
Unemployment Insurance Explained
In explaining the unemployment
insurance phase Of the national bill
to the Senate Finance Committee re-
Gently. Senator Wagner said:
Practically no restrictions are placed
upon the types of laws that the States
may enact. They may provide for
Statewide pooled funds or for in
dividual company reserves. They may
exact contributions from employers
or from employees, or from both. They
may add their own contributions II
they desire to do so. 1t Is estimated
that the per cent pay roll tax upon
employers alone will provide, after
a four-week waiting period. Is weeks
of benefit payments to the unemployed
| cSIlUldCcu dL oU pei CClL VI CllC WI n
ing wage. but not more than SIS
Additional contributions of per cent
by workers and l per cent by the
States would raise the weeks Of bene-
fit to 80.
while great latitude is thus left
to the States. the bill provides thai
no State shall receive any subsidy
nor shall any employer be entitled tC
any offset against his Federal tax
unless the State law conforms te
three basic standards.
Deposited With Treasury.
"The first of these standards Is
that all funds raised under the State
law shall be deposited with the Sec
retary of the Treasury for safekeep-
ing and management. This will pro-
tect the unemployed from the hazards
of local financial crises. And as
have already stated, the investment
NJ fhis huue oCoreoate fund bV the