Evening star., 1940-02-09

myLOW OuStHcSS WLcIcSLS yCucT.
ally Endorsed both sides of Hber-
alisation moUe. McGehee bill,
offered January rs, Das speeded
to House for action Monday. Fol-
lol0inQ January IS committee
hearing, Dartous groups found
some "faUs" in draft.
BY DON S. WARREN.
Director John A. Marshall of the
District Unemployment Compensa-
ton Board declared today he felt
an experience or merit rating plan
for employers under the pay roll
tax system was unavoidable" there
by possibly setting the stage for one
major issue in the move to revise
the present District law.
His statement was at odds with
those of spokesmen for both the
Washington Board of Trade and the
Merchants and Manufacturers Asso-
citation, who are insisting that the
proposed new compensation law in
clude a definite provision for early
establishment of such rating plan.
The Marshall statement, presum-
ably in accord with views of Federal
officials, since the local board gen.
orally follows the lead of the Federal
Social Security Board, was taken to
mean that restricted reference to
the plan in the pending bill was a
first move to place it Ion the shelf"
For five years the District law has
provided for such plan, beginning
next January l, and it was generally
understood that employers showing
stability of employment could-and
one day would-be rewarded by the
grant of differential rate in the
pay roll tax.
See Sufficient Experience.
Spokesman for local business
groups declared the last two years
of payment of jobless benefits, fol-
lowing three years Of preparatory
pay roll tax collections, gave suffi-
cient experience to warrant early
adoption of such plan, at least on
a trial basis.
Meanwhile. Representative Nc
Gehee, Democrat, of Mississippi,
who introduced the bill to revise
the jobless aid law, which provides
for reduction in the fat pay roll tax
from to 81 per cent, and to grant
extensive liberalization of benefit
payments to the eligible jobless,
said he would make no move to de-
lay action on the measure. 1t is
scheduled to come before the House
for vote Monday.
Postponement of action on the
bill for two weeks was requested
by the presidents of the two trade
groups to permit a more careful
analysis Of some features. Mr.. Nc
Gehee said he was inclined to let
the issues ride. since the measure
was on the House calendar, and that
amendments could be made on the
floor, but that the best chance for
any necessary changes lay in con-
sideration later in the Senate.
Labor Urges Liberalization.
Among other developments in the
rather complicated picture were:
l. Spokesman for local units Of
the American Federation of Labor
and the Congress of Industrial Or
CARNATIONS protested there should
be no elimination of the proposed
liberalization of benefit payments,
afforded by variety of means in
the proposed bill.
2. Very rough estimates of the
effect of the proposed pay roll tax
cut placed the saving at at least
$500, 900, while an appraisal of the
prospective increase in benefits ran
from a conservative" estimate of
some $4,000 to as high as nearly
81, ,O00, 900.
Director Marshall, while holding
that an experience rating system
was not workable, said he felt the
real solution" lay in awaiting the
time when fiat reduction could be
made all along the line in employer
taxes. un the District, as in most
States, there is no tax on employees
for unemployment compensation
A recent report by the Federal
Social Security Board shows that
such merit rating systems have been
employed in five States: Indiana,
Nebraska, South Dakota, Vermont
and Wisconsin. Thirty-nine States
in all have laws permitting such
plans to be adopted.
Marshall Favorable Tf."
Mr.. Marshall said he would like
to see such a plan-"if it was work.
able"
Proponents of such arrangements
were quick to declare that while the
District employer pay roll taxes may
be cut by 10 per cent, as proposed,
and while liberalization of benefit
payments, as provided in the bill
would place the District far in ad-
vance of the States, the District
board still would be collecting be-
tween 100000 and $4,000, 900 more
than the benefit disbursements. ac-
cording to best estimates. This
they argued, gave warrant for a
trial of the merit rating system here
without raising any hazard of hav-
ing to dip, even lightly, into the
$16,000,000 reserve fund that has
been set up.
In fact, some observers insisted
that while the District now is COL
lecting four times as much in taxes
as now are needed for benefit pay
ments, passage of the pending plan
would find the District collecting
roughly, twice as much as needed
for current benefit outlays.
Opposition to the request of bust
ness groups for delay in House action
on the pending bill came from John
Locher, president of the Central
Labor Union, A. F. of L. affiliate