Evening star. [volume] (Washington, D.C.) 1854-1972, 1943-05-10
Trade Groups
BackBi||on DC,
Unemployment
Spokesman for Labor
Are Opposed, However,
To Experience Bosis
BY J. A. OLEARY.

CARNATIONS of the District were pu
on record before Senate subcom
mittee today in favor of the Hous
bill to put the local unemployment
compensation law on an experience
rating basis, while spokesman TO
labor groups opposed it.
Appearing for the Washingto,
Board of Trade as the first witnes
for the bill, Attorney Hugh Obea
predicted its passage would give tn,
District the most liberal unemploy
ment compensation plan in thu
United States.
Although it makes a series O
changes in the law, Mr.. Obear listee
these as the three major amend
ments:
l. Enlargement of benefits to EN-.
ployes, by raising the maximum
weekly payment from S18 to $40 anc
the maximum period of payment
from 16 to 20 weeks.
2. Freezing the status of employees
While they are in the forces.
3. Establishment of the experience
rating system of fixing the tax rate
for each employer according to his
record in stabilizing employment, in
place OF the present fiat rate of 81
per cent of the pay roll.
400 Back Bill in Letters.
In addition to letters from more
than 400 individual businessmen
Mr.. Obear listed the following for
the bill: The Merchants and Manu-
facturers' Association, the Washing
ton Restaurant Association, the Real
Estate Board, the Laundry and
Cleaners Association, the District
Bankers Association, the District
Bar Association, the Building and
Loan League, Washington Taxpay-
ers' Association, Federation of Citi-
zens' Associations, and the Organiza-
ton of Theater Owners.
Francis G. Addison, jr., joined Mr..
Obear in representing the Board of
Trade.
Chief spokesman in opposition
were Frank J. Coleman of the
American Federation of Labor
speaking for the Central Labor IN
Ion and the Maryland State and Dis
trict of Columbia Federation of
Labor; Sidney R. Katz of the CLIO
Council of Maryland and the Dis
trict, and Willard Arnhein, repre-
senting heavy construction workers
OF the AFL.
Huge Reserve Predicted.
Mr.. Obear showed that while the
annual outlay in unemployment
benefits since 1888 has ranged be-
tween $1.137 l04 in one year to 81
128,329 IN another, the fund derived
from the fiat 81 per cent tax on
employers has mounted to a reserve
of more than S34O0O,o0o. The wit
ness predicted that, without a
change in the law. it will be 42,OO0,-
900 by the end of this year.
Mr.. Coleman and Mr.. Katz con-
tended that when the war is over
there will be period of unemploy-
ment, and that the tax rate should
at least be left where it is to meet
that situation when it occurs.
Mr.. Obear pointed out that So
States already have the experience
rating system, and that it will be
inaugurated in four other States
within year.
Automatic Rate Adjustment.
Under the bill the House has
passed, the local tax rate would
be graduated downward from the
present 81 per cent fiat figure to
lilo of l per cent, according to
each employers record in laying
off employees. To assure the SOL
vency of the fund, provision is
made in the bill for an automatic
adjustment of rates if the fund
ever falls below a certain ratio of
outgo requirements.
Mr.. Obear described the expert
ence rating system as an equitable
method of adjusting the tax, as
an incentive to employers to stab
1lize their employment, and also
pointed out that the Federal Gov
eminent pays interest at "a per cent
on the growing reserve deposited in
the Treasury.
Urges Even Larger Fund.
Mr.. Coleman argued there will
be "a tremendous amount of unem-
ployment" after the war. The fund
will be exhausted so rapidly, he
said, that if it is not kept up an
other WPA or dole will be necessary.
The tax should be increased, if
anything, to build up the fund"
Mr.. Coleman said.
Mr.. Katz took the position that if
the experience rating plan is pro-
posed as an incentive to stabilize
employment, the time to consider
1t would be when there is danger of
reduction in work He said the
Clio opposes the bill on the grounds
that it is inf1ationary, that the
present coverage should be extended
to include Federal employees and
domestic workers. and that benefit
payments should be broadened to
S26 week for &c weeks, with higher
allowances for dependents.
The Associated General Con-
tractors of America, in a statement
filed on behalf of H. E. Foreman,
managing director, opposed any
merit or experience rating plan, on
! the ground that stabilized employ
ment is inherent in some lines of
business, while others are neces-
sarily unstable in the degree of en-
ployment. For that reason, he
argued, the experience rating system
would be inequitable.
Says Most Employers Favor It.
Julian Brylawski, speaking for the
Washington Taxpayers Association,
pointed out that the bill passed the
! House without any opposition, that
IL members of the District Commit
tee voted to report it to the House
with two not voting. He said a
QUESTIONABLE sent out by Chairman
Randolph showed 95 per cent of the
employers of the District for the
measure.
Senator Bushfield completed the
hearings early this afternoon. He
will report his recommendations to
the District committee later.