In a few days, Missouri lawmakers will return to Jefferson City for the 2013 Veto Session and the stakes are high for Missouri employers.
“Most of the attention of this veto session has been on the much-publicized House Bill 253,” said Missouri Chamber President and CEO Dan Mehan. “However, there is more at stake than many realize, especially for Missouri employers. This isn’t a veto session, this is going to be a jobs session.”
The Missouri Chamber of Commerce and Industry will be heavily rating three override votes, in addition to the vote to override House Bill 253.
House Bill 611
Failure to override veto risks more than $330 million in state funds and an $859 million tax increase on employers. Employers could see tax increase of up to $420 per employee.
Gov. Nixon vetoed House Bill 611, legislation that will keep Missouri’s unemployment insurance program in compliance with federal mandates and protect federal funding that Missouri employers receive. The mandates were required under the federal Trade Adjustment Extension Act of 2011, and are billed as a way to combat fraud and protect the integrity of states’ unemployment funds. The bill also contained language to broaden the definition of misconduct so that employees fired for infractions such as stealing from their employers or doing drugs on the job would be blocked from unemployment insurance benefits. This provision is where Gov. Nixon had issue with the bill.
“He chose trial attorneys over Missouri employers and in the process is risking an $859 million tax increase on Missouri employers,” said Mehan.
Failure to meet compliance has heavy price tag, according to correspondence the Missouri Chamber received from the Missouri Department of Labor. During the legislative session, the Labor Department told the Missouri Chamber that employers would lose FUTA tax credits – $859 million annually — without passage of the mandates. The department also claimed Missouri would lose federal grants – approximately $46 million – the state receives each year to help administer the unemployment compensation system. The department also outlined $13 million in federal funds the Department of Economic Development-Division of Workforce Development receives each year to administer re-employment services. In addition, non-compliance would also jeopardize all federal funding for the Tile IV-D program – more than $58 million, according to the Missouri Department of Labor. The Labor Department also claimed that non-compliance would risk the loss of federal funding for the Temporary Assistance for Needy Families (TANF) program – up to $217 million. In this correspondence, the Missouri Department of Labor strongly urged the Missouri Chamber of Commerce and Industry to secure passage of the mandate language.
In August, the Missouri Chamber submitted a Sunshine Request to the Missouri Department of Labor requesting all correspondence the state had with the US Department of Labor in an effort to uncover the threat facing employers by falling out of federal compliance. That information is still pending.
The Missouri Department of Labor has filed emergency and permanent rules in an attempt to bring Missouri in compliance with the mandates – a move the Missouri Chamber suggests goes beyond statutory authority.
“The Missouri Chamber does not believe this is a prudent approach,” Mehan said. “It’s an end-run around the legislature and we question the legality. If one person sues, it will put our entire unemployment insurance system at risk.”
House Bill 650
The veto of House Bill 650 risks hundreds of jobs.
Gov. Nixon’s veto of House Bill 650 was also a choice of trial attorneys over employers. The legislation was especially important for the Doe Run Company, the largest lead producer in the Western Hemisphere, which is based in St. Louis. The legislation was critical for preserving the 1,500 jobs at the company.
One of the key benefits of House Bill 650 for Missouri employers is a provision that would provide successor liability tort reform by capping punitive damages that can be assessed against employers from actions of previous business owners. This provision is aimed at providing common-sense protections for employers in particular the mining industry, which provides thousands of Missouri jobs and significant revenue to our state.
“Gov. Nixon had to veto this to placate the trial attorneys who have given Gov. Nixon a large portion of his political funding,” said Mehan. “He can talk all day about how committed he is to Missouri employers, but when it comes down to a choice between jobs and the trial attorneys, he has left employers in the dust every time.”
House Bill 339
Veto blocks common-sense insurance measure.
House Bill 339 would prohibit an uninsured driver from collecting non-economic damages in a civil action against an insured motorist at fault for an accident.
The Missouri Chamber will also push to override this veto.
“We support the insurance industry in this measure against drivers who are breaking the law by not carrying insurance,” Mehan said.
The total cost for employers as a result of House Bill 253, House Bill 611, House Bill 650, and House Bill 339 could be more than $1.5 billion.
“Gov. Nixon will have the legacy of the largest collective tax increase on Missouri employers and workers in state history,” said Mehan.
We urge lawmakers to override his dangerous veto pen.