Bill reining in unemployment fraud heard in the Missouri House

The House Workforce Development and Workplace Safety Committee brought Missouri one step closer to stamping out fraud in the unemployment system during a public hearing on Senate Bill 510, sponsored by Sen. Will Kraus (R-Lee’s Summit.) For several years, Missouri has worked to repay millions of dollars borrowed from the federal government to cover unemployment insurance claims, when the unemployment insurance fund became insolvent. Blocking fraud would help bring solvency back to the fund.

The Missouri Senate passed Senate Bill 510 in March, sending it to the House committee. The proposed legislation would keep employees who are fired for workplace infractions such as stealing and doing drugs from receiving unemployment insurance benefits. Sen. Will Kraus sponsored a similar bill, Senate Bill 28, which was vetoed by Gov. Jay Nixon during the 2013 Legislative Session.

“We need this bill because people are getting benefits when they have done things like stealing, and that’s not right.” Sen. Kraus testified.

Many states were on the indebted list following the recession, when state unemployment funds were unable to keep up with the increased number of claims. Most have taken steps to reduce or eliminate outstanding debt. Missouri is one of 13 states that remain on the indebted list. Missouri currently owes $270 million to the federal government. In addition to penalties, interest on the debt grows at a rate of approximately $12 million a year.

“The Missouri Chamber has worked with Sen. Kraus for the last three years to reform the unemployment system, and this bill is a great start,” Tracy King, vice president of governmental affairs for the Missouri Chamber, testified. “In reviewing cases, I’ve found many people were given benefits for egregious behavior, and those that were denied could appeal and then were given a positive appeal. Employers are paying into this fund, and we need to put a stop to the abuses that are draining the fund.”

For more information on unemployment insurance reform, contact Tracy King, Missouri Chamber vice president of governmental affairs, at tking@mochamber.com, or by phone at 573-634-3511.

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