On May 6, the Florida House and Senate passed House Bill (HB) 7005 overhauling the state’s unemployment compensation system. At this writing, Governor Rick Scott is expected to sign the bill, which would trim employer taxes and implement corresponding cuts in benefits for out-of-work Floridians.

HB 7005 strikes prior language that “liberally construed” the unemployment compensation statute “in favor of a claimant.” Instead, HB 7005 states that the statute “shall be liberally construed to accomplish its purpose to promote employment security.” It seeks to do so by “increasing opportunities for reemployment” and providing, “through the accumulation of reserves,” for the continued payment of unemployment compensation. The legislation also seeks to comply with all federal unemployment laws “as part of a nationwide employment security program.”

To accomplish these goals, HB 7005 would lighten the tax burden on employers by revising the employer benefit ratio calculation downward by 10 percent beginning in January 2012. It would also allow employers to continue to pay their unemployment taxes in installments in 2012, 2013, and 2014.

The bill would also reduce available weeks of benefits and tie them to the unemployment rate. Instead of the current state maximum benefit of 26 weeks, the maximum would range from a high of 23 weeks when unemployment reaches 10.5 percent or higher, down to a low of 12 weeks when unemployment is 5 percent or less.

In addition, the bill includes several provisions designed to encourage reemployment. Effective August 1, 2011, the bill would require claimants to:

• Participate in an initial skills review using an online education or training program as part of reporting for benefits.
• Contact at least five prospective employers each week or report in person to a one-stop career center to meet with a representative for reemployment services each week.
• File claims by Internet, rather than by phone or mail, with some exceptions for existing claims.

The bill would also expand the criteria for disqualifying claimants from receiving benefits. It would change the standard for establishing misconduct from behavior showing “willful or wanton” disregard to “conscious” disregard. It would also expand the definition of misconduct to encompass off-duty behavior. In addition, it specifies chronic absenteeism as a type of misconduct. The bill would also make the following changes effective August 1, 2011:

• Prohibit claimants from receiving unemployment benefits and severance pay simultaneously.
• Expand disqualification to include being fired for all crimes committed in connection with work, rather than only those punishable by imprisonment.
• Add specific disqualifications for claimants who are incarcerated or imprisoned.

Senator Nancy Detert, chair of the Senate Committee on Commerce and Tourism, said, “The proposed reforms provide relief to employers by weeding out individuals taking undue advantage of the system and provide relief to the unemployed by offering additional assistance to help them get back to work.”