SB 734 - This act makes various changes in the law relating to unemployment compensation.

This act removes subdivision 1 of Section 288.036, RSMo, which makes an exemption from the definition of "wages" for wages earned in excess of the state taxable wage base as calculated by subsection 2 of the section. The items addressed within the removed provision are addressed in subsection 2 of the section. The state taxable wage base in 2005 shall be $10,000 and for the following years shall be set based on the preceding September 30 balance of the unemployment trust fund, less any outstanding federal advances or state bonds. Should the trust fund on September 30 be below 350 million, employers must pay an additional $1,000. Should the trust fund on September 30 be in excess of 800 million, employers are credited an amount of $500.

The maximum weekly benefit amount for all claims filed in 2004 and 2005 shall be $250.00; in 2006 and 2007, $255.00; in 2008 $260.00. Should the unemployment trust fund become insolvent the maximum weekly benefit amount shall not be increased until a time twenty-four months or later of its solvency.

No eight-week extension, pursuant to Section 288.040.1(2)(b), RSMo, is available if the employer has a base contribution rate of six percent. A claimant is not ineligible for unemployment benefits even though they are not actively and earnestly seeking work if such failure is because the individual is participating in a state approved drug or alcohol treatment program.

The act changes existing law by not allowing an individual to receive compensation during the waiting week prior to receiving unemployment benefits. Under current law the waiting week is compensable after the 9th compensable week. Further, suspension of four or more weeks shall be treated as a discharge.

In cases of discharge for misconduct connected to work, the division shall reduce a claimant's benefit balance by an amount equal to the number of penalty weeks multiplied by the claimants weekly benefit amount.

The act, in Section 288.060, removes the exemption for termination pay, severance pay, and elected officials, thus allowing such to be considered wages pursuant to this law. Beginning in January 2005 severance pay shall be reportable and deductible as wages within the section.

Should the unemployment compensation trust fund average balance for the previous four quarters fall below seven hundred million dollars, the contribution rate shall be increased based on the statutory formula in Section 288.121. Beginning in 2005 until the contributions are in excess of the benefits paid for a period of one fiscal year, an employers total contribution rate shall be equal to the base rate multiplied by the contribution rate adjustment, plus a temporary solvency charge.

Should the unemployment compensation trust fund average balance for the previous four quarters be in excess of nine hundred million dollars, the contribution rate shall be set based on the statutory formula in Section 288.122.

To protect the unemployment compensation trust fund, no fund shall be established that increases employer taxes that are offset by a reduction of unemployment contributions.
RICHARD MOORE