Evening star. [volume], February 08, 1940, Page A-13, Image 13

About Evening star. [volume] (Washington, D.C.) 1854-1972

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D. C. Job Insurance Amendment
Threatened From Two Sides
National Interests Hit Liberalization
Of Benefits; 'Looseness' in Bill Cited
(Continued From First Page.!
a more considered examination oi
its provisions. He opposed the bill
In Its present form.
A similar position was taken by
Arthur J. Sundlun, president of the
Merchants and Manufacturers As
sociation, who declared some delay
should be granted to permit essential
corrections in the present language
of the bill.
The bill, approved by the House
District Committee, is scheduled to
come up for House action Monday.
As generally understood, and be
, Cause present pay roll taxes are roll
ing up a huge and increasing unem
ployment reserve fund, the proposed
04 bill, while reducing the District pay
roll tax rate from 3 to 2.7 per cent,
would boost the maximum unem
ployment benefit payment from $15
4 to $20 a week, and lengthen the basic
duration of payments to the eligible
•Jobless from 16 to 20 weeks. Some
persons insisted the liberalization
goes beyond these points, by reason
of other provisions of the new bill.
Highest Rate in Country.
| Anxious to see a reduction in the
District's pay roll tax. now the high
est flat rate in the country. Mr. Wil
liams voiced belief that the Wash
ington Board of Trade, and District
employers generally, would not op
pose some liberalization of benefit
payments, but he did declare the
pending plan, in some instances
would far exceed State scales.
Mr. Williams said the reasons for
! the board's action in seeking to defer
j action orr the bill, which the group
previously had indorsed in principle
was that examination of the meas
ure in the past 10 days had disclosed
many technical provisions needing
revision. He added that the bill
„ would amend the present law "to
uie point where its benefits and tax
ing provisions are out of line with
those in nearly every other jurisdic
*** tinn in the country."
Findings that the present tax rates
are producing approximately $4,000
■* 000 annually in excess of benefit pay
ments were termed "an unwhole
some condition.” No State or Ter
ritory, he added, is paying a rate
of more than 2.7 per cent and some
employers in several States were
paying considerably less. He stressed
also that a majority of the States
have made arrangements to comply
with provisions of the Federal iaw
which limit collections to the first
$3,000 of any person's salary during
the year, one provision proposed
in the pending bill.
Sees Operation Tested.
Mr. Williams said he believed
there has been a sufficient amount
of operation here to justify a re
quest that an experience rating plan
be placed in effect. He asked for
‘‘drastic" revision of the clause deal
ing with calculation of benefits for
the partially unemployed workers.
He added:
“There are many other details of
the bill which are so technical and
so important in their implications
* that the Board of Trade feels it
*nust oppose passage of the legisla
tion in its present form and request
0+ postponement of consideration until
the matter has been further investi
gated.”
Mr. Sundlun said he was not con
► cerned over the plan to raise max
imum benefit payments from $15 to
$20, but that members of his group
felt the present wording of the
definition of “partial employment”
would prove “very costly.”
The merchants’ board, he said,
holds that an experience rating plan
ehould be put into effect now, on
the grounds that sufficient experi
ence has been obtained, especially
6ince so much more money is being
collected in taxes than is needed
for benefit claims.
| Intensive restudy of the effect and
possible implications of the pending
draft, which has been rushed into
| a position awaiting a House vote,
was in progress by various groups,
public and private, of various shades
of opinion. Both “friends" and
“foes" of the bill declared some cor
i v.v uuu.' n v i ^ iiu.
Despite the complicated situation
which developed in different schools
o! thought, involving Government
"officials. District and national busi
ness interests, some groups were
** striving to find a common ground.
Last year a different bill was
offered, proposing a tax rate reduc
, tion here, on a different basis, which
*as complicated with various ad
ministrative matters opposed by
Federal officials. It failed of action.
Some opponents objected no pro
vision was offered for increased un
employment benefits.
New Bill Introduced.
This year the District Unemploy
ment Compensation Board offered a
new bill, which was introduced in
Congress January 16 and on which
brief hearings were held January
25. It was recalled that during the
past calendar year some $6,000,000
in pay roll taxes was collected
whereas benefit payments totaled
roughly but $1,400,000.
Agents of the several national
business interests, actively working
on possible effects of the proposed
measure, have issued no statement
They were said to be raising fears,
however, that the proposed new Dis
trict benefit scales would be far in
excess of those in vogue in the
States; that if the States later were
^ oro e +/-» foil lino vrit Vt f ilf
., “model" adopted by Congress, some
•* State reserve might become ex
hausted. forcing the United States
^ to "take over” the system.
In some quarters emphasis is laid
on reports that the United States
row has a balance in the national
» unemployment compensation fund
amounting to more than $1,500,
QPO.OOO.
District business interests, whc
are reported to be willing to accept
“liberal” expansion of unemploy
ment benefit, scales, meanwhile
were continuing to stress the points
that the present top-rank Districl
pay roll tax of 3 per cent is con
tinuing to increase the now $16,000.
000 District portion of the tola
compensation fund.
“Quirks” Disclosed.
Study of prospective effects of thi
new bill convinced some partie;
| there were "quirks” in the meas
ure, such as the following:
1. That whereas the bill offeree
last year provided that all monie
paid by employers in taxes and col
lected by agents of the D. U. C
Board should be subject to audi
by the auditor of the District gov
ernment. the pending substitute bil
drops this feature. The only in
dependent audits provided are fo
accounts of administrative expense
of the board and of payments to th
Jobless, not tax collections.
i
2. That there appears to be no
great official desire to push into
effect the experience rating system
for employers or classes of employ
ing units, under which those show
ing stable employment and therefore
having a “good risk” record could be
given pay roll tax differentials.
While the present act sets up rather
detailed specifications in this regard,
and states that necessary standards
for the plan “shall” be adopted by
the D. U. C. Board prior to Jan
uary 1, J941, the pending new meas
ure merely directs the board to study
operation of the act “with a view
to determining the advisability" of
establishing a rating system and di
rects the board to submit recom
mendations by next January 1.
The laws of 39 States now provide
for rating systems, and such plans
have been adopted for use by five
States.
“Blankets-in” Employes.
3. That the new measure carries
a section to "blanket” into the civil
service automatically, without ex
amination, all employes of the D. U.
C. Board who have been there more
than one year, and to provide that
any individual, not yet so employed
for one year, shall be retained by the
board “so long as such an indivi
dual’s services are satisfactory to
it” and thereafter automatically
may be covered into civil service
without examination.
Testifying at the January hear
ings, it was recalled, an official of
the Social Security Board objected
to this feature. District and Fed
eral officials have been negotiating
over the issue for some weeks in view
of last year's amendment of the
Federal social security law, which
laid down certain definite require
ments as to application of the merit
system. The Federal board has in
sisted as a minimum requirement
that present emplpyes of local agen
cies be given non-competive “qual
ifying" examinations and that these
must merely attain a "passing”
■ grade.
4. That the bill once again pro
; poses that tHe record of the D. U. C.
j Board should be virtually wiped
; clean of exceptions, disallowances
and suspensions made by the Dis
trict auditor or the controller gen
eral of the United States. Such a
provision was included in last year's
! proposed bill and drew fire from
: some quarters, on the ground that
further efforts should be made bv
i John A. Marshall, director of 'he
board, and his staff, to correct, ad
just or give satisfactory reasons for
alleged errors in handling benefit
claims.
Donovan Listed Mistakes.
Last June 8. reports filed with the
District Commissioners by District
Auditor Daniel J. Donovan held that
for the first several months of the
fiscal year 1939 there had been a
rather lengthy list of mistakes in
calculation of benefit payments, in
one month amounting to as much
j as 12 per cent of the benefit pay roll.
In reply, while admitting that many
i mistakes had been made, due to the
j mass of details to be handled, Di
i rector Marshall insisted that in
many instances the District auditor
had taken exceptions without due
cause.
The language of the proposed
paragraph reads:
"The controller general of the
United States and the District audi
tor are hereby authorized and di
rected to allow credit for all excep
tions. disallowances and suspensions
in the accounts of the District Un
employment Compensation Board
outstanding at the effective date of
i this act; provided, that such ex
j ceptions, disallowances and suspen
j sions were caused by the payment
of benefits based upon temporary or
inaccurate reports which have since
been replaced by permanent and ac
curate records, or caused by erro
neous determination of claims re
| suiting from the administrative im
j practicability of computing certain
claims due to the cumbersome pro
visions of the act, or caused by the
unforeseeable mass of claims in a
newT field of governmental opera
tion requiring immediate calculation
to carry out the whole Intent of the
act.”
Employment Not Defined.
One of the principal faults found
in the pending draft by Washington
business interests is that the bill
fails to give any clear definition of
what is partial employment, or what
is full employment. Certain key of
ficials, who asked that they be not
identified, agreed that this was one
of the apparent weaknesses of the
draft as recommended by the D. U.
C. Board. These officials suggested
the need of "clarification."
The bill provides that every eligi
ble person who is partially unem
, ployed in any week shall be paid
I with respect to such week a partial
benefit. It states this "shall be an
j amount equal to the difference be
tween his weekly benefit amount
(as defined and stated in the act)
and his earnings for such week.”
Then the bill adds: “For the pur
poses of this subsection, the term
‘earnings’ shall include only that
part of an individuals remunera
tion in excess of the individual's
weekly benefit amount.”
It was suggested that the objec
tive was to give some extra benefit
to a person who lost his regular
job but found a part-time job in an
effort to get back to regular work
It appeared the plan was to permit
the value of such part-time earn
ings, plus benefit payments, to be
equal to 100 per cent of what the
person -was making before he lost
his regular Job.
Provides No Ceiling.
However, while it was assumed in
some quarters that the intention
was not to carry the total above
the proposed maximum benefit pay
ment of $20 a week, neither official
nor private students today could
find any qualifying language which
would definitely have that effect.
In fact, several officials agreed that
it appeared that a person who was
paid $40 in private employment but
lost his job and found “partial”
employment that paid him $20 a
week, could be found eligible for
the maximum benefit allowance of
$20 a week (for 20 weeks), which
would bring his total receipts for
that period up to $40 a week.
These officials “assumed” that this
would be prevented by administia
tive action, either ■ in adoption of
rules by the local board, or by the
offer of some “full-time” job to (he
claimant.
Another case was discussed deal
ing with the possible effects of the
“partial” unemployment provision.
For instance, the woman who works
Saturdays as a one-day-a-week
clerk, at $3 a day. During Decern- j
ber, on account of the Christmas |
buying season, she worked every
day. Thus her earnings for 48 weeks
at $3 a Saturday would be $144 and
with $72 for December, her total
year’s earnings would be $216. If
she claimed benefits after her De
cember employment she could be
held to be partially unemployed,
and held eligible for a weekly benefit
payment of $5 for 20 weeks while
still receiving the customary $3 pay
for each Saturday’s work, it was
contended. Some observers sug
gested such a development might be
covered properly by definitions or
i riilpc
Formulae Complicated.
It was generally agreed by spokes
men for various public and private
groups that the preset law formu
lae for benefits and periods for bene
fit payments was extremely com
plicated and difficult of calculation.
In a move for simplification, the
proposed new measure sets forth an
unemployment benefit table, show
ing what weekly benefit amounts
shall be paid to persons whose earn- !
ings in the highest quarter of the
"base period” of past employment1
were within certain brackets.
For instance, persons who earned,!
in their base periods, between $37.50
to $130 in the quarter year, would
be entitled to a weekly benefit
amount of $5. if found eligible. The
benefit table is carried up. $1 a
bracket, to $20 for persons who had |
earned $494.01 or more in the quar- ;
ter year. This plan appeared to |
those interviewed to be greatly
simplified.
Senator D. W. Clark's
Client Wins $107,000 Suit
Senator D. Worth Clark of Idaho, j
one of the few national legislators
to practice in the local courts, today \
was on record in District Court as
having won a $107,021 suit that had
been filed against a client of his.
Justice James M. Proctor signed
1 an order dismissing the suit and 1
| dissolving a temporary restraining
I order that had been issued last
year by the court. Will Cummings
of Chattanooga, Tenn., brought ac
tion in District Court against Wil
liam H. Langroise of Boise, Idaho,
as executor of the estate of James
McDonald, jr„ son of the prominent
capitalist, and against the Riggs
National Bank, claiming $107,021 .
and asking that the bank be pre
vented from paying out funds in
volved. The suit was designed to
foreclose a claim on specific prop
erty here on the basis of a claim
given in writing by James McDon- j
aid, jr., upon securities left in a
i trust by his father, the court was
I told.
| Senator Clark represented Mr.:
I Langroise in the litigation, which
has extended over several months.
Mr. Langroise contended that Dis
| trict Court was without authority ;
W>ver him as an executor adminis- :
1 tering affairs in Idaho.
Bill Would Provide
For Moore Portrait
A proposal that an oil portrait
of Charles Moore, former chair
man of the Commission of Pine
Arts, be procured by the Joint
Committee on the Library is made
in a joint resolution introduced
today by Representative Luce, Re
publican, of Massachusetts. The
bill provides that the portrait be
painted by an American artist at a
cost not exceeding $2,500 and that
| the committee have the advice of the
Commission of Pine Arts. The por
trait would be hung in the Smith
sonian Institution.
•
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