by Becki Gray
Former Senior Vice President, John Locke Foundation
Both the Senate and the House have agreed to return for the “August session” but it’s still up in the air what they will tackle. As I write this committee meetings are being posted and changes are being made to calendars. Four of the five bills scheduled to be heard in Senate Rules are ripe for “strip and replace” language. Speculation says they’ll agree to adjourn and to put off til November further talks on Medicaid reform and most likely coal ash management. But as I pointed out here yesterday, there’s several other things that were left hanging when they semi-adjourned earlier this month.
One potentially critical piece is ensuring the confidentiality of unemployment information. It turns out that under previous administrations, North Carolina’s Employment Security Commission was selling notices of unemployment compensation appeals hearings to law firms. It also turns out that this is a pretty serious violation of federal law. The practice has changed under the leadership of Assistant Secretary of the Employment Security Commission Dale Folwell but NC’s law that allowed it hasn’t. Unless the law is changed, there could be serious repercussions and monetary penalties. The State’s Title III grant funding is in jeopardy and North Carolina’s non-compliance could affect the federal Unemployment Tax Act rate – potentially costing every North Carolina business hundreds of dollars per employee.
The US Department of Labor sent a letter in March ordering the state Department of Employment Security to immediately stop selling confidential unemployment information (which of course they have) and must comply with state and Federal laws on confidentiality. It is imperative that we change our state law to comply with these federal regulations and that we do it now. Again, there are significant financial penalties for state taxpayers and for North Carolina employers at stake.
At the beginning of the short session, Representative Julia Howard led the effort in the House to change the law with HB 1069. It passed both the House and the Senate with bi-partisan support. However the Governor vetoed the bill because of some provisions regarding members on the Employment Security Commission. Representative Howard tried again with language addressing the federal non-compliance issue in a revised Senate Bill 42. It passed the House 108-1 and was sent to the Senate and then to the Rules Committee.
It seems to me the General Assembly has two choices to get this done. They can either override the Governor’s veto of HB 1069. A veto override requires 3/5 of the members present and voting. Or the Senate can pass SB 42 out of Rules Committee and bring it to the floor for a vote. If it passes the Senate with no changes, it would then go the Governor for his signature. Since SB 42 does not include the Commission provisions he objected to in HB 1069, one would presume he would sign it. Either way, it is important that North Carolina pass a law protecting the confidentiality of unemployment information, bringing state law in compliance with federal law. North Carolina’s unemployment system is on the right track. This is another necessary step to protect the system, the unemployed and employees. And the sooner it’s done the better.