State Sen. Steve Baddour said he is hearing the message of the need to support small businesses loud and clear.
Baddour, vice chairman of the Senate Ways and Means Committee, has authored a bill that would prevent the state's impending unemployment insurance rate increase.
Baddour, who represents Haverhill, said the bill would calculate the insurance rates based on employer's last three years of payroll expenses instead of just the prior year's. That would eliminate the possibility that small businesses would be penalized if they experienced strong growth over the past year, Baddour said.
"In a slow economy, small employers are looking to cut or control costs as much as possible in order to keep their doors open," said Jon Hurst, president of the Retailers Association of Massachusetts. "This rate freeze helps control those mandatory costs upon employers ..."
Additionally, the bill would require that workers work a minimum number of weeks in at least two quarters to qualify for unemployment insurance benefits.
"Those reforms will close eligibility loopholes abused by some companies and individuals," Hurst said, "and will also change the tax computation formula to create incentives to grow new jobs, rather than to cut payroll."
If the bill were to fail, small businesses in Massachusetts would face a 40 percent increase in unemployment insurance, equating to $260 per worker. That's too much, Baddour said, for some small businesses to stay afloat.
"The economic climate in Massachusetts has been improving, but at a snail's pace, and we must ensure that its fragile recovery isn't thwarted by imposing new, increased costs on businesses," Baddour said. "This is the wrong time to demand new, punitive costs."
Although he supports the freeze, Baddour also called the bill "a Band-Aid for a broken system."
"Over the past few years, we have taken a piece-meal approach to settling unemployment insurance rates, and I believe this is the right time to look at the way we fund the entire program," he said.
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