The Department of Labor & Industry Thursday announced it will lay off nearly 600 of its staff as a result of the Senate’s failure to vote on House Bill 2375 (Gingrich-R-Lebanon), which would have allowed for $57.5 million in funding to administer unemployment benefits to out-of-work Pennsylvanians.
The bill, a bipartisan piece of legislation, was passed by the House on October 19.
“The Senate put politics before people and now 600 employees will be without a job just before the holidays,” Labor & Industry Secretary Kathy Manderino said. “It’s beyond disappointing; it’s disgraceful.”
“This was not a last-minute ask, but rather what should have been a logical conclusion to conversations that began in April about extending a statute that was already in place and that has allowed the department to administer unemployment benefits in a timely manner.”
House Bill 2375 was crafted in response to the sunset of Act 34, which provided a four-year transfer from the state’s Unemployment Compensation Fund to the Unemployment Compensation Service and Infrastructure Improvement Fund to improve the quality, efficiency and timeliness of UC services and to work to replace the department’s 40-year-old Legacy computer system.
The department used Act 34 funds to reduce call wait times by more than an hour in the past two years and in 2016 the system met goals set by the federal Department of Labor that it had failed previously.
Early in 2016, the department asked for $57.5 million in funding to keep up planned system improvements amidst decreased federal funding for UC administration.
“Without the $57.5 million in funding, there is simply not enough money to pay staff,” Manderino said. “The department has made great strides in efficiency and now, due to the Senate’s lack of action, those strides – and service to our state’s unemployed – have been jeopardized.”