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Diegnan Bill to Amend Unemployment Compensation Law Advances


TRENTON – Legislation sponsored by Senator Patrick J. Diegnan, Jr. that would amend New Jersey’s unemployment compensation law passed the Senate Budget and Appropriations Committee today.

“Reforming our unemployment system is paramount to ensure that it treats workers fairly,” said Senator Diegnan (D-Middlesex). “For too long, workers have been denied benefits due to a definition of “misconduct” that clearly prejudices working men and women.  This will bring fairness back into our unemployment system and ensures our safety net is there for our working families when needed.”

The bill, S-2439, would amend New Jersey’s unemployment compensation law to reduce the period of time for which individuals are disqualified from receiving unemployment compensation for misconduct connected with work.  It would reduce the disqualification period from seven weeks to five weeks.  It would also remove the category of “severe misconduct” from the law.

Individuals can be temporarily disqualified from receiving unemployment insurance (UI) compensation if they are discharged from work due to misconduct.  The level of misconduct determines the period of disqualification and the requirements that individuals must meet to requalify.  The original UI law had two levels of misconduct: “misconduct” and “gross misconduct.”  A third level, “severe misconduct,” was added in 2010 upon the recommendation of Governor Christie.  The recommendation came in his conditional veto of a bill intended to address the financial distress of the UI fund due to large diversions to the general fund combined with high unemployment during the Great Recession.  The bill increased the period of disqualification for misconduct from five weeks to seven, which this bill would reverse.

Governor Christie’s conditional veto did not clearly define “severe misconduct,” and regulations proposed by the Department of Labor and Workforce Development to clarify the definition either faced strong opposition from advocates and organized labor or were rejected by the courts.  During the final months of Governor Christie’s term, the department proposed regulations that the new administration decided not to pursue.  Instead, the new administration met with labor advocates and agreed that the 2010 “severe misconduct” amendments to the UI law should be repealed.

Misconduct is conduct which is improper, intentional, connected with the individual’s work, within the individual’s control, and is not a good faith error of judgment or discretion.  Bad judgement is either a deliberate refusal, without good cause, to comply with the employer’s rules or a deliberate disregard of reasonable standards of behavior, including reasonable safety standards and reasonable standards for a workplace free of drug and substance abuse.

The bill was released from committee by a vote of 8-5, and next heads to the full Senate for further consideration.