Unemployment Rates

Heads of state celebrate frontline worker bonuses and insurance deal

Hundreds of thousands of pandemic frontline workers in Minnesota will receive payments of about $750 and businesses will be spared a huge tax hike under a deal celebrated Monday at a ceremony on Capitol Hill. of the state marking the greatest achievement so far of this legislative session.

It was a moment workers and business owners had waited months to see, as lawmakers struggled to broker a deal until the final weeks of an election-politics-tinged session.

“That $750 at the Minnesota median income, that equals a month’s rent. That equals groceries. … That’s money that can be put back into their savings accounts. So that’s important” , Mary Turner, president of the Minnesota Nurses Association, said as she tried to hold back tears. “But we still have work to do.”

Nurses, long-term care workers, educators, first responders, child care providers, grocery store staff and others who were unable to work from home when COVID-19 hit will be eligible for bounties, said DFL House chair Melissa Hortman. Lawmakers estimated that 667,000 people would be eligible for the payments, totaling $500 million.

Monday’s signing of the bill was solemn. DFL Governor Tim Walz had already signed the deal on Friday, the culmination of a long-running dispute between legislative leaders.

“It’s a positive. I’m really grateful to the legislators who worked on this and all those who kept the faith. It bodes well,” Walz said.

Lieutenant Governor Peggy Flanagan called the move “an incredibly important first step.” But she said leaders also needed to reach agreements on earned sick leave, paid family and medical leave and stronger childcare.

It will likely take 10 to 12 weeks before checks for frontline workers start to come out, said Roslyn Robertson, commissioner for the Department of Labor and Industry. A supplier will create a system over the next two weeks where workers can request money, and then there will be a 45-day request period, she said.

Walz said many people don’t know they are eligible and the state will work to publicize the money and how to apply.

Lawmakers had agreed in June 2021 to spend $250 million on “worker bonuses” for employees who had to perform critical in-person work throughout the pandemic. But negotiations over who should get the money and how much they should get broke down in the fall. As the current legislative session approached, Democrats demanded a much larger sum: They wanted the state to spend $1 billion and hand out checks for $1,500. The new law is a compromise approach, the heads of state said.

“This deal took a lot longer than any of us had hoped. But at the same time, I think the outcome was probably better than expected,” said the Senate Majority Leader of the GOP, Jeremy Miller.

The deal lawmakers reached last week includes $2.7 million to replenish the state’s unemployment insurance trust fund that has been drained by the flood of jobless claims as workers have been laid off during the pandemic, and to repay the federal government for money the state borrowed to cover unemployment benefits.

Many companies have seen their potential unemployment insurance tax rates rise sharply this year to fill the depleted trust fund. Walz and Senate Republicans had been pushing throughout the legislative session for a quick deal to funnel some of the projected budget surplus of nearly $9.3 billion into the fund to prevent interest rate hikes. ‘taxation.

Businesses were required to submit payroll tax payments for the first quarter of the year by April 30, state officials said. Employers who paid the highest rates can get an automatic credit to their unemployment insurance account, which will be used to pay for the next quarter, said Steve Grove, commissioner of the Department of Jobs and Economic Development. It will land in the accounts in about seven to 10 days, he said.

However, business owners who want the state to write them a check will have to wait longer, he said.

“If you need the money now, it’s going to take us — we don’t know, a month, two months,” Grove said.

Business owners Raji Eid and Tez Hailu stood with Walz as he signed the legislation at Monday’s event. Their business, EIDS Cleaning and Consulting in St. Paul, operates on a shoestring budget, Hailu said, and the two said a big tax hike would have dealt a big blow.

“We would have been finished. Honestly,” Eid said. “Literally, that would have been impossible.”