A group of labor unions is sponsoring a voter initiative to restore recent cuts in the District's unemployment compensation benefits, but an unlikely combination of business and labor officials strongly opposes the measure.
The Food and Allied Service Trades Council (FAST) last week filed with the D.C. Board of Elections and Ethics a proposed initiative that would eliminate the current $206 weekly cap on benefits, increase taxes on most employers by about $20 to $35 for each employe, guarantee jobless persons 39 weeks of benefits, and restore benefits for workers who voluntarily resign jobs or are fired for cause.
FAST, a coalition of five local unions representing about 45,000 food-service and hotel employes in the region, is seeking to overturn many of the cuts proposed by Mayor Marion Barry and approved by the D.C. City Council last March in an attempt to reduce a $57 million deficit in the city's unemployment compensation fund.
Backers of the initiative believe the City Council "panicked" over the deficit and passed a law which cuts workers' benefits too steeply, while failing to tax employers adequately, said Ron Richardson, secretary-treasurer of Local 25 of the Hotel and Restaurant Employes Union.
Yesterday, representatives of both the Greater Washington Board of Trade and the AFL-CIO's Metropolitan Washington Council said they oppose the referendum, particularly because it would conflict with the deliberations of a nine-member city commission named last March to recommend long-term solutions to the trust fund's fiscal problems.
The commission's report is expected by January.
"We believe (the initiative) is ill-advised and we believe it is irresponsible," said Roger Blunt, chairman of the Board of Trade's legislative-fiscal bureau. Blunt said the question involves "very complex, highly technical issues" that should be considered by the commission and the council, rather than voters.
The Board of Elections has scheduled a special session Sept. 21 to consider whether the initiative is appropriate for placement on the ballot.
If approved, the initiative's backers would need to get petition signatures from 5 percent of the District's electorate, or about 20,000 registered voters. FAST is hoping to get the signatures in time to put the question on the ballot for the May 8 presidential primary.
The Board of Trade plans to ask the elections board to turn down the initiative, Blunt said, on the grounds that it involves city appropriations and budget matters, subjects that are barred from initiatives.
Labor is split on the issue, with FAST, whose members no longer belong to the labor council, breaking ranks with council members to propose the initiative.
Joslyn N. Williams, president of the AFL-CIO's Metropolitan Washington Council said the council's executive board last week reaffirmed its opposition to the initiative because the labor group believes the study commission may find a method to increase benefits and guarantee solvency of the fund.
Mayor Barry also will not support the initiative because he is satisfied that business and labor, which are both represented on the commission, can work out differences on the issue.
Under current formulas, employers pay taxes on the first $8,000 that each employe earns, with the tax rate varying depending on the firm's past record for unemployment. Under the initiative's formula, the ceiling would increase to about $8,700, and rise with inflation.
Matt Watson, the former D.C. auditor who drafted the initiative for FAST, said the changes would increase most employers' tax by $20 to $35.
Prior to the council's action, workers who quit or were fired for cause could collect jobless benefits after a six- to 10-week penalty period. The council eliminated the "quits and fires" benefit altogether, which the initiative would restore.
The council also cut the maximum term of benefits from 34 weeks to 26. Currently, jobless workers can collect 39 weeks because the federal government pays 13 weeks additional benefits.
The initiative would commit the city to maintain the 39 weeks if the federal benefit stopped.
"I think what we have proposed is modest, and nothing that will hurt the business community," Richardson said. He said the city council's changes amounted to "local Reaganomics" because it "cut benefits to workers rather than putting a fair tax on business."
Blunt, however, said the measure was burdensome and would have "serious negative impact on business development."