Under my little concept proposal, could the burden to an employer be minimized?
In otherwords, there is no TAX burden as long as the individual is employed...only if they hae a layoff, do they have to provide some level of support to the individual as a result of unemployment benefits.
I would even offer to the employer to either provide "Cobra" or extend the Insurance benefits for as far out as Unemployment benefits are extended, using the company insurance. If the rate is lower on the company plan than "Cobra" then there is a bit of savings to the employer...I would have the employer pick up the employee contribution portion as the Unemployment pay is so low that to burden the unemployed worker with this added cost during that time would be foolish.
Now, if an employer is smart, they would build a contengincy account to cover a portion of potential layoffs...it's a bit of self-insurance for bad times. As the government, I would allow companies to use this account as a tax shelter, with a very basic rule. The money can ONLY be used for Unemployment benefit payments...or bankruptcy payments. I would not allow a company to utilize these funds for any other business.
In essence it would be an insurance for the company, should they need to let an employee go in a way that they would qualify to receive benefits, the company would not be spending extra out of pocket...but they would also have control of that Unemployment account.
I am certain, as I am not a policy writer, that there are additional details that would have to be defined, but in essence, the concept minimizes the government involvement, allows Insurance to remain private, and gives the responsibility back to the employer/employee. This appears to be a win-win for everyone...not to mention, keeps those of us citizens not involved from being taxed to support something we are not involved in.
Hey that makes me think...employers pay Unemployment taxes...what would hurt from implementing an individual unemployment fund tax shelter as an option to employees? Not a 401K Retirement, but rather some type of investment fund that could roll over into a retirement fund if it is never needed, but that if we become unemployed, we have a fund that will provide an added financial benefit at a fixed amount per week, for so much time or until the fund runs out. The account would be the individuals account and would travel with them from job to job...the only two ways that you would be able to withdraw without penalty is if you were unemployed and eligible for benefits, or retired and at Social Security retirement benefits level. Of course this would be an OPTIONAL fund, and you could manage it like a retirement fund, thus making high yielding investments.
Just think, this would be open to everyone, from the minimum wage worker to the multi-millionaire CEO, etc... It's optional, not mandatory...thus provides a way for people to protect themselves for the future. In the event of an early death, the fund could be passed on to the next of kin, or person defined in the individuals will (TAX FREE) but under the same withdraw rules, with exception to minors, whom would have a trust fund to help manage needs until they reach 18, or as a full time student...graduation or 25 years of age.
Why would the government not want to provide a means for people to be responsible for themselves?
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