Senate Republicans, Virginia business groups support back-to-work incentive

(The Center Square) – Virginia Senate Republicans are urging Gov. Ralph Northam to call a special session for lawmakers to create a $1,500 back-to-work incentive for those collecting unemployment.

The proposal would eliminate the higher unemployment benefits received during the COVID-19 pandemic and divert that money toward the back-to-work program as a means to incentivize Virginians to work rather than stay home.

Although unemployment numbers have improved in the commonwealth, the unemployment rate still was 4.7% in April. Before the state felt the effects of the COVID-19 pandemic and subsequent economic restrictions, the unemployment was 2.9% in April 2020. According to a National Federation of Independent Business report, many businesses are struggling to find qualified workers to fill positions, which may be, in part, because higher unemployment benefits create an incentive to stay home.

The Senate Republican plan would provide a one-time $1,500 bonus with federal COVID-19 relief funds for a person who returns to work and stays at his or her job for at least six weeks.

“With so many Virginia businesses experiencing workforce shortages and ‘Help Wanted’ signs seemingly everywhere, we need to replace supplemental federal unemployment payments with back-to-work bonuses now,” Senate Republican Leader Tommy Norment, R-James City, said in a statement.

Four other states have introduced back-to-work incentives and other plans are in the works in other states. Some members of the statewide business community have gotten behind the effort.

Nicole Riley, NFIB Virginia state director, told The Center Square a back-to-work bonus is “a really good way to incentivize workers to come back to the workplace.” The NFIB is the largest small business association in the country.

Diverting funds toward a back-to-work program, rather than using it for higher unemployment benefits will incentivize work in a way that “doesn’t leave workers high and dry,” Riley said. The NFIB supports a back-to-work plan that gives flexibility to employers so they can address the needs of their employees, whether that be money for child care or other monetary needs.

Although most of the pandemic-era restrictions will end Friday, Riley said some businesses still have to limit operations because they aren’t able to fill openings. She said this is hurting small businesses who have been struggling since the start of the pandemic.

A back-to-work incentive also earned support from the Virginia Restaurant, Lodging & Travel Association. Robert Melvin, the association’s director of government affairs, told The Center Square the association is open to a number of potential plans that will allow funds to flow through the employer to the employee, rather than simply using the funds to support higher unemployment benefits.

The status quo, Melvin said, is not working. He said the association has been in talks with the Virginia Employment Commission and the governor’s workforce about an incentive program, which they have been open to.

Northam’s office did not respond to a request for comment from The Center Square about whether he would support a back-to-work incentive.

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