Business groups urge UI reform and relief as Massachusetts employers face billions in repayment

Bill Rennie of the Retailers Association of Massachusetts and Christopher Carlozzi of the National Federation of Independent Business told the committee that Massachusetts employers face a growing unemployment insurance (UI) burden tied to pandemic-era claims and an accounting error.

Rennie noted that businesses are already repaying hundreds of millions: "Our members and employers across the Commonwealth are currently paying back, you know, the $2,700,000,000 bond, that was floated to repay the federal government for COVID costs." Carlozzi added that auditors found a separate $2.1 billion error that will be repaid over time, bringing the total near $5 billion in UI debt that employers could shoulder.

Both witnesses urged the legislature to pursue UI reform and to consider using state reserves to shield employers, as some other states have done. Carlozzi cited other states' actions and said: "New York agreed to pay off all UI debt using more than $6,000,000,000 from their reserves to ensure small businesses were not stuck with the expense." Committee members pressed for specifics about the fund solvency timeline; witnesses said current DUA projections show insolvency within a few years without intervention.

Why it matters: Employers reported rising costs across payroll taxes, health insurance and energy on top of UI assessments, and survey data presented by the Retailers Association indicated many small firms are considering sale or closure within five years. Witnesses warned that continued tax increases could reduce hiring and competitiveness.

Ending: Business groups asked for legislative engagement on UI reform, health‑care cost relief and energy policy that preserves choice for businesses as the committee considers economic supports for small firms.