4148

VETOES

payments, all sickness and accident disability payments.

House Bill 1541 would amend § 20(n)(2), effective January 1,
1985, to add the following:

"If payments are made to an employee or an
employee's dependents for sickness or accident
disability, this paragraph (2) excludes from
'wages' only payments that are received under
a workmen's compensation law[.]" (Emphasis
added).

This change, which substantially tracks the language of the
federal law, would effectively modify the term "wages" to include
sickness and accident disability payments made by an employer,
except those made under a worker's compensation law. Although
this change in State law is not mandated by federal law, the net
effect of such a conforming change would be to greatly reduce an
employer's federal tax liability. See Position Statement of
Department of Employment and Training on House Bill 1541
(February 22, 1984).

This primary purpose of House Bill 1541 is reflected in the
bill's short title: "Unemployment Insurance - Taxable Wages".
That short title is nevertheless somewhat misleading. Although
the impetus behind House Bill 1541, as explained above, was to
amend the definition of "wages" for taxation purposes, the
amendment of this quite basic definition necessarily would have
other effects that, while intended, are not reflected in the
short title. For example, the defined term "wages" is also used
in the law governing an employee's weekly benefit amount (Article
95A, § 3(b)); by redefining "wages" to include sickness and
accident disability benefits, employees will earn additional wage
credits to be used in determining their weekly benefit amounts.
Thus, the bill ultimately affects more than merely "taxable
wages".

A far more serious problem, however, is the title's purpose
clause:

"F[or] the purpose of including in an employee's wages,
under the Unemployment Insurance Law, payments made
under an employer's plan on account of illness or
accident disability under a workmen's compensation
law."

This title indicates that the only sickness or accident
disability payments to be "included in ... wages" are those "made
... under a workmen's compensation law". In fact, the bill would
do the exact opposite: it would "exclud[e] from 'wages'" those
payments - and "only" those payments - that are "[made] under a
workmen's compensation law". In other words, the bill is
intended, and was specifically drafted, to include as wages all
sickness or accident disability payments other than those made