Lora Poepping, Board Member

As we all appreciate, UUC is committed to living our values—both in the greater community and within our beloved community. At our  2024 Annual Congregational Meeting, a resolution was brought forward related to providing UUC’s employees with unemployment insurance.

The resolution states: "The Congregation requests that the Board of Trustees study, or cause to have studied, the feasibility and costs of providing unemployment insurance to the Church's employees. This study should be published on the Church's website and in the Church's email newsletter promptly upon its completion, but no later than March 28, 2025."

If you are not familiar, Washington State Unemployment Insurance (UI) is a government program that provides temporary financial assistance to workers who have lost their jobs through no fault of their own. It is designed to help individuals cover basic expenses while they search for new employment. UI is funded through employer payroll taxes at the state and federal levels.

Over the past year, a comprehensive, thorough, and thoughtful study was completed. Led by Board member Lora Poepping (25 years in Human Resources), Operations Director Byron Krystad, and with input from an external HR Consultant, Lynette Hatcher, the following were considered:

• Exclusion from unemployment insurance is a hallmark of religious institutions in the United States. The nature of the employment of ministers and other religious professionals don't lend themselves well to unemployment insurance models, and it further ensures the federal government and states are not forced to use taxpayer dollars to extend benefits to religious institutions.

• The cost of participating in an unemployment insurance plan could cost the church a minimum of $10,000/year. That's using average tax rates across all currently taxed employers and does not consider administrative overhead and possible variations on rates that might be assigned to the church if it pushed the state and federal government on recognizing it as an unemployment tax-paying employer.

• Once you ask the government if you can pay taxes that you were not required to pay before, there's no return from that decision. You are committing the current and future church, always, to paying those taxes. Once a right is given away, it isn't given back. We must consider the future congregation's disappointment in this decision if it proves problematic for them years from now.

• Both now and in the coming years, it will be in the church's best interest to behave like a church whenever possible in the eyes of the federal government. That includes participating in federally recognized exemptions for religious institutions, such as federal unemployment taxes and corporate income taxes, or even having a formal 501(c)3 finding by the IRS. The more we cast ourselves as another nonprofit organization or a corporation instead of a religious institution, the more risk we take of having our status as a church stripped from us altogether. (This is a serious concern, especially now.)

• Our historic rate of forced attrition (layoffs or firing) show that our existing fully funded severance policy would cost considerably less, while still delivering equivalent value to former employees as the state’s unemployment plan.

When an employee voluntarily leaves UUC for retirement, personal reasons, to move to new employment, etc., we do our best to make certain they feel an appreciation for their contribution. Many members are supportive and write cards of thanks. As head of the staff, the Lead Minister may also make recommendations on how to recognize an outgoing staff member’s contribution.

Considering these dynamics, and with agreement by the Board, UUC will not be providing unemployment insurance to its employees. UUC’s efforts to provide a severance policy that considers the impact on our community—both now and into the future—reflects our ideals and love for UUC.

We are truly appreciative of the intent of this exploration and took the work to heart. This study has been completed, and we thank our former Operations Director, Byron Krystad and consultant Lynette Hatscher for the support and research assistance.

For more details about unemployment may be found on this Washington State website.