House State Administration Committee members heard testimony on House Bill 812 on March 1, 2025, a measure from Rep. Denise Joy that would allow certain nonprofessional educational employees who work nine or ten months to apply for unemployment benefits during scheduled school breaks.

Supporters told the committee the change would reduce turnover among low‑paid classified staff who often work summer months without pay, while the Department of Labor and Industry and school finance groups warned the additional claims could materially draw down Montanas unemployment insurance trust.

Representative Denise Joy, the bill sponsor, told the committee she is a nine‑month school employee and framed the measure as a retention tool: "HB 12, 8 12 is legislation that solves a problem," she said, describing how many classified employees lose income during the roughly 60 summer days when school is not in session and therefore struggle to remain in education careers.

Quint Nyman, deputy executive director of the Montana Federation of Public Employees, said classified workers positions — cooks, custodians, paraprofessionals, bus drivers and aides — are among the lowest paid in the state and face gaps in income during the summer. "HB 1 8 12 provides classified school employees in Montana with the opportunity to apply for unemployment insurance during summer breaks," he said, adding that prior changes and private‑contractor differences have created disparate treatment.

Lance Melton, representing the Montana School Boards Association and other K‑12 groups, expressed reluctant opposition and raised legal and fiscal concerns. Melton pointed to a statutory requirement that new obligations imposed on schools must identify a funding mechanism and said the bill as drafted contains a technical drafting flaw that could make it ineffective without a funding source. He warned that in other states the cost to school systems and to the unemployment trust escalated rapidly after similar changes.

Sarah Swanson, commissioner of the Montana Department of Labor and Industry, provided fiscal projections for the committee. Using Montanas current unemployment rules and a set of assumptions provided to the panel, she projected that allowing classified employees to file could cost the unemployment trust roughly $22.25 million in fiscal 2026 under a 65% take‑rate assumption and as much as about $32.0 million under a 75% take‑rate assumption. Swanson noted the states unemployment trust was currently well‑funded but that roughly a $25 million draw would likely trigger higher employer tax rates under the departments rate schedule.

Committee members questioned whether districts already provide reasonable assurance of continued employment (a mechanism that can make employees eligible now) and how many employees would be affected. Witnesses estimated roughly 13,000 full‑time‑equivalent classified school positions statewide and said MFPE represented approximately 5,000 classified employees in schools and the university system.

Representative Joy closed by urging the committee to consider the quality‑of‑education and equity arguments: "We are the people who change the diapers. We're the people who get somebody on a bus. We're the ones who lift them out of wheelchairs," she said, asking members to weigh the classroom impact of losing experienced classified staff.

During the committees executive action session the substitute motion to table House Bill 812 passed on a roll call vote (11 ayes, 8 noes), effectively pausing further action in the House State Administration Committee.

Votes at a glance

- Motion: Substitute motion to table House Bill 812 (mover: Rep. Tillman). Outcome: Passed (11 ayes, 8 noes).