Broadband access assistance is available

My Madison alder rep, Regina Vidaver, passed on the following information about an Emergency Broadband Benefit that will provide a discount of up to $50 per month towards broadband service for eligible households and up to $75 per month for households on qualifying Tribal lands.

Eligible households can also receive a one-time discount of up to $100 to purchase a laptop, desktop computer, or tablet from participating providers if they contribute more than $10 and less than $50 toward the purchase price.

The Emergency Broadband Benefit is limited to one monthly service discount and one device discount per household.

A household is eligible if a member of the household meets one of the following criteria:

  • Has an income that is at or below 135% of the Federal Poverty Guidelines or participates in certain assistance programs, such as SNAP, Medicaid, or Lifeline;
  • Approved to receive benefits under the free and reduced-price school lunch program or the school breakfast program, including through the USDA Community Eligibility Provision in the 2019-2020 or 2020-2021 school year;
  • Received a Federal Pell Grant during the current award year;
  • Experienced a substantial loss of income due to job loss or furlough since February 29, 2020 and the household had a total income in 2020 at or below $99,000 for single filers and $198,000 for joint filers; or
  • Meets the eligibility criteria for a participating provider’s existing low-income or COVID-19 program.

As of 12 May 2021, eligible households can enroll in the program to receive a monthly discount off the cost of broadband service from an approved provider. Eligible households can enroll through the approved provider or by filing an application at this link.

Anyone in Wisconsin who might be eligible for this assistance should apply.

Given that unemployment claims-filing is on-line only unless you indicate in a phone call to the unemployment support center that “I have disabilities that make on-line filing difficult and am requesting assistance” (an option not available to those who converse on the phone), the broadband assistance offered here is essential.

New PUA benefit options

The Department is sending out a new notice regarding PUA eligibility that is creating much confusion.

This notice is the Department’s effort to comply with UIPL No. 16-20 Change 5 (25 Feb. 2021). This program letter addresses various issues with PUA benefits that exist in some states. Unfortunately, all of the issues raised in this program letter exist in Wisconsin. As a result, this new PUA notice reflects some massive changes in PUA eligibility that tmj4 covered in early April of this year.

New PUA eligibility criteria

Partial loss of work because of the pandemic

This provision is a major change in eligibility in Wisconsin, as the Department previously denied all PUA claims for anyone (other than independent contractors or those quarantined because of Covid-19) whose employer did not completely shut down. The Department also mistakenly canceled PUA eligibility whenever a PUA claimant returned to any kind of work. Pursuant to this program letter:

Individuals experiencing a reduction of hours or a temporary or permanent lay- off. The Department approves the following COVID-19 related reason for an individual to self-certify for PUA eligibility: “An individual is an employee and their hours have been reduced or the individual was laid off as a direct result of the COVID-19 public health emergency.”

* * *

Generally, individuals in covered employment who are laid off, are experiencing a reduction in hours, or are working part-time as a result of partial business closure would qualify for regular UC (or PEUC or EB) and therefore would not be eligible for PUA. However, such individuals may not be eligible for regular UC (or PEUC or EB) because, for example, they lack sufficient wages to qualify, have a previous disqualification, or have exhausted regular UC, PEUC, and EB. This expanded COVID-19 related reason establishes a circumstance under which they may self-certify eligibility for PUA.

The individual must report any earnings from the reduced hours when filing continued claims and such amounts must be deducted from the PUA weekly benefit amount in accordance with the state law. See Section C.16.c. of Attachment I to UIPL No. 16-20, Change 4.

UIPL No. 16-20 Change 5 at 8-9 (emphasis in original, footnote removed). Because Wisconsin denies regular unemployment benefits to disabled workers receiving SSDI benefits, the vast majority of PUA claimants are now obviously eligible under this provision. So, tens of thousands of PUA claims in Wisconsin must now be re-examined in light of this provision.

Of course, a sizable chunk of PUA claimants are still waiting on hearings for their PUA claims. So, those claimants should continue to wait for their hearings, as those hearings will be quicker than any new PUA claim.

Only those claimants who had their PUA claims originally denied and saw that denial affirmed at a hearing (and did not petition the Labor and Industry Review Commission for further review) or did not appeal that original denial should file a new PUA claim right now. Again, having your claim heard now at a hearing will be quicker than filing a new PUA claim.

Likewise, you should NOT withdraw a currently filed appeal concerning your PUA eligibility. If nothing else, the year long wait on your PUA benefits should be sufficient evidence that having your current PUA claim heard at a hearing or through Commission review will be imminently quicker than any new PUA claim that will take another year to process.

Note: This “new” PUA eligibility provision represents a return to how most states were handling PUA claims prior to UIPL No. 16-20 Change 4. See Pandemic (PUA) claims are being denied for invalid reasons (10 Nov. 2020).

School-year employees

Normally, school employees are NOT eligible for unemployment benefits because of reasonable assurance. But, under this program letter educational employees who lose work because of pandemic-related scheduling volatility with that educational institution are now eligible for PUA benefits.

However, the individual may be eligible for PUA if they have other non-educational employment from which they are able to self-certify that they are unemployed, partially unemployed, or unable or unavailable to work for a different COVID-19 related reason. As described in Section 4.e.i. of UIPL No. 10-20, Change 1, wages from the educational institution may not be used to calculate the individual’s PUA WBA.

If school schedules or planned school openings are disrupted and an individual is found to no longer have a contract or reasonable assurance to return in the subsequent year or term, then they can establish eligibility going forward as described in subparagraph (A) under this new COVID-19 related reason or another COVID-19 related reason that is applicable to their situation.

UIPL No. 16-20 Change 5 at 7. In addition, educational employees not subject to reasonable assurance may also qualify for PUA benefits under this new provision if the school schedule is canceled up upended because of the pandemic and those educational employees do not otherwise qualify for regular unemployment benefits. Id.

Unsafe working conditions connected to the pandemic

A common problem in Wisconsin during this pandemic has been the denial of regular unemployment benefits for those workers who are taking the pandemic seriously and actually following public health orders by staying home rather than working (and, in many cases, with the support of their employers).

The Labor and Industry Review Commission has begun to correct this problem. See discussions of recent Commission decisions here and here.

But, it remains to be seen to what extent the Department will follow these decisions (recent initial determinations indicate that the Department is still ignoring court precedents on substantial fault). So, this new eligibility provision provides explicit PUA eligibility to those employees concerned with public health.

An individual is generally denied unemployment benefits if the state determines that the work is suitable and the individual did not have good cause for refusing such work. This new COVID-19 related reason applies only to individuals who had already been receiving unemployment benefits but were determined to be ineligible or disqualified under state law because they refused an offer of work at a worksite that was not in compliance with local, state, or national health and safety standards directly related to COVID-19. This is a separate COVID-19 related reason from item (ii) of Section 2102(a)(3)(A)(ii)(I) of the CARES Act, which provides eligibility to an individual who quits their job as a direct result of COVID-19.

For example, an individual may self-certify under this new COVID-19 related reason who has previously been denied because the state law does not consider health and safety standards when assessing suitability or good cause, or who has previously been denied because the health and safety standards considered under state law are more restrictive than the local, state, or national COVID-19 health standards.

UIPL No. 16-20 Change 5 at 5-6.

In light of this program letter, claimants now have two options to pursue when losing work because an employer is either ignoring public health orders or a claimant is seeking to follow those orders — the Commission precedents cited above or this new PUA eligibility provision. Furthermore, there will be situations where employers are ignoring public health mandates where this new provision will apply.

An individual was laid off in October 2020 and began receiving regular UC. The individual received a new job offer in January 2021, however,the new work site was unsafe due to non-compliance with physical distancing measures under state law. The individual was disqualified from continued receipt of regular UC under state law. The individual is now eligible to apply for PUA under this new COVID-19 related reason.

UIPL No. 16-20 Change 5 at 6.

Backdating of PUA claims

Per this program letter, these three new eligibility provisions are available to PUA claimants retroactive to their pandemic-related job loss.

For individuals with a PUA claim filed on or before December 27, 2020, the expanded COVID-19 related reasons provided in Section 4.a. of this UIPL are to be applied retroactively based on the effective date of an individual’s existing PUA claim.

UIPL 16-20 Change 5 at 12. Only those individuals filing a new PUA claim will be limited to early December 2020 for back-dating their PUA claim. Id. at 13.

Consistent claim-filing requirements and options

The second page of the new PUA notice is taken directly from UIPL No. 16-20 Change 5 at I-1 to I-2, which mandates this form for PUA claims. In addition, this program letter requires that:

  • PUA claimants be permitted to select more than one Covid-19 related reason for their PUA claim. UIPL No. 16-20 Change 5 at 10.

As another example, an individual may be unable to work because they are the primary caregiver of a child who is unable to attend school because the school is closed to in-person instruction as a direct result of the COVID-19 public health emergency. That same individual may also be immunocompromised and unable to reach their place of employment because they have been advised by a health care provider to self-quarantine. Under these circumstances, the individual may self-certify that they are unable or unavailable to work under both items (dd) and (ff) of Section2102(a)(3)(A)(ii)(I) of the CARES Act.

  • PUA claimants must be allowed to select different Covid-19 reasons for each weekly certification. Id.

To continue the examples in paragraph B., the school may reopen in a subsequent week to provide in-person instruction. With this change in circumstances, the first and second individuals may no longer self-certify under item (dd) of Section 2102(a)(3)(A)(ii)(I) of the CARES Act because the school is no longer closed. However, both individuals may continue to self-certify under the other COVID-19 related reasons that are applicable to their respective situations.

  • PUA claimants can now file weekly certifications and indicate they are not eligible for PUA benefits that week by selecting “no Covid-19 related reason” in order to keep their claim alive without needing to file a new initial PUA claim. Id. at 11.

Acknowledging that, along with an individual’s changing circumstances, an individual might continue to file after they are no longer unemployed, partially unemployed, or unable or unavailable to work because of a COVID-19 related reason, the initial claim application and continued claim forms must provide an option for the individual to self-certify that none of the COVID-19 related reasons apply.

The new PUA notice

The new PUA notice going out is intended to satisfy the following requirement:

States must notify every individual who had previously filed a PUA claim at any time while the PUA program was in effect, and was denied for any week because they were not unemployed, partially unemployed, or unable or unavailable to work for one of the COVID-19 related reasons available at the time. This notification must advise the individual of the opportunity to self-certify to the complete list of COVID-19related reasons, including the new criteria provided in Section 4.a. of this UIPL. Such notification must occur individually as described in Section C.28.of Attachment I to UIPL No. 16-20, Change 4.

UIPL No. 16-20 Change 5 at 11 (emphasis in original).

Note: The nature of this new form — a paper copy that must be scanned and submitted on-line or mailed/faxed in — indicates that it is a rushed response, as the Department has no mechanism yet on its portal for filing these new PUA claims. Indeed, the ability to file PUA initial claims seems to no longer be available on the portal. This development should raise some eyebrows, as the program letter itself instructed states to have all of its provisions enacted within a month of the program letter’s release, i.e., March 25th. See UIPL No. 16-20 Change 5 at 9 (DOLETA “expects many states will need until the end of March or later to have the new COVID-19 related reasons in place”).

It should also be noted that PUA weekly certifications simply are not possible if there is no PUA initial claim currently approved by the Department.

Next steps

As indicated on the new PUA notice being mailed out, the Department is combining a host of changes to PUA eligibility with the new PUA documentation requirements connected to the Continued Assistance Act. The only explanation provided by the Department for all these changes is a curt warning when connecting to the portal:

New PUA notice

So, here is what PUA claimants should do.

  1. If you have a current PUA claim or appeal pending in some way (a claim not yet approved or denied, or an appeal waiting for a hearing, or a petition for Commission review waiting for a decision from the Commission), wait on that claim or appeal being decided in your favor. Do NOT withdraw your appeal under the false pretense that a withdrawal will somehow speed up your claim.
  2. I repeat: do NOT withdraw an appeal or let an appeal of a denied claim lapse.
  3. If you have not already filed a PUA initial claim, then file a PUA initial claim with the new form. For dating when this new PUA claim should start, check the “no” box because this new claim will not have same date as a previous PUA claim and write in the date this new PUA initial claim should start.
  4. If the appeals process for your first PUA claim has run and nothing is pending with that original PUA claim, then file a new PUA initial claim with the new form. For dating when this new PUA claim should start, check the “yes” box because this” new PUA claim” has the same date as your previous PUA claim and then write in the same date from the first PUA claim for when this new PUA initial claim should start.
  5. Per the directions on the first page of the new form, with your new PUA claim include the relevant documentation now required. Even though Wisconsin has always required this documentation to establish benefit year eligibility and even if you have previously provided this documentation, you must provide this supporting documentation now with this new PUA initial claim.
  6. If filing a new PUA initial claim with the new form, send the new PUA initial claim form along with the supporting documentation relevant to your specific PUA claim issue or issues to Wisconsin New PUA, PO Box 7905, Madison WI 53707. Use 2-day Priority Mail so that you get a tracking number. Do not send the documents via certified or registered mail.
  7. Call the PUA help line at 608-318-7100 for any questions you might have. Make sure to take notes for any advice you receive, writing down what that advice was, the date of the phone call, and who you spoke with. But, if the staffer tells you to withdraw a claim, ignore that advice.

Climate Change and jobs

With the role of winter in Wisconsin changing and the lack of winter work search waivers for unemployment benefits for those having seasonal jobs, consideration of new kinds of job programs is needed.

The UC Berkeley Labor Center has developed one such plan. This plan provides detailed recommendations that can be applied in other states to ensure quality jobs and which support workers under policies that reduce greenhouse gas emissions.

The Action Plan identifies specific complementary labor policies that can be incorporated into climate policies to generate family-supporting jobs and career pathways for disadvantaged workers. The plan hows how training investments can deliver the skills required to perform these high-quality jobs and broaden access for all workers. It also provides recommendations on the transition for workers in declining industries to comparable livelihoods.

There are a series of short briefs for specific industries:

Able and available during the pandemic

In late March 2021, the Labor and Industry Review Commission released Lewis v. Skogens Foodliner Inc., UI Hearing 20012206MD (26 March 2021), concerning being able and available for work when the pandemic started. The decision is whether a person who was a high-risk, vulnerable individual for severe illness because of Covid-19 remained able and available when she stayed away from work because of the pandemic with the support of her employer and pursuant to the orders of her doctor.

The Commission found that the employee, as a high-risk individual who was not subject to a clear instruction from an employer to return to work, remained able and available for work and so eligible for unemployment benefits.

The reasoning and factual finding is straightforward. But, until this decision appeared, all appeal tribunal decisions on the question of being able and available during the pandemic have denied eligibility.

In part, the difficulty of this issue in appeal tribunal decisions and initial determinations rested on the complex and haphazard history of how Wisconsin responded to the pandemic. To that end, Lewis provides a clear and understandable narrative that connects these responses to unemployment law and regulations and how claimants who are vulnerable to the pandemic acted reasonably when they stayed out of their workplaces (with the support of their employers).

During weeks when the emergency safer-at-home orders were in place, the Commission explains:

Section 7 of the Safer at Home Orders urges elderly people and those who are vulnerable as a result of underlying health conditions to stay home. Order #94 defines “people over 60 years of age” as vulnerable. The employee is 70 years old and suffers from respiratory issues. She is therefore “vulnerable” within the meaning of the Safer at Home Orders.

Emergency Order #7 and DWD Emergency Rule 2006 require the department to consider a claimant available for work if the claimant is quarantined (under Emergency Order #7) or instructed to stay home (under DWD Emergency Rule 2006) under government direction or guidance due to COVID-19 and the employer has not provided clear instruction for the employee to return to work. Such is the case here.

Lewis at 5. And, for the weeks when there was no emergency safer-at-home order, the Commission reasons:

In order to be considered available, a claimant must maintain an attachment to the labor market, be ready to perform full-time suitable work in the labor market, and must not be withdrawn from the labor market due to restrictions on his or her availability for work. A claimant is presumed to be able to work and available for work unless there is evidence that, in the relevant week, the claimant was not able to work or available for work. Wis. Stat. § 108.04(2). In determining whether an employee has withdrawn from the labor market, the commission considers, among other things, whether the claimant has placed “unreasonable restrictions on working conditions.” Wis. Admin.Code § DWD 128.01(2)(7) [should be 128.01(4)(a)(7)].

The employee is a vulnerable individual, as recognized by the Safer at Home Orders. She is at heightened risk for severe complications, should she contract COVID-19. The employee was instructed by her physician not to return to work that requires direct physical contact with the general public, due to her risk of severe illness from COVID-19. The employee remained willing to accept work that does not require that she have direct contact with the general public. The work that she is available to perform does not require special training or experience because she is available for all work with the only limitation being that she cannot work directly with the general public.

The employee has maintained an attachment to the labor market. She is ready and willing to perform full-time suitable work. Under the circumstances, the employee’s restriction on working conditions was not unreasonable.

An employee who is out of work during the COVID-19 public health emergency due to being at high risk of severe illness from COVID-19, but who is willing to accept work that does not put him or her at higher risk of contracting the virus, has not imposed an unreasonable restriction on working conditions, and is available for suitable work.

Lewis at 6 (footnote replaced with statutory reference).

Here is to hoping that the Department and its administrative law judges begin to follow Lewis. Indeed, the Department should re-open prior initial determinations that denied unemployment benefits to claimants who stayed home because of the pandemic. Claimants who have health conditions that made them vulnerable to severe illness because of Covid-19 and who avoided work either with the permission of their employer or because of a medical provider’s order remained able and available for work.

Credit and applause to JSO for handling this case and passing it on to me.

For those who need to look up the various legal documents cited in Lewis.

  • Emergency Order #7 (18 March 2020) and in effect until 9 May 2020: amending state unemployment able and available law and requirements in light of the pandemic.
  • Emergency Order #12 (24 March 2020) and in effect until 24 April 2020: the state’s first safer-at-home order, which closed numerous businesses, directed how other businesses could remain open, and directed that residents and workers stay at home when possible.
  • Emergency Order #28 (16 April 2020) and in effect until 13 May 2020, when struck down in relevant part in Wisconsin Legislature v. Palm, 2020 WI 42: the state’s second safer-at-home order, which closed numerous businesses, directed how other businesses could remain open, and directed that residents and workers stay at home when possible.
  • Emergency Rule 2006 (9 May 2020) and in effect until 6 Feb. 2021: amending state able and available law and requirements in light of the pandemic.
  • Emergency Rule 2106 (11 Feb. 2021) and in effect until 10 July 2021: amending state able and available law and requirements in light of the pandemic.
  • Executive Order #94 (10 Nov. 2020): recommends that vulnerable individuals should avoid Covid-19 health hazards and so continue to stay home.

The original 2012 SSDI ban reemerges in Evers’ 2021 budget proposal

For those with dyslexia, my apologies. But, in 2021 Wisconsin is actually returning to what happened in 2012. That is, Gov. Evers’ 2021 budget proposal seeks to return Wisconsin to the original 2012 SSDI eligibility ban for receiving unemployment benefits.

Here is the story of how disabled workers in Wisconsin continue to get the short end of the stick.

The original eligibility ban, dressed up as a financial offset

In November 2012, the Department introduced proposal D12-05, which stated in relevant part:

2. Create 108.05(7g) Social Security benefits.

(a) If a claimant is receiving, has received, or has filed for primary Social Security disability benefits for a particular week it creates a rebuttable presumption that the claimant is unavailable for suitable employment for that week, unless the claimant provides, on a Department form, a statement from an appropriate licensed health care professional who is aware of the claimant’s Social Security disability claim and the basis for that claim, certifying that the claimant is available for suitable employment. If the claimant provides a statement to overcome the rebuttable presumption, the claimant is still considered unavailable for suitable work unless the claimant earned base period wages under s. 108.06 (1) while receiving or having filed for primary Social Security disability benefits.

(b) Information from the Social Security Administration is considered conclusive, absent specific evidence showing that the information was erroneous.

3. Reason for the Amendments

Roughly 117,000 Americans double-dipped by cashing unemployment and Social Security disability checks, costing taxpayers a combined $856 million in fiscal year 2010, according to the Government Accountability Office. Nationwide the cash benefits they received totaled over $281 million from DI and more than $575 million from UI.

To understand why such “double-dipping” may constitute fraud, please note the following general requirements for each program:

To receive unemployment insurance benefit payments, claimants must state that they are able to work.
To receive disability insurance benefit payments, claimants must state that they are unable to work.

Under certain circumstances, it is possible that some individuals may be eligible for concurrent cash benefit payments due to differences in DI and UI eligibility requirements. Differences in program rules and definitions allow individuals in certain circumstances to receive overlapping DI and UI benefits without violating eligibility requirements. The Social Security Administration’s definition of a disability involves work that does not rise to the level of substantial gainful activity. In contrast, a state’s determination of “able and available for work” criteria for UI benefits may include performing work that does not rise to the level of substantial gainful activity. As a result, some individuals may have a disability under federal law but still be able and available for work under state law, thus eligible to receive DI and UI.

Footnote: A number of reviewing federal courts have held that a Social Security disability claimant’s acceptance of state unemployment compensation does not, in and of itself, prove an ability to work. See, e.g., Lackey v. Celebrezze, 349 F.2d 76, 79 (4th Cir. 1965) (claimant entitled to disability benefits where no showing made that claimant actually represented to state authorities that he was able to work or that he was aware of legal requirements for unemployment compensation); Kinsella v. Schweiker, 708 F.2d 1058, 1066 (6th Cir. 1983) (Swygert, J., dissenting) (noting that the mere receipt of unemployment insurance benefits does not prove ability to work); Roberts v. Callahan, 971 F.Supp. 498 (D.N.M. 1997) (although claimant had to state she was willing to work and that she applied for some jobs in order to receive unemployment benefits, case remanded to reconsider credibility determination); Alverio v. Chater, 902 F. Supp. 909, 928 (N.D. lowa 1995) (finding that claimant’s simultaneous receipt of unemployment insurance benefits and application for social security disability benefits did not negate her claim of disability or indicate substantial evidence of her lack of credibility); Riley v. Heckler, 585 F.Supp. 278 (S.D. Ohio 1984) (claimant entitled to award of past due disability benefits despite receiving state unemployment benefits); Flores v. Dep’t of Health, Educ. and Welfare, 465 F.Supp. 317, 322 (S.D.N.Y. 1978) (record showing that administrative law judge relied almost exclusively on claimant’s receipt of unemployment benefits failed to sustain denial of claim, but rather established that claimant made prima facie showing that he was unable to work at his former occupation).

Yet, many of individuals currently receiving both unemployment insurance benefit payments and disability insurance payments do not fall within that narrow category and are therefore committing acts of fraud. In general, legitimate beneficiaries of these social safety net programs can draw funds from one program, or the other, but not both at the same time.

Unemployment insurance benefits are not counted under the Social Security annual earnings test and therefore do not affect an individual’s receipt of Social Security benefits. Yet, federal law does allow that the unemployment benefit amount of an individual to be reduced by the receipt social security disability insurance benefits.

D12-05 at 1-3 (emphasis in original, except in last paragraph where emphasis added).

As explained to the council at the time: “the proposal was developed after review of the laws of a few different states and that [a] review of a number of states found that some states simply have a complete ban on the simultaneous collection of SSDI and unemployment insurance.” See Council minutes at 5.

Framed in this way, this proposed eligibility ban allegedly only applied to very few individuals. The Advisory Council pushed back on the retroactive application of this ban, see Advisory Council Meeting — 2/21/13 (21 Feb. 2013), but accepted that the eligibility ban should apply to all SSDI recipients, see Advisory Council Meeting — 1 April 2013 (1 April 2013).

The eligibility was then enacted as part of SB200/2013 Wis. Act 26.

The false assumptions within D12-05

There are more, but the following false assumptions are intrinsic to Wisconsin’s SSDI/UI eligibility ban and the whole concept of disabled people not also being workers.

The number of SSDI recipients affected by the eligibility ban

Originally, the Department only considered 50 or fewer claimants to be affected by this unemployment eligibility ban. See SSDI and unemployment: recent developments (5 June 2015). Then, when first implemented, the ban affected 687 claimants. Id. A few months later, the 2015 Advisory Council report at 8 indicated:

The ban on simultaneously collecting both Social Security Disability Insurance (SSDI) benefits and UI benefits saved hundreds of thousands of dollars for the UI Trust Fund as close to 3,500 UI claims have been denied through early May 2015.

These numbers were off by more than 150,000. In the 2012 annual SSDI statistical report, there were 157,689 SSDI recipients working in Wisconsin that year. In the 2015 annual SSDI statistical report, there were 161,864 SSDI recipients working in Wisconsin that year. The workforce in Wisconsin in these years was between 2,642,306 and 2,722,302.

That is, when the unemployment eligibility ban was first proposed, there were nearly 160,000 SSDI recipients working in Wisconsin. Not 50. Not 657. And, not even 3,500.

Disabled people, work, and substantial gainful activity

The proposal created a picture of disabled folks being either disabled and receiving SSDI benefits or working and NOT being disabled. This picture is ludicrous, based on the number of SSDI workers in the state and the size of the state’s workforce.

  • In 2012, 1 in 16.76 Wisconsin workers were receiving SSDI benefits.
  • In 2015, 1 in 16.82 Wisconsin workers were receiving SSDI benefits.

As obvious here, one out of seventeen workers in Wisconsin IS receiving SSDI benefits. So, disabled people ARE working. In fact, nearly all disabled people receiving SSDI benefits were working (more than 90%). In 2015, the total number of SSDI recipients in Wisconsin was 178,051. So, only 16,637 SSDI recipients in 2015 were NOT working, or 9.34% of all SSDI recipients. In 2019, 156,887 out of 184,985 SSDI recipients worked. The effect of the SSDI eligibility ban was actually creating what it alleged, as four years later the number of SSDI recipients was down to 84.8%.

Disabled workers are NOT working, for the purposes of SSDI eligibility, in “substantial gainful activity.” Rather, literally 150,000+ Wisconsin residents are working part-time jobs of various kinds to supplement their monthly SSDI benefit. As noted below, none of them are getting rich off of this work or in combination with their SSDI benefits. They are working because they need to work and because they want to work.

But, because they have a major physical or mental disability, they can no longer function in the kind of work they previously did and which previously supported them. Their disability is life-altering, and so they become eligible for SSDI benefits because of that disability and when they have sufficient earnings prior to becoming disabled to establish financial eligibility. See this background discussion of SSDI eligibility from the 2019 SSDI statistical report for the history and mechanics of SSDI benefits.

Note: There are many programmatic and financial incentives for disabled individuals to return to gainful, substantial work. So, numerous individuals may receive SSDI benefits for several years because of their disability until they can learn new techniques and skills in response to that disability. A person who loses a hand certainly is disabled. Over time that person might learn to function adeptly at some profession with just one hand, and hence no longer be disabled. In the meantime, however, that person may well work as a cashier at a fast food restaurant for a few hours a day. The SSDI program is currently set up to encourage individual to find substantial gainful employment through training programs, trial runs at full-time work, and taking on part-time jobs as ways for SSDI recipients to transition off of the benefit program.

The income of SSDI recipients

The unemployment claimants I am currently working with receive a monthly SSDI benefit at around $600 at the low end and over $1900 at the high end (these claimants at the high end are blind or missing limbs and had substantial earnings before becoming disabled). As obvious here, no one is getting rich from their SSDI benefits.

For 2015, the average monthly SSDI benefit in Wisconsin was $1,157.75 and the median SSDI benefit was $1,074.00. That year, 10.5% of SSDI recipients in Wisconsin received less than $600 per month. See Table 16 of the 2015 SSDI statistical report. In 2019, the average monthly SSDI benefit in Wisconsin was now $1,246.39 and the median SSDI benefit was $1,156.00. That same year, 9.4% of SSDI recipients in Wisconsin received less than $600 per month. See Table 16 of the 2019 SSDI statistical report.

So, nearly all SSDI recipients need to work in some way to supplement their meager SSDI benefit. Under Social Security law, SSDI recipients can receive a certain amount of income from work without that income affecting their SSDI eligibility. In 2020, that amount was $1260 per month. To put that number in perspective, that monthly income would produce a weekly benefit rate for unemployment benefits of only $144 per week.

As noted above, there are numerous programs for encouraging SSDI recipients to work more hours and receive additional income without affecting their SSDI benefit for a certain period of time. In this way, the SSDI program allows for a transition period in which SSDI recipients can return to full-time regular work and substantial gainful activity without immediately losing their SSDI benefits.

This transition period is crucial for many SSDI recipients because the key benefit available to SSDI recipients is availability of Medicare coverage after they have received SSDI benefits for two years. As SSDI recipients have a disability for which medical coverage is most likely essential, they cannot at all afford to lose that coverage even for a day.

Given that Wisconsin has failed to expand its Medicaid coverage under the Affordable Care Act, SSDI recipients usually cannot afford purchasing their own medical coverage. That is, SSDI recipients need to maintain their Medicare coverage until they can land a full-time job that includes medical coverage for them and their families as a benefit to that job.

So, SSDI recipients are working because they absolutely need to work in order to pay their basic food and rent bills. And, just like any other worker, SSDI recipients can be laid off or need to quit a job for good cause just like any other worker. They are not “a narrow category” of individuals. Nor are SSDI recipients and workers distinct from each other as theorized in the Department proposal.

SSDI recipients work just like everyone else who works, and SSDI recipients are just as likely to lose jobs just like everyone else. That is why unemployment insurance benefits are NOT counted for federal purposes against an SSDI benefit.

In the day-to-day lives of disabled people, there simply is no either/or with SSDI and work/unemployment. For SSDI recipients, there is work and unemployment just like with the non-disabled. In contrast to non-disabled workers, however, the Department proposed here to cut the disabled off from receiving unemployment benefits because the Department pretended that disabled people did not actually work. And so, the Department cruelly proposed taking away unemployment benefits from a group of people already struggling to get by because of disabilities after losing essential jobs. The Department took this action under the guise of preventing these disabled workers from “double-dipping” into two different “safety nets.”

Double-dipping and fraud

Because the Department presumes that disabled people receiving SSDI do NOT work, it than accepts the converse claim that SSDI recipients should NOT be eligible for unemployment benefits. In this worldview, any disabled person receiving both SSDI benefits and unemployment benefits is “double-dipping.”

Hence, the example cited by the Department as justification for this eligibility ban is an individual who falsified both SSDI and unemployment claims in New Mexico, Wisconsin, Kansas, and Montana. See D12-05 at 5. For the Department, anyone receiving both SSDI benefits and unemployment benefits is presumed to be fraudulent.

But, as the numbers above reveal, this example is pretending that one person’s fraud applies automatically to all disabled persons who lose jobs and want to claim unemployment benefits because of that job loss. The ten of thousands of disabled workers are NOT committing fraud when they work. They are just working, as the SSDI programs allows and encourages them.

The lengthy footnote in D12-05 reveals that under Social Security law work and unemployment benefits do NOT indicate a lack of disability. In short, that footnote contradicts completely the idea in the proposal that work and unemployment eligibility is antithetical to SSDI eligibility and benefits. Yet, this text and the legal holdings set forth in the court decisions matter for naught. See also this 2006 letter and this 2010 letter from the Social Security Chief ALJ to other Social Security administrative law judges over the role of unemployment eligibility in assessing SSDI benefit claims. Actual law is not going to get in the way of the Department’s perception of “double-dipping.”

Eligibility ban vs. fiscal offset

The Department’s presentation of this proposal switches without explanation from it being an eligibility ban to a financial offset.

The proposed statutory language is an obvious eligibility ban. But, the discussion of the proposal is replete with examples and rhetoric about a fiscal offset. For instance, the closing sentence quoted above from the proposal: “Yet, federal law does allow that the unemployment benefit amount of an individual to be reduced by the receipt social security disability insurance benefits.”

And, in a description of the equitable effect of this proposal: “The overlapping payment of both social security disability insurance and unemployment insurance payments under the structure of both programs should be the exception.” D12-05 at 4.

When the proposal came under legal challenge, the Department’s efforts at defending it, as detailed below, turned almost completely to an argument about D12-05 being a fiscal offset to prevent dual payment of disability and unemployment benefits.

Not surprisingly, even the Department’s legal claims about what other states had done lacked basic support. At the time of this proposal, only two states actually applied a financial offset, and that offset was 50%, not 100%, and only North Carolina had an eligibility ban. See DWD Proposal D15-01 — Legal Red Flags at n.7, citing Comparison of State Unemployment Laws: Ch.5, Nonmonetary Eligibility at 5-45.

Note: North Carolina enacted its own SSDI ban — declaring SSDI recipients unable to work — the same year as Wisconsin. See N.C.S.L. 2013-2 § 5 (19 Feb. 2013).

Subsequent research reveals that Minnesota’s 50% offset actually only applies when a person starts receiving SSDI benefits. See Minn. Stat. § 268.085, subd. 4a. After his or her benefit year is over, there is no deduction for SSDI benefits See this explanation from 2015.

Furthermore, Illinois removed its 50% offset for SSDI recipients in 2016. See IL P.A. 99-488 (eff. 3 Jan. 2016), which removed the 50% offset and any eligibility limitation based on SSDI benefits; see also 820 ILCS 405/611.

Note: This rhetorical shift from eligibility ban to financial offset reoccurred in 2020 when the Department described its state law to federal officials. See this letter brief at 3-5.

The first test of D12-05

As enacted, this eligibility ban did not fare well at first. In Gary Kluczynski, UI Hearing No. 14400214AP (30 May 2014), the Commission held that this original ban on receiving unemployment benefits only applied to a single week in which SSDI benefits were received. In practice, then, this eligibility ban was a financial offset. But, importantly, this financial offset was only for one week of unemployment benefits per month.

A dozen or so other SSDI recipients then had their eligibility bans on unemployment benefits redone in light of Kluczynski. The Department was not happy at all.

The Department’s response to Kluczynski: D15-01

The Department challenged Kluczynski and companion cases in court, and those challenges eventually led the Department to revise to its benefit the venue and departmental error provisions in unemployment law. See Department proposals, 2021 edition, and going back to 2019 (22 March 2021) (reviewing Department changes to departmental error) and UI bill public hearings and UI concealment (12 February 2016) (describing opposition to court review changes proposed by the Department).

At the 16 April 2015 meeting of the Advisory Council, the Department voiced its opposition to Kluczynski:

SSDI — Currently, there are several SSDI cases on appeal to the circuit court. One case has been fully briefed and the department is awaiting a decision. As indicated by the litigation, the department has a difference of opinion with LIRC. LIRC has only recently raised concerns regarding the American with Disabilities Act (ADA) and other issues relating to benefit ineligibility. The current statute was approved by USDOL and federal law allows a total reduction of benefits for disqualifying income. LIRC is referencing policy considerations. Policies are decided by the Council, Legislature and Governor.

Council Minutes at 8. The Department also proposed a re-write of the eligibility ban in D15-01 to create an eligibility ban that applied to every week a person received unemployment benefits, so as to undo the holding in Kluczynski regardless of any court decisions.

Note: The Commission’s concerns over the Department’s SSDI eligibility ban were not “policy” differences with the Department but specific legal problems with an eligibility ban running up against federal anti-discrimination law, SSDI law, and federal requirements for state administration of its unemployment program. See DWD Proposal D15-01 — Legal Red Flags.

D15-01 is the eligibility ban that we have today. Despite warnings from the Commission and myself, the Advisory Council approved of D15-01 at its April 2015 meeting, see SSDI benefits and unemployment (22 April 2015), and this proposal was enacted as part of 2015 Wis. Act 334/AB819.

Note: Actual passage was a story in itself. See Update on UI legislation (16 March 2016).

As currently enacted, this ban consists of the following statutory provisions.

Wis. Stat. § 108.04(2)(h):

A claimant shall, when the claimant first files a claim for benefits under this chapter and during each subsequent week the claimant files for benefits under this chapter, inform the department whether he or she is receiving social security disability insurance payments, as defined in sub. (12) (f) 2m.

Wis. Stat. § 108.04(12)(f):

1m. The intent of the legislature in enacting this paragraph is to prevent the payment of duplicative government benefits for the replacement of lost earnings or income, regardless of an individual’s ability to work.

2m. In this paragraph, “social security disability insurance payment” means a payment of social security disability insurance benefits under 42 USC ch. 7 subch. II.

3.a. Except as provided in subd. 3. b. to d., an individual is ineligible for benefits under this chapter for each week in the entire month in which a social security disability insurance payment is issued to the individual.

b. In the first month a social security disability insurance payment is first issued to an individual, the individual is ineligible for benefits under this chapter for each week beginning with the week the social security disability insurance payment is issued to the individual and all subsequent weeks in that month.

c. Following a cessation of social security disability insurance payments to an individual and upon the individual again being issued a social security disability insurance payment, the individual is ineligible for benefits under this chapter for each week beginning with the week the social security disability insurance payment is issued to the individual and all subsequent weeks in that month.

d. Following cessation of social security disability insurance payments, an individual may be eligible for benefits under this chapter, if otherwise qualified, beginning with the week following the last Saturday of the month in which the individual is issued his or her final social security disability insurance payment.

The Evers’ SSDI budget proposal

In his 2021 budget, Gov. Evers proposed replacing the current eligibility ban with a 100% financial offset. While the budget bill is thousands of pages long, the SSDI-UI provisions number just a few pages.

As proposed, Gov. Evers transforms the current eligibility ban into a 100% financial offset applied on a weekly basis to claimants wanting unemployment benefits.

The continued presumption that disabled folk do not work

A weekly financial offset on unemployment benefits will have a devastating impact on SSDI recipients. Given that most SSDI recipients are working in low-wage work and usually earning a thousand dollars or less per month, they qualify for some of the lowest weekly benefit rates allowable in Wisconsin.

For example. a disabled worker receiving $800 a month in SSDI benefits would, under Gov. Evers’ proposal, find that $200 per week would be applied against their weekly benefit rate. So, to receive an actual unemployment benefits, this disabled worker would need to have a weekly benefit rate greater than $200 to receive any actual unemployment benefits.

None of my current SSDI clients have a weekly benefit rate higher than $174. Most have the minimum weekly benefit rate available in Wisconsin for PUA benefits — $163. If the minimum PUA rate did not apply to them, their weekly benefit rate would be well below $163 and probably less than $120, if they qualified at all for a benefit year.

Here is an extremely conservative estimate of who would be affected by this eligibility ban — nearly all SSDI recipients in Wisconsin who ever lose work.

12 weeks (less than the avg claim length in 2018 and 2019)
$100 avg WBR for SSDI recipients
40,000 SSDI recipients (out of 150,000+) who lose a job through no fault of their own in a calendar year
-----------
$48,000,000 in annual unemployment benefits at issue

So, under Gov. Evers’ SSDI offset budget proposal, $48 million in unemployment benefits to SSDI recipients would likely go unpaid. Even if the number of SSDI recipients is halved to 20,000, the impact on unemployment benefits at issue is still $24 million.

And, this offset would likely be as comprehensive as any eligibility ban. Only claimants with a monthly SSDI benefit of less than $400 a month would still be eligible for unemployment benefits under this scenario. That low amount for a monthly SSDI benefit, however, is highly unlikely, as the Wisconsin SSDI benefit average in 2019 was $1,246.39.

On the other hand, a weekly benefit rate of $100 (or less) for SSDI recipients is extremely likely. So, Gov. Evers’ proposal would continue to keep $48 million in unemployment benefits out of the hands of SSDI recipients through a financial offset rather than an eligibility ban.

Note: These numbers pale in comparison to the under-reported Department numbers, when in 2015 the Department congratulated itself on halting benefits to around 3,500 SSDI recipients (see p.8 of the council activities report) and thereby preventing $2.3 million in unemployment benefits from being paid out (see p.34 of this financial report).

Gov. Evers’ budget proposal may end the outright discrimination going on with SSDI recipients. But, it does not stop the cruelty of cutting them off from a vital workplace right when they most need it financially. Gov. Evers should know better. At least under Kluczynski, SSDI recipients could still receive unemployment benefits on the weeks they did not receive their SSDI check. But, Gov. Evers’ offset proposal goes further than what exists in any other state to create a financial offset that in practical terms accomplishes what the original 2012 SSDI proposal sought to accomplish: preventing SSDI recipients from receiving any and all unemployment benefits under the guise of preventing these disabled workers from “double-dipping” into two different “safety nets.”

Should this proposal pass, SSDI recipients in Wisconsin ought to leave a state that excludes the work that more than 90% of them perform from mattering when they stop working through no fault of their own. They have suffered enough. Nearly every other state outside of North Carolina would allow SSDI recipients to receive any unemployment benefits due them without any offset whatsoever (as previously noted, the 50% offset in Minnesota only applies during the claimant’s first year of SSDI benefits). There simply is no reason why Wisconsin should continue to persecute disabled folks as it has been doing.

New portal 2.0 and how to navigate it, or old wine in a new bottle

Update (30 April 2021): Made the headline more descriptive.

The Department has been announcing its new unemployment portal.

New UI portal home screen with messages and claim status showing

The problem with this new portal is that basic functionality and information remains unchanged. All that has happened is that the Department has replaced a few menu commands with some new icons. The confusing messages about claim status, the lack of access to the legal documents that decide claim status like benefit year calculations remain, and the multiple layers and clicks to find key information and documents that might or might not be available are still present. Furthermore, there is still no instruction or guidance from the Department about how to navigate the portal to accomplish vital tasks, like appealing an initial determination.

One of the first problems claimants will notice is that not all commands/tools are available to all claimants. For instance, the Department is advertising how claimants can now upload documents. But, that feature is only available to certain claimants when the Department itself decides that those claimants need that ability. The portal for the PUA claimant shown below lacks the document upload tool.

Portal home with no document upload tool

Looking for issues and determinations leads to a confusing and incomplete presentation in which only the current issues and determinations are listed. Clicking on the Determinations button

Selecting the determinations icon

takes claimants to a Determinations and Appeals page:

Determinations and appeals for a claimant

This listing, however, only provides current determinations and appeals. Determinations that have NOT been appealed but which are still denying benefits are NOT listed here.

The issue listed at the top for each of these determinations, moreover, do NOT at all describe the initial determinations themselves.

Furthermore, there may be other determinations for which no initial determination was issued. Click on View Determinations History to see what other determinations might be connected to you.

Click on View Determinations History

Here, more determinations connected to you may appear:

Determinations history for a claimant

In this screenshot, there are now four determinations rather than just the two that have been appealed.

The one for the week 26/2019 indicates that a quit in 2019 is NOT disqualifying because the claimant subsequently earned enough wages to satisfy any disqualification connected to that quit. There is no initial determination connected to this listing. And, there are two for week 15/2020: one disqualifying the claimant issued on 10/28/2020 (which per the Determinations screen above we can see that the claimant has appealed) and another issued on 7/24/2020 finding the claimant eligible for PUA benefits. Finally, there is a determination for week 31/2020 that was issued on 12/31/2020 finding that the claimant quit a job and so is disqualified from receiving unemployment benefits (per the Determinations screen above, we can see that this determination also was appealed).

These are NOT all the documents available to this claimant, however. The Document History option detailed below remains the only viable option for seeing all the documents connected to an unemployment claim.

The appeals option is problematic as well. Selecting Appeals

Selecting the appeals option on the new portal

will only show the determinations that can still be appealed. Determinations for which an appeal would be late are NOT listed.

No determinations that can be appealed are listed

To find an appeal online for an older initial determination, claimants have to click on the Find Determination button, enter the number of the initial determination they want to appeal, and then click on still another Find Determination button.

Enter initial determination number and click on the find button

The initial determination number is the number in the upper left corner of initial determination.

Layout of an initial Determination explained

Since most claimants do not track these initial determination numbers, this requirement for an initial determination number for finding an old initial determination creates a major roadblock for filing any late appeals.

Finally, the claim status messages remain as confusing as ever. These messages are generated when a Department staffer does anything involving an unemployment claim. They do NOT reflect the actual legal status of the claim.

Misleading claim status message

Claimants should continue to ignore these messages because they often mean nothing and can actually be misleading.

So, the portal’s usefulness remains limited to two tasks: a claimant’s document history and a claimant’s benefit payment history. Here is how those tasks work with the new portal.

Document history

Your Document History will list some of the important documents connected to your claim, and it provides a central location for finding those documents on your portal.

Claimant document history

To get to your Document History, follow these steps.

1. Click on the Menu button on the upper-right corner of the screen.

Selecting Menu in the upper right hand corner

2. After clicking on Menu, you will see a screen similar to the following:

All menu options revealed after clicking on the Menu button

3. Click on the Document History option.

Document History option to click on

4. The Document History screen is then revealed.

Claimant document history

5. Click on the View button next to each document to see that specific document. Notice that initial determinations, appeals, appeal confirmations, and telephone hearing packets — labeled as Telephone Instructions — are available here.

Benefit payment history

In contrast to the document history process, claimants’ access to their benefit payment history has been improved.

1. Click on the Print Benefit Statements icon.

Print benefit statements icon selected

2. The following screen is presented to you.

Print benefit summary screen

3. Make sure the checkbox By choosing to create a formal summary, I acknowledge that it will include personal infromation such as my name and Social Security Number is checked and that Create a PDF document is selected.

Print benefit summary with options selected

4. Click on the Create Document button.

Click on the Create Document button

5. A PDF printout of your benefit claim and payment history will appear on your screen or be prompted to be downloaded.

Sending a PDF document via e-mail

Do NOT send any PDF documents via e-mail message that have confidential information like social security numbers or bank account information. Initial claims/applications and telephone hearing packets/instructions almost always have raw social security numbers visible to anyone.

  • On a smart phone: when viewing the PDF, click on the share button and then select the e-mail option. Make sure to then write in an e-mail address and a subject.
  • On a desktop: download the PDF document, start up your e-mail program, and then attach the PDF to a new e-mail address that you are sending to someone (make sure to fill out a subject and to whom the message is being sent).

Tax matters

Given the delays with unemployment claims in Wisconsin, eventual payment of benefits is leading to folks receiving lump sum payments of $10,000, $15,000, or even $20,000 or more.

Payments that large will mean a federal and state income tax liability, IF you do not have state and federal taxes deducted automatically at the time benefits are paid — aka, tax withholding.

Note: Because benefit payment levels are generally low in Wisconsin, having taxes deducted from benefit payments has usually NOT been an issue. With the supplemental funding from the $600 PUC in spring and summer of 2020 and the $300 PUC in 2021 and because lump sum payments are including six to twelve months of benefits, the amounts being paid are now much, much larger than normal.

Keep in mind that income taxes are almost always paid on a calendar year basis. So, for income tax purposes what matters is in which year benefit payments are made. The weeks being claimed is what matters for unemployment, but is inconsequential for your income tax.

Note: A vital document everyone should have is a PDF of their benefit payment history. Instructions for getting that PDF document are available here. As noted in these instructions, follow them carefully. You should probably be getting a new PDF of your benefit payments every month.

2020 income taxes

If a large payment was made to you in 2020, the American Relief Plan allows waiver of the first $10,200 in unemployment benefits received on your federal income taxes.

But, in Wisconsin state income tax is still owed on all unemployment benefits received. As of yet, there is no waiver of state taxes owed on unemployment benefits received. Instructions for paying the taxes owed are here.

If you have already filed your 2020 federal income taxes before mid-March 2021 when the American Relief Plan was enacted, the IRS will automatically make the waiver correction on your federal tax return. So, there is no need to file an amended tax return to the IRS.

2021 income taxes

Income tax returns for the 2021 calendar year are not due until 2022. But, a big payment of unemployment benefits in 2021 of $10,000 or more will likely mean that you should be filing both federal and state estimated taxes on a quarterly basis to avoid penalties. These estimated tax payments are needed if federal and state income taxes are not automatically deducted from your unemployment benefits when those benefits are paid. Estimated taxes are due for earnings received:

  • January thru March: estimated taxes postmarked or paid by April 15th
  • April and May: estimated taxes postmarked or paid by June 15th
  • June thru August: estimated taxes postmarked or paid by Sept. 15th
  • September thru December: estimated taxes postmarked or paid by 18 January 2022 (but, to avoid calendar year confusion and issues, you should probably make this last payment before December 31st)

For example, if you receive a big payment of unemployment benefits in March 2021 without any federal or state income tax deductions, then you should probably file both a federal and state estimated tax payment for the first quarter of 2021 by April 15th.

If federal tax deductions were made from that benefit payment but no state deductions were made, then you only need to file a state estimated tax payment.

If state tax deductions were made from that benefit payment but no federal deductions were made, then you only need to file a federal estimated tax payment.

Obviously, the requirement to pay estimated taxes when there is no tax withholding also applies when those weekly benefit payments add up over time. With the addition of the $300 PUC until September 6th of this year, a person with a weekly benefit rate of $300 will be receiving $600 each week. Ten weeks of those payments will be $6000, and fifteen weeks will be $9,000. So, it will be a good idea to make an estimated tax payment for that amount where there is no tax withholding.

Even when back to work but at a reduced schedule, you will probably still be eligible for unemployment benefits, including the $300 PUC. So, these benefits will add up quickly, and tax withholding from your workplace wages will not be enough to cover the income tax liability.

In other words, if you are receiving unemployment benefits in 2021 and there is no federal and state tax withholding when those benefits are paid, you should consider filing quarterly estimated tax payments.

Here are the forms needed for filing 2021 estimated taxes:

Note: The spreadsheet, the information presented in this post, and the links to other websites and information is for your own personal use and is not intended as tax advice or guidance for your specific situation. Per IRS Circular 230 Disclosure requirements: To ensure compliance with requirements imposed by the IRS, any US federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code, or (ii) promoting, marketing, or recommending to another party any transaction or matter discussed herein.

The Department of Workforce Development itself has information about tax withholding and for turning tax withholding on or off. To avoid estimate tax payments in the future, make sure to turn tax withholding for state and federal income taxes on. For any unemployment benefit payments received without tax withholding, consider making the estimated tax payments described here.

Department proposals, 2021 edition, and going back to 2019

At the 18 March 2021 meeting of the Advisory Council, the Department began introducing its own proposals for changing unemployment law. More proposals are expected. These first proposals are appearing first because they were originally put forward during the last legislative session. The pandemic, however, meant that these proposals were never acted on.

Some of these proposals are innocuous. Others combine difficult and complex issues with a less than forthright explanation. What follows are these first proposals, their 2019 versions, and an assessment of what is going on.

D21-01, Creating an administrative fund

Here, as in D19-09, the Department seeks to create a permanent administrative fund for its own use.

As explained in the 2021 and 2019 proposals on this issue, there already exists an administrative account under Wis. Stat. § 108.20 that contains the interest and penalties paid by employers who fail to submit timely tax reports and payments.

This account, however, “lapses” at the end of a legislative session, and so any funds in this account gets transferred to general state funds rather than remaining a specific unemployment income/expense item.

The proposal here is to change the administrative account into an administrative fund that cannot “lapse,” so that these funds remain available to the Department. As explained in the fiscal impact:

The most recent lapse expenditures of employer interest and penalties monies occurred in SFY16 and SFY17 of approximately $2.67 million and $2.23 million respectively. This proposal would result in an additional $2 – $3 million in funds remaining within the UI program during years where lapse is in effect.

D21-01 at 3.

In past years, the interest and penalties employers paid were apparently so small that a lapse into the general fund was inconsequential. Now, with these interest and penalties numbers over $2 million, the amount is sizable and worth hanging on to.

Left unexplained by the Department here is why the interest and penalties paid by employers have of late increased so much. The Department’s targeting of small employers for unpaid tax liabilities has noticeably increased the last few years. But, members of the Advisory Council are left to guess why the Department now has $2+ million in this administrative account.

Note: The administrative fund/account here is separate from the Program Integrity Fund under Wis. Stat. § 108.19(1s) and the interest payment fund under Wis. Stat. §§ 108.19(1m) to (1q) when paying interest on federal loans to the unemployment trust fund. As of February 2021, the Department’s program integrity fund was nearly $16 million.

D21-02, Appropriations and technical fixes

This proposal and is predecessor, D19-08, involve hundreds of small changes in wording and statutory references.

In part, these changes are needed in light of the creation of an administrative fund in D21-01. This 2019 memo lists the changes being proposed.

D21-03, REDA for reimbursable employers

Through D15-04, the Department created a reimbursable employer fund to cover benefit charges that arise from identity theft. Because reimbursable employers pay dollar-for-dollar for any benefits paid to a claimant, benefits paid because of identity theft mean that there is no actual claimant from whom the stolen benefits can be recouped. See The first of the DWD-sponsored proposals have appeared in legislation (22 Oct. 2015), DWD/Advisory Council bill going forward (29 Jan. 2016), and 2015 Wis. Act 334 § 73.

From an initial set aside of $2 million for this identity theft fund, there is today around $1.9 million still available.

The Department now proposes here and in D19-01 to use some of these funds to reduce the taxes reimbursable employers pay for covering situations when other reimbursable employers lack the available funds for covering the unemployment benefits owed to claimants.

Note: These shortages from reimbursable employers most often arise when the reimbursable employer closes unexpectedly, leading to its former employees filing claims for unemployment benefits but no employer available for reimbursing the Department for the benefits paid out.

When such shortages arise, the remaining reimbursable employers are charged an additional fee called the reimbursable employer debt assessment or “REDA” to cover this shortage.

The Department proposes that a limited amount of the reimbursable employer identity theft fraud funds set aside in the balancing account be made available to recover uncollectible reimbursements instead of assessing the REDA (or to reduce the amount of the REDA). This would greatly reduce administrative costs to the Department and non-profit reimbursable employers and relieve those employers of having to pay the REDA. The Department proposes that the identity theft fraud funds be used to pay the REDA only if the use of those funds would not reduce the balance of the funds below $1.75 million. This would ensure that the bulk of the identity theft fraud funds are available for restoring identity theft charges.

The Department also proposes to increase the minimum amount of the REDA from $10 to $20, which would reduce the administrative costs of assessing the REDA.

What is left unsaid in this proposal is whether the Department will stop its collection efforts against reimbursable employers who have defaulted and created the uncollectible debt in the first place.

D21-04, Changing the timing of DWD reports

This proposal and its predecessor, D19-19, are less complicated than they seem.

The Department is responsible for releasing three reports and conducting one event — the public hearing. Here is the current schedule:

  • public hearing every two years (usually in November) of even numbered years
  • fraud report released annually in March of each year
  • financial outlook report released in April on odd years every two years
  • Advisory Council report released in May on even years every two years

Essentially, the Department wants to shift the financial outlook report to being released in May every two years on even numbered years. Because the financial report is shifted to even-numbered years, the Department wants to move up the Advisory Council report to January. The new schedule would be:

  • public hearing every two years (usually in November) of even numbered years
  • Advisory Council report released in January on even years every two years
  • fraud report released annually in March of each year
  • financial outlook report released in May on even years every two years

The impetus for this change is so that most of the reports and information become available when unemployment legislative proposals are brought before the legislature. Right now, an odd-numbered year, is when those proposals first appear and are developed. Next year — an even-numbered year — is when those proposals are likely to be brought before the legislature. Apparently, the Department wants to use the Advisory Council report and the financial outlook report to support whatever proposed legislative changes are being pushed for at the time.

As a consequence, the focus of the Department’s efforts with this change is being pointed to a specific legislative session, rather than any general, long-term view of the unemployment system as a whole.

D21-05, Avoiding DOR debt collection

As many claimants can already attest, the Department is incredibly effective at debt collection.

In this proposal and its 2019 version, D19-22, the Department proposes to exempt itself from Wis. Stat. § 71.93(8)(b), which requires state agencies to enter into an agreement with the Department of Revenue for collecting long-term debts.

Given how effective the Department has been at collecting unemployment debts and the tools available to it — offsets against unemployment benefits, interception of tax refunds, liens against real estate and cars, wage garnishments, levies of bank accounts, and re-payment plans — debt collection by the Department of Revenue adds unnecessary layers and additional fees. So, this proposal makes sense.

D21-06, Excluding appeal tribunals from the definition of departmental error

Revamping departmental error has been a constant item on the Department’s agenda. Over the past decade, the Department has changed unemployment law to excuse its mistakes rather than actually correcting its actions and policies. Here is what the Department has done so far:

This new proposal dates back to when the SSDI eligibility ban was enacted and was originally set forth in D19-07.

Recall that the original SSDI eligibility ban was poorly drafted, see D12-05, and the Commission held in Gary Kluczynski, UI Hearing No. 14400214AP (30 May 2014) that this original ban on receiving unemployment benefits only applied to the week in which SSDI benefits were received. In D15-01, the Department proposed the eligibility ban that we have today.

Between D12-05 and D15-01, the Department challenged the Commission over Kluczynski and other SSDI recipients it and appeal tribunals had originally found eligible for unemployment benefits under D12-05. The Department won many of those cases in circuit court, and the Commission then changed its mind and agreed with the Department that SSDI recipients were not eligible for unemployment benefits.

But, when the Department began seeking to recoup unemployment benefits against SSDI recipients, the Commission held that it and appeal tribunals had gotten the law wrong and so these SSDI claimants did not need to repay the unemployment benefits they had received. The Department then took this repayment issue to the appeals court and lost decisively in DWD v. LIRC (Morse), 2017 WI App 68:

DWD’s argument is that it should be permitted to recover the overpayments if there was a reasonable basis for DWD’s mistake. In essence, DWD contends that a departmental error stemming from a misinterpretation of law should not preclude overpayment recovery if the misinterpretation was reasonable.

As stated, Wis. Stat. § 108.02(10e)(am)1. defines “[d]epartmental error,” in part, as follows: “A mathematical mistake, miscalculation, misapplication or misinterpretation of the law or mistake of evidentiary fact, whether by commission or omission.” Nowhere in the statute do the words “reasonable” or “unreasonable” appear. We may not add words to the statute’s text. Words excluded from a statutory text must be presumed to have been excluded for a purpose. Heritage Farms, Inc. v. Markel Ins. Co, 2009 WI 27, ¶14 & n.9, 316 Wis.2d 47, 762 N.W.2d 652. “One of the maxims of statutory construction is that courts should not add words to a statute to give it a certain meaning.” Fond Du Lac Cty. v. Town of Rosendale, 149 Wis.2d 326, 334, 440 N.W.2d 818 (Ct. App. 1989). We deduce the legislature’s intent from the words it has chosen. See id. at 332. We reject DWD’s invitation to add additional requirements to these existing statutes. The legislature did not choose to insert adjectives such as “reasonable” or “unreasonable” or “longstanding” to limit the statutory terms “misapplication or misinterpretation of the law.” We have no power to insert what the legislature chose to omit.

Even if we did have such power, we would not exercise it here. First, we see no benefit to the claimants, DWD, LIRC, or the courts, in imposing DWD’s proposed “reasonable misinterpretation” exception to the waiver statute. Such an addition would result in additional litigation about whether an interpretation, though pronounced an error of law by a court, was still “reasonable.” Such a debate would inevitably cause unnecessary and unproductive expenditure of agency and judicial resources. It is a court’s job to interpret statutes. See Ott v. Peppertree Resort Villas, Inc., 2006 WI App 77, ¶11, 292 Wis.2d 173, 716 N.W.2d 127 (describing what a court must do when interpreting statutes). Courts should not be drawn into collateral litigation about whether a wrong interpretation was nonetheless “reasonable.” One person’s “reasonable” (e.g., an agency that wants its money back to pay other benefits) can be another person’s “absurd” (e.g., an unemployed claimant who really needed the money, did not misrepresent anything, was entitled to the benefits under the prevailing statute interpretation, and spent it before the court decision). DWD’s approach, if adopted, would produce the opposite of the certainty and predictability that the administrative system of unemployment benefits was designed to produce. We cannot conclude that DWD offers a more reasonable interpretation of Wis. Stat. § 108.02(10e)(am)1. than LIRC. See DWD, 375 Wis.2d 183, ¶11.

Morse at ¶¶22-4.

So, in D19-07 and now D21-06, the Department wants to overturn Morse without mentioning this court decision at all (and instead indicating that this issue is only a minor and technical dispute between it and the Commission) in order to make sure that any unemployment benefits that ever go to SSDI recipients in the future will always have to paid back. The Department’s explanation for the fiscal effect of this change reveals that this change in the law is very much about SSDI benefits:

To determine the impact of the proposed change, 2015-2017 data was reviewed for LIRC determinations that found departmental error based on appeal tribunal determinations. There were no LIRC decisions that found departmental error in 2016 or 2017 and in 2015, there were approximately 10 determinations. The total overpayment for all affected determinations was approximately $6,560, which claimants would now be required to pay back if departmental error could not be found on appeal tribunal determinations. At an 80% collection rate, this results in an average savings to the Trust Fund of $5,200 annually. Since there were no LIRC decisions that found departmental error [by an administrative law judge] in 2016 or 2017, the Trust Fund savings may be less going forward.

As this explanation indicates, the only cases at issue here are the 2015 and earlier SSDI cases for which the Department wanted to recoup unemployment benefits.

The other problem with this proposed legal change that is not mentioned at all is that the current understanding of departmental error has been in existence for decades and serves as an important check against appeal tribunals for getting basic unemployment law wrong. See, e.g., Parker v. Cady Cheese Factor Inc., UI Hearing No. 05200982EC (12 Aug. 2005) (an interpretation of a statutory provision which disregards a contrary long-standing interpretation by the commission constitutes departmental error).

Essentially, the Department’s proposed change to departmental error would mean that administrative law judges could ignore longstanding Commission precedent, and the consequences of that ignorance would fall exclusively on claimants. Under the Department’s proposed change in the definition of departmental error, waiver of any over-payments for the actions of administrative law judge’s would no longer be available to claimants who rely on administrative law judge’s getting unemployment law right in the first place.

I cannot think of anything more detrimental to the cause of justice and the purpose of unemployment benefits as vital economic assistance than this proposed change.

D21-07, Clarifying the effect of criminal convictions when charging concealment

In this proposal, the Department seeks to address the situation of a claimant who is charged criminally for unemployment fraud before the Department has alleged unemployment concealment.

In some circumstances, however, criminal prosecution may result in a court-ordered restitution order or judgment when the Department has not issued an administrative determination that a debt is owed. Examples could include submitting forged documents to the Department with the expectation that the forger would receive a benefit; submitting false unemployment benefit claims by using a fictitious employer scheme; or filing benefit claims using stolen identities.

D21-07 at 1. This concern is at present completely hypothetical, but the Department’s ever zealous push for pursuing unemployment concealment against claimants means that it is always thinking through the angles and procedures for these kinds of cases.

So, the Department wants to make sure that its concealment cases are NOT affected by any criminal cases and that claimants criminally guilty of concealment can not later contest that guilt to the Department. To accomplish this goal, the Department wants a change in law so that any criminal proceeding will serve as issue preclusion for the Department’s own concealment case against the claimant.

Section 108.101(5) of the statutes is created to read:

Notwithstanding sub. (4) [no other legal matter is binding for purposes of unemployment law], a final order or judgment of conviction for a crime entered by a court is binding on the convicted person in an action or proceeding under this chapter that relates to the criminal conviction. A person convicted of a crime is precluded from denying the essential allegations of the criminal offense that is the basis for the conviction in an action or proceeding under this chapter.

D21-07 at 1. In making this proposal, the Department does not intend “this proposal to change the Department’s practice with respect to nearly all cases referred for criminal prosecution. The Department intends to continue to refer most cases for prosecution after its administrative determination is final.” D19-20 at 2 (emphasis supplied).

Given that a person found guilty of criminal unemployment fraud will likely face prison as well as steep financial penalties, the goal here of later going after the claimant administratively for unemployment concealment seems to either be overkill or an admission that the Department cannot coordinate a criminal prosecution with prosecuting attorneys to make sure that the criminal case includes all relevant administrative issues from the Department’s perspective.

D21-08, Fiscal agents and family care employment

Like the departmental error proposal, this proposal hides a great deal of complexity and numerous other issues.

The aging of boomers and the push in Wisconsin for family members to provide care for their aging parents through numerous state support programs has led many, many folks to obtain “work” as family caregivers or to hire in-home caregivers to supplement what the children are doing.

A quirk in state law, however, allows the companies that facilitate this family care to avoid being identified as employers. Instead, the parents who are receiving this care are identified as the employers of their children and other caregivers for the purpose of unemployment law.

Note: This quirk in state law also applies to parents providing care of their adult children, though the specific statutes at issue are different.

Most parents and their children never know about the parent being the employer of record because the “notice” of this issue is provided in small print on one of many forms they complete when starting out with this family care. Because the parents are the employer of record, however, they are supposed to pay unemployment taxes for the wages paid their caregivers. Needless to say, most of these “employers” never pay the unemployment taxes that are owed.

For the most part, no one discovers this problem until after the parent has passed away. Then the children and hired caregivers file unemployment claims because they are now out of a job and looking for new work.

The family members who provide care to their parents are excluded from receiving any unemployment benefits pursuant to Wis. Stat. § 108.02(15)(km), which defines excluded employment as a family member providing personal care or companionship to another family member.

Many, many family members are only finding out about this exclusion when they file for unemployment benefits. And, given the arcane nature of this exclusion, many are paid unemployment benefits by mistake, only to have the Department recoup those unemployment benefits at a later date.

Understandably, non-family members are still eligible for unemployment benefits. But, the parent-as-employer has passed away without paying the unemployment taxes that were due, and any claim against the “estate” for unpaid unemployment taxes is unlikely to get anywhere given that these estates are usually meager to begin with and already claimed by other debts.

In D17-02, the Department addressed this lack of liability for the unpaid unemployment taxes by making the fiscal agents joint and severally liable for the unemployment taxes that are still owed. See also the discussion of D17-02 in Department unemployment proposals in 2017 (24 May 2017). As the Department explained for why joint and several liability for fiscal agents was needed:

Individuals who receive long-term support services in their home through government-funded care programs are domestic employers under Wisconsin’s unemployment insurance law. [Wis. Stat. § 108.02(15)(km)] These employers receive financial services from fiscal agents, who directly receive and disperse government program funds. The fiscal agent is responsible for reporting employees who provide services for the domestic employers to the Department, and for paying unemployment tax liability on behalf of the employer. [Wis. Stat. § 46.27(5)(i)] Currently, approximately 16,000 of the 19,000 domestic employers in Wisconsin receive government-funded care and use a fiscal agent. These employers incur tax liability when fiscal agents fail to file quarterly reports or fail to make tax liability payments. [As of July 2016, the receivables for domestic employers is $44,709.02] It is difficult to collect delinquent tax from domestic employers who use fiscal agents because these employers are typically collection-proof.

D17-02 at 1 (footnotes inserted into text). These numbers — 16,000 out of 19,000 domestic employers — indicate just how significant this issue is.

In D19-03 and now D21-08, the Department is proposing to change the law so that fiscal agents could optionally elect to be the employer-of-record for family members caring for others in their family. That is, family members would no longer be prevented from receiving unemployment pursuant to Wis. Stat. § 108.02(15)(km).

The fiscal impact of this proposed change based on the claim-filing problems that occurred when claims were at a near-record low is sizable.

In 2018, there were approximately 93 determinations excluding wages from benefit claims under 108.02(15)(km). Assuming the individual had no other base period wages this would result in approximately $354,330 in additional benefits paid annually (assuming an average weekly benefit amount of $300 and average weeks paid of 12.7). Adjusting for taxes, this would result in an approximately $233,857 cost to the Trust Fund. However, this does not take into account the additional tax revenue on employee whose wages would no longer be excluded from UI coverage.

In summary, this proposal could result in:

• More tax revenue received and more benefits paid based on previously excluded wages under 108.02(15)(km); however, this amount cannot be established.

• Fewer benefit overpayments based on the 108.02(15)(km) exclusion estimated at $100,000 annually. This is because under this proposal these benefits would now be payable. However, most overpayments are collected (at least 80%) thus this would not have a significant impact on the Trust Fund.

D21-08 at 5-6.

The problem with this proposal is that the change in who is the employer in these cases is an optional change done at the discretion of the fiscal agent. Given how confusing, unknown, and ambiguous this issue is already for parents and their family care-givers as well as what the Department is encouraging here (that fiscal agents voluntarily take on an additional expense at their discretion), this proposed change seems highly unlikely to lead to any practical change at all in regards to family members currently being placed in excluded employment.

Right now, almost all family members think that these fiscal agents are their employers. Family members as caregivers report their hours of work to these fiscal agents, and these fiscal agents are the entities that pay family members for their hours of care for their elderly parents and relatives. Almost none of them understand at all that the parents receiving care are legally an employer responsible for paying unemployment taxes.

So, if this proposal is going to have any actual impact on a very confusing and difficult situation, the switch from parent-as-employer to fiscal agent-as-employer needs to be a mandatory change, not optional.

American Rescue Plan

The latest rescue package signed into law on 11 March 2021 provides for:

  • $1,400 per person direct stimulus payments for individuals earning less than $75,000 and for couples earning less than $150,000.
  • PUA benefits extended 23 more weeks on top of the original 50 weeks (39 under CARES and 11 under Continued Assistance) for a total of 73 weeks until 6 September 2021.
  • PEUC benefits extended 29 more weeks on top of the original 24 weeks (13 under CARES and 11 under Continued Assistance) for a total of 53 weeks until 6 September 2021.
  • The additional $300 PUC per week starting on the week ending 1/2/2021 continued for all weeks until 6 September 2021.
  • Work share programs are extended thru 6 Sept. 2021.
  • Full federal funding of EB benefits extended thru 6 Sept. 2021.
  • The federal subsidy for reimbursable employers is increased from 50% to 75% for unemployment weeks beginning after 31 March 2021 until the week ending 9/6/2021.
  • Full, 100% funding of waived waiting week benefits retroactive to the week ending 1/2/21 (this subsidy was previously 50%) and effective through the week ending 9/6/2021. As the Department persuasively indicated on March 18th to the Unemployment Insurance Advisory Council, this federal funding means that claimants get an additional $300 PUC payment earlier into their hands as well as one week of regular unemployment benefits being funded by the federal government rather than Wisconsin employers (meaning that Wisconsin employers end up with the first week of benefits paid for by the feds rather than out of their unemployment accounts). At the March 18th meeting of the Advisory Council, labor caucus members pushed for full support of this waiting week waiver, but employer representatives for some reason had to think about whether employers would want to have one week of benefits subsidized or not.
  • Waiver of all interest charges for states that have seen their unemployment trust funds go negative, hence free money (does NOT apply to Wisconsin, as the trust fund is $1 billion in the black as of February 2021).
  • Waiver of federal income taxes on the first $10,200 received in unemployment benefits (regular, PUA, PEUC, EB, and PUC) for 2020 income taxes (not 2021 income taxes, which will be due in 2022).
  • Additional funds offered to states to shore up and modernize their claim-filing systems “to help workers get the benefits they deserve when they need them.” States will need to submit grants to DOLETA to receive this funding.
  • An expanded Child Tax Credit on income tax forms that will provide $300 per month to families with children under 6 and $250 per child 17 and under.
  • 100% coverage of any COBRA premiums for any workers laid off and maintaining health care coverage through COBRA thru 30 Sept. 2021. Details and mechanisms for this coverage are to be determined and will include employer or insurer payments for that coverage on behalf of the former employees.
  • Expanded subsidies for ACA health coverage that will apply to 2021 and 2022 calendar years. Anyone receiving unemployment benefits in 2021 will be automatically eligible for subsidized ACA health care coverage. The extent of those subsidies are to be determined.
  • Financial shoring up of the Pension Benefit Guaranty Corporation so as to keep pension payments flowing to millions of retirees.

There are income limits to many of these provisions. But, for nearly all unemployed workers in Wisconsin, those income limits will not be an issue.

Initial claims and a new benefit year?

With the pandemic coming up on a year, many folks are seeing notices on their portal about needing to file a new initial claim because they have a new benefit year. The notice looks something like the following:

Your current benefit year has ended with the week you just filed a weekly claim for.

If you want to receive benefits for the week ending 03/20/21 you must file an initial claim application to start a new benefit year. To file an initial claim click on the “File Initial Claim” button.

If you do not need to file for the week ending 03/20/21, the next time you need to file for benefits you will need to file an new initial claim application.

If you are receiving or have filed a claim for regular unemployment benefits, PEUC benefits, or EB benefits, then you need to heed this notice.

But, this notice makes no sense whatsoever if you are filing for or receiving PUA benefits because you are not eligible for regular unemployment benefits in the first place, as there is no “benefit year” connected to PUA benefits.

Claimants receiving PUA benefits have called Department staffers to ask what they should do. Those staffers have correctly replied that claimants receiving PUA benefits should NOT file a new initial claim, as that initial claim triggers a new investigation into their eligibility for regular unemployment benefits. That investigation will only delay payments even further and add to the Department’s already too high workload.

The only claimants receiving PUA benefits who should file a new initial claim at the end of a benefit year are those claimants receiving PUA benefits because they exhausted their eligibility for regular unemployment benefits, PEUC benefits, and EB benefits or those individuals receiving PUA benefits because the specific PUA reason for benefits is not available to them under regular unemployment law.

Note: The reasons a claimant normally eligible for regular unemployment benefits would receive PUA benefits is, for example, because they are quarantined because of Covid-19, school employees in certain circumstances, and those who left jobs because an employer is not following public health orders. These last two reasons are covered under new federal guidance released on February 25th of this year, UIPL 16-20 Change 5 (25 Feb. 2021). A discussion of that new guidance is in the works.

Everyone else receiving PUA benefits — typically independent contractors and claimants excluded under state law from receiving regular unemployment benefits — should NOT file an initial claim ever.

Your first initial PUA claim should suffice for all your PUA benefits until there is a new reason for you to claim PUA benefits, such as if you returned to full-time work and stopped claiming PUA benefits altogether, only to be quarantined when you caught Covid-19. In that circumstance, you would file a new PUA initial claim citing the quarantine as the reason for the new PUA initial claim. Previously, the Department did not allow any additional PUA claims to be filed. The new federal guidance mandates that multiple PUA claims be allowed.