JFC (really DWD) targets LIRC

Workers compensation administration is NOT being transferred from DWD. The workers compensation ALJs are being moved to the Division of Hearings and Appeals, however.

In unemployment, the Joint Finance Committee is approving an increase in the concealment surcharge to 40%. At present, this surcharge is 15%. The additional 25% will be used for program integrity purposes — i.e., auditing claimants. Additional criminal penalties for concealment are being deleted.

And, for the Labor and Industry Review Commission, a budget cut of $434,900 (out of a total budget of $3,612,000 and a sizable chunk of the Commission’s UI budget), transferring the cut funds to DWD for additional “program integrity,” and making the general counsel a political appointment by the governor:

18. Labor and Industry Review Commission (LIRC). Transfer the limited administrative attachment for LIRC from the Department of Workforce Development (DWD) to the Department of Administration (DOA). Further, transfer LIRC’s appropriations to be budgeted separately under Chapter 20 of the appropriation schedule. Reduce LIRC federal unemployment administration funding by $434,900 FED annually and, to the extent allowable under federal unemployment insurance (UI) law, provide these funds for UI program integrity purposes. DWD’s UI administration appropriation would be increased by $434,900 annually to reflect this provision. [Under the motion, LIRC would be attached to DOA under s.15.03 for limited administrative purposes, but would have its own appropriation schedule (currently LIRC is budgeted as a program under DWD). The provision that the Department (currently DWD, DOA under the motion) submit LIRC’s budget to the Governor without change would remain] Additionally, convert 1.0 position from classified to unclassified, and specify the Governor appoint the LIRC general counsel position.

Apparently, this provision is payback for the Commission’s red-flag memos about SSDI and concealment. These budget shenanigans raise obvious questions about how independent the Commission can really be.

Job search regs from early 2014 to be enforced on 14 June 2015

DWD announced today that:

Effective June 1, 2015, Secretary Reginald Newson of the Wisconsin Department of Workforce Development (DWD), determined that DWD has the technological ability to implement the changes made by Clearinghouse Rule No. 13-081 to s. DWD 127.02 (intro.), and (2) to (11), Wis. Adm. Code.

The requirements of these provisions will be enforced beginning June 14, 2015.

UPDATE (28 May 2015): A revised announcement adds a reference to DWD 126.03.

The regulations at issue are DWD 127.02:

DWD 127.02 Waiver of work search requirements. The department shall waive a claimant’s requirement to conduct at least 4 actions to search for suitable work if any of the following apply:

(1) The claimant performs at least 20 hours of work for any employer in that week.

(2)  The claimant is currently laid off from employment with an employer but there is a reasonable expectation that the claimant will be returning to employment within a period of 8 weeks, which may be extended an additional 4 weeks but may not exceed a total of 12 weeks. In determining whether the claimant has a reasonable expectation of reemployment by the employer, the department shall request the employer to verify the claimant’s employment status. If the employer does not verify the claimant’s employment status, the department may consider any of the following:

(a) The history of layoffs and reemployments by the employer.

(b) Any information that the employer furnished to the individual concerning the claimant’s anticipated reemployment date.

(c) Whether the claimant has recall rights with the employer under the terms of any applicable collective bargaining agreement.

(3)  The claimant has a reasonable expectation of starting employment with a new employer within 4 weeks and the employer has verified the anticipated starting date with the department. The waiver shall not exceed 4 weeks.

(4) The claimant has been laid off from work and routinely obtains work through a union referral and all of the following apply:

(a) The union is the primary method used by workers to obtain employment in the claimant’s customary occupation.

(b) The union maintains a record of unemployed members, and the referral activities of these members, and allows the department to inspect such records.

(c) The union provides, upon the request of the department, any information regarding a claimant’s registration with the union or any referrals for employment it has made to the claimant.

(d) Prospective employers of the claimant seldom place orders with the public employment office for jobs requiring occupational skills similar to those of the claimant.

(e) The claimant is registered for work with a union and satisfies the requirements of the union relating to job referral procedures, and maintains membership in good standing with the union.

(f) The union enters into an agreement with the department regarding the requirements of this subsection.

(6) The claimant is summoned to serve as a prospective or impaneled juror.

(7) The claimant is enrolled in and satisfactorily participating in a course of approved training under s. 108.04 (16), Stats., in a work share program under s. 108.062 (10m), Stats., or in a self-employment assistance program or another program that has been enacted by the Wisconsin or federal legislature and the program includes that claimants who participate in the program shall be waived by the department from work search requirements.

(8) The claimant has not made a search for suitable work because of an error made by personnel of the department.

(9)  The claimant’s most recent employer failed to post appropriate notice posters as to claiming unemployment benefits as required under s. DWD 120.01 and the claimant was not aware of the work search requirement.

(11)  The claimant has been referred for reemployment services, is participating in such services, or is not participating in such services, but has justifiable cause for failure to participate. Justifiable cause includes that the claimant is unable to participate due to any of the following:

(a) The claimant is summoned to serve as a prospective or impaneled juror.

(b) The claimant is enrolled and satisfactorily participating in a course of training approved by the department, in a work share program under s. 108.062 (10m), Stats., or in a self-employment assistance program or another program that has been enacted by the Wisconsin or federal legislature and the program includes that claimants who participate in the program shall be waived by the department from work search requirements.

(c) The claimant is employed.

(d) The claimant is attending a job interview.

(e) Circumstances which the department determines are beyond the claimant’s control.

 

And here is DWD 126.03:

DWD 126.03  Waiver of work registration requirement. The department shall waive a claimant’s work registration requirement for any given week if any of the following apply:
(2) The claimant is currently laid off from employment with an employer but the employer has verified with the department there is a reasonable expectation that the claimant will be returning to employment within a period of 8 weeks, which may be extended an additional 4 weeks but may not exceed a total of 12 weeks. If the employer does not verify the claimant’s employment status, the department may consider any of the following:
(am) The history of layoffs and reemployments by the employer.
(bm) Any information that the employer furnished to the individual concerning the claimant’s anticipated reemployment date.
(cm) Whether the claimant has recall rights with the employer under the terms of any applicable collective bargaining agreement.
(3) The claimant has a reasonable expectation of starting employment with a new employer within 4 weeks and the employer has verified the anticipated starting date with the department. The waiver shall not exceed 4 weeks.
(4) The claimant has been laid off from work and routinely obtains work through a union referral and all of the following apply:
(a) The union is the primary method used by workers to obtain employment in the claimant’s customary occupation.
(b) The union maintains a record of unemployed members, and the referral activities of these members, and allows the department to inspect such records.
(c) The union provides, upon the request of the department, any information regarding a claimant’s registration with the union or any referrals for employment it has made to the claimant.
(d) Prospective employers of the claimant seldom place orders with the public employment office for jobs requiring occupational skills similar to those of the claimant.
(e) The claimant is registered for work with a union and satisfies the requirements of the union relating to job referral procedures, and maintains membership in good standing with the union.
(f) The union enters into an agreement with the department regarding the requirements of this subsection.
(5) The claimant is summoned to serve as a prospective or impaneled juror.
(6) The claimant is enrolled in and satisfactorily participating in a course of approved training under s. 108.04 (16), Stats., in a work share program under s. 108.062 (10m), Stats., in a self-employment assistance program, or another program enacted by the Wisconsin or federal legislature and the program includes that claimants who participate in the program shall be waived by the department from work registration requirements.

Expect work search waivers to decline both in number and length under these now implemented regulations.

Why employer UI taxes are down: concealment and substantial fault

A previous post noted that unemployment taxes for employers are going down because the reserve fund’s cash balance is currently and expected to remain more than $500 million.

This success is remarkable, especially since it did not come about because employers’ taxes have been raised substantially. To be sure, the higher unemployment during the Great Recession led to the highest tax schedule — Schedule A — being implemented. And, for three years, 2011 to 2013, the FUTA tax credit available to employers was reduced.

But, recall the UI debt hole Wisconsin was in during the Great Recession. In March 2011, Wisconsin owed just over $1.6 billion because of borrowing to cover unemployment benefits being paid out. Only eleven other states ever owed more during this recession.

One point six billion dollars is a big hole to climb out of. As noted in a recent GAO report, some states reduced the number of weeks claimants were eligible for benefits as a way to fix their UI debt problems. In short, rather than making employers pay more, these states limited the ability of claimants to collect benefits in the first place. With less benefits being paid out, the taxes employers paid went further.

Other than the introduction of a waiting week before unemployment benefits begin being paid out, Wisconsin did not shorten the total weeks of unemployment eligibility. But, Wisconsin did other things on the benefit side of the equation that have starkly reduced the amount of benefits being paid out to claimants.

As noted previously, Wisconsin has been exceptionally aggressive on charging claimants with concealment and is proposing both increased penalties and stricter compliance standards to be applied to claimants that would effectively charge them with fraud when making honest mistakes on their claims. As the Department’s own fraud report shows, DWD has been taking in over $20 million a year the past two years in over-payment collections alone. Forfeiture penalties and charges against future unemployment benefits add significantly to the amounts flowing back into the reserve fund from claimants.

But, forfeiture over-payments and collections only tell part of the story. Department staffers have publicly noted that benefit payments are now at historically low levels. Indeed, at the May 19th Advisory Council meeting it was noted that Wisconsin has not seen such low levels of benefit payments since 2000, fifteen years ago. The big question is why benefit payments in Wisconsin are so low right now.

A look at 2013 and 2014 financial reports to the Advisory Council show large declines in 2014 in benefits being paid to claimants. The benefits charged to taxable employers for the past three years when employees were discharged are:

2012 - $788,019,106.15

2013 - $714,257,663.70

2014 - $580,681,613.52

The ratio of current year benefit payments to benefits paid the previous year, are 0.91 in 2013 but 0.81 in 2014. In other words, there was a nearly 20% decline in benefit payments in 2014 when compared to 2013, nearly double the decline in benefit payments from 2012 to 2013.

Benefits being paid to employees who quit also declined sharply in 2014.

2012 - $85,799,497.23

2013 - $81,861,854.13

2014 - $69,388,417.56

The 2013 ratio of benefit payments relative to the previous for quits was 0.95. That ratio in 2014 declined to 0.85, nearly three times the decline seen in 2013.

These declines in benefit payments in 2014 directly arise from changes in unemployment law contained in the 2013 budget act — 2013 Wis. Act 20 — regarding the elimination of numerous quit exceptions and the adoption of a new, substantial fault standard for discharges (see this previous post about these changes being included by the Joint Finance Committee in the budget bill). Understand that the original estimates presented to the Joint Finance Committee for these changes in unemployment law were a reduction of $14.1 million in benefit payments during the first fiscal year and a $23.1 reduction in benefit payments during the second fiscal year. As noted above, the actual decline for quits alone in 2014 was just over $12 million, and for discharges the decline was approximately $134 million.

NOTE: The financial reports given to the Advisory Council lack specific data about the number of claims at issue. The recent report about the activities of the Advisory Council, however, states that the new substantial fault standard led to “4,654 denied cases in 2014. See p.7 of the activities report. Using the average claim duration of 15.3 weeks and the average weekly benefit amount of $285 from the Department’s 2015 financial report, see pp. 37 and 38, each substantial fault disqualification amounted to $4,360.50. Adding up all of the denied cases in 2014 means that $20,293,767 in benefits were NOT paid out that year, $4 million more than what the Department estimated in its 2015 financial report, see p.33 of the financial report.

Because the decline in benefit payments is significantly more than what can be pieced together from available data, using a ratio of benefit payments from one year to the next to track these changes indicates at least how extraordinary the declines in 2014 were and, as indicated below, provides a mechanism for predicting what will happen in 2015 using currently available data.

Estimates for 2015 show that the decline in benefits being paid pursuant to discharges will continue. Using data for the first four months of each year, the total amount of benefits estimated to be paid in 2015 to discharged employees will be just over $480 million, $100 million less than in 2014. And so if current trends continue, the estimated level of benefits going to discharged employees in 2015 will only be 83% of the already record low amount that went to discharged employees in 2014.

On the other hand, estimated benefit payments in 2015 for employees who quit will only be $3 million less from what claimants who quit received in 2014. That is, benefits paid to employees who quit are expected to be within 97% of the 2014 numbers. Accordingly, it appears that the application of the new quit standards to claimants has stabilized and subsequent declines in benefits pursuant to quits are unlikely.

The Department has yet to acknowledge the impact the substantial fault disqualification has had on the benefits being paid out to claimants. The Department’s estimates set forth in its 2015 annual Financial Outlook Report call for a $16 million reduction in benefits to discharged employees because of substantial fault (much less than the $100 million estimated here for 2015) and an $11.5 million reduction in benefits through the elimination of various quit exceptions (nearly $9 million more than estimated here for 2015 but similar to the decline in quit benefits seen in 2014). See pp. 32-3 of the report.

These estimates severely under count the impact substantial fault has had on claimants. In its Financial Outlook Report, the Department presents for the first time a public description of the new substantial fault standard:

Substantial fault essentially means that if an employer establishes a reasonable job policy to which an employee can conform, failure to conform constitutes substantial fault.

See p.33 of the report. According to the Department, then, employees are disqualified whenever they fail to follow a reasonable employee policy. Given how steep the decline in benefits has been for discharged employees in 2014 and the first four months of 2015, it is obvious that the Department has begun applying this broad conception of substantial fault.

And so, with less money being paid out as unemployment benefits, employers’ taxes could that much more quickly fill the hole in the reserve fund created by the Great Recession. There simply has been no need in Wisconsin to reduce the number of weeks claimants are eligible for benefits when those claimants are likely to be disqualified in the first place from receiving any benefits at all.

Finally, it should be noted that even though Wisconsin now has a positive reserve fund balance, the unemployment fund is still not all that healthy. Based on standard UI fund metrics, a recent Trust Fund Solvency Report shows that Wisconsin still fares about as well as most other states do — that is, not so well (see p.56 of the report). The fund’s solvency is rated at 0.13 and a minimum of 0.60 is needed for Wisconsin to be eligible for interest free loans to cover future benefit payments. For how Wisconsin compares to other states, see p.59 of the solvency report. Among mid-western states, Wisconsin fares worst except for Indiana and Ohio, which both still have outstanding debt. Presentations by the Department to the Advisory Council have described the reserve fund’s financial problems in detail. See, e.g., the presentation contained in the Advisory Council activities report, pp.16-44. But, raising employers’ unemployment taxes appears to be unnecessary when benefit payments to claimants continue to decline markedly.

Employer UI taxes going down in 2016

At the May 19th meeting of the Advisory Council, the Department of Workforce Development confirmed that employers’ unemployment taxes will be going down in 2016 because the case balance in the UI Reserve Fund will be $500 million or larger on 30 June 2015.

Currently, employers are paying taxes based on Schedule A tax rates. In 2016, employers will switch to Schedule B. Those employers with negative or overdrawn balances on their individual UI tax accounts will still pay the same tax rate. But, those employers with positive account balances will see a reduction in their unemployment taxes. Two charts — one for small employers and another for large employers — detail the reductions.

New employers will also see an immediate reduction. Small employers will go from 3.6% to 3.25%, and new, large employers will see their UI tax rate decline to 3.4%, down from 4.1% (the difference between small and large employers are whether taxable payroll is under or over $500,000 — keep in mind as well that taxable payroll for UI purposes is only the first $14,000 in wages being paid to an employee, so a large employer for UI purposes has around 36 employees).

Back in November 2013, the Department presented the Advisory Council with various charts about how unemployment taxes and tax rates were spread across industries. Page four, in particular, shows that manufacturing accounted for almost 25% of the payroll subject to unemployment taxes even though manufacturing jobs were 16.4% of the labor force. Other data available in this handout concerns negative account balances by industry (see p.5). Not surprisingly, construction has the most employers and the total negative balance for those employers was nearly $20 million in October 2013. For those in construction or manufacturing, the charts on pp.7-9 provide comparative data you might find useful.

This Narcotics Anonymous group brought to you by DWD

Yesterday, the Joint Finance Committee approved of drug testing the unemployed in the proposed budget.

The final testing requirements are similar to AB192 minus the requirement to survey employers about their drug testing. Accordingly, the estimate by the Legislative Finance Bureau to a great extent applies to this similar testing requirement. I went through AB192 costs here. In short, initial costs for setting up the drug testing will be just over $1.6 million, and the annual costs for the drug testing will, it is estimated, be $1.06 million.

The drug testing in the budget bill was previously described here. For the Joint Finance Committee, the Fiscal Bureau added additional analysis for the drug testing that is now in the budget bill. This memo revises the annual cost estimates from AB192 — now only $973,200 — and notes numerous “issues” with this testing. For instance, other drug testing programs have only found extremely low numbers of positive test results, this testing could easily be more expensive than estimated, the testing requirement could — if the full scope of the requirement is allowed by federal authorities and applied by DWD — cover up to 85% of all claimants in Wisconsin, almost 5% of Wisconsin’s workers would most likely be immediately covered by this drug testing requirement, and estimated treatment costs of $2,700 per claimant are really nothing more than guesswork and that actual costs for treatment are unknown.

The ability of employers to volunteer test results of job applicants raises a host of additional problems as well, from whether employers will need to change their testing procedures to DWD-approved testing, potential violations of employee privacy, and creating a host of complications regarding departmental record-keeping requirements. Indeed, the Finance Bureau specifically notes that the Advisory Council previously asked the legislature to repeal a similar testing provision that was passed by the legislature in 2011. And, the legislature did so. None of the issues with that legislation have been addressed in this current drug testing requirement.

So, there are many reasons to think this drug testing requirement is not ready for prime time. But, all of these problems are not what is most remarkable about this legislation. What is most strange here is who is advocating for this testing and what supporters and critics are saying.

As the title for this post indicates, this testing requirement is essentially making the Department of Workforce Development into a sponsor and supporter of drug treatment programs for hundreds of Wisconsin workers. Prior to my arrival in Wisconsin, for some time I lived in Massachusetts, the home state of that lion of the senate, that bastion of liberalism, Ted Kennedy. Senator Kennedy certainly changed his positions on issues over time, but the Kennedy of the 1970s was the symbol of big government programs intended to cure societal ills. In 2015 — forty years later — you would think that the Republicans of today would be as far apart from 1970s big government liberalism as possible, especially when many push President Reagan’s rebuke of that liberalism as a little bit of political heaven on earth.

Yet, during the debate over this drug testing the Democratic members of the Joint Finance Committee were the ones pointing out the wasteful, big government spending at issue with this drug testing. The estimates were low-balled, these Democrats exclaimed, the testing and treatment will accomplish nothing, and government bureaucracy will only make finding work that much harder. WisPolitics budget blog smartly featured the Republicans’ response to these criticisms. Rep. Dale Kooyenga, R-Brookfield, explained: “There’s a tremendous opportunity through good public policy to make a community better.” In 1975, Ted Kennedy could not have said it better, and that is what makes this drug testing one of the strangest pieces of legislation I have ever seen.

Job searching and temp agencies: Weekly contacts now mandated

Back in August 2014 I described the lack of information available to claimants about one of the new requirements instituted by 2013 Wis. Act 20 — that former employees of temp agencies need to contact those temp agencies once a week as one of their four weekly job searches.

In December 2014, the Labor and Industry Review Commission issued a decision on this issue, Brown v. Seek Career/Staffing Inc., UI Hearing Nos. 14402929AP (18 December 2014). In this case, a claimant’s assignment at a temp agency ended, and she filed a claim for benefits. The temp agency had previously indicated to her that she needed to contact the temp agency more than once a week for follow-up assignments after the original assignment ended.

The Commission found that the new temp agency contact requirement in Wis. Stat. § 108.04(2)(i) applied, and the claimant had to return benefits for three weeks she had NOT contacted the temp agency. At the hearing, the claimant argued that the Department of Workforce Development had not made her aware of this new requirement.

The employee further states that neither the Handbook for Claimants nor a claimstaker advised her of the requirement to contact the employer. However, the law does not require the department to provide that information. The law requires the employer to inform the employee that she must contact the employer about available assignments. The employer is also not required to inform the employee that she might be ineligible for benefits if she fails to contact the employer. What the employee was allegedly told after the fact is not relevant to whether she performed a search for work in the weeks at issue.

The Commission reached this conclusion even though a departmental investigator found that this requirement to contact the former temp agency did not apply to her because the temp agency here wanted the former employee to contact the agency more than once a week — i.e., more than what was required in the statute. For the Commission this initial decision by the investigator was irrelevant because the Commission had not previously addressed this temp agency contact requirement.

The adjudicators found that Wis. Stat. § 108.04(2)(i) did not apply to the employee because the employer required that the employee contact the employer more frequently than weekly. The ALJ found that, for unemployment insurance purposes, the employee was not required to contact the employer more frequently than once per week. However, she was still subject to the requirement of Wis. Stat. § 108.04(2(i) to contact the employer at least once per week in order to be eligible for benefits. An interpretation of a statutory provision which disregards a contrary long-standing interpretation by the commission constitutes departmental error. Parker v. Cady Cheese Factor Inc., UI Dec. Hearing No. 05200982EC (Aug. 12, 2005). Wis. Stat. § 108.04(2)(i) is a recently enacted provision of the unemployment insurance law and this case is the commission’s first occasion to interpret and apply its language. The adjudicators did not disregard any settled or long-standing interpretation of Wis. Stat. § 108.04(2)(i). While the commission and the ALJ have a different interpretation of that provision than the adjudicators’ interpretation, the commission cannot conclude that the adjudicators’ interpretation was unreasonable so that waiver of the recovery of overpaid benefits is required.

So, in 2014 the claimant’s handbook had no information about this requirement. But, the Commission found that this requirement still applied regardless of whether the Department told claimants about it.

And, keep in mind that the current claimant’s handbook still has no information about this requirement:

Part 4: Work Search, Registration for Work and Re-employment Services
Work Search
When You Must Perform Work Search Actions

You are required to perform at least four work search actions each week unless the department clearly tells you that your work search is “waived” and that you do not have to look for work.

In some cases, you will not have to look for work if you are working part-time. Do not stop looking for work just because you start working part-time. Call a Claims Specialist to find out if your part-time work allows us to waive your work search.

If you do not make an adequate search for work, you may lose benefits.

If applying for Wisconsin UI Benefits from another state and Wisconsin tells you to register for work or report in person, you should go to the public employment office nearest your home.

Weekly Work Search

You are required to perform at least four work search actions every week if you are told that you have to look for work.

If you are required to look for work, the UCB-12 weekly work search notice will provide you with detailed work search instructions and a sample work search log. Do not stop looking for work unless you are advised by the department your work search is waived.

The department may request evidence of your work search at any time. You are required to keep a record of your weekly work search actions for one year. If you file your weekly claim certifications online, you are required to report work search actions as part of completion of the claim. The Department will keep copies of work search records you submit online. Falsely reporting any information on your work search form may be an act of concealment. (See Part 7: Fraud and Quality Control.)

Registration for Work

If you are required to perform a weekly work search you must register for work with Wisconsin Job Service online at https://jobcenterofwisconsin.com/ui and complete a job match profile within 14 days of the date you completed your application for UI benefits.

If you fail to register by the deadline provided, you will not be eligible for benefits for any week prior to the date you registered. If you have questions or feel you have justifiable cause for not registering as required, contact a Claims Specialist.

If you have previously registered. you must logon to https://jobcenterofwisconsin.com/ui to verify that your registration and job match profile have not expired.

Re-employment Services

Help in Finding Employment

For re-employment services logon to http://jobcenterofwisconsin.com or contact your nearest job center. To locate the nearest job center call 1-888-258-9966 toll free or search online at http://wisconsinjobcenter.org/directory. If you reside in another state contact the nearest public employment office.

Re-employment Programs

If you are registered with Wisconsin Job Service, are required to seek work, and reside in Wisconsin or a border ZIP code, you are required to complete an online orientation and assessment. When you complete the orientation and assessment, you will be notified whether you have additional requirements to participate in re-employment services. Participation in re-employment services is intended to help you return to work faster.

If you fail to participate in the re-employment services, you may lose benefits. If you cannot participate within the deadline given, contact the Job Center immediately to reschedule.

Participation in any of these required re-employment services will satisfy your work search for the week in which you participate. However, attending other employment workshops on your own can only be considered one work search contact, even if the workshop is conducted by a Job Center.

Updated: March 9, 2015

In other words, if you work at a temp agency and want to claim unemployment benefits after the assignment ends, you will need to contact that temp agency every week of your unemployment as one of your four job searches. It does not matter that no one has told you about this requirement as long as the temp agency itself has informed you that it wants you to contact the agency every week after your assignment ends.

Whether you have to accept each assignment offered you is a question for another post.

UPDATE (26 May 2015): The May 2015 Advisory Council’s activities report at p.7 has the following information about this requirement to contact temp agencies on a weekly basis:

2013 Wisconsin Act 20 provides if a claimant’s last employer was a “temporary help company,” the claimant must contact that employer weekly for an assignment or the claimant is considered to not have conducted a reasonable search for suitable work.

The temporary help company must provide written notice of the fact that the claimant did not contact the temporary help company to the department within 10 business days after the end of that week. There are three exceptions to this requirement:

1. The claimant has been waived from work search actions by the department;
2. The temporary help company did not require the claimant to contact it or failed to give the claimant written notice of the requirement that the claimant must conduct weekly contacts with the temporary help company seeking assignments, or;
3. There is good cause for the failure of the claimant to contact the temporary help company.

If the claimant does contact the temporary help company, the claimant will have satisfied one of the required weekly work search actions.

Primary Statute Created: Wis. Stat. §108.04 (2) (i).

The new work search requirement for temporary help companies resulted in 138
disqualifications due to failure to contact the company, protecting UI program integrity and saving thousands of dollars for the UI Trust Fund.

So, the Department is actively applying this requirement without even including this requirement in the claimant’s handbook.

Wisconsin assembly passes drug testing

Details are here courtesy of WPR. The senate still needs to act and the governor has to sign the legislation.

Costs of Drug Testing

The drug testing provisions in the proposed budget have also been put into separate legislation — AB192 — and the Legislative Finance Bureau has prepared estimates for how much this testing would cost. While the Finance Bureau cautions that these numbers are not applicable to the proposed drug testing in the budget bill (see this post for details about that drug testing), everything I have heard and read indicates that the drug testing proposed in AB192 is very similar to what is proposed in the budget bill.

To start, here are the numbers for setting up this drug testing:

• Programming costs of just over $1.2 million.
• Training, program management, testing, communications, and database development costs of around $360,000.
• Vendor costs of $18,000.
• Policy and rule promulgation costs of $38,000.

So, the total costs to set up this drug testing are just over $1.6 million.

[AB192 also includes a requirement to survey employers about their drug testing requirements. The costs for setting up this survey would be more than $1.2 million. Subsequent surveys every ten years will cost $865,000.]

Obviously, there are also annual costs for this drug testing.

• DWD estimates that 85% of claimants will have to be screened to determine if drug testing is appropriate for them. That screening will cost $2 per claimant or $321,000 annually.
• DWD estimates that 2.5% — about 4,000 claimants — will end up being required to undergo drug testing. DWD believes around 300 will refuse these tests, and that tests for the rest — at $40 per test — will cost around $149,000 each year.
• DWD believes 318 of those tested will test positive — around 8.5% of those tested (a high positive test rate that is unlikely to occur when compared to prior testing). DWD also posits that only half of those testing positive will opt for treatment (an extremely low estimate, especially when treatment will be the only way for unemployment benefits to continue and these benefits are usually vital to paying rent and getting groceries). Treatment costs of $2700 per claimant, then, will only amount to just under $430,000 annually.
• Staffing costs of .75 FTE or nearly $69,000 annually will be needed for managing all of this testing, and printing and mailing associated with this testing will cost $5,000.
• Not yet known will be the costs for litigating disputes over test results or how much will be spent on test results that employers voluntarily submit to DWD.

With these numbers taken as is, drug testing will cost each year around $1.06 million.

Understandably, there are savings from this drug testing because claimants who test positive and do not seek treatment will not collect any unemployment benefits. Here, the Department of Workforce Development’s over-estimating the number of positive test results and under-estimating the number of folks who will seek treatment leads to significant savings. Nearly 460 claimants each year are expected to lose their eligibility for unemployment benefits, according to the Department’s estimates (NOTE: this number consists of of the 300 who refuse drug tests plus the 159 who test positive this number of claimants testing positive and refusing treatment is wrong, since only 318 are believed to test positive and only half of this number will presumably refuse treatment, leaving only 159 — not 459 as reported). Assuming an average benefit amount of $3,950, just over $1.8 million will then NOT be paid out to 459 claimants.

The Finance Bureau does not simply accept this number as the total savings, however. Employers’ unemployment taxes will be reduced somewhat for two reasons: (1) claimants who test positive and refuse treatment will not be paid any benefits that can be charged to employers’ accounts, and (2) claimants who test positive but seek out treatment will have their benefits paid out of the general balancing account rather than charged against their employers. In both cases, employers will be paying less in unemployment taxes (and even though benefits continue to be paid in the second scenario). Because the charges to employers’ accounts are being reduced, there will be a general reduction in employer’s unemployment taxes. So, according to the Finance Bureau, employers will see a general $194,000 reduction in their unemployment taxes. In addition, approximately $600,000 of benefits will be charged to the balancing account for those claimants seeking out treatment. As a result, the annual savings are down from $1.8 million to just over $1.02 million each year of this program.

In short, even with the Department’s generous estimates about how many will test positive and how few will actually seek treatment, this drug testing will still cost Wisconsin taxpayers around $30,000 each year. Keep in mind as well that, even though employers’ unemployment taxes are being reduced by $194,000 for the 300 refusing tests and the 159 testing positive, around $600,000 in benefits being paid each year to those testing positive and seeking treatment will be paid out of the balancing account.  As a result, the balancing account — which all employer pay a portion of their taxes into — is likely to have a negative balance that much sooner. Take out the generous estimates about how many will test positive and how many will refuse treatment, then the costs escalate further.

UPDATED 13 May 2015 (struck out reference to wrong number and added explanation for how that number is calculated; updated discussion at end of posts about costs of drug testing).

A taste of life in prison

A member of my church recently served five days in jail for trespass on a military base.

Given the proposed increases in concealment penalties contained in the budget bill and a change in the definition of concealment to make folks strictly liable for their mistakes, many more claimants could face significant jail time because of unemployment law. So, it makes sense that folks get an idea about what jail is really like. Here is one description.

My five days in “Pod A” at the Juneau County jail

By Bonnie Block

On April 1, 2015, a six person jury found me guilty of trespassing at the Volk Field Open House because I handed out leaflets with four questions about drone warfare in the parking lot of the Wisconsin National Guard Museum. National Guard personnel deemed that “propaganda” sight unseen. The result was my arrest, being charged with trespass, pretrial motions to greatly limit the evidence I could present to the jury and ultimately the trial. The fine was $232, but I felt I couldn’t in good conscience pay it.

So Judge Paul Curran sentenced me to serve five days in the county jail. After I was “booked in” and issued my orange jump suit and orange plastic clogs, I was escorted to Pod A where I became the seventh woman living in a two-story cinder block room about 35 by 15 feet. The front half was common space with metal tables with stools or benches attached, a TV high on the wall, a cabinet with the various request forms and some books & games or puzzles and two phones. The front wall was one-way glass so guards in the “bubble” could see in but we couldn’t see out.

The back half of the room was divided into two levels each of which had five bunk-beds and a bathroom with shower. There were seven narrow windows on each level, but they were opaque so no one could see out. The TV was on from 8 am till 11 pm (or 12:30 am on weekends) as were bright florescent lights which were dimmed after “lockdown” but never turned off.

[NOTE: The Juneau County Jail was built in 2002 and its website describes the jail like this: “This modern Pod design allows Jail Deputies to restrict and control the movement of prisoners throughout the facility, while minimizing the staff needed to monitor and control the population. This layout places Pod’s or housing units around a centralized control center from which a single deputy can monitor all of the cells and each pod. The Control Deputy can control cell doors, lights, water, inmate’s communications and inmate movement. CCTV monitoring is conducted from the central control station as well.”]

I set my small storage box and bedding on Cot #2 as directed and the guard left slamming the metal door shut. l introduced myself to four of the women (the other two were napping) and told them why I was there. We talked a while and then I went to make my bed. One of the women came to help because the sheets were only about 2/3 the length of the blue plastic mat that served as a mattress, but if you knotted them together just right you could cover the whole pad.

A few hours later, as I was working on a puzzle, I realized I was chilly because I only had a short-sleeved shirt and no socks (my socks, bra, and turtleneck were the wrong color so they stayed in storage in the booking area). I went to put my towel around my neck like a shawl. Immediately there was a voice over the intercom: “Ladies, please inform the new person what the rules are.” The rules are that you cannot cover your neck or face. l put the towel back and rubbed my arms. Without a word one of the women went to her box and brought me a thermal long-sleeved shirt and another brought me a warm pair of socks — both regulation white. Thanks to their generosity, I was comfortable for the rest of my stay.

As I listened to these women for the next few days I heard stories of being victimized or suffering abuse, of addiction to drugs, of homelessness, of illness, of needing dental care or surgery, of poverty and unemployment, and of more than a dozen children in foster care or cared for by relatives while their mothers were locked up. Five of the six women were there because they couldn’t make ball or were on a probation hold. Only one had already been tried and sentenced to one year in jail.

I entered the Jail voluntarily to make a public witness with support from family and friends and knowing I would get out in five days. They entered abruptly and now sit waiting weeks or months for a court date, or a visitor (allowed once a week) or till they could make a phone call ($1.50 a minute to a corporation called Securus which someone outside has to pay in advance and then accept the collect calls). They waited for mail or finding a book that looked interesting, or for the Friday commissary pick-up (assuming someone had put money in their account.) And they walked — 54 times around the common area was a mile and you counted it off with a deck of cards.

I’ve seen clients in various Wisconsin jails and prisons and I’ve visited fellow resisters in jail — but it’s very different to have metal doors clang shut and know that you’ve lost your freedom. I expected there to be regimentation and rules — but I had no idea of how frustrating and aggravating the guards’ collective punishment mindset would be. I knew I’d be locked up in a confined space — but didn’t understand what happens when you don’t know if it’s day or night and feel cut off from the natural world. I knew there would be little privacy and a lot of surveillance — but l didn’t know how dehumanizing that would feel.

in short, I have been one of the absurdly privileged people who has not had to face the punitive U.S. criminal justice system — just as I have not lived in countries beneath the Hellfire Missiles carried by U.S. drones that I’m working hard to stop. As I was writing this reflection a few days after I got out of jail, the daily e-mail from Campaign Nonviolence arrived and put both of these things into context.

“No one today can afford to be innocent, or to indulge themselves in ignorance of the nature of contemporary governments, politics and social orders. The national polities of the modern world are ‘states’ which maintain their existence by deliberately fostered craving and fear: monstrous protection rackets.” [Gary Snyder, The Path of Compassion: Writings on Socially Engaged Buddhism, p. 83]

It is precisely our “craving and fear” which makes us wrongly believe we are protected from the “terrorists” by our government’s program of targeted assassination via drones. And it is precisely “a protection racket” which makes us think spending billions on jails and prisons is being “tough on crime” and that we’re safer if we lock people up in cells or Pods without adequate services or diversion programs and often before they’ve even been convicted of a crime.

Just as we can’t kill our way to peace and security, we can’t imprison our way to public safety and justice. Militarism and drone warfare are not the answer. Nor are jails the answer. Those who have created the current systems are not going to be the ones who fix it. That’s up to us as nonviolent, determined, and relentlessly persistent activists.

LIRC website updated

The Labor and Industry Review Commission has revamped its website.  It is now much easier to navigate and apparently allows for quick updating of news tidbits. And, all of the original links still work.  Nicely done.