Unemployment benefits for federal workers during the shutdown

The Department of Workforce Development released the following notice yesterday:

Wisconsin ready to assist furloughed federal employees
Workers can access unemployment funds during partial shutdown

MADISON — Federal employees in Wisconsin can apply for unemployment benefits to help meet their financial needs while they wait for work to resume.

“We are ready to assist any federal employee that is facing a lack of work and income due to the partial shutdown,” said Department of Workforce Development Secretary Caleb Frostman. “Furloughed federal workers are dislocated workers, unemployed through no fault of their own and can apply for unemployment.”

Federal employees can apply for unemployment through DWD’s online UI benefit system at my.unemployment.wisconsin.gov.

Because many federal offices are currently closed, furloughed workers should be prepared to provide wage verification in the form of pay stubs or a W-2 form as DWD may be unable to verify wages through the employer.

Federal workers that are working full time but are not being paid during the partial shutdown are not eligible for unemployment benefits.

There are more than 29,000 federal employees in Wisconsin. Per preliminary counts, DWD’s unemployment division fielded roughly 426 total initial and continued unemployment compensation claims between Jan. 7 and Jan. 11, 2019.

As required by law, workers who receive back pay should plan to repay any unemployment benefits received.

Several issues need pointing out, however.

First, federal workers are finding it difficult to impossible to actually file unemployment claims. On-line claims (the only method allowed for filing an unemployment claim) are being rejected without an explanation that the worker understands. And, phone calls to get an explanation are limited to certain days of the week, and those days are connected to a worker’s social security number. Miss that day, and you have to wait several other days or maybe even a week to try again with a phone call.

Note: For example, after two minutes of voice menu choices and prompts, I learn that I need to call back on Monday, Wednesday, or Friday, as Tuesday is not my designated day according to my social security number if I want to ask someone a question about the claims-filing process.

Second, the on-line claims process (the last time I had access) does not contain a category for govt shutdown. These workers are not laid off. They have not been discharged either or let go for performance-related reasons. They could indicate that they are locked out, but I do not think that reporting category exists. And, the kind of questions being asked can lead to claims being summarily rejected. For instance, a federal worker could easily report he or she is still eligible for work with his or her federal agency. Answering yes to such a question would automatically mean no eligibility for unemployment benefits because the separation seems to be a voluntary quit by the employee.

Third, given the Department’s eagerness to charge concealment for non-intentional claim-filing mistakes (including in 2018 alleged mistakes in reporting the reasons for the employee’s separation from employment). So, an employee might indicate he or she is laid off and start collecting benefits because of the shutdown. The Department may later conclude, however, that this layoff “reason” is incorrect and then charge the claimant with unemployment fraud for intentionally providing misleading information on his or her unemployment claim (and even when the mistake was actually unintentional).

Note: for a full description of the unemployment concealment issue, see this expert report I prepared for a case of a claimant charged criminally for the kind of unemployment concealment allegations that the Labor and Industry Review Commission routinely dismisses.

Fourth, any federal workers with second jobs, while still eligible for unemployment benefits, MUST make sure to report wages and hours from those second jobs. Under-reporting those numbers will automatically be considered by the Department to be fraudulent. So, any wages or hours from a second job should be OVER-reported to avoid a fraud charge down the road.

Fifth, you will need to do four job searches a week and many other tasks to remain eligible for unemployment benefits. For how to handle those job searches and other unemployment filing matters, make sure to review these tips for filing unemployment claims in Wisconsin.

Finally, when/if the shutdown ends and if/when missing wages are repaid, you will need to immediately contact the Department about re-paying unemployment benefits. If you wait for the Department to contact you, expect to be charged for unemployment concealment.

So, as repeatedly said here, unemployment is purposefully difficult to impossible to receive and everyone should avoid unemployment benefits unless you have no other options. The on-line system is designed for the benefit of the Department — not you — as a way to catch a mistake on your part. As obvious, these hoops and obstacles for filing unemployment claims are part of a larger economic change underway in this state the past several years. Until there are significant changes in the unemployment system in Wisconsin, you need to be as careful as possible and understand that the Department is always looking for a reason to disqualify you or charge you with concealment if you do end up receiving unemployment benefits.

UPDATE (17 Jan. 2019): Another problem appears for federal employees — having the wages to qualify for unemployment benefits in the first place. Because of the shutdown, federal agencies are not responding to inquiries from state unemployment agencies about verifying employees’ wages. As a result, employees need to produce pay stubs going back a year or more to establish the wages paid out for various quarters. The catch: access to the pay stubs is usually only available to employees when at work using their computers.

A January 15th press release from the House Committee on Ways and Means has the details:

Neal Calls on Secretary Acosta to Help Furloughed Workers Access Unemployment Insurance
 WASHINGTON, DC – Today, Ways & Means Committee Chairman Richard Neal (D-MA) sent a letter to Department of Labor (DOL) Secretary Alexander Acosta calling for guidance to be issued that would ensure that states can provide federal workers not being paid during the government shutdown with Unemployment Insurance (UI) benefits. Roughly 800,000 federal workers are furloughed without pay due to the shutdown, and President Trump has stated that this impasse could persist for many more months. Unemployment Insurance would  help furloughed workers make ends meet and pay for necessities as the shutdown continues.

“During the shutdown in 2013, the Department of Labor moved quickly to make sure this lifeline was available to workers, issuing guidance to state workforce agencies about helping workers access UI benefits, 10 days after the shutdown cut off their pay,” wrote Chairman Neal. “Twenty-four days after the shutdown began, your department has not issued similar guidance to help federal workers navigate this crisis. Indeed, many states are working hard to help these workers, but the lack of guidance and leadership from DOL has impeded their progress.”

Certain UI eligibility requirements – for example, that recipients be actively searching for new jobs, and that they obtain proof of eligibility directly from agencies – can be waived when workers are furloughed or are expected to return to their jobs without pay. However, Chairman Neal pointed out that without guidance on this matter from DOL, “we are hearing reports that some workers have been unable to access benefits, and without guidance, states may not be able to use the flexibility in federal law.” Mr. Neal also raised his concern that as the shutdown drags on, DOL does not act, and more furloughed workers are called back to the office, “this Administration is simply forcing more and more federal workers to return to their work stations without pay or UI benefits.”

Lastly, Chairman Neal pointed out that “the need for unemployment benefits caused by the shutdown will, in the short run, have a negative impact on unemployment trust fund balances, which are already dangerously low in a number of states.” He asked that Secretary Acosta respond and explain “what harm the shutdown is doing to state unemployment insurance trust funds in the short run, whether that impact is triggering tax increases for employers to fund the shortfall, and how you plan to work with states to remedy that harm in the longer term.”

Full text of the letter is available HERE.

As obvious from this press release, the Dep’t of Labor is simply dropping the ball on a host of issues and so adding additional hurdles for federal employees trying to claim unemployment benefits when out of work through no fault of their own.

UPDATE (23 Jan. 2019): For more information about the problems federal workers are having in filing their unemployment claims and actions states can do to ease that claim-filing, see this posting by Andrew Steiner of The Century Foundation.

Note: There is typo in the article. The governors who want the federal govt to pass legislation to allow unemployed federal workers to receive unemployment benefits even when called back to work for no pay are from Michigan, New York and Washington, not Wisconsin.

 

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