Next steps for SSDI recipients

Now that the Department will allow disabled workers to receive PUA benefits, here is what folks should do to get that PUA money into their hands as quickly as possible.

Filing a PUA claim

  1. If not already done, file a PUA claim with the Department by logging in at https://my.unemployment.wisconsin.gov/ and then clicking on the file PUA claim link.
  2. If unsure of the status of your PUA claim, call the Department’s special PUA help line at 608-318-7100, available from 7:30 AM to 4:30 PM, Monday through Friday.
  3. If you have trouble understanding the on-line filing process or have difficulty connecting to the Internet and completing the on-line process, call the PUA help line at 608-318-7100, available from 7:30 AM to 4:30 PM, Monday through Friday, to file your claim over the phone.
  4. If you need to submit any documents in support of your claim, mail those documents to:Pandemic Unemployment Assistance (PUA) Program
    PO Box 7905
    Madison WI 53707

    There is, as of July 29th, a 10+ day wait for the Department to process any paperwork the Department receives. So, there is nothing gained by faxing a document to the Department. Send the paperwork by mail and wait. First-class, regular mail is sufficient and reliable.

  5. If you have any regular wage work that is covered under regular, normal unemployment, you need to apply and have your claim for regular unemployment benefits denied.If you are only an independent contractor, you do NOT need to file a claim for regular unemployment benefits.

    If you are not sure of your status as an independent contractor, file a claim for regular unemployment benefits.

  6. Once your claim for regular unemployment benefits is denied because you receive SSDI benefits, call the 608-318-7100 number and ask that your PUA claim be immediately processed.If an appeal of that initial determination regarding a claim for regular unemployment benefits has been filed, withdraw that appeal by calling the hearing office at 608-266-8010. Then call the PUA hotline at 608-318-7100 and ask that your PUA claim be immediately processed. The Department has explained that it will not wait for any appeal periods to run before it can start processing your PUA claim.

    Note: The Labor and Industry Review Commission has held that the statutory ban on regular unemployment benefits to the disabled will remain in place for the time being.

    CAUTION: Do NOT automatically withdraw an appeal/request for a hearing or automatically decide NOT to appeal all initial determinations you receive. The only issue you should NOT be appealing is a denial of regular unemployment because you receive SSDI benefits. I have seen several initial determinations involving disabled folks that deny them benefits because they reported not being available for full-time work. See below for more information.

    If you have doubts about the issue in question, call the hearing office at 608-266-8010 and ask one of the staff to explain what the issue is. The hearing office staff are generally knowledgeable and helpful.

  7. If you were told by anyone not to file a claim because your SSDI benefits make you ineligible, file your claim for regular unemployment and a claim for PUA benefits, if any of those claims still needs to be filed.
  8. Wait for a notice about your PUA claim application being approved to arrive in the mail. That notice will include a calculation of your weekly benefit rate for PUA benefits.Your weekly benefit rate is based on this formula. If your wages are insufficient to qualify for a weekly benefit rate that is less than $163, then you will be paid the minimum PUA weekly benefit rate in Wisconsin of $163.

Filing weekly certifications

  1. If you filed a claim for regular unemployment benefits, you also had to file weekly certifications with that claim. Those weekly claim certifications should automatically transfer over to your PUA claim.
  2. If you stopped filing those weekly certifications because of the delays or eligibility denials by the Department, call the PUA hotline at 608-318-7100 and ask to file those missing weekly certifications. Explain that the certifications are missing because the Department had originally denied your eligibility for all unemployment benefits because you were receiving SSDI benefits. 
  3. On those weekly certifications, report that you are available for full-time work. Even though all SSDI recipients typically work part-time jobs, for purposes of unemployment law you need to report that you are potentially available for full-time work (which the Department considers to be 32 or more hours per week).

    Note: this issue of availability when disabled is examined in detail in Tunisha Perkins, UI Hearing No. 11605816MW (11 January 2012). Unfortunately, the Department does not apply Perkins and will find you ineligible for failing to answer yes to being available for full-time work, causing an unnecessary hearing and delay in your benefits.

    If you have already filed weekly certifications that indicated you were not available for full-time work, submit a copy of the Perkins decision for your hearing.

  4. If you have not filed weekly certifications (because you have only filed a PUA claim and are waiting for the Department to approve your PUA claim), you can file those weekly certifications once the Department acts on your PUA claim.
  5. When reporting wages for independent contractor work on your PUA weekly certification, you report your profits minus your expenses when a wage payment is made to you.

    I still do not know when or how you report the hours worked for those wages as an independent contractor.

  6. You will only receive PUA benefits for each weekly certification you file. If you do not file a weekly certification for a week, you will NOT receive any PUA benefits for that week.
  7. If you return back to your job (or any job), you should probably skip filing a weekly certification if your work hours and pay are similar to what your were earning prior to the pandemic.

    For instance, if you averaged 15 hours a week at $10 per hour at your job prior to the pandemic, you should file weekly certifications when your hours of work are significantly less than 15 hours a week. But, once your hours approach 15 hours a week again (with similar pay), then you should skip filing your claim for that week.

  8. If you have trouble understanding the on-line filing process or have difficulty connecting to the Internet and completing the on-line process, call the PUA help line at 608-318-7100, available from 7:30 AM to 4:30 PM, Monday through Friday, to file your weekly certification over the phone.
  9. Once your weekly certifications are processed, the Department will begin paying out PUA benefits based on those certifications. The PUA benefits will come either by debit card or direct deposit into a bank account, depending on which payment method you selected.

Your PUA claim will start on the week you lost work because of the pandemic (in Wisconsin, probably sometime in March) and will be backdated to include all weeks from that starting week.

You will also receive the $600 PUC for all weeks claimed for weeks in April, May, June, and July (until the week ending July 25th).

Do not expect the Department to be mistake-free in processing these claims. I have received word already of an SSDI recipient having her PUA claim denied because she filed a claim for regular unemployment benefits for the same weeks of her PUA claim. Such a denial runs counter to the very procedure the Department is requiring claimants to follow for PUA claims.

The process outlined above is what the Department has explained it wants to follow for these claims. It is your best bet for getting PUA benefits as quickly as possible. Still, it is likely going to be at least another week to 3-4 weeks before you actually receive the PUA benefits due you.

SSDI — Waiting for the discrimination to end

Ever since Sec. Frostman issued his June 9th letter admitting that the denial of PUA benefits to the disabled did not follow the CARES Act and was also probably discriminatory, folks have been waiting for an actual change in Department policy on this issue.

Folks are waiting because Sec. Frostman did not actually change anything with this letter. Rather, he asked Sec. Scalia for the US Dep’t of Labor to OK this change in DWD policy.

Within a week of that letter, I was already hearing from my sources that the US Department of Labor would support this change soon. But, nothing happened.

And, still nothing happened.

Last week, some legislators began informing their disabled constituents that action by Sec. Scalia was imminent that same week. But, nothing happened.

Then, this week, on Tuesday evening, the Dep’t of Labor issued an Unemployment Insurance Program Letter (“UIPL”) No. 16-20, Change 2 (21 July 2020) with additional guidance on PUA benefits.

Unfortunately, this additional guidance did NOT include anything specific for those receiving SSDI benefits.

Ironically, this new guidance did indicate how corporate shareholders who are excluded from receiving regular unemployment are then eligible for PUA benefits.

Question: My state generally finds that a corporate shareholder is not “unemployed” because he or she continues to act on behalf of the company. Is a corporate shareholder eligible for PUA?

Answer: It depends. If the individual is a corporate shareholder and providing services for the corporation, the individual may be eligible for regular UC, depending on state law. If the individual performed services for the corporation and received compensation and is not eligible for regular UC, then he or she may be eligible for PUA, provided the individual is unemployed, partially unemployed, or unable or unavailable to work due to one or more of the COVID-19 related reasons listed in Section 2102(a)(3)(A)(ii)(I) of the CARES Act.

Those who have been following this issue with the disabled will quickly see that this reasoning for finding corporate shareholders eligible for PUA benefits is exactly the same reasoning that should apply to SSDI recipients who are excluded from receiving regular unemployment benefits under state law.

So, corporate shareholders who have lost work because of the pandemic can start receiving PUA benefits. The disabled? Still waiting.

As of yesterday (and after this examination of the issue), the Department updated its PUA FAQ to the following:

PUA-SSDI answer as of July 23rd

So, now the Department is making the wait official.

The problem with all of this waiting is that the answer has been obvious from the start, but the Department has been in denial.

Moreover, the US Dep’t of Labor knows the right answer already as well. Do not take my word for it either. This presentation makes absolutely clear that:

Section 188 of WIA and section 188 of WIOA prohibit discrimination based on disability in programs operated, and activities provided by, recipients of WIA and WIOA Title I financial assistance, or by one-stop partners.

WIA/WIOA nondiscrimination regulations prohibit these covered entities (either directly or through contractual, licensing, or other arrangements) from using standards, procedures, criteria or administrative methods that have the purpose or effect of subjecting qualified individuals with disabilities to discrimination on the basis of disability.

See presentation at 12.

SSDI eligibility is a standard enshrined in state law in Wisconsin and North Carolina that subjects these workers with disabilities to discrimination by preventing them from receiving the unemployment benefits due them but for their disability. There is no way around this conclusion: it is in the states’ statutes.

But, for some, unknown reason, this obvious conclusion cannot be acted on. And, so the disabled continue to wait and wait and wait.

The disabled have now been waiting since March of this year. In little more than a week, five months will have lapsed and August will be here. And, too many of the disabled will be facing evictions and continued lack of work. Many are no doubt wishing they had left Wisconsin or North Carolina a long time ago, as they would not be facing this unconscionable waiting anywhere else.

Denying UI to the disabled makes no sense

A time out for some politics.

Last week, the Dems introduced a bunch of proposals for peeling back some of the changes Walker had had made to unemployment, including an end to the ban on unemployment benefits for SSDI recipients.

As noted here previously, around 158,000 SSDI recipients work in some way in Wisconsin. As a result, one out of every twenty workers in this state is a disabled worker receiving SSDI benefits. This statement is not a mistake. One out of every twenty workers in this state is receiving SSDI benefits.

So, this ban is sucking money out of the recovery for one out of every twenty workers in this state. No wonder the UI trust fund did so well under Walker. One out of twenty workers is barred from ever collecting unemployment benefits no matter what happens to them.

And, this ban completely undercuts the whole of an unemployment system that is supposed to provide economic stimulus and support when times get tough. It makes no sense from any perspective except that of a greedy banker.

heroicoldmanpotter

Yet, the Republican reaction to the Dem proposals was that these changes would somehow undercut the “economic success” of the last decade. Really? What economic success? The numbers for Wisconsin and the mid-west in general have been just awful. But for Dane County, Wisconsin has been losing jobs on the whole for the last several years. And, rural Wisconsin has been dying a slow death under these policies.

Ken Lonnquist has a column in the Isthmus about this idiocy:

These statements from Vos and Walker demonstrate ignorance, indifference, and even cruelty toward Wisconsin workers with disabilities. COVID-19 threw millions of people out of work, but it’s the Wisconsin Legislature that is throwing people with disabilities to the wolves.

Dealing with COVID-19 is hard enough for people with disabilities. Why deny these residents who lose their jobs the pandemic assistance that other workers are receiving? Why deny the Wisconsin economy the significant cash infusion this would bring?

Since mid-March, I’ve done a Facebook Live half-hour show for kids and families every weekday morning. It helps keep me in practice, entertains folks of all ages, and offers a resource to teachers seeking topics and themes for virtual study-units.

It gives me a little semblance of normalcy, and makes me feel like I’m doing something positive as we all endure this pandemic.

Our Legislature needs to do something positive, too.

If Republicans are serious about fixing the unemployment, they need to get the Legislature in session NOW and fix the UI system. Yes, DWD is not helping matters. For some reason DWD is still following the agenda of the previous administration. But, fixing some of the legal mistakes of the past should be a no-brainer.

Confusion abounds at DWD over SSDI

Note: Here is an appeal letter I filed today to the Labor and Industry Review Commission in two more SSDI cases.

Dear Commissioners:

On Ms. __’s behalf, I am petitioning for Commission review of the above-referenced matter.

This matter concerns the eligibility of SSDI recipients for unemployment benefits and PUA benefits and the discriminatory nature of Wisconsin’s prohibition against the disabled.

The same issues and arguments raised in Hearing No. 20602969MW are present in this case. Accordingly, here too I am asking for an expedited decision by the Commission in this matter.

One difference, however, is that the Department’s actions continue to sow additional confusion in regards to the legal questions at stake. I am attaching various documents that I ask the Commission to take administrative notice regarding the Department’s actions in regards to SSDI eligibility. As evident in these documents, the Department’s continued basis for denying PUA claims is the same state law that denies regular unemployment benefits to SSDI recipients, Wis. Stat. § 108.04(12)(f).

  • Ex.1 is an initial determination dated 2 June 2020 denying a claim for PUA benefits for the week ending 3/21/2020 for a recipient of SSDI benefits. The claimant here only applied for PUA benefits, as he is an independent contractor. For the Department, the applicable law is Wis. Stat. §§ 108.04(2)(h) and 108.04(12)(f).
  • Ex.2 is an initial determination two pages in length dated 26 June 2020 approving a claim for PUA benefits for the week ending 3/28/2020 for a recipient of SSDI benefits. The claimant here only applied for PUA benefits, as he is an independent contractor. For the Department, the applicable law is Pub. L. 116-136 (the CARES Act) and 20 CFR § 625.
  • Ex.3 is an initial determination dated 6 July 2020 denying a claim for PUA benefits for the week ending 5/9/2020 for the same claimant who was approved for PUA benefits in Ex.2. For the Department, the applicable law is Wis. Stat. §§ 108.04(2)(h) and 108.04(12)(f).
  • Ex.4 is a screenshot of PUA and PUC benefit payments the claimant in Ex.2 and Ex.3 received on 5 July 2020. In total, this claimant received his $163 weekly PUA for 13 weeks and a $600 PUC benefit for 12 weeks.
  • Ex.5 is an initial determination two pages in length dated 11 June 2020 approving a claim for PUA benefits for the week ending 3/28/2020 for a recipient of SSDI benefits. The claimant here only applied for PUA benefits, as she is an independent contractor. For the Department, the applicable law is Pub. L. 116-136 (the CARES Act) and 20 CFR § 625.
  • Ex.6 is an initial determination dated 15 June 2020 denying a claim for PUA benefits for the week ending 6/6/2020 for the same claimant who was approved for PUA benefits in Ex.5 . For the Department, the applicable law is Wis. Stat. §§ 108.04(2)(h) and 108.04(12)(f).
  • Ex.7 is an an initial determination dated 15 July 2020 denying a claim for PUA benefits for the week ending 3/28/2020 for the same claimant who was approved for PUA benefits in Ex.5 and then denied those benefits in Ex.6. For the Department, the applicable law is Wis. Stat. §§ 108.04(2)(h) and 108.04(12)(f).
  • Ex.8 is the debit card that the claimant in question in Ex.5, Ex.6, and Ex.7 received in the mail yesterday.
  • Ex.9 is a payment screen for the claimant in question in Ex.5-8 indicating payment for 11 weeks of PUA benefits and the $600 PUC benefit made on 15 July 2020.

I have no idea what is going on with these various determinations and actions by the Department. The Department’s FAQ for PUA benefits — https://dwd.wisconsin.gov/uiben/pua/#faq — states the following as of today in regards to SSDI benefits:

SSDI PUA FAQ

Here is what at best can be gleaned from the Department’s actions. First, the Department is maintaining that state law governs both PUA and regular unemployment eligibility for the disabled. Second, by insisting that claimants determine how they are eligible by deciding which kind of benefit claim they pursue — regular or PUA — the Department is forcing claimants to pursue both kinds of claims given that the Department is denying both kinds of claims for the same reason.

Third, by failing to resolve issues on its own initiative, the Department is creating a situation that guarantees confusion and mistakes by Department personnel when processing these claims. The claimants who have received their PUA benefits despite initial determinations proclaiming them ineligible will face demands from the Department to repay these benefits. Some may avoid repayment through arguments over departmental error. Others will have to repay. As such, unemployment has essentially become a lottery system in which a few — after a legal battle — may eventually keep their unemployment benefits because they were “lucky” enough to have an error in their favor. Others, equally deserving, will have nothing unless the Commission acts quickly to correct what the Department is doing.

Claimants cannot and should not be expected to navigate on their own the legal issues involved with filing an unemployment claim and somehow guess how the Department will decide these issues at some future date. Such a requirement runs against the whole point of why and how unemployment was originally put into place in Wisconsin. All that claimants want and need is the stabilizing income unemployment is supposed to provide at a time of job loss. They do not care if the monies come from regular unemployment or PUA. That is a Department issue that the Department should be deciding.

The Department has failed to provide necessary guidance here. Under Wisconsin’s laws, the Commission has the authority and responsibility to decide issues of unemployment law and must make sure that the Department administers unemployment benefits pursuant to what state and federal law require. I ask that the Commission do so here.

Thank you.

The Department is still fighting eligibility for the disabled

On June 9th, Sec. Frostman indicated a change of heart at the Department, as the Department now considered the denial of PUA benefits to SSDI recipients to be both in violation of the CARES Act and discrimination against the disabled in violation of various federal requirements.

But, the Department delayed taking any action by pushing the issue back to federal authorities for additional clarification.

In the meantime, actual cases regarding the denial of unemployment eligibility continued. On June 30th, I filed an appeal in one of those cases. In this appeal, I asked the Commission for a quick decision in this matter, given how many of the disabled have been going without any unemployment support or work for months now.

The Department filed an answer on July 7th.

In contrast to Sec. Frostman’s letter, the Department maintained in this answer that the Commission should affirm the denial of benefits to this disabled worker because she received SSDI benefits and that any decision regarding her PUA benefits claim had to wait until the Department issued a decision (which the Department would NOT do until all her other claims and appeals were exhausted).

It was as if Sec. Frostman had never issued his letter at all.

Moreover, this answer was just plain wrong on about everything it said legally. So, I filed a response the next day.

For instance, the Department’s answer says that discrimination against the disabled regarding eligibility for SSDI recipients was previously decided by the Commission in Rose Hanley, UI Hearing No. 17600677MW (7 April 2017). That case can hardly be considered legally definitive, as no detailed argument or explanation is provided regarding the discrimination claim in question. Furthermore, that case concerned a claim of discrimination in violation of the Americans with Disabilities Act, which applies in employment and housing and access to buildings. As noted in my letter brief and Sec. Frostman’s letter, the federal discrimination laws that apply to the administration of unemployment benefits are quite different and specifically acknowledged by federal authorities and the Commission (but apparently not the Department as a whole) as applying to the administration of unemployment benefits.

My response to the Department’s answer also included the following poster, which used to hang in the unemployment offices of this state.

Unemployment poster

This poster indicates why all workers need unemployment benefits. But, in fighting a decision to find the disabled eligible for unemployment benefits, the Department is ignoring why Wisconsin invented unemployment benefits in the first place. A weekly benefit for food and shelter does not exist when the state agency actively takes every opportunity to deny unemployment benefits for weeks and now months at a time.

As I wrote in my response to the Department’s answer:

Today, July 8th, for the claimant featured in this media report — https://www.wisconsinwatch.org/2020/06/wisconsin-blocks-pandemic-payments-for-federal-disability-aid-recipients/ — I received an appeal confirmation for an appeal I filed on May 15th. It is beyond cruel to make SSDI recipients wait several more months for their PUA claims to be adjudicated in the Department’s discretion. People and their families literally are starving because of inaction and legal delays by the Department.

Despite Sec. Frostman’s June 9th letter admitting the denial of PUA benefits to the disabled is not supported by the CARES Act and is discriminatory, the Department is fighting a decision on this very issue and is instead only offering weeks of additional delay.

The people of Wisconsin deserve better.

Update (9 July 2020): for some basic information about who receives SSDI, see this explanation.

Update (17 July 2020): Fox6 has an update as well on SSDI folks still being denied.

 

SOME in the Department now think the disabled SHOULD receive PUA benefits

Recall that Wisconsin denies unemployment benefits to SSDI recipients. But, with the pandemic and the economic stimulus created in the CARES Act, it seemed that the disabled in Wisconsin should be eligible for federally-funded PUA benefits based on the statutory provisions in that act.

For some reason, Wisconsin DWD decided the prohibition on eligibility in state law would govern this federal law. By mid-May, legislators were getting dozens to hundreds of inquiries regarding PUA-eligibility for the disabled.

At this time, DWD-UI had received a generic “conclusion” from the US Dep’t of Labor that the SSDI-recipients were NOT eligible for PUA benefits (no actual reasoning is available; see this April 2020 e-mail chain and this other April 2020 e-mail chain — a client of mine just received these from his own open records request).

At this time, I began working with numerous legislative offices at the state and federal level by explaining to them how the proffered rationales for denying PUA benefits to the disabled made no sense in light of current law or the CARES Act. Despite my efforts at being rational and following the actual text of the statutes and regulations in question, my efforts were not having much success.

I feared that reliance on the legal process to correct the Department’s misinterpretation of the law would mean a practical denial of PUA benefits to the disabled. After all, who could wait six to ten months for the legal process to work its way through without any income whatsoever. As is obvious to everyone (except maybe the Department), people literally are going hungry and are getting more desperate by the hour.

A change in policy by the Department is needed now, not next week or next month.

Then, two reporters picked up on this story and did some amazing pieces about the scope of this denial and and its irrational nature.

That media coverage led DWD to produce this e-mail chain dated May 29th with a proffered guidance from the US Dep’t of Labor.

According to this “guidance,” the denial of eligibility for regular unemployment determines eligibility for PUA benefits. As several legislative aides and others know, I did not think this “guidance” was all that convincing. It misconstrued relevant statutes and regulations and avoided applying the basic text of the CARES Act itself for determining eligibility for PUA benefits in the first place.

I continued to work with legislators and advocacy groups on this issue. I also went from 1-2 calls a day to 5-10 calls a day from folks seeking legal help with their unemployment issues. I am now working with around 50 disabled people directly in regards to their eligibility for unemployment benefits and am probably at my limit of how many I can represent.

In the meantime, one of these new clients informed me of a hearing set for June 10th. My June 4th appearance notice in that case probably has still not been processed as of today, but I managed to finally get through to the hearing office about my participation with a phone call on June 9th (my successful strategy? Call every hour starting at 8:30am. I got through at 10:30am after a 35 minutes wait).

That same day, I then got calls from the senior ALJ from the Milwaukee hearing office about procedural matters and even a personal e-mail message from a DWD attorney urging me to drop my “meritless” appeal.

The hearing on June 10th went forward, and the next day I submitted a letter-brief on the issues of how the ban on regular unemployment is discriminatory, how SSDI-recipients are eligible for PUA benefits under the statutory text of the CARES Act if the discriminatory ban remains, and why the ALJ should rule on these issues. If you want to understand the legal issues at stake, read this letter-brief.

Then, last Saturday a source revealed to me a June 9th letter from Sec. Frostman to Sec. Scalia at the US Dep’t of Labor indicating that it is now DWD’s position that SSDI-recipients ARE eligible for PUA benefits because the prior advice had misstated the relevant law.

So, the Department now agrees with me. Let that sink in for a moment.

Without the media coverage on this issue, there would not be a change right now. So, my public thanks to the reporters for their coverage on this issue.

As a result, DWD leadership has stepped up and made a needed policy change. For that, DWD leadership is to be commended and thanked. Still, much work remains, and no one should expect that DWD as a whole has suddenly changed its stripes.

The Department staffers responsible for this discrimination against the disabled are pushing back against this change. Rather than just implementing it, they have warned of dire consequences should the Department get this issue wrong, like the disabled being required to repay the PUA benefits they received or even the Department being sued by the US Dep’t of Labor.

So, the Department claims it now needs permission from Sec. Scalia to find the disabled eligible for PUA benefits. This claim is being made despite the lack of any formal or correct guidance originally denying PUA eligibility to the disabled in the first place.

So, hogwash. As noted in my letter-brief, North Carolina has a similar ban for the disabled receiving state unemployment benefits. In that state, the ineligibility of SSDI recipients is based on their allegedly NOT being able and available for work. North Carolina waived that requirement away by executive order.

Wisconsin claims it cannot waive any able and available requirements, even ones created by state law, such as the requirement to register with the job center of Wisconsin website. In other words, North Carolina is doing something Wisconsin considers impossible. And, yet, somehow North Carolina is doing fine, or at least better than Wisconsin in processing its own unemployment claims and there is no ensuing legal cataclysm.

Wisconsin, in its own ban against the disabled, simply declares them ineligibility regardless of their ability to work. So, the “ineligibility” in Wisconsin falls squarely in the category of making them “eligible” for PUA benefits. As noted in my letter-brief and by Sec. Frostman in his letter, anyone ineligible for regular state unemployment benefits is, by the statutory text of the CARES Act, eligible for PUA benefits.

But (with legal matters, there always seems to be a but), no one should underestimate the hostility of staffers at the Department to awarding PUA benefits to the disabled. The June 9th personal e-mail message to me provides ample evidence of that hostility.

And, I suspect that the Department will slow walk eligibility and examine every facet of a claim for possible denial or fraud charges. And, all of the folks who never applied in the first place or were told not to apply may not be allowed by the Department to file their claims now after this change in policy.

Finally, let’s acknowledge the consequences of this policy change. In 2018, there were around 186,423 SSDI recipients in Wisconsin. Of these, 158,502 worked as well. See Table 9 of this 2018 report.

Around 3 million folks in Wisconsin are in the labor force now. So, 5% of the labor force consists of disabled workers receiving SSDI benefits. FIVE PERCENT.

Note: This number of 158,502 disabled workers is more than all construction workers in the state (127,500 is the April revised figure for construction workers in Wisconsin for March 2020).

Under the state’s eligibility ban, employers still pay unemployment taxes on the wages paid their disabled employees. And, the unemployment trust fund accrues additional monies because these disabled employees are ineligible for the unemployment benefits due them for their work. As such, the trust fund has been rebuilt off of the labor of the disabled. Really.

If this change in policy actually does happen, there are literally tens of thousands of people who will be helped out by my pro bono efforts, these media reports, and the efforts of my clients.

Update (18 June 2020): Fox6 has a follow-up piece on the Department’s shift in position as well.

Letter to Governor Walker

In light of the Senate passage of AB819 on Tuesday of this week, I am sending a letter to Governor Walker urging him to line-item veto four provisions in the bill.

Dear Governor Walker:

I represent in my legal practice numerous employees and employers in unemployment law matters, and I urge you to line-item veto various provisions in AB819.

The provisions at issue consist of proposals by the Department of Workforce Development (“DWD” or “Department”) that create marked, unpredictable, and undesirable changes in unemployment law for the employees and employers of Wisconsin.

Changes to the definition of unemployment concealment

Sections 18 and 19 of the bill essentially make claimants strictly liable for their claim-filing mistakes. The proposed changes state that concealment is intentional but then disclaim that the Department does not have to prove that a claimant has such an intent. Furthermore, the proposed changes specify ways for a claimant to show no concealment that are so limited or specific that they essentially mean that concealment will be presumed.

This strict liability standard creates due process issues in unemployment law as well as significant problems for any criminal sanctions against claimants for actual concealment. The implications in criminal cases are especially problematic. While the intent requirement for concealment is being removed, criminal prosecutions for unemployment concealment still need mens rea to be shown. Because the mens rea is being administratively presumed rather then proven, claimants who commit actual concealment could likely avoid criminal prosecution for their fraudulent acts in light of this missing mens rea.

Creating a slush fund for Department expenditures

Sections 83-87 of the bill creates a fund for perpetually funding the Department’s program integrity efforts. This funding mechanism, however, lacks any criteria regarding this spending or legislative oversight and so allows for Department hiring and expenditures that are arbitrary. Accordingly, this program is the antithesis of small government .

Re-doing the prohibition on receiving unemployment benefits when receiving Social Security Disability Income (“SSDI”) benefits

Sections 20-25 of the bill re-write the prohibition on receiving unemployment benefits when already receiving SSDI benefits. An earlier and similar prohibition was enacted as part of 2013 Wis. Act 36. The Labor and Industry Review Commission (“LIRC” or “Commission”) initially held that the original prohibition only applied for the week when the claimant received his or her SSDI benefit check. Four circuit courts, however, reversed the Commission’s reasoning. As a result, there is now no legal need for re-writing this prohibition.

Furthermore, this new prohibition will, pursuant to section 103 of the bill, be retroactive to January 2014, the same time when the original prohibition became effective. Because of this retroactive application, this new prohibition creates a constitutional problem that will lead to a new round of litigation for the three to five claimants who received a few hundred dollars of unemployment benefits before the Commission decisions regarding the first prohibition were over-turned. The Department will end up spending thousands of dollars in litigation expenses and staff hours over a few hundred dollars in unemployment benefits. Since the first prohibition is now being enforced, there is simply no legal or economic need for this second retroactive prohibition.

Changing the procedures for obtaining review of a LIRC decision in circuit court

Sections 54 and 55 of the bill substantially alter the process, venue, and parties involved in appeals of Commission decisions. Among these proposed changes, the Department will have the right to file unemployment appeals in any county it chooses regardless of where employees or employers reside. Furthermore, because these changes presume that any party in an unemployment case risks default judgment when not answering a complaint, employers will need to file answers in claimant appeals of Commission decisions. Since Wisconsin requires any company to have an attorney representing it in court, employers will have to spend several hundred dollars for an attorney to file an answer on their behalf. Right now, employers can rely on the Commission to defend these cases and have no need for separate representation and the filing of answers.

The Commission tried to discuss these changes with the Department and the Advisory Council but was ignored. Without a voice in the process, the Commission formally opposed these changes at public hearings for this bill.

There are notable improvements in unemployment law in this bill. For instance, the provisions for protecting reimbursable employers from identity theft in section 73 of the bill are useful and well-done.

But, the four provisions mentioned here create confusion and legal complications about what unemployment law means and how to apply it. Please line-item veto these provisions.

DWD/Advisory Council bill going forward

The official Advisory Council/DWD bill has just been introduced, AB819. So, here is a rundown of what has been happening with unemployment law over the last several months, organized by proposal.

Department Proposals

  • A second SSDI prohibition, D15-01, to replace the current prohibition was approved in April 2015 and back-dated in May 2015. But, after the Department started winning the court cases challenging the old SSDI prohibition (see this post for the details), this proposal disappeared from the Department’s legislative draft at the council’s September 2015 meeting. But, after the Labor and Industry Review Commission ruled in November 2015 that departmental error had occurred when appeal tribunals (but not the Commission) had originally ruled in favor of claimants regarding dual receipt of SSDI and UI benefits (and so no repayment of UI benefits previously received was proper), this proposal re-emerged at the November 2015 council meeting in the Department’s legislative drafts and is now part of AB819. Why? This second SSDI prohibition is back-dated to January 2014, the effective date of the original SSDI prohibition.
  • D15-02 is a house-keeping change that allows the Department to issue determinations against out-of-state employers in combined wage claims for being at fault for an erroneous benefit payment to a claimant. This proposal is part of AB416 and has been enacted in 2015 Wisconsin Act 86.
  • D15-03 applies the Treasury offset program to employers, as described previously in this post. This proposal is part of AB416 and has been enacted in 2015 Wisconsin Act 86. Because of this quick enactment, employers will be subject to treasury offsets for their 2015 tax returns for any unemployment taxes for which they have been found individually liable.
  • D15-04 sets up essentially a backup insurance program for reimbursable employers who get their unemployment accounts swindled by identity fraud (and so have little to no hope of ever recovering the stolen benefits). The final recommendation from the council was for reimbursable employers to be taxed initially in order to create a fund of $1 million for covering themselves against identity fraud, essentially the second option of the three presented. This proposal is part of AB819.
  • D15-05 corrects a hole in the statutes that accidentally left LLPs out of the definition of employer (see also this DWD memo on this issue). This proposal is part of AB819.
  • The Advisory Council approved the Department’s appeals modernization proposal, D15-06, at the 7 January 2016 meeting. LRB draft language was prepped soon thereafter. Perhaps the most significant change in this proposal — notice by Internet in place of postal mail — has NOT received any discussion of comment from council members, however. This proposal is now part of AB819.
  • A renewed work-share program, D15-07, is part of AB416 and has been enacted as 2015 Wisconsin Act 86.
  • Proposed changes to the definition of claimant concealment in D15-08 (described in this previous post and described in a Department memo (discussed in this post) are part of AB819. Additional criminal penalties for concealment in AB533 continue to advance in the legislature. To see what all the fuss is about, take a look at this January 21st Assembly Committee on Public Benefit Reform hearing regarding AB533 and other UI bills or read this LIRC memo on the proposed concealment changes.
  • Technical changes in D15-09 and included in AB819 will allow the Department to distinguish able and available determinations from separation determinations.
  • D15-10 eliminates the publication of the claimant benefit tables within the statutes and is included in AB819.
  • Major changes to the process for getting unemployment decisions reviewed in circuit court, set forth in D15-11, are part of AB819. These changes were previously described here and here.
  • D15-12 allows the same protocols for unemployment taxes in regards to fiscal agents in adult care to apply to fiscal agents in child care situations. This proposal is part of AB819.
  • D15-13 ends the sunset date in 2034 for the program integrity fund (i.e., the fund for receiving some of the monies from concealment enforcement) since the Department now expects concealment monies to continue in perpetuity. See the next two proposals for why.
  • The Department’s proposals for a program integrity slush fund, D15-14 and D15-15, are part of AB819.

Labor and Management Proposals
At the Advisory Council’s 19 January 2016 meeting, the council took action on various management and labor proposals and the agreed-to changes have been incorporated in AB819.

The management proposals that the council agreed to include significant changes to what will be considered suitable work:

  • During the first six weeks of a job search, suitable work that a claimant MUST accept will be those jobs that (1) do not have a lower grade of skill than one or more of his or her most recent jobs and (2) have had an hourly wage that is 75 percent or more of what the claimant previously earned in his or her most recent, highest paying job.
  • After the first six weeks, suitable work means any work the claimant is capable of performing regardless of prior experience, skills, or training, as long as the wages for that job are above the lowest quartile wage-level in the claimant’s relevant labor market.

Once a job offer is considered suitable work for a claimant, then the claimant only has good cause for declining the job offer if the claimant’s personal safety is at risk, the claimant’s sincerely held religious beliefs conflict with the work, the work entails an unreasonable commuting distance, or some other compelling reason makes accepting the offer unreasonable. These changes to what will be considered suitable work will also apply to those who tentatively accept a job and then quit within the first thirty days.

In addition, this accepted management proposal will either eliminate unemployment eligibility entirely for anyone receiving temporary or partial workers’ compensation benefits or mandate offsets against UI benefits for those receiving these kind of workers’ compensation benefits (the specific type of workers’ compensation benefit being received leads to the different kinds of treatment). In other words, the SSDI prohibition is being expanded to workers’ compensation benefits. Also, anyone making a mistake in how they report their specific workers’ compensation benefits will, under the new on-line filing system, likely face a concealment charge for his or her mistake in reporting the kind of workers’ compensation benefits he or she is receiving.

These management-sponsored changes will take effect four weeks after enactment.

The labor proposals that the council agreed to include:

  • repealing the mis-classification prohibitions in workers’ compensation and fair employment law,
  • creating an administrative penalty for mis-classification for unemployment purposes of $500 per employee (capped at $7,500) when construction employers (and only construction employers) knowingly and intentionally provide false information to the Department (NOTE: compare this definition with the proposed changes to claimant concealment) for the purpose of misclassifying or attempting to mis-classify an employee,
  • fining employers in painting and sheetrock work $1,000 per incident (capped at $10,000 per calendar year) when coercing employees into accepting non-employee status for unemployment purposes, and
  • fining construction employers $1,000 per employee (with a maximum of $25,000) for subsequent violations as well as possible referral for criminal prosecution.

These mis-classification changes will take effect six months after passage.

Budget Bill Fixes
The LIRC funding fix bill, discussed here, is also right now being considered by the legislature.

The call in the budget bill for the Department to create suitable work rules for claimants has been eliminated by the management-sponsored changes to suitable work described above.

Substantial fault and misconduct principles from unemployment law to come to workers’ compensation

A Department-sponsored bill from the Workers’ Compensation Advisory Council, SB536, will make the following changes to workers’ compensation law:

Employees suspended or terminated for misconduct or substantial fault This bill provides that an employer is not liable for temporary disability benefits during an employee’s healing period if the employee is suspended or terminated from employment due to misconduct, as defined in the unemployment insurance law, or substantial fault, as defined in the unemployment insurance law, by the employee connected with the employee’s work.

The unemployment insurance law defines “misconduct” as action or conduct evincing such willful or wanton disregard of an employer’s interests as is found in 1) deliberate violation or disregard of standards of behavior that an employer has a right to expect of his or her employees; or 2) carelessness or negligence of such degree or recurrence as to manifest culpability, wrongful intent, or evil design in disregard of the employer’s interests or to show an intentional and substantial disregard of an employer’s interests or of an employee’s duties and obligations to his or her employer.

The unemployment insurance law defines “substantial fault” as acts or omissions of an employee over which the employee exercised reasonable control that violate reasonable requirements of the employee’s employer, but not including minor infractions, inadvertent errors, or failure to perform work due to insufficient skill, ability, or equipment.

In other words, temporarily disabled employees lose their workers’ compensation benefits when they lose jobs because of misconduct or substantial fault (which by the way also cancels out their unemployment benefits). Given this two-fer, employers will have an extra incentive for discharging employees who suffer a temporary workplace injury. Not only are the employees disqualified from receiving unemployment benefits, but they also lose their workers’ compensation benefits. Given how easy it is to find substantial fault (the Commission has found mere negligence to qualify as substantial fault), workers’ compensation benefits for temporary injuries are likely to become exceptionally rare under this new provision. YIKES!

NOTE: As seen in the 21 October 2015 minutes of the advisory council meeting in which this change — Management Proposal 11 — was discussed, these concerns about the impact of this disqualification were not new. In these minutes, however, these concerns were made in regards to misconduct only. Substantial fault was not discussed.