Employers’ proposed notice to claimants

One of the requirements of the Families First Coronavirus Response Act, Pub. L. 116-127, was that states require employers to provide individualized notification of the availability of unemployment benefits to employees at the time of their separation from employment. This requirement was essential for some of the administrative funding available from the Families First Act.

States that did not yet have this requirement, like Wisconsin, were to implement this requirement by emergency rule within 60 days of the passage of the Families First Act. See UIPL 13-20 (22 March 2020) at 3-4.

The Families First Act was signed into law on 18 March 2020. So, Wisconsin needed to have an emergency rule implementing this requirement no later than 17 May 2020.

There is so far no emergency rule (Wisconsin did issue a scope statement, 018-20, on 30 March 2020 for such a rule). At the last two meetings of the Unemployment Insurance Advisory Council, there has been vigorous debate about creating the needed emergency rule.

The big questions: Why this delay and such debate?

What currently exists

It helps to know what is currently required for notice of unemployment benefits, a poster:

Notice-posters as to claiming unemployment benefits. Each covered employer shall keep employees informed about unemployment insurance under ch.108, Stats., by posting appropriate notice-posters supplied by the unemployment insurance division. The notices shall be permanently posted by each such employer at suitable points in each of the employer’s work-places and establishments in Wisconsin. Suitable points for posting the notices include: on bulletin boards, near time clocks, and other places where all employees will readily see them

DWD 120.01.

Failing to provide this poster allows an employee to backdate a claim for unemployment benefits.

The administrative rules provide for a waiver of the notification requirement if exceptional circumstances exist. An exceptional circumstance exists if the employe was not aware of the duty to notify the department of her intent to initiate a claim and her most recent employer failed to post or maintain a notice as to claiming benefits. Wis. Admin. Code § DWD 129.01(4)(c). It is the employer’s obligation to post UI posters at suitable points where all employes will readily see them. See Wis. Admin. Code § DWD 120.01.

Gadzinski v. Thomson Newspapers Inc., UI Hearing No. 00401683AP (7 Sept. 2000).

What the Department has done

So, it would seem that all the Department needs to do is create an additional requirement for employers to provide individualized notice about unemployment benefits to employees at the time of their separation.

For some reason, however, the Department did not get around to even presenting a proposed emergency rule until the July 16th meeting of the Advisory Council, well after the May 17th deadline.

Note: Other emergency rules, like job search changes, EmR2006, not charging employers interest for delayed tax contributions, EmR2011, and waiving experience rating changes for employers for their pandemic-related layoffs, EmR2018, were all done without waiting for the Advisory Council.

This proposal creates a new DWD 120.02. The Department explains that:

(14) Summary of Rule’s Economic and Fiscal Impact on Specific Businesses, Business Sectors, Public Utility Rate Payers, Local Governmental Units and the State’s Economy as a Whole (Include Implementation and Compliance Costs Expected to be Incurred)
The proposed rule is expected to have an economic impact on employees, who may be more likely to file timely claims for unemployment insurance. The proposed rule is expected to have an economic impact on employers because employers will need to provide notice of the availability of unemployment insurance at the time of separation of employment. However, employers may provide notice to employees electronically, so employers may be able to limit the fiscal impact of this rule to minimal staff time to send an e-mail or text message to the separating employee.

(15) Benefits of Implementing the Rule and Alternative(s) to Implementing the Rule
The benefits of implementing this rule are that claimants who are separated from employment will have timely notice of the availability of unemployment insurance, so that they will be less likely to attempt to backdate their claim. The department may save staff time under this rule if more unemployment insurance claims are timely filed and fewer claimants seek to backdate claims.

(16) Long Range Implications of Implementing the Rule
The long range implications of this rule are that more employees will have timely notice of the availability of unemployment insurance benefits so they will be more likely to file their claims timely and less likely to seek to backdate their claims.

At the July 16th meeting of the Advisory Council, only one management representative was present (and so the council lacked a quorum). This management representative, moreover, voiced heated opposition to this change, as it would potentially give employees a few more weeks of unemployment benefits when the required notice was lacking.

The proposed rule states:

DWD 120.02 Notice at Separation.
(1) Each employer shall provide notification of the availability of unemployment insurance to employees at the time of separation from employment by at least one of the following methods:
(a) Letter.
(b) E-mail.
(c) Text message.
(d) Flyer.
(e) Any other department-approved method designed to give immediate notice to employees of the availability of unemployment insurance at the time of separation.

(2) If the circumstances of the separation make immediate notice under this section impossible, the employer shall provide notice to the employee as soon as possible.

(3) Notice under this section shall include content approved by the department. Note: Approved content for the notice under this section is available online at https://dwd.wisconsin.gov/dwd/publications/ui/notice.htm.

(4) An employer’s failure to comply with this section constitutes exceptional circumstances over which the claimant has no control under s. DWD 129.01 (4) (f) unless the employee was aware of the availability of unemployment insurance.

Note: The effective date of this proposed emergency rule is 2 Nov. 2020, in order to allow time for employers to comply with this requirement.

The August 20th meeting continued with these concerns. Management representatives questioned why this change needed to be permanent (there was no sunset provision and the Department intended the emergency rule to eventually become a permanent rule). The Department explained that federal law and guidance mandated this permanent change.

As set forth in the rule, this notice could easily be included in a final paycheck, the Department explained. If done that way, at most an employee could claim would be one, two weeks at the most (because of delays in the final paycheck).

Janell Knutson and Andy Rubsam tried to calm management representatives’ anxiety by explaining that claimants who tried to get their claims back-dated would face a high hurdle for accomplishing that task. If the person had ever filed for unemployment before or if the claimant acknowledged seeing the employer’s unemployment poster (even a poster that might exist), then the Department would find that there was no basis — no exceptional circumstance — to allow the claim to be back-dated despite the requirement for individualized notice in this proposed rule.

Note: This legal “application” of the individualized notice requirement essentially makes the whole issue moot except in very rare circumstances — i.e., the Department’s motivating goal for several years now.

Management representatives were not satisfied with this legal narrowing of the proposed notice requirement (which in any case will be applied by the Department and drew no response from labor representatives). So, into caucus to discuss this proposal the Department, management representatives, and labor representatives went.

The solution they reached was to append a sentence to the end of sub-section (4) of the proposed emergency rule:

If the employer meets the requirements of s. DWD 120.01, the employee is deemed to be aware of the availability of unemployment insurance for the purposes of this subsection.

In other words, the poster requirement will satisfy the requirement for individualized notice. Huh?

Apparently, the US Dep’t of Labor is not happy with this change to the proposal, as the Department has yet to actually introduce this proposal as an emergency rule (the Dep’t of Labor needs to approve proposed changes in law as being in compliance with federal requirements).

Note” I am speculating here, but the lack of approval is not surprising. UIPL 13-20 Change 1 (4 May 2020) at I-1 states:

Question: My state law already includes a requirement that employers post a notice at their worksite that informs workers of the availability of UC. Is this sufficient?

Answer: No. Under Section 903(h)(2)(A), notice to workers must be provided individually and at the time of separation. As discussed in UIPL No. 13-20, the state does have significant flexibility in the method of communicating this requirement to employers, as well as the form in which employers provide the notice to employees (such as letters, emails, text messages, or flyers given or sent to the individual receiving the information).

In situations where the existing state law does not already satisfy this requirement, the state may have to amend its statute or issue regulations. The Department recommends that the state consider issuing emergency regulations to satisfy this requirement for Allotment I funds in light of the statutory requirement that these grant payments be made within 60 days of the enactment of EUISAA.

So, nothing is happening just yet on something so minor as providing employees notice of unemployment benefits when there is an employment separation. This episode says much about the actual agenda of the Department during this economic crisis, and that agenda certainly is not all that concerned with the needs of employees.

Indeed, because of its inaction, the Department may well need to repay administrative funding it has already received. Sigh, still more policy choices that ultimately hurt workers.

Update (1 Oct. 2020): The proposed emergency rule is in effect starting on Nov. 2nd. Any employer that has an unemployment poster in the workplace or a virtual unemployment poster will NOT be subject to this requirement of providing an employee individualized notice at the time of separation or reduced hours. As Department attorneys advised (see above), all that an employer needs to do is provide notice of this poster at some point during the employment relationship. Really, why have a rule when it does not matter.

Update (6 Oct. 2020): As expected, the fiscal impact of this new non-requirement is minimal. The Department explains (emphasis supplied):

“Consistent with the new federal law, this rule adds a requirement that employers must also notify employees of the availability of unemployment insurance at the time of separation. Employers who fail to provide this notice may have additional benefits charged to their unemployment insurance account in the Trust Fund if the employee is given additional time to file an initial claim due to the employer’s failure to give notice. Additional time to file an initial claim is only given to claimants who were unaware of the requirement to file for unemployment insurance benefits, so it is expected that the fiscal effect on employer unemployment insurance accounts will be minimal.

“Employers may incur an additional expense in providing notice under this rule if they elect to provide notice in paper form by, for example, mailing a letter to the employee. However, employers may provide electronic notice, such as e-mail or text message, to employees. Electronic notice is not expected to create new out-of-pocket costs for employers.”

Update (13 Oct. 2020): Here is the official page for the emergency regulation.

Update (14 Oct. 2020): Employer counsel agree that a poster in the break room satisfies this requirement.

Update (4 Nov. 2020): Another employer-side counsel agrees that this notice requirement is in reality inconsequential:

What Are the Consequences for Not Giving Immediate Written Notice?

The DWD did not create a penalty to the employer for noncompliance with the new rule. However, failure to comply may provide “exceptional circumstances over which the claimant has no control,” allowing a separated former employee to file backdated or otherwise untimely applications for unemployment insurance benefits. However, it appears this is only true if the employer is also violating the poster requirement of DWD §120.01.

As this post also notes, there is no new poster or poster requirement alongside this new regulation. So, this new requirement does not actually mean anything.

Improved on-line UI access for employers

The Department of Workforce Development has announced as of 27 Sept. 2018 improved on-line access for employers to their unemployment accounts.

Department of Workforce Development Announces Upgraded Unemployment Insurance Employer Online Services

MADISON (9/27/18) – Today, the Department of Workforce Development announced enhancements that will make it easier for employers to interact and correspond with the Department’s Unemployment Insurance program.

The first improvement is a streamlined and an easy to use UI Employer Online Services and SIDES E-Response sign-on. The second improvement permits employers to view benefit determinations and to file benefit appeals electronically.

“Wisconsin was the first state in the nation to offer unemployment insurance benefits,” said Secretary Ray Allen. “Now, we are leading again as the first state to provide an electronic method for employers to appeal benefit cases through the SIDES Exchange.” Allen noted that unemployed workers already have the ability to appeal such cases electronically.

Unemployment Insurance (UI) SIDES E-Response is a web-based system that allows electronic transmission of information requests from UI agencies to employers and/or Third-Party Administrators (TPAs), as well as transmission of replies containing the requested information back to the UI agencies.

Prior to the enhancements, employers had to use different login credentials for each response sent through SIDES. Employers are now able to use their UI Employer Online Services credentials to respond to inquiries through SIDES. This enhancement makes the system more user-friendly, saving employers time and money.

Newly Upgraded UI Employer Online Services include:

  • Single sign-on for UI Employer Online Services and SIDES E-Response – saves time, reduces complexity
  • Employer appeals can be filed online – view and print benefit determinations, file appeals, amend appeal responses and send attachments

Additional employer benefits include:

  • Safe and secure online services are available to employers for free
  • Eliminates delays and save money on employer paper mailings
  • Reduces improper payments and employer charging, keeping tax rates as low as possible

To sign-up, log-in, or learn more, visit https://dwd.wisconsin.gov/ui/sides

Essentially, these changes expand what is currently available to employer representatives via SIDES to allow all employers to have the same kind of access to their accounts. For small employers who do not have an agent handling their unemployment accounts, this added access is an obvious improvement.

The changes, however, will not be obvious without some exploring of the employer accounts by the employer. So, employers: log into your accounts at the link in the press release above and do some exploring.