Comments can also be submitted by e-mail message to UILawChange@dwd.wisconsin.gov, an e-mail address that will only be active from November 9th to 18th.
Comments by regular mail can be mailed to:
Janell Knutson, Chair
Unemployment Insurance Advisory Council
P.O. Box 8942
Madison WI 53708
While not stated, it is apparent that these comments MUST be received by Nov. 18th.
Note: In either written or e-mailed comments, do NOT include social security numbers, birth dates, or phone numbers. As indicated below, no one from the Department will be following up with you, and these public hearing comments are not the forum for hoping that someone will address issues directly connected to your specific situation. In these public comments, you can explain your situation or the situation of others and how unjust or ridiculous it was and what needs to be fixed with claim-filing in general.
Past public hearings have seen an outpouring of public commentary. The 2016 public hearing was the first opportunity for public comment on the end of winter work search waivers.
A total of 295 people provided 307 comments by letter, e-mail or at the public hearing. The department received the majority of correspondence by letter (158 letters) or through e-mail (123 emails). A total of 51 people attended the public hearing in which 19 people testified, 6 people testified and provided written correspondence and 1 person registered an opinion, but did not speak. A majority of the correspondence was specific to an employer or industry and contained the same text. A tally of the comments showed 246 comments received related to [winter] work search waivers for recalled employees.
There was no reaction or recommended change to these hundreds of complaints at the Advisory Council meeting when these comments were presented, other than an explanation later posted on the Department’s work search FAQ (that has since been removed; PDF of original available here):
What is the policy basis for the requirement change?
The requirements are a result of a change in DWD’s administrative rules. These rules not only bring Wisconsin in line with more than half of all U.S. states and reaffirm the purpose of UI as delivering short-term assistance, but they also respond to employer concerns regarding the solvency of the UI Trust Fund’s balancing account. The change assures that Wisconsin’s UI law conforms to the federal requirement that state UI programs provide for an experience-rated UI tax system. This ensures fair and equitable financing of the payment of benefits among employers. By encouraging employees to find employment during their industry’s off season, fewer benefits are paid. This assists employers who have negative account balances and are taxed at the maximum UI tax rate. DWD, with the support of three separate committees in the Wisconsin State Legislature, restored the waiver limits that were in place prior to their repeal in 2004.
In short, winter work search waivers were ended because this change reduced the available unemployment benefits to claimants and so, in turn, reduced the unemployment taxes employers pay (less benefits paid means employers’ unemployment tax rates do not increase or even decline, since unemployment tax rates are based on the benefits paid out to the employees of an employer).
The 2018 public hearing was a tepid affair, with winter work search waivers again attracting the most attention.
Numerous attendees indicated that Department staffers are hostile to claimants by always doubting what is being told to them, and that the whole process is simply dehumanizing. More than few attendees had to stifle tears in the midst of their testimony, in light of their anguish and desperation.
Questions cannot be answered, these attendees indicated, and answers when provided are too often contradictory. As one attendee described, the burden of proof is on her, and she is presumed to be attempting to scam the system until she can show by clear and convincing evidence that her claim for unemployment benefits is forthright.
The picture painted in this testimony is a Department no longer functioning as an unemployment agency but instead as a kind of welfare office trying to correct the “immorality” of claimants who want unemployment benefits rather than a job.
The enormous delays in eligibility determinations, how obvious pandemic-related claims were being denied, language and technology barriers to claim-filing, the SSDI eligibility ban, winter work search waivers, and the confusion between eligibility based on PUA benefits versus regular unemployment benefits also drew widespread concern and outrage at this public hearing.
So, at present, while I encourage everyone concerned about unemployment to testify at the November 2022 public hearing coming up, I fear that all of that testimony and commentary will still be for naught. The last three public hearings have in general been ignored, and there is no indication that this practice will change suddenly.
A class action challenging the SSDI eligibility ban in Wisconsin that prevents disabled workers from receiving regular unemployment benefits has been filed. Note: A history of the SSDI eligibility ban in Wisconsin is available here.
SSDI recipients interested in the class action and eventually receiving regular unemployment benefits for job losses that are not their fault need to do two things.
File an initial claim and then weekly certifications for regular unemployment benefits. Do not let Department staffers talk you out of filing these initial claims and weekly certifications. You will be denied, and you should appeal that denial. At your unemployment hearing submit a copy of this brief about why the SSDI eligibility ban discriminates against you because of your disability. Note: Prior to the hearing date, you will need to print and mail in to the hearing office a copy of this brief with your name, hearing number, and social security number on the first page.
Do not fall victim to the Department’s mishandling of its own able and available requirements. If asked by a staffer in a phone call or by an administrative law judge during a hearing or on an initial claim or weekly certification about your ability to work more than 32 hours in a week or your availability for more than 32 hours of work in week, answer “yes” to both questions. As currently being asked, these questions CONFLICT with Wisconsin unemployment law and so are invalid questions.
Because of the pandemic, you may lack sufficient earnings during the last year to establish a benefit year. But, you should still file initial claims and weekly certifications. When the SSDI eligibility ban is overturned and you finally can establish a benefit year, you will then be owed unemployment benefits for the weekly certifications now being denied by the Department. So, file away.
At the 18 March 2021 meeting of the Advisory Council, the Department presented its first eight proposals. These first eight proposals included the proposals that the Advisory Council originally approved of in 2019 (but which were not enacted because of the pandemic).
At the 15 April and the 20 May 2021 meetings of the Advisory Council, the Department presented another 18 proposals — D21-09 thru D21-26. Yikes. Here are those proposals, with links to the actual proposals that appeared at the May 2021 Advisory Council meeting.
D21-09, Employee Status solely determined by unemployment law
The Department seeks to amend the definition of employee and self-employment.
The Department proposes to amend sections 108.09(2)(bm) and 108.09(4s) to provide that all issues of unemployment insurance employee status may only be determined under Wisconsin unemployment statutes and rules. This proposal will provide consistency in determining individuals’ eligibility for unemployment benefits and employers’ unemployment insurance tax liability by limiting the employee status inquiry to the provisions of the unemployment insurance law.
D21-09 at 2. The actual proposed changes seem to do little more than re-arrange statutory wording, however. At present, current unemployment law prohibits consideration of licensing requirements or other state or federal law in determining employee status. So, there is a change in wording being proposed, but I cannot determine what substantively is being changed. The Department’s rationale seems to be that administrative law judges are over-turning initial determinations that held claimants to be employees (and so, concluding that the claimants truly were independent contractors) because those administrative law judges were looking to laws outside of unemployment law.
the appeal tribunal shall not take administrative notice of or admit into evidence documents granting operating authority or licenses, or any state or federal laws or federal regulations granting such authority or licenses.
So, the actual goal of this proposed change is unclear at the moment.
This proposals adds a provision — required by federal law — to prevent employers from re-organizing themselves and thereby reducing their tax rate significantly and restoring a positive account balance as a “new” employer — a practice called SUTA dumping.
SUTA dumping is a major problem that can easily “cost” thousands of dollars (and maybe even tens of thousands) per employer, especially when extended beyond one year. The proposed penalties are a $5,000 forfeiture, a possible $10,000 civil penalty, and possible criminal charges as a class A misdemeanor (up to 9 months in jail and up to a $10,000 fine).
So, these penalties are chump change and unlikely to discourage any employer but the smallest from SUTA dumping. A large employer who might save $70,000 or more in three years will not bat an eye at these proposed penalties.
Moreover, the penalties for claimant concealment are much more severe. Alongside the financial penalties that claimants incur for the claim-filing mistakes, per 2017 Wis. Act 147 the criminal penalties for claimant concealment are:
For benefits up to $2,500: An unclassified misdemeanor with a fine up to $10,000, imprisonment up to nine months, or both.
For benefits up to $5,000: A Class I felony, for which the penalty is a fine upto $10,000, imprisonment up to three years and six months, or both.
For benefits up to $10,000: A Class H felony, for which the penalty is a fine up to $10,000, imprisonment up to six years, or both.
For benefits over $10,000: A Class G felony, for which the penalty is a fine up to $25,000, imprisonment up to 10 years, or both
And, unlike claimant concealment, actual and specific intent to commit SUTA dumping needs to be proven. Proposed Wis. Stat. § 108.16(8)(mm)3 will read:
For the purposes of this paragraph and par. (m), “knowingly” means having actual knowledge of or acting with deliberate ignorance of or reckless disregard for the statute violated.
D21-10 at 3. Claimant “intent” for the purpose of unemployment concealment is shown for any claim-filing mistakes by the following factors:
a. Whether the claimant failed to read or follow instructions or other communications of the department related to a claim for benefits. b. Whether the claimant relied on the statements or representations of persons other than an employee of the department who is authorized to provide advice regarding the claimant’s claim for benefits. c. Whether the claimant has a limitation or disability and, if so, whether the claimant provided evidence to the department of that limitation or disability. d. The claimant’s unemployment insurance claims filing experience. e. Any instructions or previous determinations of concealment issued or provided to the claimant. f. Any other factor that may provide evidence of the claimant’s intent.
Wis. Stat. § 108.04(11)(g)2 (setting forth a claimant’s duty of care to provide accurate and complete responses to Department inquires).
These standards are hardly comparable. They should be. They need to be.
Work-share has been one of the few unemployment success stories in Wisconsin during this pandemic. In light of federal changes to work-share programs during the pandemic, this proposal seeks to expand work-share options and flexibility in light of those federal changes so that more employers and employees can take advantage of these benefits.
This proposal is a no-brainer and should have been adopted months ago.
The Department wants to hear about other changes needed to work-share efforts in Wisconsin. Other than a reduction in the complicated paperwork (a universal complaint for work-share), contact me with your suggestions. I will pass them on to the Advisory Council.
D21-12, Secretary waiver of provisions for the sake of funding flexibility
This proposal expands the general savings clause (the Department’s secretary can waive compliance with any specific state requirement should that state requirement be found to conflict with federal law) to also allow the Department secretary to waive requirements that prevent the state from taking full advantage of federal funding opportunities (like immediately waiving the waiting week when the pandemic struck, as the legislative delay costs Wisconsin employers’ millions of dollars).
D21-13, Initial tax rates for construction employers
Unemployment taxes have been declining so rapidly in Wisconsin that the initial tax rates for construction employers — one of the few booming industries from before and during the pandemic — are now lower than the initial rates of non-construction new employers.
D21-13 at 1. Because construction work is generally seasonal work, initial tax rates in construction should in theory be higher than for general, non-construction employers. The Department’s solution is to amend “the initial tax rate for construction employers to be the greater of the initial rate for non-construction employers or the average rate for construction industry employers as determined by the department on each computation date, rounded up to the next highest rate.” D21-13 at 2.
Until construction work no longer has seasonal layoffs because of winter, this proposal makes sense.
Current regulations, however, still prioritize in-person hearings over hearings by phone. In this proposal, the Department wants:
to amend chapter DWD 140 to provide that, while parties may continue to request in-person hearings, it is the hearing office’s discretion whether to grant that request. The Department also proposes to clarify language in DWD chapter 140 regarding hearing records, Department assistance for people with disabilities at hearings, and to correct minor and technical language in DWD chapter 140.
D21-14 at 2. As currently worded, the proposal simply justifies what the Department wants to do and provides no actual reasons or justification for these changes. For instance, the Department lacks space for in-person hearings because the Department previously closed three out of four hearing offices.
Even more troubling, the substances of the proposed changes is lacking. Wis. Admin. Code § DWD 140 is THE set of regulations for how hearings are conducted. Any changes to this chapter could have long-term repercussions to claimants and employers about what happens at unemployment hearings and their access to the hearing files connected to these cases.
When presenting this proposal, the Department indicated that the changes to DWD 140 are needed as well as to DWD 149 to reflect the Department’s current practices in responding to open records requests. So, it begs the question of what exactly is in conflict between these regulations and the Department’s current hearing practices. Wis. Admin. Code DWD 149.03 provides:
(1) Claimants and employing units. Except as otherwise provided under s. DWD 140.09, the department shall make the following records available to the following persons upon request:
(a) An unemployment insurance record concerning an individual is available to that individual.
(b) An unemployment insurance record concerning an individual’s work for an employing unit is available to that employing unit.
(c) An unemployment insurance record concerning a determination to which an employing unit is identified as a party of interest under s. 108.09, Stats., is available to that employing unit.
(d) An unemployment insurance record concerning an employing unit’s status or liability under ch. 108, Stats., is available to that employing unit.
In legal circles it is generally understood that phone hearings favor employers, as employer witnesses can gather in one room and share a set of notes during their testimony without an administrative law judge witnessing those notes being passed.
Finally, for comparison, here is a 1998 Department notice (from a 2000 training about unemployment hearings) about opting for a phone hearing. If the Department is going to go forward with this change, it should address these points it put forward in 1998 for why phone hearings are problematic.
Currently, summer camp counselors are generally ineligible to receive unemployment benefits because they are usually full-time students. But, summer camps must still pay unemployment taxes for the wages paid to summer camp counselor.
This proposal applies the federal definition of excluded employment for camp counselors to state law.
The result of this change is that summer camps will no longer pay unemployment taxes for the wages paid to their summer camp counselors. And, some summer camp counselors who are not students may lose the ability to include their summer camp wages in establishing a benefit year.
This proposal repeals the drug testing provisions the Walker administration kept trying to institute. Recall that the drug testing efforts came in three parts: (1) voluntary employer testing and reporting, (2) mandatory testing of claimants based on to-be-determined federally designated occupations for testing, and (3) mandatory testing of claimants based on a future, state-based list of designated occupations. Only the voluntary employer testing and reporting was ever implemented.
The big news here is that as of 31 March 2021, the Department has received 171 drug test reports (either a failed test or failing to take a test) from potential employers. Previously, the Department had reported none or just a couple of voluntary testing reports from employers. In any case, the impact of these 171 voluntary employer reports remains nil. “No claimants have been determined to be ineligible for UI benefits under the pre-employment drug testing statutes and rules and denied benefits because of the employers’ reports of a failed or refused drug test as a condition of an offer of employment.” D21-16 at 1. So, there has been no opportunity for claimants to maintain their eligibility by enrolling a drug treatment program at the state’s expense.
Because employers have no idea of whether a job applicant is receiving or not receiving unemployment benefits OR because employers are failing to provide the necessary drug-testing paperwork and follow the necessary protocols for reporting a drug test OR a combination of these two factors, the voluntary drug testing has been a complete bust. In more than five years, this effort has not led to a single disqualification or enrollment in a drug treatment program. Ending a program that is doing nothing should make sense.
D21-17, Repeal of the substantial fault disqualification
This proposal seeks to repeal the substantial fault disqualification. There are two issues with this proposal, however.
Second, court decisions in Operton v. LIRC, 2017 WI 46, and Easterling v. LIRC, 2017 WI App 18, have limited the scope of substantial fault in important ways from how the Department applies this disqualification. But, the Department continues to ignore those court precedents. Indeed, as of May 2021, I have come across two cases of employees disqualified for substantial fault because of unintentional mistakes where the mistakes in question are nearly identical to the mistakes in Operton (inadvertent job mistakes) and Easterling (unintentional mistakes while attempting to satisfy employer demands).
D21-18, Expansion of the relocating spouse quit exception
This proposal restores this quit exception to allow any claimant who has to quit a job because his or her spouse has to relocate. Prior to 2013, Wisconsin allowed claimants to receive unemployment benefits when they had to relocate because of a spouse transferring to another job for any reason. In proposal D12-19, the Department limited this quit exception to the spouses of military personnel who had to relocate.
So, this proposal restores the expansive nature of this quit exception.
The problem here, like with substantial fault, is that the Advisory Council previously rejected this Department proposal to limit this quit exception to the spouses of military personnel. Here is what the Advisory Council actually agreed to back in 2013. So, this proposed change should be included as a matter of course in the council’s agreed-upon bill.
The waiting week was enacted as part of the 2011 budget act, 2011 Wis. Act 32 and without any input from the Advisory Council.
The concept of a waiting week exists because state unemployment agencies originally could not act quickly on a claim for benefits, and so a waiting week was needed to give the state agency time to process the necessary paperwork. With the advent of claim-filing by phone, however, that additional time was no longer needed. The waiting week effectively became a vehicle for reducing the total amount of benefits paid out to a claimant, since claimants did not receive any unemployment benefits for the first week of their claim.
The Department estimates that the waiting week costs claimants $26.1 million each year. D21-19 at 3. Given the purpose of unemployment benefits to provide immediate economic stimulus to workers in time of need after losing their jobs, a waiting week makes no sense.
D21-20, Repeal of the lame duck work search and work registration changes
In light of Wisconsin’s partial wage formula, a claimant with a weekly benefit rate of $370 could in theory have as much as $574 in wages and still qualify for at least $5 in unemployment benefits. D21-21 at 1. In other words, the partial wage formula indicates that anyone with $575 or more in wages would NOT receive any unemployment benefits.
As a consequence, the $500 cutoff actually discourages some work, as any employee who receives $500 or more in wages loses all unemployment benefits. For instance, a person with a WBR of $370 who earns $550 in wages would receive $22 in unemployment benefits that week, if the $500 wage cap was eliminated.
In other states, the gap between earnings and unemployment eligibility is called an “earnings disregard.” In some of these states, a worker who earns just $200 in a week loses unemployment eligibility dollar for dollar, so the earnings disregard in those states is sizable. See Massachusetts, for example, in this table. Because of Wisconsin’s partial wage formula, the earnings disregard in Wisconsin is limited to this $500 wage cap and only applies for claimants receiving the highest weekly benefit rate.
So, at present this $500 wage cap has a very limited effect. But, should the weekly benefit even be increased, it will become a major problem. And, as indicated in the next proposal, Wisconsin now has the second-lowest weekly benefit rate in the mid-west. So, this artificial cap needs to go if Wisconsin is going to raise its weekly benefit rate.
Finally, as noted by the Department, D21-21 at 3, the eligibility ban when working 32 or more hours in a week remains in place.
Currently, Wisconsin has the second-lowest maximum weekly benefit rate in the mid-west.
State Max. WBR Max. w/ dependents
IL $484 $667
IN $390 $390
IA $481 $591
MI $362 $362
MN $740 $740
OH $480 $647
WI $370 $370
A listing of the weekly benefit for all the states is available here.
Note: this data is different from what the Department reports in its proposal, and these numbers are current as of October 2020. These numbers have changed since then. Ohio, for instance, currently has a maximum WBR of $498 and $672 with dependents.
The highest WBR available is in Massachusetts, at $823 ($1,234 with dependents). The second highest is in Washington state at $790.
This proposal sets forth a series of increases in the weekly benefit rate.
For benefits paid for weeks of unemployment beginning on or after January 2, 2022, but before January 1, 2023, the maximum weekly benefit is capped at $409.
For benefits paid for weeks of unemployment beginning on or after January 1, 2023, but before December 31, 2023, the maximum weekly benefit is capped at 50% of the state’s annual average weekly wages.
For benefits paid for weeks of unemployment beginning on or after December 31, 2023, the maximum weekly benefit is capped at 75% of the state’s annual average weekly wages, or the maximum weekly benefit amount from the previous year, whichever is greater.
Wisconsin’s weekly benefit rate relative to the wages being paid in this state has never been all that good and has become essentially a token reimbursement in the last few decades.
Using the average weekly Wisconsin wage of $951 in 2019, the maximum WBR in 2023 would be $475, and in 2024 the maximum WBR would be $713. So, this proposal would basically make the maximum weekly benefit rate actually useful and relevant again in Wisconsin.
D21-23, Expanded flexibility in searching for suitable work
Here, the Department proposes two changes. First, the Department wants to expand the canvassing period from six weeks to eleven weeks.
The canvassing period is the time when you can reject a job offer which is a lower grade of skill or at a significantly lower rate of pay (less than 75%) than you had on one or more recent jobs without losing your eligibility for benefits. SeeTips for filing for unemployment benefits in Wisconsin for more information about your canvassing period.
Second, the Department proposes expanding the trial time period for quitting a job without being disqualified from receiving unemployment benefits from 30 days to ten weeks (the original time period). The Advisory Council originally approved of the change from ten weeks to 30 days.
This trial time period provides various ways for an employee to still qualify for unemployment benefits when quitting a job regardless of the employee’s actual reason. The main reason found in this category usually is that the job fails to meet established labor market standards (e.g., wages are 25% or less than what is normally paid in that specific labor market for that occupation). But, any reason that would have allowed the employees to refuse the job offer in the first place as well as any reason for quitting the job with good cause applies here. Only the last reason — having good cause for quitting the job — is still available to employees after the trial period has expired.
D21-24, changing the SSDI eligibility ban to an offset
This proposal was previously discussed here, along with the entire history of the Department’s SSDI eligibility ban qua offset. Whether as an eligibility ban or an offset, it still makes no sense. There should be no SSDI offset, just like there should be no SSDI eligibility ban.
Here is hoping the Advisory Council can fix this crazy proposal and end this discrimination against the disabled.
At present, large employers (those with annual unemployment taxes of $10,000 or more) must e-file their reports and e-pay their unemployment taxes.
This proposal would mandate e-filing and e-pay for ALL employers.
The problem is that many one or two person LLCs and other self-employed individuals have no conception of unemployment taxes and the reports that need to be filed. Given the lack of broadband access in the state, this mandate for these small employers is likely difficult to impossible to implement.
Without a broad-based, educational media campaign, this mandatory e-filing will accomplish little more than allowing the Department to levy administrative penalties against small employers who have no idea what is going on and fail to provide their forms and payments via e-file and e-pay. The fact that implementation will be delayed until the Department actually has the technology in place to support this proposal offers little assurance. In short, this proposal should be rejected out-of-hand. After all, those who push for ease-of-use indicate that multiple kinds of access need to be maintained and fully supported. So, mandatory e-filing and e-pay actually runs counter to making unemploymeny more modern and easier-to-use.
This proposal seeks to replace the token employer penalties for mis-classifying construction workers (1) with penalties that at least some have some dentures to them and (2) to expand this issue to all industries rather than limiting it to just construction.
The Advisory Council at the urging of Mark Reihl, then the head of the carpenters’ union in Wisconsin (and now division director for unemployment) originally approved the original penalties proposed by the labor caucus.
$500 civil penalty for each employee who is misclassified, but not to exceed $7,500 per incident.
$1,000 criminal fine for each employee who is misclassified, subject to a maximum fine of $25,000 for each violation, but only if the employer has previously been assessed a civil penalty for misclassified workers.
$1,000 civil penalty for each individual coerced to adopt independent contractor status, up to $10,000 per calendar year.
D21-36 at 1.
With this proposal, the Department explains:
The proposal removes the $7,500 and $10,000 limitations on these penalties and provides that the penalties double for each act occurring after the date of the first determination of a violation. The proposal also removes the limitations on the types of employers to which the penalties apply, allowing them to be assessed against any type of employer that violates the above prohibitions.
(b) The department shall consider the following nonexclusive factors in determining whether an employer described under par. (a) knowingly and intentionally provided false information to the department for the purpose of misclassifying or attempting to misclassify an individual who is an employee of the employer as a nonemployee:
1. Whether the employer was previously found to have misclassified an employee in the same or a substantially similar position. 2. Whether the employer was the subject of litigation or a governmental investigation relating to worker misclassification and the employer, as a result of that litigation or investigation, received an opinion or decision from a federal or state court or agency that the subject position or a substantially similar position should be classified as an employee.
Under this standard, it is well nigh impossible to charge an employer with mis-classification for a first-time violation. On the other hand, claimants are given no such leeway for their claim-filing mistakes. As noted above with proposal D21-10 (SUTA dumping), claimants who have filed for unemployment insurance previously and been given notice to read the claimants’ handbook are presumed to know everything about how to file an unemployment claim and to not make any claim-filing mistakes. But, here, employers are not liable for mis-classification (a far more serious problem economically) until after their first instance of mis-classification. In other words, these mis-classification penalties can only apply to employers when prosecuted a second time for the same mis-classification. Having two bites of the apple sure is nice.
Either employers should be held to the same claim-filing standards as employees, or the intent requirements used against employees for their claim-filing mistakes needs to be seriously redone.
Previous posts detailed the length of time and number of cases in the unemployment backlog in part 1, some of the mistakes by the Department that allow cases to be re-opened in part 2, a place for stories and advice about how to find assistance in part 3, how most claims in Wisconsin — and unlike in other states — are being denied and thereby creating a ginormous backlog in hearings in part 4, and in part 5 how the Department’s big push to fix the backlog in December 2020 was creating a hearings backlog and not addressing the root causes of all the delays.
Hard data regarding the Department’s handling of initial claims is now available about that big push for clearing the backlog.
As evident here, December 2020 saw a marked increase in first payments of initial claims, around 2.5x the number of payments in November 2020. Unfortunately, the number of first payments declined by half in January 2021.
This increase in first payments for December, however, is good news because the hearings backlog did not skyrocket. Previously, I had feared that the hearings backlog would be at 25,000. At the end of January 2021, the hearings backlog had only climbed to 15,915, up from 15,744 in December 2020.
So, kudos to the Department for clearing some cases by getting those cases approved.
Still, systemic problems with the processing of unemployment claims remain. This first payment data indicates that the effort to clear the backlog was a one-time event. TMJ4 reports that the processing delays have arisen in part because the Department added a bunch of new staffers with minimal training who then focus on specific issues rather than looking at the big picture.
Second, way too many initial claims are still NOT being paid. Through January 2021, Wisconsin has only made first payments of 27.98% of 147,260 PUA initial claims. For comparison, North Carolina has made first payments in 60% of 415,747 PUA initial claims, and New Jersey has made first payment of 76% out of 707,167 PUA initial claims.
For initial claims of regular unemployment benefits, Wisconsin has only made first payments of 30.85% out of 1,248,186 initial claims through the end of January 2021. Prior to the pandemic, the percentage of initial claims that ended up with a first payment in Wisconsin was 38.81%. So, Wisconsin is actually paying out fewer initial claims during the pandemic than from before the pandemic.
In comparison, Colorado’s first payments during the pandemic are at 64.20% out of 775,053 initial claims. Prior to the pandemic, the percentage of initial claims with first payments in Colorado was at 65.40%. In North Carolina, 44.82% of 1,642,172 initial claims for regular unemployment benefits during the pandemic led to first payments (prior to the pandemic, North Carolina was paying 45.25% of initial claims for regular unemployment benefits). Only New Jersey has seen a sharp decline in first payments for regular unemployment claims, paying 38.29% of 2,025,278 initial claims, down from 51.72% prior to the pandemic.
So, the claim-filing problems in Wisconsin are more severe than in any other state, including states like New Jersey and Colorado that still have COBOL-based mainframes on the back end of their claim-filing systems. The majority of initial claims in Wisconsin simply are NOT being paid at all.
Third and more troubling, there is now a major backlog with unemployment hearings that shows no signs of being cleared anytime soon. During the pandemic, the number of appeals filed per month have averaged 4,138 per month, while the number of appeal tribunal decisions has averaged 2,958 per month, more than a thousand less than the number of appeals. In January 2021, that gap declined to around 500 more appeals than decisions.
So, the size of this hearing backlog of around 16,000 cases now means that claimants will likely have to wait eight or more months for their cases to be heard.
And, the number of initial claims is still running more than 2x higher than normal. As a result, there are plenty of cases still in the pipeline.
Out of 63 SSDI-PUA claimants I am currently working with, 21 are still waiting for their benefits, now a year into the pandemic. Only 26 (less than half) have been paid their PUA benefits without additional hiccups (and most of them were not paid until August and September of 2020). Most of the 21 claimants still waiting for any payment have yet to even have a hearing.
As usual, John Oliver explains how truly broken unemployment is throughout the nation:
The failures in the unemployment system is a national problem. What has happened in Wisconsin is simply a “leading” indicator of how just how broken the system is. This propublica description of the claim-filing problems in North Carolina, for instance, also describes many of the same issues in Wisconsin about changes on making claim-filing more difficult, reducing already low employer taxes even further, and cutting off eligibility through additional claim-filing requirements.
Reporters have informed me that claimants are only winning around 30% of their appeal tribunal decisions after an appeal of an initial determining denying their claim (roughly the same percentage prior to the pandemic). That percentage is terrible. Almost all of the denials I am seeing are without any factual or legal merit but occur because the investigator has found a piece of information on the initial claim or a weekly certification to be less than perfect for establishing eligibility. This low win rate for unemployment hearings indicates that the biases against allowing benefits to claimants remain solidly in place: administrative law judges are looking for reasons and evidence for getting claims denied rather than explaining and helping claimants to get those denials over-turned.
So, having representation for these hearings is even more vital now, given the complexity of Wisconsin unemployment to begin with when coupled to the all of the new federal benefit programs that have been added.
I have done a video interview with the Wisconsin state bar where I plead for more lawyers to get involved with these unemployment cases.
This case involves a part-time tour guide for the Capitol. When the pandemic struck, the Capitol building was closed to the public, those tours stopped, and she was laid off.
She applied for unemployment and, when contacted by the Department, explained that, as a 75-year-old woman with underlying health conditions she was concerned about working in a safe environment in the midst of the pandemic.
The Department subsequently denied her claim, asserting that her desire for a safe workplace was an unreasonable decision to restrict her availability.
At her hearing, she explained that she did not know how to respond to a hypothetical job offer for which the relative safety of that hypothetical job was unknown. She did explain that had the Capitol tours continued, she would have continued to work there, as she knew that this work would have been safe. But, she declined to volunteer as an election worker during the April 7th primary, as she did not think that work environment was sufficiently safe for her.
In his decision, an an administrative law judge affirmed her disqualification for NOT being available for work during the pandemic.
DWD 128.01 (7) Covid-19. (a) Notwithstanding any other subsection in this section, the department shall consider a claimant to be available for suitable work if the claimant is perceived by an employer as exhibiting COVID-19 symptoms preventing a return to work, or the claimant is quarantined by a medical professional due to COVID-19 symptoms, or the claimant is instructed to stay home under local, state or federal government direction or guidance due to COVID-19, and one of the following applies:
1. The employer has instructed the claimant to return to work after the employee no longer exhibits symptoms, after a set amount of time to see if the disease is present, or after the quarantine is over.
2. The employer has not provided clear instruction for the claimant to return to work.
3. The claimant would be available for other work with another employer but for the perceived COVID-19 symptoms preventing a return to work or but for the quarantine.
(b) This subsection shall be good cause for not reporting for an eligibility review under s. DWD 128.03.
As obvious from this text, this exception is limited to what an employer does, a quarantine ordered by a medical provider, or a government public health order that mandates someone not report to work. So, this rule does not apply to this claimant.
The administrative law judge then explained:
In this case, the employee has not regularly worked 32 hours per week for several years. Her avoidance of working the polls on the April election day does not make her unavailable for work. However, she was not working full-time before her layoff and she is not applying for new jobs. As she would not work at a new job unless she determined the job to be safe, the full picture presented is that she is withdrawn from the full-time labor market and is not available for work.
The claimant appealed to the Labor and Industry Review Commission. In an exceptional brief by the clinic’s student coordinator, Emma Wood, she explained that everything about the claimant’s concern for a safe workplace as a 75-year-old woman was reasonable in light of the risks she faced from Covid-19 and that work searches were waived for the pandemic. The law student wrote:
To determine that [the claimant] is unavailable for suitable work because she desired safe work is to say that she is required to accept dangerous work. This is in direct contradiction of the federal and state imposition of the duty of employers to provide a place of employment free from known hazards. 29 USC § 654(a)(1), Wis. Stat. § 101.11(1). A preference for safe work should be considered at least as “understandable” as a salary preference. See,Willert, UI Hearing No. 88-401443MN (LIRC February 23, 1989).
In a decision dated 29 Jan. 2021, the Commission reversed the disqualification. The Commission wrote (footnotes replaced with citations):
As a general rule, to be eligible for unemployment insurance benefits as to any given week, a claimant must he able to work, available for work, and actively seeking work during the week. [Wis. Stat. § 108.04(2)(a)] “Able to work” means that the claimant maintains an attachment to the labor market and has the physical and psychological ability to engage in some substantial gainful employment in suitable work. [Wis. Admin. Code § DWD 128.01(3)(a)] “Available for work” means that the claimant maintains an attachment to the labor market and is ready to perform full-time suitable work in the labor market. “Full-time work” means work performed for 32 hours or more per week. [Wis. Stat. § 108.02(15s)] However, an individual with a physical or psychological restriction will not be considered unavailable for work solely because of his or her inability to work full-time, provided the individual is available for suitable work for the number of hours the individual is able to work. [Wis. Admin. Code § DWD 128.01(3)(b) cited, but should be Wis. Admin. Code § DWD 128.01(4)] A claimant is not available for suitable work if he or she has withdrawn from the labor market due to restrictions on his or her availability for work. [Wis. Admin. Code § DWD 128.01(4)(a)]
Under Wis. Admin. Code § 128.01(2), an employee claiming unemployment benefits is presumed able to work and available for work, unless evidence is obtained that the claiming employee was not able to work or available for work. In her brief, the employee argues she is available for full-time work and correctly notes that her work searches were waived under the emergency administrative rule, ER2006, approved by the rule-making committee of the legislature. The commission conferred with the ALJ who conducted the hearing as to his credibility and demeanor impressions. The ALJ noted the employee was very credible and direct in her testimony and did not try to avoid any questions the ALJ asked of her. Without any contrary evidence to rebut the employee’s testimony, the employee is presumed able to and available for suitable work in her labor market. The commission’s reversal of the ALJ’s decision is based on the unrebutted presumption that the employee was able to and available for work within the meaning of Wis. Admin. Code § DWD 128.01(2) and not any differing credibility assessment.
This Commission decision does NOT accept what the claimant contended — that she had a reasonable belief in wanting a safe workplace. Rather, the Commission holds that the presumption of being able and available was not overcome in this case in light of the pandemic and Emergency Rule 2006, which waived job search requirements.
Still, this decision is important, because it shows that the Department’s efforts to disqualify a part-time worker in light of their history of part-time work is not sufficient to disqualify someone.
Previous posts detailed the length of time and number of cases in the unemployment backlog in part 1, some of the mistakes by the Department that allow cases to be re-opened in part 2, a place for stories and advice about how to find assistance in part 3, and how most claims in Wisconsin — and unlike in other states — are being denied and thereby creating a ginormous backlog in hearings in part 4.
“Since the start of the pandemic, our top priority at DWD has been ensuring that all eligible unemployment claims in Wisconsin are paid as quickly as possible,” Pechacek said. “Today, I am proud to say we have reached our goal to clear the backlog of claims. The tireless work of DWD staff has made it possible for UI to resume its seasonal level of timeliness in January. I look forward to implementing further enhancements to our UI processes to continue to improve services to Wisconsinites who are out of work through no fault of their own.”
The Department’s previous weekly data reports provide running totals of claimants paid unemployment benefits, initial claims that were filed, and the number of claimants still waiting on their claims to be adjudicated. When combined into one document, simple math in a spreadsheet allows for weekly changes in these totals to be tracked, and those weekly totals reveal that the “backlog” has largely been “fixed” by denying initial claims.
The first, brown line shows the weekly change in the number of initial claims filed by week. This data was reported in May 2020, whereas the rest of the data was not first reported until August 2020.
The green, triangle line reveals the number of claimants by week reported by the Department as being paid regular unemployment benefits. Until late December, this weekly number was the lowest being reported.
The purple, triangle line shows the weekly change in the number of claimants who were either not paid or denied regular unemployment benefits (initial claims minus paid claimants). Until early December, this number kept increasing until it plunged to under 5,000 for the 12/15/2020 data release.
The red, hourglass line shows the weekly change in denied claims (initial claims minus paid claimants and then minus claimants still waiting on adjudication). This number jumped markedly for the 9/29/2020 data release, then continued to increase by 10,000 a week to over 16,000 a week by the first December report. And, each subsequent week in December saw an even greater number of initial claims being denied, such that in the last two weeks there were more claims being denied than initial claims being filed (a difference of more than 10,000 for the final week of data).
Initial claims and claimants are not exactly interchangeable numbers, as there are circumstances where an individual claimant can have more than one initial claim. But, initial claim data is generally understood as a good proxy for the number of claimants in an unemployment system, and so is the statistic used in unemployment circles to assess how many actual people are filing claims because of job loss, especially since weekly claims data only really measures the number of claimants who have had their claims approved and are receiving benefits or are in the process of receiving benefits.
Because the Department has continued to rely on weekly claims data, the Department has under-reported the claims backlog and has completely missed the growing number of claims getting denied.
In a late-October memo to then Transition-Secretary Pechacek, I wrote the following about this counting problem:
Currently, the Department has been reporting weekly claims data as descriptive of how the Department has managed its pandemic response (more than 90% of weekly claims have been paid is a common talking point of the Department’s). Weekly claims data provides a measure of the financial drain on the unemployment trust fund and says little to nothing about the actual number of initial claims that have been filed with the pandemic or how many of those claims have actually been processed by the Department. Weekly claims data only indicates the number of weeks of benefits that have been claimed and so provides a measure of the “draw” on the unemployment trust fund. This statistic says nothing about the number of people who have denied their claims and those still waiting on their claims to be decided.
If you want to know how the Department is actually doing with its processing of unemployment claims, the traditional measures are around first payments and the average number of days needed for various steps (first payments, adjudication, and appeal tribunal decision). While the Department refuses to provide this data in response to queries, the Department must provide this data to the Dep’t of Labor. As a result, anyone conversant with unemployment has access to this data.
The picture this data paints is horrendous. Through the end of August, Wisconsin reports 918,757 initial claims connected to the pandemic (initial claims filed in March through August) and only 294,571 first payments for those same months, a percentage of 32.06%. Prior to the pandemic (the months from January 2018 through February 2020 — two years and two months), there were 632,728 initial claims and 245,558 first payments, a percentage of 38.81%. Not only are these percentages some of the lowest in the nation, Wisconsin may be the only state that has actually experienced a decline in first payments during the pandemic.
Note: Dep’t of Labor data for PUA claims filed from March thru August indicate that Wisconsin has paid 30.96% of 103,511 PUA initial applications. The percentage in other states is starkly better: North Carolina with 257,718 PUA initial claims is at 74.45%, Minnesota with 108,110 initial claims is at 86.87%, and Florida is at 88.91% for 329,289 PUA initial claims. Even Illinois with 335,533 initial PUA claims is at 45.15% (and without any August data).
And, denial rates have actually increased since the pandemic started, particularly for reasons that have nothing to do with an actual separation from work (i.e., a failure to follow a Department claim-filing requirement).
The data for when the Department first pays unemployment claims shows a major breakdown here as well. The Dep’t of Labor requires that 87% of all first payments must be made within 14 days (waiting week) or 21 days (no waiting week) and 93% within 35 days. See UIPL 21-04 (18 May 2004) (available at https://wdr.doleta.gov/directives/attach/UIPL21-04.pdf). First payment rates have plummeted in Wisconsin.
This combination of more claims being denied alongside the increased delays in paying claims that are eventually approved creates a second bottleneck at the adjudication stage. For the months from March through August of this year, only 52.58% of appeal tribunal decisions have been issued within 30 days and 78.73% on average have been issued within 45 days.
Note: The Dep’t of Labor threshold is 60% and 80% of these decisions, respectively.
These numbers are only going to get worse. At the end of August 2020, there were 9,655 cases pending before appeal tribunals, roughly 9x the number of pending cases that existed on a monthly basis prior to the pandemic. Granted, many of these cases are nonsensical and lead to quick hearings (since the administrative law judge is simply recognizing the obvious, like the claimant was laid off because of the pandemic). But, the administrative sludge created by this crush of cases is having its natural effect of short tempers among staffers at all levels and claimants giving up in the face of these mindless obstacles. As I explained in “Unemployment delays, part 1” (16 Sept. 2020) (available at https://wisconsinui.wordpress.com/2020/09/16/delays-part-1/):
“At the end of March, some major problems and bottlenecks in the claims-filing process were identified [https://wisconsinui.wordpress.com/2020/03/31/claims-and-phone-calls/]. Other than what was noted then, many of those bottlenecks continue to exist.
“On May 12th, as the claims piled up, processing delays were enormous [https://wisconsinui.wordpress.com/2020/05/12/backlogs-with-claims/]: a month was needed just to process a faxed or mailed document for an unemployment claim and more than a week just to get a document recognized by the hearing office after being received.
“Now in mid-September it still takes around 30 days for a claim document sent by mail or fax to be processed. And, information sent to a hearing office still takes 5+ days to be processed. Furthermore, while the clogged phone lines to reach a claim specialist have been opened up, it is now incredibly difficult to contact the hearing office by phone. In my experience, it takes numerous phones calls over a day or two and then a hold of 30 to 70 minutes or more before I can get through to a hearing office staffer.”
And, there is no glimpse of a decline in unemployment claims anytime soon. Right now, initial claims are on the rise, and the trajectory of the pandemic in the nation and in Wisconsin indicates that the situation is likely to get worse (week 11 was 1:1).
As of week 42, nearly 1 million initial claims have been filed in Wisconsin, and there are close to 120,000 PUA claims that have been filed (the approximate number of regular initial claims paid in all of 2019 or 2018). The unemployment system as currently designed and implemented is designed to stymie successful claims. Whereas before the pandemic folks simply gave up on unemployment and found low-wage work as a substitute, those job options are no longer available at the moment. So, not only will there never be a clearing of the claims backlog under the current system, but a tidal wave of cases will be created at the hearing stage regarding people will be challenging the unjust denial of their claims. Major change in how the Department handles unemployment claims is the only way to escape a new meltdown and political fallout.
On 14 December 2020, the Legislative Audit Bureau released an audit report on the Department’s claims-processing delays. The results of that audit bares out what I indicated back in October.
First, the audit revealed that the number of claimants waiting on their claims was much larger than being reported by the Department:
As of October 10, 2020, DWD had paid 493,504 of the 662,731 individuals (74.5 percent) who had filed initial claims for regular program benefits since March 15, 2020, but it had not paid the remaining 169,227 individuals (25.5 percent). DWD may not have paid these individuals because it had not yet resolved their claims, it had denied their claims, or the individuals had withdrawn their claims. The data we obtained from DWD did not indicate the reasons why DWD did not pay these claims.
Report 20-28 (Processing Certain Unemployment Insurance Claims) at 6. In comparison, in its October 13th report, the Department indicated that the weekly claims “in process” were only 8.12% of the weekly claims filed — a figure three times smaller than the actual number of claimants still waiting on their claims.
Second, the audit revealed that over three quarters of all initial claims were being adjudicated rather than just approved (as typically happens when both employer and employee report a layoff and there are no other “issues” discovered in the documents):
We found that DWD placed into adjudication the initial claims of 514,026 of the 662,731 individuals (77.6 percent) who filed claims from March 15, 2020, through October 10, 2020. DWD may place a given claim into adjudication because of multiple issues. As of October 10, 2020, 96,623 of the 514,026 individuals (18.8 percent) still had initial claims in adjudication.
Report 20-28 (Processing Certain Unemployment Insurance Claims) at 9.
Third, the audit bureau randomly sampled 268 individuals to assess how quickly the Department processed their claims.
our file review found that DWD had resolved the initial claims of 250 of the 268 individuals (93.3 percent) as of November 2020. DWD’s data indicate that 70 of the 144 individuals whose initial claims DWD had denied subsequently filed new claims after April 11, 2020. As of October 10, 2020, 34 of those 70 individuals were paid program benefits.
Report 20-28 (Processing Certain Unemployment Insurance Claims) at 12. The audit bureau concluded:
it took an average of 13.0 weeks to resolve the initial claims of the 250 individuals in our file review. We estimate that it took an average of 11.5 weeks to deny the claims of the 144 individuals and an average of 15.5 weeks to pay program benefits to the 103 individuals.
We estimate that DWD was responsible for 11.0 of the 13.0 weeks (84.6 percent) that it took, on average, to resolve the initial claims of the 250 individuals. For example, DWD was responsible for time that elapsed before it requested information it needed from individuals and employers, and for time that elapsed after it had the information necessary to pay or deny program benefits but did not do so. In contrast, DWD was not responsible for time that elapsed while it waited for individuals and employers to provide information it had requested.
Our file review found more than 950 instances when DWD was responsible for time elapsing while it processed the initial claims of the 268 individuals. The 268 individuals each experienced, on average, more than 3.5 instances when DWD was responsible for time elapsing during initial claims processing. A given claim could have multiple instances if, for example, time elapsed before DWD requested information from individuals or employers, and then additional time elapsed after DWD received the information.
This last point reveals a state agency overwhelmed with so much work that staffers cannot even look at case files in a timely way. Unlike every other state, however, Wisconsin has NOT changed its adjudication process whatsoever in the face of the pandemic (CA: weekly claims allowed every other week; every other state but WI: waiving investigation of benefit year separations for pandemic-related job losses, since employer accounts are not charged for any benefits connected to such job losses).
So, the delays revealed by the audit bureau are a natural consequence of Department staffers still trying to do the same job they have been doing for the last few years alongside the same denial criteria and impulses without any pressure from above to approve claims or altering the adjudication process in light of the tidal waive of claims connected to the pandemic.
Given that most initial claims are being denied, all the problems revealed by the audit bureau are making their way to the hearing office. Simple errors are popping up all over the place, for no other reason than because staffers and administrative law judges are being overwhelmed with their workload. Hearings are generally short — since eligibility facts are already in the investigatory record and just need to be entered into the hearing record. But, getting all those decisions written and properly entered is causing problems I have never seen to this extent before. Almost every case now is falling into limbo because of some processing error that hearing office staffers now are having great difficulty fixing.
My December has been about as bad as it has ever been with this pandemic. And, given the skyrocketing number of claims that were denied in December, I suspect that these hearing office problems are only expanding.
Gov. Evers and Lt. Gov. Barnes are having listening sessions for the state’s 2021-2022 budget.
The session tomorrow — Dec. 2nd, starting at 6pm — is on the “Environment, Infrastructure, and the Economy.” As unemployment benefits are part of the economy, those of you still waiting on benefit claims or have had their entirely merited claims denied for illegitimate and illegal reasons should make your concerns about the unemployment system known.
Click here to register for this meeting. The meeting can be watched on WisEye.
If you are looking for something to say, look at this poster that used to appear in the state’s unemployment offices.
(1) Unemployment in Wisconsin is recognized as an urgent public problem, gravely affecting the health, morals and welfare of the people of this state. The burdens resulting from irregular employment and reduced annual earnings fall directly on the unemployed worker and his or her family. The decreased and irregular purchasing power of wage earners in turn vitally affects the livelihood of farmers, merchants and manufacturers, results in a decreased demand for their products, and thus tends partially to paralyze the economic life of the entire state. In good times and in bad times unemployment is a heavy social cost, directly affecting many thousands of wage earners. Each employing unit in Wisconsin should pay at least a part of this social cost, connected with its own irregular operations, by financing benefits for its own unemployed workers. Each employer’s contribution rate should vary in accordance with its own unemployment costs, as shown by experience under this chapter. Whether or not a given employing unit can provide steadier work and wages for its own employees, it can reasonably be required to build up a limited reserve for unemployment, out of which benefits shall be paid to its eligible unemployed workers, as a matter of right, based on their respective wages and lengths of service.
(2) The economic burdens resulting from unemployment should not only be shared more fairly, but should also be decreased and prevented as far as possible. A sound system of unemployment reserves, contributions and benefits should induce and reward steady operations by each employer, since the employer is in a better position than any other agency to share in and to reduce the social costs of its own irregular employment. Employers and employees throughout the state should cooperate, in advisory committees under government supervision, to promote and encourage the steadiest possible employment. A more adequate system of free public employment offices should be provided, at the expense of employers, to place workers more efficiently and to shorten the periods between jobs. Education and retraining of workers during their unemployment should be encouraged. Governmental construction providing emergency relief through work and wages should be stimulated.
(3) A gradual and constructive solution of the unemployment problem along these lines has become an imperative public need.
Maybe the state should start paying attention to some of these objectives.
Previous posts detailed the length of time and number of cases in the unemployment backlog in part 1, some of the mistakes by the Department that allow cases to be re-opened in part 2, and a place for stories and advice about how to find assistance in part 3.
job losses are now spiking both nationally and state-wide,
the ensuing loss of PUA benefits at the end of 2020 is a fiscal cliff for millions, and
continuing claims demonstrate that long-term job losses are becoming entrenched.
Wisconsin’s own jobs report for October 2020 reinforced these conclusions, as the state unemployment rate rose markedly because of losses in leisure and hospitality and the public sector.
The actual initial claims data indicates that the pandemic has created a systemic increase in the number of new initial claims being filed every single week.
Since the start of the pandemic, initial claims have leveled off to around 5x what was filed for the comparable week in 2019. There are two noticeable dips where the ratio dropped significantly down below five: first for the weeks 35-37 and again for the weeks 44-47. The reason for these dips, however, are quite different. In weeks 35-37, there was an actual decline in the number of initial claims being filed in 2020. In weeks 44-47, on the other hand, the drop in the ratio is not from a decline of initial claims in 2020 but from an increase in initial claims that were filed in 2019.
As Wisconsin still has winter, there are a host of industries (road construction, landscaping, recreation, and others) that lay off their workers on a seasonal basis, and so there is a steady rise in initial claims every year for these Wisconsin workers. As a result, this latest dip in the ratio does NOT represent an actual decline in initial claims in 2020. Rather, all that is happening is that the number of cases in 2020 is simply not rising enough to match the increases from 2019. All told, pandemic-related claims are still much higher than last year, as Wisconsin has experienced an increase of roughly 7x the initial claims from what was previously filed in 2019.
And, most of these 2020 claimants are seeing their initial unemployment claims denied. The percentage of regular unemployment claims leading to a first payment of benefits is actually down in Wisconsin from before the pandemic.
For the months of January 2018 through February 2020, there were 632,728 initial claims in Wisconsin, of which 245,558 led to first payments, a percentage of regular unemployment claims being paid of 38.81%.
Here is the monthly initial claims data for Wisconsin for the months of the pandemic:
So, during this pandemic, Wisconsin is actually paying out fewer claims than it did from before the pandemic. Less than one out of three initial claims are leading to a first payment, whereas before the pandemic nearly two our of every five claims was being paid.
For comparison, here are initial claims and first payment data during the pandemic for several other states:
ST Initial 1st Pay %
NC 1,452,638 700,687 48.24
MI 1,997,061 1,168,887 58.53
FL 3,298,791 1,578,803 47.86
IL 2,037,211 1,063,231 52.19
AR 412,425 179,558 43.54
PA 2,233,652 1,201,647 53.80
IN 1,322,840 553,568 41.85
OR 621,445 357,489 57.53
All of these claims being denied in Wisconsin has led to a staggering backlog in hearings.
Prior to the pandemic, appeal tribunals were issuing around 1,200 to 1,500 decisions a month. Here is what happened with the pandemic:
Month Pending Filed Decided
Oct 12,771 4,480 3,289
Sept. 11,052 4,414 3,063
Aug 9,655 4,860 3,236
July 6,719 4,442 4,083
June 6,309 3,307 3,363
May 6,296 4,922 3,724
April 5,090 6,034 2,492
March 1,520 1,952 1,565
In the last few months, more than 4,000 appeals of initial determinations have been filed every single month. Administrative law judges are now issuing more than 3,000 decisions these same months. But, they cannot keep up, and the backlog of pending cases is, at the end of October 2020, nearly 13,000 cases. If not a single appeal was filed after October 31st, it would still take around four months to clear the current backlog of cases that need a hearing.
For comparison, in Illinois, which has twice the number of initial claims that Wisconsin has, pending cases before an administrative law judge at the end of October numbered just 2,069. Pennsylvania has a backlog at the end of October of 3,950 pending cases — one-third of the backlog in Wisconsin — even though Pennsylvania has handled more than twice the number of initial claims than Wisconsin has.
Given the backlog of cases in Wisconsin, it is no wonder that folks should now expect to wait four to six months for their hearing. Because Wisconsin has kept every possible disqualification alive during this pandemic except for the four job searches a week and so is investigating any and all potential disqualifications — even issues going as far back as January 2019 — the system simply cannot keep up. The more people that are hired at the Department simply means more cases that have to be adjudicated.
So, if not approved for unemployment benefits soon after filing an initial claim, expect to wait several months or longer for a decision. And, if that initial determination does not go your way, expect to wait four to eight months for your hearing after filing your appeal.
All I can offer at the moment is the possible assistance described in part 3 of this series. Unemployment in Wisconsin truly is broken.
Note: The news article, however, continues to report the Department’s weekly claims data — 74,000 claimants — as the number of still outstanding claims. As many of the people who testified at the public hearing, those waiting includes those waiting for a hearing, which is a three to five month process right now (and getting longer). So, the actual number should be those who are waiting for a payment period. And, that number is at best 150,000 to 200,000.
Given that many of the issues have already been covered here, here are some links to those looking for answers raised at the hearing.
The Department’s general hostility to claimants
Numerous attendees indicated that Department staffers are hostile to claimants by always doubting what is being told to them, and that the whole process is simply dehumanizing. More than few attendees had to stifle tears in the midst of their testimony, in light of their anguish and desperation.
Questions cannot be answered, these attendees indicated, and answers when provided are too often contradictory. As one attendee described, the burden of proof is on her, and she is presumed to be attempting to scam the system until she can show by clear and convincing evidence that her claim for unemployment benefits is forthright.
The picture painted in this testimony is a Department no longer functioning as an unemployment agency but instead as a kind of welfare office trying to correct the “immorality” of claimants who want unemployment benefits rather than a job.
Numerous attendees described enormous delays of three to five months with their claims (see below for how long claimants can currently expect for their claims to be heard after appealing a denial).
Apparently forgotten by everyone is the Supreme Court decision in Cal. Dep’t of Human Resources Development v. Java, 402 U.S. 121, 91 S.Ct. 1347, 28 L.Ed.2d 666 (1971). Java concerned a hold placed on payment of unemployment benefits when an employer contested claimant eligibility. First, the court described the investigatory process:
A claimant, appearing at an unemployment insurance office to assert a claim initially is asked to fill out forms which, taken together, indicate the basis of the claim, the name of the claimant’s previous employer, the reason for his unemployment, his work experience, etc. The claimant is asked to return to the office three weeks later for the purpose of receiving an Eligibility Benefits Rights Interview. The issue most frequently disputed, the claimant’s reason for termination of employment, is answered on Form DE 1101, and the Department immediately sends copies of this form to the affected employer for verification. Meanwhile the employer is asked to furnish, within 10 days, ‘any facts then known which may affect the claimant’s eligibility for benefits.’ Cal.Unemp.Ins.Code §§ 1327, 1030. If the employer challenges eligibility, the claimant may then be asked to complete Form DE 4935, which asks for detailed information about the termination of claimant’s previous job. The interviewer has, according to the Local Office Manual (L.O.M.) used in California, the ‘responsibility to seek from any source the facts required to make a prompt and proper determination of eligibility.’ L.O.M. s 1400.3(2). ‘Whenever information submitted is not clearly adequate to substantiate a decision, the Department has an obligation to seek the necessary information.’ L.O.M. § 1400.5(1)(a). This clearly contemplates inquiry to the latest employer, among others.
The claimant then appears for his interview. At the interview, the eligibility interviewer reviews available documents, makes certain that required forms have been completed, and clarifies or verifies any questionable statements. If there are inconsistent facts or questions as to eligibility, the claimant is asked to explain and offer his version of the facts. The interviewer is instructed to make telephone contact with other parties, including the latest employer, at the time of the interview, if possible. L.O.M. § 1404.4(20). Interested persons, including the employer, are allowed to confirm, contradict, explain, or present any relevant evidence. L.O.M. § 1404.4(21).
The eligibility interviewer must then consider all the evidence and make a determination as to eligibility. Normally, the determination is made at the conclusion of the interview. L.O.M. § 1404.6(2). However, if necessary to obtain information by mail from any source, the determination may be placed in suspense for 10 days after the date of interview, or, if no response is received, no later than claimant’s next report day. L.O.M. § 1400.3(2)(a).
Java, 402 US at 126-7. Obviously, claimants in Wisconsin are reporting an investigatory process that is nothing like what is described here. Few claimants are having any contact with the Department adjudicators before their claims are denied. And, claimants then have to wait until a hearing and getting a hearing packet in the mail to learn why the Department actually decided to deny their unemployment benefits in the first place.
Note: Indeed, most claims denied in Wisconsin have nothing to do with an employment separation. Rather, the main reason are the claimants’ failure to satisfy Department mandated claim-filing requirements, as non-separation denials have sky-rocketed over the past decade, even as separation denials have declined to under 20% of all claims filed:
The Court then went on to explain why unemployment was started and how the requirement for paying benefits “when due” in federal law was set:
On the basis of 1922-1933 statistics, it was estimated that 12 weeks of benefits could be paid with a two-week waiting period at a 4% employer contribution rate. The longest waiting period entering into the estimates was four weeks, indicating an intent that payments should begin promptly after the expiration of a short waiting period.
Other evidence in the legislative history of the Act and the commentary upon it supports the conclusion that ‘when due’ was intended to mean at the earliest stage of unemployment that such payments were administratively feasible after giving both the worker and the employer an opportunity to be heard. The purpose of the Act was to give prompt if only partial replacement of wages to the unemployed, to enable workers ‘to tide themselves over, until they get back to their old work or find other employment, without having to resort to relief.’ Unemployment benefits provide cash to a newly unemployed worker ‘at a time when otherwise he would have nothing to spend,’ serving to maintain the recipient at subsistence levels without the necessity of his turning to welfare or private charity. Further, providing for ‘security during the period following unemployment’ was thought to be a means of assisting a worker to find substantially equivalent employment. The Federal Relief Administrator testified that the Act ‘covers a great many thousands of people who are thrown out of work suddenly. It is essential that they be permitted to look for a job. They should not be doing anything else but looking for a job.’ Finally, Congress viewed unemployment insurance payments as a means of exerting an influence upon the stabilization of industry. ‘Their only distinguishing feature is that they will be specially earmarked for the use of the unemployed at the very times when it is best for business that they should be so used.’ Early payment of insurance benefits serves to prevent a decline in the purchasing power of the unemployed, which in turn serves to aid industries producing goods and services. The following extract from the testimony of the Secretary of Labor, in support of the Act, describes the stabilization mechanism contemplated:
I think that the importance of providing purchasing power for these people, even though temporary, is of very great significance in the beginning of a depression. I really believe that putting purchasing power in the form of unemployment-insurance benefits in the hands of the people at the moment when the depression begins and when the first groups begin to be laid off is bound to have a beneficial effect.
Not only will you stabilize their purchases, but through stabilization of their purchases you will keep other industries from going downward, and immediately you spread work by that very device.’
Java, 402 US at 131-3 (footnotes omitted). Accordingly, the court held:
Paying compensation to an unemployed worker promptly after an initial determination of eligibility accomplishes the congressional purposes of avoiding resort to welfare and stabilizing consumer demands; delaying compensation until months have elapsed defeats these purposes. It seems clear therefore that the California procedure, which suspends payments for a median period of seven weeks pending appeal, after an initial determination of eligibility has been made, is not ‘reasonably calculated to insure full payment of unemployment compensation when due.’
Java, 402 US at 133 (footnote omitted). Notice that, for the court, “delaying unemployment compensation until months have elapsed defeats” the purpose of unemployment. So, these months-long delays in payment of unemployment benefits in Wisconsin is, under Java, a violation of federal law.
A few attendees spoke about having trouble getting benefits after being told to stay home because of concerns with Covid-19. Others talked about child-care problems created by the pandemic.
The main point of PUA benefits is the pandemic, and there are specific provisions that allow benefits in the following circumstances:
(aa) the individual has been diagnosed with COVID–19 or is experiencing symptoms of COVID–19 and seeking a medical diagnosis
(bb) a member of the individual’s household has been diagnosed with COVID–19
(cc) the individual is providing care for a family member or a member of the individual’s household who has been diagnosed with COVID–19
(dd) a child or other person in the household for which the individual has primary caregiving responsibility is unable to attend school or another facility that is closed as a direct result of the COVID-19 public health emergency and such school or facility care is required for the individual to work
These are all simple and obvious criteria. But, the Department is NOT applying this criteria in a simple, open, and straightforward fashion or contacting claimants with helpful inquiries that would allow the immediate payment of benefits. Rather, what is happening is that these claims are being heavily scrutinized for any discrepancy or misstatement that allow for a denial of benefits. So, folks end up having to appeal and wait. And wait. And wait some more for a now backlogged hearing process.
Note: In September, I indicated that the hearing process was then taking a month just to process an appeal of an initial determination. That delay is now around six weeks. The actual hearing is now taking another three to four months. In other words, getting a claim denied (which has been taking several months to begin with), will as of mid-November 2020 take another four to six months to correct. I know of claimants that have been waiting since March 2020 for their unemployment benefits, and many still do not even have a hearing scheduled.
And, for those that are getting their claims denied right now: after waiting eight months, you can expect to wait another four to six months for a hearing on your unemployment claim. Not good at all.
Language and technology barriers
A few attendees described the access barriers to claims-filing in Wisconsin. UIPL 02-16 (1 Oct. 2015) indicates that Wisconsin should have at a minimum more than one way to file a claim (phone, on-line, and in-person are the options) and that multiple languages need to be available when the working population depends on multiple languages.
Wisconsin for some years now has been in violation of these standards. Current claim-filing processes and questions are available here.
Again, in a state where broadband access is extremely limited, it makes absolutely no sense to have an on-line only claim-filing system. And, the fact that this system is inaccessible because of language barriers as well as to those with other disabilities have been longstanding problems.
SSDI and how to report eligibility for full-time work
One SSDI recipient testified about how she cannot work full-time and so was being wrongly denied when she answered a claims question truthfully by saying she cannot work full-time.
Obviously, she considered full-time work to be akin to 40 hours in a week. But, for unemployment purposes, full-time work varies from worker to worker.
As noted here, the question is legally wrong, as eligibility for full-time work is defined by how much work an individual is actually capable of doing. So, this attendee should have answered “yes” to being available for full-time work, if she could do what she was physically capable of, even if that work was only ten hours a week. As the question does not actually follow state law, however, it does not provide correct legal guidance.
Several attendees described being tossed back and forth between regular unemployment benefits and PUA benefits. Those approved for PUA benefits are now being told by the Department to repay those benefits because they potentially qualify for regular unemployment benefits.
This problem is one issue that is not unique to Wisconsin, as it is present in most states at the moment.
By law, PUA benefits are only supposed to be paid out if a claimant has no eligibility for regular unemployment of any kind (which includes PEUC and EB benefits, as well as regular unemployment benefits that could potentially exist in another state).
The Department, however, is doing little to nothing to educate claimants about these issues. In the midst of this pandemic and with no work or income in sight, folks are simply desperate for any kind of unemployment assistance and do not have the time or legal expertise to decipher the kind of support they are receiving — regular, PUA, PEUC, or EB — and when or how that support should switch over to another program.
But, the Department is making claimants responsible for all of this information by determining at some later date when and how an alternative benefit source should have been applied and demanding immediate re-payment of the thousands of dollars under the prior unemployment program/benefit.
This penalizing of claimants for not switching from PUA to EB or PEUC benefit programs at the right time by ordering repayment of all benefits shocks and confuses claimants who receive these notices and stifles the very goal of economic stimulus at the heart of these programs.
Yet, these repayment demands are essentially administrative accounting problems inherent with the state unemployment agency that ultimately is responsible for adjusting the source or category of an individual’s benefit payments.
Essentially, because the state is responsible for transferring the claimant from one benefit program to another, claimants should not be on the hook for repayments connected to these administrative accounting issues. Instead, states should be responsible for these administrative transfers themselves, and any amounts due because of states’ failure to act promptly on these issues should be forgiven as far as claimants are concerned. At the very least, the Department should be explaining that, for example: while PUA benefits need to be repaid, the claimant will instead receive regular unemployment benefits for the same weeks, resulting in no over-payment or an over-payment of just $X amount, which will be recovered in installments against future unemployment benefits paid out.
But, that kind of advice would probably be deemed as being too helpful.
This advice about how to get actual information about your claim and financial help should continue to be relied on.
For claimants, the Department’s portal continues to be less than useful except for two issues. See this post about how to get the two useful kinds of info — actual decision documents and payment benefit history — out of your portal.
Note: Do NOT ever conclude that your portal sets forth an accurate and historical record of activity relating to your claim. Department reports regarding your claim WILL change based on how the Department staffers characterize events, and so even claim approvals can “disappear” from your claim-history. Get PDFs when they appear in your document history or your benefit payment history and hand on to those documents. A year from now, the Department may deny, for instance, that you were ever approved for unemployment benefits and that you falsely claimed being laid off when your employer says you quit. If you did not retain that initial determination originally approving your claim for being laid off, you will no longer find that document when now being charged with fraud for claiming a layoff when you supposedly quit. Again, get PDFs of your unemployment documents and hang on to them for dear life. The Department, after all, has a profit incentive in turning the tables on you at some future date.
So, a public hearing in the midst of this pandemic is nothing to be excited about. In light of the pandemic, this hearing is split across two days and takes place via webex, a difficult on-line conferencing tool that is great in corporate environments but a pain to use across numerous platforms and technologies, especially where broadband access is limited. Here, for example, is the help Department offers for the toll-free number.
Today’s session was less than remarkable. Besides myself, there were about 25 observers and 12 witnesses (a 13th never managed to get her computer audio working, a common issue with webex). In lieu of providing basic information about the claim-filing process or even some sympathy to those describing their frustration, the Department’s representatives maintained that they could provide no information in response to such queries, even general queries, and was solely there to listen to public testimony.
And, if participants did not connect on right at 2pm (the scheduled start of today’s hearing, which was supposed to last until 4pm), they may have found no connection whatsoever. The Department abruptly ending the public hearing at 2:49pm when there no more speakers who had not yet testified.
Note: There does NOT appear to be any legal basis for ending a public hearing simply because no one from the public is currently in attendance. In-person public hearings continue for the entire scheduled time, as participants may well have planned to arrive at a certain time rather than appear immediately at the beginning. By ending this hearing prematurely before the scheduled ending time of 4pm, the Department violated its own notice for this meeting.
You can still register for the session tomorrow, Nov. 10th, from 4:30-6:30pm.