Continued Assistance Act

The Continued Assistance Act had a rocky signing, but it is now law and some details are starting to emerge.

As with this pandemic, there are numerous programs, and it is vital that you keep the distinctions clear for yourself. So, first determine which unemployment benefit applies to you and then read the section for that specific benefit.

And, then read about the other benefit programs, as those will likely affect you as well at some later point if not immediately.

The Department indicates that it hopes to start paying out the new $300 PUC benefit before the end of January. Implementation of the other programs remains unknown.

Returning to work notices

In response to largely fictionalized concerns over workers refusing to come back to work, notice requirements about refusing work are now mandated.

Wisconsin already has had generalized notices in place, and has actively been encouraging workers to report any and all work refusals so as to deny claimants eligibility. For example, the Department provides this advice to employers:

If an employee decides not to return to work when the business re-opens, are they eligible for unemployment?

In most cases, no. Unemployment benefits are available to individuals who are totally or partially unemployed due to no fault of their own. In this example, the individual—not the employer—is choosing not to work and, therefore, would be ineligible. However, the facts of each circumstance are important. An investigation would be conducted to determine if the employee would still be eligible. Please see the Claimant Handbook Part 6 Eligibility Issue, Common Disqualifications.

How do I notify UI that an employee had refused to return to work?

UI Employers can report individuals who are filing for UI but have refused a job offer by visiting https://unemployment.wisconsin.gov/employerfeedbackform.

You will choose “Report Individual Who Refused Work” and be prompted to answer several questions regarding the individual who refused the work, and the job offer itself. A confirmation email is sent to the person submitting the information. The reported information is sent to a UI Job Refusal Mailbox, prompting the creation of an eligibility issue on the individual’s claim that will need adjudication.

UI Employers can also contact the UI Help Center (Employer Assistance Line), (414) 438-7705.

Whether workers are actually refusing returning to work remains to be seen, especially since Wisconsin’s partial unemployment eligibility is a financial boon to workers who do return to work (as long as that work is still not full-time).

Interestingly, this provision also requires the Department to provide claimants accused with refusing a return to work with a plain-language notice that includes:

• Summary of state UC laws regarding an individual’s return to work;
• Statement about the individual’s rights to refuse to return to work or to refuse suitable work;
• Explanation of what constitutes suitable work under state UC law;
• Explanation of the individual’s right to refuse work that poses a risk to the individual’s health or safety (if permissible and as defined under state law); and
• Instructions for contesting a denial if the denial is due to a report by an employer that the individual refused to return to work or refused suitable work.

UIPL No. 9-21 (30 Dec. 2020) at 14-15. Such a notice is much more than what Wisconsin currently offers for a work refusal.

Finally, you can refuse a return to work and remain eligible for PUA benefits if:

• you are diagnosed with COVID-19 or have symptoms of a COVID-19 infection,
• you are caring for a family member or a member of your household diagnosed with COVID-19,
• you have primary care-giving responsibility for a child or person who cannot attend school or another facility because of the pandemic and so you cannot abandon that care-giving responsibility, or
• a government agency or a medical provider has told you to quarantine

The $300 PUC

There is now a new $300 PUC payment for 11 weeks, starting with the week ending 1/2/2021 through the week ending 3/13/2021 for anyone receiving PEUC, PUA, EB, or regular unemployment benefits.

This $300 PUC is automatic as long as the claimant is receiving some other unemployment benefit for these weeks.

Pandemic Emergency Unemployment Compensation (PEUC)

PEUC benefits are extended an additional 11 weeks, from the week ending 1/2/2021 through the week ending 3/13/2021. But, these additional weeks cannot be paid for any weeks prior to the week ending 1/2/2021.

A phaseout time period is now available to those claimants receiving PEUC benefits who have not yet exhausted those benefits as of the week ending 3/13/2021. These claimants can continue receiving PEUC benefits for additional weeks until the week ending 4/10/2021.

Because with every new quarter PEUC payments are halted or slowed while state agencies investigate claimants’ potential eligibility for regular unemployment benefits, there is now a program in place to allow state agencies to continue paying PEUC benefits in certain circumstances.

Individuals may be eligible to continue to receive PEUC instead of regular UC if all of the following criteria are met:

Criterion #1: The individual has been determined to be entitled to PEUC with respect to a benefit year;

Criterion #2: The benefit year with respect to which the PEUC entitlement had been established (i.e., the parent claim) has expired after the date of the enactment of the Continued Assistance Act (December 27, 2020);

Criterion #3: The individual has remaining entitlement to PEUC with respect to such benefit year; and

Criterion #4: The individual would qualify for regular UC in a subsequent (new) benefit year and the WBA for regular UC in the new benefit year would be at least $25 less than the WBA payable on the individual’s PEUC claim.

UIPL No. 17-20 Change 2 (31 Dec. 2020) at 6-7. Essentially, this criteria means that a person can continue to receive PEUC benefits rather than regular unemployment benefits if that person still has weeks remaining on their PEUC claim, their current benefit year does not expire until after 27 Dec. 2020, and the total weekly benefit amount in regular unemployment benefits is $25 less than what they are entitled to with their current PEUC benefits.

This program letter spells out various options for how state agencies can apply this option. See UIPL No. 17-20 Change 2 (31 Dec. 2020) at 7-11.

NEW — Mixed Earners Unemployment Compensation (MEUC)

Many independent contractors found themselves eligible for regular unemployment benefits because of side jobs they had. Those regular unemployment benefits were much lower than what they would have earned from the self-employment, however.

So, a new, optional benefit has been created for these self-employed workers, and Wisconsin has said it is adopting it.

Under this program, claimants who have more than $5000 in self-employment income for the calendar year previous to when their initial claim starts will be eligible for an additional straight $100 per week on top of their regular unemployment (or PEUC or EB) benefit. See UIPL No. 15-20 Change 3 (5 Jan. 2021) at 4-5.

The documentation to establish the $5000 in self-employment income is nominally a tax return.

If available, individuals must provide a copy of the income tax return for the most recent taxable year ending prior to the individual’s application for regular UC to substantiate their self-employment income for purposes of establishing eligibility for MEUC. If the tax return is not available (e.g., because the individual has not yet filed the income tax return yet), acceptable documentation of self-employment income include, but is not limited to, pay check stubs, bank receipts, business records, ledgers, contracts, invoices, and billing statements that substantiate self-employment income of at least $5,000 during the most recent taxable year ending prior to the individual’s application for regular UC.

Individuals may submit this documentation at any time while the MEUC program is in effect. States may wait to make an eligibility determination for an MEUC application until documentation is provided. Or, states may provide individuals a reasonable amount of time, as provided under state law, to submit this documentation after they apply for MEUC. However, until the individual provides the documentation and the state can determine that it substantiates that the amount of self-employment income meets MEUC eligibility requirements, MEUC payments may not begin.

Unfortunately, this MEUC benefit is only payable for weeks ending 1/2/2021 through the week ending 3/13/2021 — 11 weeks in all.

Assistance in figuring out this new program is available here, and the Department has created a FAQ as well.

Finally, MEUC payments are counted for determining income for Medicaid coverage Children’s Health Insurance Program (CHIP). See UIPL No. 15-20 Change 3 (5 Jan. 2021) at 5.

Note: Per § 2104(h) of the CARES Act, PUC benefits are NOT counted for Medicaid and CHIP.

Pandemic Unemployment Assistance (PUA)

There are many changes and updates.

• The new calendar quarter that started in January 2021 does not mean that all PUA payments have to be put on hold while the Department investigates potential eligibility for PEUC benefits. States like Wisconsin are now allowed to continue paying PUA benefits for four more weeks while the state determines potential eligibility for PEUC benefits.
  
  Obviously, claimants who receive PUA benefits in lieu of PEUC benefits cannot later claim PEUC for those same weeks.
  
  This lag period (or hold harmless period) realistically only applies to those receiving PUA benefits because they have exhausted their eligibility for regular unemployment benefits and then suffered a pandemic-related job loss. After all, claimants who initially are only eligible for PUA benefits cannot ever receive PEUC benefits. So, this lag period option will not matter to the self-employed or the SSDI recipients who are getting PUA benefits, since they are ineligible for regular unemployment or PEUC benefits in the first place. Still, this lag period is helpful to claimants in W2 covered employment who are receiving PUA benefits because they lacked sufficient benefit year earnings.

• New initial claims for PUA benefits filed after Dec. 27th can only be backdated to a job loss on Dec. 1st at the earliest.
• A phaseout period is now available to those claimants receiving PUA benefits who have not yet exhausted those benefits as of the week ending 3/13/2021. These claimants can continue receiving PUA benefits for additional weeks until the week ending 4/10/2021.
  
  
  
  PUA claimants are eligible for this phase out period if their PUA claim is eventually considered to be “live” for the week ending 3/13/2021.

There is now an additional documentation requirement for PUA claims. Claimants will have to provide documentation regarding their employment, self-employment, or the job offer/work they were slated to start for any weeks PUA weeks for the week ending 1/2/2021 or later.

• New PUA claims filed on Jan. 31st or later will have to provide that documentation within 21 days of the claim.
• Continued PUA claims or initial PUA claims filed prior to Jan. 31st will have 90 days to provide this documentation.

In most cases, documentation submitted to provide proof of income should be enough. But, those claimants receiving PUA benefits because of a withdrawn job offer or loss of work may need to provide additional documentation. Here is what the program letter spells out for this requirement:

In general, proof of employment includes, but is not limited to, paycheck stubs, earnings and leave statements showing the employer’s name and address, and W-2 forms when available.

Proof of self-employment includes, but is not limited to, state or Federal employer identification numbers, business licenses, tax returns, business receipts, and signed affidavits from persons verifying the individual’s self-employment.

Proof of employment with organizations such as the Peace Corps, AmeriCorps, and educational or religious organizations includes, but is not limited to, documentation provided by these organizations and signed affidavits from persons verifying the individual’s attachment to such organizations.

Proof of the planned commencement of employment includes, but is not limited to, letters offering employment, statements/affidavits by individuals (with name and contact information) verifying an offer of employment.

Proof of the planned commencement of self-employment includes, but is not limited to, business licenses, state or Federal employer identification numbers, written business plans, or a lease agreement.

Individuals must present the proof of employment and the state may verify the proof submitted using records the state may have available, such as wage records or state revenue records.

* * *

Unlike the documentation requirement to receive a higher WBA, documentation to substantiate employment or self-employment need not cover the entire period in which an individual was working. States have discretion to determine if the documentation an individual submits substantiates an individual’s employment, self-employment, or planned commencement of employment or self-employment.

UIPL No. 16-20 Change 4 (8 Jan. 2021) at I-10 to I-11. Claimants who fail to provide this requested documentation will be liable for repaying PUA benefits only for weeks ending 1/2/2021 and later. “This is because the individual cannot be ineligible for a week of unemployment ending before the date of enactment solely for failure to submit documentation.” Id. at I-12.

There is also a new weekly re-certification requirement specifying that, for each week claimed, the pandemic-related reason for PUA-eligibility, effective the week ending 2/6/2021, must be provided.

Note: Wisconsin has already mandated this requirement for PUA claimants. See the PUA weekly certifications at the post that has Wisconsin’s claim-filing forms.

But, benefits are NOT to be denied for prior weeks solely for failing to submit this weekly certification by states that made a good faith effort to implement PUA program for those prior weeks. See UIPL No. 9-21 (30 Dec. 2020) at 9; see also UIPL No. 16-20 Change 4 (8 Jan. 2021) at I-15 to I-16. So, Wisconsin may well be denying benefits to claimants pre-maturely and without legal justification.

Over-payments of PUA benefits can NOW be waived if the claimant is not at fault for the mistaken payment and repayment would be contrary to equity and good conscience (i.e., the claimant cannot afford repayment at this time). As Wisconsin’s over-payment standard is based on the Department making an error of some kind when there is no claimant fault, this equity and good conscience should apply for over-payments of PUA benefits:

If a state UC law provides for the waiver of overpayments but does not include a provision defining “equity and good conscience” the state must use the following provisions for equity and good conscience, when assessing whether an individual overpayment may be waived.

» It would cause financial hardship to the person from whom it is sought;

» The recipient of the overpayment can show (regardless of his or her financial circumstances) that due to the notice that such payment would be made or because of the incorrect payment either he/she has relinquished a valuable right or changed positions for the worse; or

» Recovery could be unconscionable under the circumstances.

States that choose to waive overpayments under Section 201(d) of the Continued Assistance Act must notify all individuals with a non-fault overpayment of their ability to request a waiver. The notification must include how to request the waiver.

Waiver determinations must be made on the facts and circumstance of each individual claim, blanket waivers are not permissible.

Update (16 Feb. 2021): The Department has a program tracker page for the Continued Assistance programs. Unfortunately, the news is NOT good.

Extended PEUC benefits are NOT slated to be available until March 4th. The new PUA benefits are not slated to be paid until April 21st, well after the end date of March 13th and even after the phaseout period ending on April 10th. And, MEUC benefits will not be available until April 28th, four months after the program was supposed to start.

Lame duck stimulus

Actual provisions are scarce. But, you can get a description of the unemployment provisions from Michele Evermore of NELP and from the National Law Review.

Some things claimants should immediately note:

• benefits for PEUC and PUA programs are extended an additional 11 weeks to March 14th
• an additional $300 PUC is added for anyone receiving PEUC, PUA, EB, or regular unemployment benefits during these additional weeks,
• anyone who has not exhausted PEUC benefits (now 24 weeks in toto) or PUA benefits (now 50 weeks in toto) can continue to receive those benefits after March 14th to the week of 5 April 2021,
• waivers for over-payment of PUA benefits are now available (previously, over-payments of PUA benefits were not legally available for claimants caught between regular unemployment and PUA),
• waivers of LWA over-payments are also now available,
• claimants can file new PUA claims for job losses after 1 December 2020,
• claimants with new PUA claims after 31 Jan. 2021 must now submit wage records verifying unemployment within 21 days, and
• all other PUA claimants must submit wage records verifying their unemployment within 90 days of 31 January 2021 (i.e., Thursday, 1 May 2021).

Employers should note as well:

• reimbursable non-profit employers will continue to receive the 50% subsidy through 14 March 2021, and
• 100% federal support for work-sharing arrangements will continue.

For state unemployment agencies, waiver of any interest on federal loans to cover payment of regular unemployment benefits continue (not an issue in Wisconsin, as the unemployment trust fund was $1.2 billion as of Nov. 10th). But, federal funding for waiting week benefits is halved to 50%.

Update (28 Dec. 2020): The current president waited several days to sign this bill — until December 27th — and so both PUA and PEUC benefits were slated to expire on December 26th. That delay could mean that there will be a week gap in coverage, including the new $300 PUC that is part of these extended unemployment benefits.

A report from The Hill indicates that some states and Michelle Evermore of NELP are developing a way to keep claimants from losing this week of benefits:

According to Evermore, the Labor Department’s Employment and Training Administration, which administers federal aid to state unemployment programs, could modify their existing state contracts instead of writing new ones altogether, thus avoiding the lapse.

“It looks like it may be possible that states could, instead of drafting new agreements with states, they could just modify their old agreements,” Evermore said.

In essence, they could backdate their agreements to keep the funds from lapsing. But Evermore warned that the workaround may not pass legal muster, and whether states could proceed remained an open question.

One state unemployment office confirmed to The Hill that they were working on the effort. The Hill has reached out to the Labor Department for comment.

If the workaround is approved, it could potentially prevent the trimming of another benefit that provides $300 in additional unemployment insurance to the roughly 20 million people receiving them.

Why the $600 PUC matters

With 140,000 claimants still waiting on their regular unemployment and (I’m conservatively guessing based on the amount of PUA paid out at the moment) 80,000 PUA applicants still waiting (see the small print at 2), the $600 PUC that has been paid to those found eligible seems more myth than reality.

This tweet explains what the consequences are for the nation when the $600 PUC goes away:

Binyamin Appelbaum @BCAppelbaum
Let’s talk about unemployment benefits.

The federal government is currently “employing” about 20 million Americans at a weekly wage of $600.

In about 10 days, it plans to lay off all of them.

What do you think that is going to do to the economy?

And, this twitter thread has the economics explanation of why the $600 PUC needs to continue right now:

Ernie Tedeschi @ernietedeschi
A short thread on the emergency $600 per week unemployment insurance payment, more formally known as Federal Pandemic Unemployment Compensation (FPUC) /1

FPUC payments are currently coming to around $18 billion per week, supporting 30 million workers. It’s the largest week-to-week federal COVID response program that’s still ongoing. /2

The FPUC raises wage replacement rates substantially for eligible workers: around 2/3 of them are now getting more from augmented UI than they did from their prior jobs. This raises the question of whether the FPUC has reduced job finding. /3

It’s a difficult question to tackle, since the US has never had wage replacement rates above 100% before, but also because the CARES Act relaxed work search requirements for everyone regardless of how generous their UI benefit is. /4

Nevertheless, I looked at transitions into and out of employment in May and June in the household survey, to see if higher wage replacement rates were generally a drag on job finding. I used the superb Ganong et al (2020) UI benefit calculator to link-in likely benefit rates. /5

That calculator is here: https://github.com/ganong-noel/ui_calculator /6

I looked at both the linear effect of wage replacement rates on job finding and job leaving probabilities in May and June, as well as testing for whether there was a “kink” at 100% specifically. /7

The bottom line was that I found no evidence of any effect on labor market flows from more generous UI in May and June, controlling for other demographic factors. In fact some of the point-estimate coefficients were the “wrong” sign. /8

 

I tried it a variety of other ways unreported in my analysis too: adding controls for state reopenings and mobility, adding state rather than Census division fixed effects, doing the analysis as a panel with individual fixed effects. Nothing was statistically significant. /9

This doesn’t mean that the FPUC wouldn’t be binding in all states of the world. If the economy were at full employment, if there were no pandemic, and if the FPUC were a permanent rather than a temporary component of the UI system, I’d expect an effect. /10

But the results suggest that the FPUC isn’t remotely binding right now at the micro level. Given the macro support to the economy from the FPUC and the growing uncertainty over the economic & COVID outlook, I lean more and more that UI generosity should be maintained. /11

Full expiration would mean an economy that is 2% smaller by the end of 2020, and with 1.7 million fewer jobs, than if the FPUC were extended. /12

Even a partial compromise — $300 per week for the rest of the year — would still be an economy 1% smaller by year-end with 800,000 fewer jobs. /13

And those are just aggregate figures. At the individual level, workers would be devastated if the FPUC expired. Almost overnight, their incomes would be cut in half. In states like Arizona, Louisiana, and Mississippi, the typical worker would lose 75% of her benefits. /14

And in states with large populations of unemployed — states like Nevada that are heavily dependent on industries like tourism — losing the FPUC would be equivalent to losing a tenth of all state personal income. /15

This analysis honestly shifted my thinking. I’m still open to the theory that high wage replacement rates could be binding in the future. But I’m much less concerned about that in the near-term than I was, and more convinced that giving up generosity this year is unwise. /FIN

In that last chart, the states that are less affected by the loss of PUC are those states that have paid out less unemployment overall relative to their workforce. Since Wisconsin has been slow to approve unemployment benefits for claimants, the loss of PUC in this state will have less of an impact. Of course, Wisconsin has also gained less from the PUC in the first place because of DWD’s unwillingness to make the claims-filing process easier to navigate and adjudicate.

No PUC for you: DWD denies a federal $600 payment when there is a “BAR”

CBS 58 has a report about how Wisconsinites with a BAR are not receiving any of the $600 PUC payment despite guidance that they should receive at least $300 PUC payment each week. The key paragraph from the story:

“We have received verification [from the US Dep’t of Labor] that if somebody has a BAR fine, which is a benefit amount reduction, they are not eligible to receive Federal Pandemic Unemployment Compensation, which is the acronym FPUC or the additional $600 a week, and basically it’s because this person was found to have committed fraud against the system and therefore they would not be able to get those additional benefits due to that bar penalty as a result of committing fraud,” said Emily Savard with the Department of Workforce Development.

Here is the May 8th e-mail message in which the Department announced this policy to its staffers:

From _, Melissa – DWD
Sent: Friday, May 08, 2020 10:46 AM
To: _
Subject: FPUC and BAR

If a claimant does NOT receive UI, PEUC or PUA payment for a week because the entire amount is applied to the Benefit Amount Reduction (BAR) the claimant will not receive Federal Pandemic Unemployment Compensation (FPUC) (extra $600).

Melissa _
IQ Supervisor (Integrity and Quality)

The Department’s own original April 20th guidance on PUC benefits did NOT have this exclusion (emphasis supplied).

Eligible to receive a payment under UI, UCFE, UCX, PEUC, PUA, EB, STC, TRA or DUA. FPUC is added after all debts are offset, forfeited, or applied to a benefit amount reduction from the individual’s UI. Individuals whose UI payments are intercepted to pay debts (child support or pverpayments) are eligible for the $600 FPUC payment, even if 100% of their weekly benefit amount is intercepted.

What changed?

According to the CBS 58 report, the Department asked for additional guidance from the US Dep’t of Labor on this issue. But, why would additional guidance be needed?

A BAR used to be called a forfeiture of future unemployment benefits. Here is how an initial determination in 2016 regarding a “BAR” read:

Effect

The claimant shall forfeit $12705.00 of unemployment compensation benefits that become payable during the six year period that ends 02/05/22.

Additionally, the Department may at a later date seek criminal prosecution under Wis. Stats. 108.24.

---

Forfeiture (the withholding of future payable benefits) is an administrative penalty for intentionally concealing information affecting your unemployment eligibility and is in addition to any overpayment caused by such concealment of information.

---

And, here is the relevant language for a “BAR” in an initial determination in 2018:

Effect

The claimant’s benefit amount shall have a reduction of $1480.00. This reduction remains in effect for benefits and weeks that become payable during the six-year period that ends 02/15/25.

---

This benefit reduction of future payable benefits is an administrative penalty for intentionally concealing information affecting your unemployment eligibility and is in addition to any overpayment caused by such concealment of information.

---

There has been NO change in this law, Wis. Stat § 108.04(11), during this time. The only change has been in how the Department characterizes this forfeiture of future unemployment benefits.

But, this change in terminology by the Department is important. Federal guidance for the payment of the $600 PUC payment has the following information about when there is an over-payment of benefits because of a forfeiture and whether the $600 PUC is still paid:

Question: Must FPUC payments be used to offset intrastate state or federal UC overpayments?

Answer: Yes. FPUC payments must be reduced to recover state and federal UC overpayments if the state has a cross-program offset agreement in place with the Secretary under Section 303(g)(2), SSA (42 U.S.C. § 503(g)(2)). However, a state may not offset more than 50 percent from the FPUC payment to recover overpayments for these unemployment benefit programs.

UIPL 15-20 PUC benefits, Change 1 (9 May 2020) at I-2 (emphasis supplied).

Essentially, the Department is claiming that this change in wording in how it calls this forfeiture of future unemployment benefits — from a forfeiture to a benefit amount reduction or BAR — means that the federal guidance about still paying $300 of the federal PUC payment (and earmarking the other $300 towards the remaining benefit amount reduction) does not apply.

Again, as with eligibility for PUA benefits for the disabled (see the discussion of SSDI in this post), the Department is going out of its way to stymie the whole purpose of the CARES Act: to stimulate the economy by giving folks needed cash to pay for rent and groceries.

As the federal guidance for PUC payments explains:

Question: When is an FPUC payment considered to be overpaid?

Answer: An FPUC payment is an overpayment any time an individual receives an FPUC payment for which the individual was not eligible. For example, if an individual is paid FPUC and the underlying UC benefit payment is subsequently denied and determined to be overpaid, then the FPUC payment is also overpaid. However, if an individual is eligible receive at least one dollar ($1) of underlying benefits for the claimed week, the individual is eligible to receive the FPUC payment for that week.

UIPL 15-20 PUC benefits, Change 1 (9 May 2020) at I-2 (emphasis supplied).

All the claimants currently under the BAR penalty are seeing in their benefit statements that they are being credited/reduced each week for these BAR/forfeiture penalties. Just like any forfeiture, these funds simply are not being paid out to them. So, why is the Department at least not paying out the $300 PUC as per federal guidance on this issue?

Implementation dates for CARES Act unemployment provisions

All states have reportedly signed agreements with the Department of Labor to implement the CARES Act unemployment provisions.

Here is when you can expect to start receiving these benefits, if eligible, for Wisconsin and a few other states and territories.

PEUC benefits

These Pandemic Emergency Unemployment Compensation benefits are available to anyone who is no longer eligible for other kinds of unemployment benefits from the date the state signed its agreement with the Department of Labor.

If a person exhausts PEUC benefits, they should be eligible for PUA benefits according to Labor Department guidance. See UIPL 16-20, § 4.a., last par. on p.4.

PUC payments

These $600 payments have started in some states. Anyone who receives any other kind of unemployment benefit — regular, EB, PUA, or PEUC — will also receive an additional $600 PUC payment through July 31st.

These payments, when they start, will be dated to the first week of the claim (minus any waiting week).

• WI: to start making these payments the week of 26 April 2020
• CA: first checks start on April 12th
• DC: processing starts on April 17th, with the first payments starting on April 21st
• IL: checks have already started
• MA: April 9th
• NY: checks have already started
• OR: first checks to start arriving on April 13th and processing of these claims to start April 10th

PUA

These benefits are for those who do NOT qualify for regular unemployment benefits (either because they lack sufficient earnings to qualify or have lost gig work/self-employment because of the pandemic.

Note: More on PUA eligibility in another post later this week.

• WI: taking the first applications the week of 21 April 2020
• DC: taking applications by April 28th
• MA: new portal for PUA not ready until 4/30/2020
• OH: mid-May
• RI: up and running

As noted in the NY Times, there may be additional hurdles for these workers to satisfy before they are declared eligible by the states taking these applications.

These delays, in part, are occurring because of neglect and reliance on out-dated technology in managing state’s unemployment systems. For instance, Wisconsin is one of numerous states that still uses a mainframe computer application built on COBOL to process unemployment claims.

California Governor Newsom’s April 15th press conference revealed several important initiatives relating to both unemployment benefits and undocumented workers. First, an Executive Order issued this same day included:

• helpful language about mis-classification of independent contractors who should be receiving UI in California under AB5;
• a requirement that the state unemployment agency expand phone service to seven days a week, from 8am to 8pm;
• new authority for the unemployment agency to streamline and automate the state’s work sharing program; and
• an official announcement that the PUA program will start taking claims on April 28th (yesterday, CA announced that it will pay all PUA claimants the minimum PUA of $168 a week, plus $600 within 24-48 hours of when the individual files for benefits).

Second, the Governor announced a new $125 million Disaster Relief Fund for undocumented workers and families (which includes a contribution of $50 million from the philanthropic community) helping 150,000 undocumented Californians with grants to be disturbed by community-based organizations.

Other issues: reform, safety and health, and consumer protections

Michele Evermore of NELP advises that states can take several steps to make the unemployment claims simpler and more efficient.

• using WARN Act layoff provisions to coordinate with unemployment (something Wisconsin already does to a limited extent)
• making sure unemployment departments have access to claimants’ and employers’ tax filings for their employees (something I have recommended for years but which the Department has resisted).

And, to determine how unemployment interacts with the sick leave provisions, carefully review this complicated but still very useful flow-chart.

If you need guidance on worker safety and health issues connected to COVID-19, see this review of resources courtesy of NELP.

Help with consumer law issues arising from this the pandemic is available from the National Consumer Law Center.

Update (15 April 2020): Added info about California’s efforts to provide PUA and PUC benefits.

Filing problems in Wisconsin are not new

Reports emerged last week about how efforts in Florida to make claim-filing more difficult are now knee-capping unemployment eligibility during this pandemic.

Privately, Republicans admit that the $77.9 million system that is now failing Florida workers is doing exactly what Scott designed it to do — lower the state’s reported number of jobless claims after the great recession.

“It’s a sh– sandwich, and it was designed that way by Scott,” said one DeSantis advisor. “It wasn’t about saving money. It was about making it harder for people to get benefits or keep benefits so that the unemployment numbers were low to give the governor something to brag about.”

Republican Party of Florida chairman Joe Gruters was more succinct: “$77 million? Someone should go to jail over that.”

With hundreds of thousands of Floridians out of work, the state’s overwhelmed system is making it nearly impossible for many people to even get in line for benefits.

Those in Wisconsin now having great difficulty filing unemployment claims will recognize these same problems: language barriers, mandates for on-line only claiming procedures, difficult to non-existent ways to correct or add claim information that do not fit complex Department-sanctioned processes, legalistic explanations of requirements that have become more complex rather than simplified and clarified, and a near complete absence on social media of explanations concerning unemployment eligibility, processes, and requirements.

And, these problems continue during this pandemic. The Department has only now on the morning of April 6th released versions of its pandemic FAQ in Spanish and Hmong.

But, actual on-line claim-filing, completing job registration requirements at the job center website, and satisfying on-line workshop requirements at the job center website remain English-only.

Note: The Department’s “solution” for these language barriers is to allow a claimant to call for assistance from an interpreter. This assistance, however, depends on the claimant reading the English-language requirements on the website to the interpreter over the phone if the interpreter is outside of the Department (i.e., not a Department employee).

And, the CARES Act FAQ created by the Department is English-only for now. And, to see what the Department is advising about the PUA benefits available under the CARES Act, you need to click here in order to then click on this PDF chart.

All of this clicking and advice to keep re-visiting these website for updated information forces everyone in Wisconsin to keep searching and exploring for answers to simple and vital questions that to them concern how will they pay for groceries and rent next week. The Department should be doing better.

In other words, even if a claim is filed, these on-line requirements to create a resume (not just upload) and to complete required on-line surveys remain in place for receipt of unemployment benefits. The access problems created by these requirements are well-documented and long-standing.

In contrast to Wisconsin, New York has created an excellent flow chart for how all of the various pandemic-related federal benefits will operate in conjunction with regular unemployment benefits.

This chart is front and center in New York state’s explanation of CARES Act benefits and was available in Spanish from the start. Indeed, New York will start paying out PUC benefits this week to its claimants and is now accepting applications by self-employed individuals for PUA benefits.

Until there are changes in Wisconsin, these filing tips and this FAQ should be essential reading for everyone filing unemployment claims in Wisconsin.

Implementing CARES act unemployment provisions

Wisconsin’s Department of Workforce Development is reporting on its FAQ that is will take several weeks to receive guidance about the unemployment provisions in the CARES act and then probably another several weeks before those provisions can be implemented.

Note: The Legislative Fiscal Bureau has already released its analysis of the CARES act as well as the earlier Families First act. This analysis notes some key provisions of these laws that DWD has yet to address, notably employer experience rating for pandemic-related layoffs.

Wisconsin may not have the time to wait. The Economic Policy Institute reports that nearly 20 million are expected to be out of work soon. Current — and shocking — national unemployment figures released today support this prediction. Indeed, after two weeks we are already nearly a third of the way there to 20 million. NELP reports:

This week’s unemployment claims report, which reflects last week’s claims, is up to 6.648 million, up 3.341 million from last week’s historic—and shocking—initial claims report. This is again a truly unprecedented number. Unfortunately, far too many eligible workers who are trying to file for unemployment are still encountering long waits or can’t connect at all with the state unemployment agency websites. NELP urges states to ramp up their claims-processing capacity as quickly as possible.

The Dep’t of Labor data for Wisconsin is just as shocking:

Note: Thanks to Colin Gordon of the Iowa Policy Project for this data and charts.

So, Wisconsin should expect that phone lines and on-line claims systems will continue to be crushed.

Other states are attempting to respond to this onslaught of claims in creative ways, ways that Wisconsin should give serious consideration to adopting:

• Massachusetts has been holding virtual town halls daily, and once or twice a week in Spanish for those applying for unemployment. Nearly 70,000 have taken part in this option over the past week. Thousands can be on the phone or online at once and staffers take live questions.
• Massachusetts has also already signed an agreement with the Dep’t of Labor for implementing the CARES act unemployment provisions.
• New Hampshire has signed its agreement as well. This agreement will, according to the governor, allow New Hampshire to shift regular unemployment claims arising from the pandemic to the federally-funded PUA benefits, increasing the benefits for many as a result of the higher minimum for PUA benefits.
• Washington state’s FAQ already has information about the federal benefits in the CARES act as well as how other federal benefits (such as tax relief payments) will interact with unemployment benefits.

Note: for a full run-down of what is happening in the state’s in regards to unemployment, see Unemployment Insurance Protections in Response to COVID-19: State Developments.

Finally, employees should be on the lookout for employers attempting to siphon away some of the benefits headed to claimants. Ohio is reporting numerous instances of employers not paying last paychecks and employers trying to avoid unemployment by reducing/zeroing out hours. Wisconsin law requires last paychecks to be paid to employees, and any loss of work because of a lack of work — whether the loss is partial or full and regardless of how the lack of work is labeled — entitles a person to unemployment benefits.

Coronavirus Aid, Relief, and Economic Security Act, aka the CARES act

Update-1 (26 Mar. 2020): the Ways and Means committee just released a FAQ on this bill.

Update-2 (26 Mar. 2020): a comparison of current pandemic relief measures from the Center for Economic and Policy Research and a press release from NELP on the new bill.

Update-3 (26 Mar. 2020): NELP’s description of the bill is now available.

Legislative leaders agreed on a bill, then there were some additional negotiations, and the senate has now passed an 880 page bill. Here is a summary of the unemployment provisions.

New kinds of unemployment assistance

The Act creates a Pandemic Unemployment Assistance (PUA) program which will be available for a large swath of workers who are not otherwise eligible for state unemployment insurance (UI). Eligibility for the program runs from 27 January 2020 through 31 December 2020, so eligibility is retroactive. The total duration of this benefit is 39 weeks.

The Act also creates a Pandemic Unemployment Compensation (PUC) benefit of an additional $600 per week for anyone receiving regular state UI or PUA. PUC will last through 31 July 2020 and will NOT be paid retroactively.

Finally, the Act creates 13 weeks of Pandemic Emergency Unemployment Compensation (PEUC) for those who were classified as employees who have exhausted or will exhaust state UI benefits without finding a new job.

Pandemic Unemployment Assistance (PUA)

Covered individuals here include people who are NOT eligible for regular state UI, including individuals who have exhausted their state UI benefits, including Extended Benefits.

Applicants will need to provide self-certification that they are:

(1) partially or fully unemployed, OR

(2) unable and unavailable to work because of one of the following circumstances:

• They have been diagnosed with COVID-19 or have symptoms of it and are seeking diagnosis;
• A member of their household has been diagnosed with COVID-19;
• They are providing care for someone diagnosed with COVID-19;
• They are providing care for a child or other household member who can’t attend school or work because it is closed due to COVID-19;
• They are quarantined or have been advised by a health care provider to self-quarantine
• They were scheduled to start employment and do not have a job or cannot reach their place of employment as a result of a COVID-19 outbreak;
• They have become the breadwinner for a household because the head of the household has died as a direct result of COVID-19;
• They had to quit their job as a direct result of COVID-19;
• Their place of employment is closed as a direct result of COVID-19; or
• They meet other criteria established by the Secretary of Labor.

OR are (3) self-employed (and have lost work), OR

(4) seeking part-time employment (if state law allows for benefits for PT workers) [Wisconsin’s benefit formula encourages part-time work when receiving unemployment benefits, but requires claimants to be looking for full-time work or as much work as possible for that individual given that individual’s physical limitations], OR

(5) do not have sufficient work history to qualify for UI, or otherwise do not qualify for state UI.

People who can telework with pay, and anyone receiving paid sick or paid leave benefits cannot receive PUA.

People eligible for PUA can receive up to 39 weeks of benefits, through 31 December 2020. There is no waiting week for the benefits. The benefits that are paid out as well as expenses for administering this program are covered 100% by federal monies.

PUA benefits are calculated the same way as they are for the federal Disaster Unemployment Assistance program under the Stafford Act (the model for the PUA program). So, there is a minimum benefit amount that is equal to one-half the state’s average weekly UI benefit (about $190 per week on average for all states). Wisconsin’s minimum DUA is $163. The maximum benefit will be $370, Wisconsin’s maximum weekly benefit rate.

Pandemic Unemployment Compensation (PUC)

Through 31 July 2020, all UI and PUA claimants will receive their usual calculated benefits plus an additional $600 per week in compensation. The $600 in extra compensation is NOT retroactive.

The additional $600 per week may be paid either with the regular UI payment or at a separate time at the discretion of the state. But, this benefit must be paid weekly.

The PUC benefits that are paid out as well as administrative expenses are covered 100% by federal monies.

PUC payments are NOT income for purposes of eligibility for Medicaid and CHIP.

Pandemic Emergency Unemployment Compensation (PEUC)

An additional 13 weeks of state UI benefits, tacked onto whatever the state currently offers (all but 8 states offer 26 weeks of UI). Wisconsin currently provides for 26 weeks of benefits, so now 39 weeks of benefits will be available here.

For those who might be eligible for regular benefits in other states, they must first apply for benefits in those other states before receiving PEUC benefits.

Note: This eligibility in other states was a major problem during the last recession and the EUC benefits made available then. Many claimants received EUC benefits only to find six months to a year later that they had to repay those EUC beenfits because they were eligible for regular UI benefits in other state if they had thought to apply for those benefits.

The PEUC benefits that are paid out as well as administrative expenses connected to PEUC are covered 100% by federal monies.

Job search and registration requirements each state has for regular UI benefits remain in place for PEUC benefits. But, “a State shall provide flexibility in meeting such requirements in case of individuals unable to search for work because of COVID-19, including because of illness, quarantine, or movement restriction.”

Claim-filing mistakes, penalties, and repayment

There are fraud penalties for anyone who makes “a false statement or representation of a material fact, or knowingly has failed, or caused another to fail, to disclose a material fact, and as a result of such false statement or representation or of such nondisclosure such individual has received” these new federal benefits. As DWD alleges fraud when making unintentional claim-filing mistakes and DWD will be administering these federal benefit programs in Wisconsin, folks should exercise extreme caution on this front.

The numerous warnings that begin every Wisconsin claim are there to indicate how aggressive the Department is on this issue. The Department does NOT consider failing to know something or mis-understanding an issue to be an adequate excuse for a claim-filing mistake. In other words, the Department presumes all mistakes are intentional fraud; any admission of a mistake, for the Department, constitutes an admission of guilt.

Note: The penalties for unemployment fraud are sizable. As of January 2020, the program integrity fund in which only a small portion of these penalties are deposited, amounted to $11,726,000 (see line 228). The Department is free to spend these funds as it sees fit.

Repayments that are needed when there are filing mistakes for non-fraudulent reasons can be waived when the over-payment of benefits was without fault of the claimant and repayment would be contrary to equity and good conscience (i.e., an economic hardship on the claimant).

Finally, payment of benefits under these programs can NOT be stopped until “until a determination has been made, notice thereof and an opportunity for a fair hearing has been given to the individual, and the determination has become final.”

Short-Time Compensation (aka work-sharing) (STC)

Federal government will fully reimburse states for all STC programs as defined in Section 3306(v) of the Internal Revenue Code.

Grants will be available to states that already have STC programs to help improve and promote them. Wisconsin already has a work-share program.

Note: What is work-share you ask? In return for maintaining benefits for employees, an employer can keep workers employed at reduced hours. The reduced pay is subsidized with unemployment benefits covering the lost hours of work. The application form spells out the requirements for this program on the third page. For more information or to apply, call the employer contact number at the Department: 608-261-6700.

States that enact conforming STC programs after the date of enactment will also be eligible for funding and implementation/promotion grants.

STC plans entered into by employers must provide that the employer will pay to the State 1/2 of the amount of STC paid under the plan. This money goes into the state UI trust fund. I am unsure of what this provision will mean for Wisconsin employers that adopt a work-share program.

Other provisions

For states that waive their waiting week, all benefits paid for that week as well as administrative expenses will come from federal monies.

There is a “nonreduction rule” — as long as the states are participating in these programs, they may not do anything to decrease the maximum number of weeks of UI or the weekly benefits available under state law as of 1 January 2020.

Reimbursable employers like non-profit and governmental entities will be reimbursed for unemployment benefits paid out to their employees from 13 March 2020 through 31 December 2020. The Dep’t of Labor is supposed to issue guidance that “would provide maximum flexibility to reimbursing employers as it relates to timely payment and assessment of penalties and interest pursuant to such State laws.”

State unemployment agencies have flexibility to hire additional staff through 31 December 2020. They may engage temporary staff, rehire former employees, and retirees, all on a non-competitive basis.