Winter work search concerns

As they say on a popular television show, “Winter is coming.” For Wisconsinites, winter means seasonal layoffs, as Wisconsin for the time being still has a winter.

Seasonal layoffs, however, no longer mean seasonal unemployment with work searches waived for the snowy months. Rather, DWD has instituted an 8 week + additional 4 week work search waivers that are complicated to follow and difficult to get. The Department’s work search FAQ has the needed information about the new work search requirements and the end of seasonal work search waivers.

Keep in mind that the end of seasonal work search waivers came when DWD adopted a proposal based in part on how Florida limited its work search waivers; see also this direct link to my comments on the proposed regs. Obviously, DWD did not consider that Florida has a much different winter than Wisconsin.

The limited work search waivers were enacted in 2013 but not put first into effect until the 2015-16 winter season.

So, the first time the public could respond to these new waivers was at the 17 November 2016 public hearing, and hundreds voiced their displeasure to this change in waiver practice.

As the minutes for the 19 January 2017 Advisory Council meeting explain (p.5 of the pdf):

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 work search waivers for recalled employees.

These minutes leave out, however, that almost all of the comments — similar or not — were from employers. The 43 pp. summation of those comments show that employers were deeply concerned over retaining skilled and dedicated seasonal employees who were now at risk of leaving due to the new work search requirements that force employees during winter layoff months to search for and accept work with other employers and thus disrupt the operations of the original employer. Letters from Sen. Erpenbach, Sen. Harsdorf, and Sen. Carpenter also raised these concerns about employers losing valuable employees.

NOTE: Sen. Harsdorf’s bill to restore seasonal work search waivers, SB83, has not gone anywhere.

Apparently, nothing was done for the upcoming winter season that is now approaching. The only official response to this uproar is set forth in the last Q&A in the work search FAQ (emphasis supplied):

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.

The concerns of employers about keeping valuable employees through winter layoffs in a state that has a winter and staying competitive when work returns in the spring apparently mattered for naught.

But, employees are not simply thrown to the winter wolves or wampas. Here are three things claimants should keep in mind when performing their four jobs searches a week.

Canvassing periods In Wisconsin, claimants have during their first six weeks — their canvassing period — the right to refuse work outside of their typical job experience. For instance, if the claimant is a nurse, he or she can decline a McDonald’s job during the first six weeks of his or her job search. See, e.g., Einerson v. Milwaukee Institute of Art & Design, Inc., UI Hearing No. 09610221MW (29 April 2011) (employee properly declined to accept the newly created position during her canvassing period because the new position required non-professional responsibilities that encompassed significantly less skills than were required in her most recent employment).

Protection of labor standards After their six week canvassing period, employees must accept ANY job offer as long as it meets labor market criteria (not less than 25% of the average wage for that job during that shift in question in the local labor market — aka the relevant county). So, a person can decline a nursing job if the $8 an hour pay is less than 25% of the average, local labor market rate. See, e.g., Hemenway v. Life Style Staffing, UI Hearing No. 12002612MD (9 Jan. 2013) (employee entitled to refuse offers of new work from the employer if the conditions were substantially less favorable to him than those prevailing for similar work in the locality). These labor standards protections arise from long-standing federal requirements described in UIPL No. 41-98 (17 August 1998).

Unreasonable job offer conditions A claimant can turn down job offers if the commute or shift is not reasonable for the applicant. Commute is relative to the area (a twenty-file mile commute in Milwaukee could be too long but normal and expected in rural Wisconsin). And, a shift not previously worked by the claimant can also be grounds for declining the job. So, a nurse who typically worked first shift can decline a third shift job offer if she has little to no experience working third shifts. See DWD 128 for the details.

WinterWampa

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UI bill public hearings and UI concealment

The official Advisory Council/DWD bill, AB819, had its first public hearing on Thursday, February 4th, before the Assembly Committee on Jobs and the Economy.

The Department of Workforce Development and the Advisory Council presented testimony in support of this bill. The Labor and Industry Review Commission testified against sections 54 and 55 of the bill — Department proposal D15-11, previously described here and here. I cannot think of any instance in which one state agency testified against a bill supported by another state agency. To understand the nature of this dispute, see the Commission’s memorandum and the Department’s responses to that memorandum.

I also testified about the proposed concealment changes in the bill.

On February 10th, the Senate Committee on Labor and Government Reform held its hearing on the Senate version of the Department’s UI bill, SB684. WisEye was there.

The Department and the Advisory Council again pushed for adoption of these proposed changes, and the Commission again disputed the changes to circuit court review. Both Kevin Magee from Legal Action of Wisconsin and myself testified against the proposed concealment and “program integrity” changes.

My testimony focused on the Department’s marked increase in concealment cases starting in 2014 and even more concealment cases in 2015 against Wisconsinites. To demonstrate this concealment expansion, I used two charts. The first chart looked at how concealment assessments have varied from 2011 through 2014.

over-payments assessed

In this chart, the percentage of concealment assessments relative to the unemployment benefits being paid out was pretty much constant from 2011 through 2013. In 2014, however, concealment over-payments as a percentage of total unemployment benefits paid out jumped to 2.79%, approximately a 0.80% increase from the previous year. A 0.8% in gross domestic product or the unemployment rate would make headlines across the state. So, this 2014 increase in concealment over-payments being charged against claimants is remarkable.

These numbers from the fraud report also show how concealment over-payments suddenly increased in 2014 relative to non-fraud over-payments. In 2011, 2012, and 2013, non-fraud over-payments constituted more than 50% of total over-payments. In 2014, however, non-fraud over-payments dropped over five percentage points to just over 45%. Naturally, the percentage of fraud over-payments to total over-payments jumped in 2014 to nearly 55%. So, in 2014 concealment shot up in scope relative to unemployment in general just as non-fraud over-payments markedly declined.

Over-payment assessment data for 2015 is not yet available. But, the financial reports prepared for the Advisory Council indicate how much concealment monies have been collected by the Department as of 31 October 2015. As of that date, the Department had collected nearly $31 million in fraud and non-fraud over-payments. Of this amount, just over $1.753 million had been collected pursuant to the 15% concealment penalty that applies in concealment cases.

concealment collected

This 15% number provides a mechanism for estimating how much of the $31 million in over-payments relate to concealment allegations in general. Dividing $1.753 million by 15% equals approximately $11.69 million and represents the over-payments so far arising from concealment. Subtracting $11.69 million leaves around $19 million as the non-fraud portion of the over-payments paid in 2015. Accordingly, by 31 October 2015 the percentage of concealment to non-concealment over-payments collected at nearly 61%.

These numbers show a sudden increase in 2014 in concealment cases and this increase accelerated in 2015. In this light, the Department’s push to change the definition of concealment is part of an agenda to expand the scope and reach of concealment. The Department countered in its testimony before the committee that an intent to conceal is still required under its proposed changes to the definition of concealment. The proposed language, numerous posts on this blog, a Commission memorandum, and Kevin Magee’s testimony at the public hearing belie the Department’s assertions. Mistakes are increasingly being charged as concealment by the Department, and Commission review applying the actual concealment standard is the only way to fight these kind of charges.

Essentially, concealment is becoming the modus operandi of the Department’s efforts in administering the state’s unemployment law. Anyone who makes a mistake is at risk of a concealment charge from the Department, and the Department wants to change unemployment law to reflect this practice.

Unemployment public hearing tomorrow

The unemployment advisory council and the Department of Workforce Development are holding a public hearing tomorrow, 13 November 2014, to take comments on unemployment law. The hearing will be in the afternoon and early evening from 2:30 to 4:30 and 5:30 to 7 PM.

In Madison, the location for the hearing will be:

UW-Extension
The Pyle Center
Room 227
702 Langdon Street
Madison, WI

Check the DWD website for other locations.  If you want to say something about how the state is handling unemployment law, here is your opportunity.  See you there.