Large state UI programs unprepared for next recession

Rick McHugh of NELP offers the following observations about unemployment legislation in other states:

Ben Casselman of the 538 blog has a new posting on the current state of UI programs. . The main focus of the blog is on the fact that several large states’ trust funds have not recovered from the Great Recession and they are unprepared for the next recession.

Rather than raising taxable wage bases and taking other responsible financing steps, the result of trust fund insolvency has been restrictive state legislation in some states mainly during the 2010-2013 time period. Eight states (AR,FL,GA,KS,MI,MO,NC,SC) have cut the maximum number of available weeks of UI to less than the traditional 26 weeks—and Ohio is considering joining this club. An Ohio bill cutting maximum durations to a sliding scale ranging from 12 to 20 weeks, depending upon the state’s unemployment rate, is advancing in the Ohio House of Representatives. The bill contains many other restrictive eligibility measures, and is modeled upon 2013 North Carolina legislation. It is estimated by the Ohio Legislative Service Commission to reduce benefits by $475 million a year.

One change from the North Carolina pattern is that Ohio employers would see UI payroll taxes fall under the Ohio bill, something that places the entire burden for improving Ohio’s trust fund on its jobless workers. Even North Carolina was not this one-sided in its approach to UI retrenchment. Policy Matters Ohio’s concerns about HB 394 are expressed in testimony by Zach Schiller and Hannah Halbert here and here. Many newspapers in Ohio have expressed concerns about the Ohio bill’s approach, and while momentum has slowed since the bill’s introduction in November 2015, the outcome remains uncertain.

States cutting the available weeks of benefits attempt to justify these changes by claiming that paying fewer weeks of benefit will induce a more rapid return to work by jobseekers. According to a recent Economic Policy Institute Snapshot by Will Kimball, three states cutting UI benefits the most (FL,GA,NC) by adopting a sliding scale approach similar to the Ohio proposal, have not seen their prime age (25 to 54 years of age) employment to population ratios increase. If the rationale for cutting weeks was true, jobless workers would return in greater numbers to employment. What appears to be happening to a more significant extent is that, without support from UI benefits, more jobless workers are dropping out of the labor force in those states.

These initial findings by EPI are consistent with many studies reviewed in NELP’s latest edition of our UI Toolkit. Specifically, one section of the toolkit presents recent studies that show that some economists’ preoccupation with disincentive effects of UI benefits has not been reflected in the behavior of jobless workers during the recession. In addition, the toolkit discusses other reports that show that UI claimants in fact do, in fact, look for work while on UI and that UI benefits keep individuals in the labor market and support better job matching. While sometimes facts don’t matter in contemporary policy debates, the tide of recent perspectives is now running against traditional economists’ strong moral hazard concerns about UI claimants.

Note that Wisconsin has through substantial fault and concealment, already seen a remarkable decline in its benefit levels.

New Internet Claims Filing Process for 2016

The Department of Workforce Development is revamping its Internet Claims Filing process with a much more complicated and detailed series of questions and screens. At the December 17th Advisory Council meeting, the Department was scheduled to present to the council what these changes would entail. Because of other issues, however, the council never got to see this presentation. Luckily, the Department sent me a copy.

Those filing their weekly claim certifications will now be told about fraud warnings at the start and end of their claim filing. See pp.2 and 17. And, the 14 questions now being asked are at least 20+ questions. Furthermore, rather than simplifying the information being asked about, the new questions continue to be legalistic and leave key information out.

NOTE: For comparison, here are the questions Massachusetts asks claimants (in Massachusetts, the phone questions are the same as when filing by Internet).

NOTE: Also compare the information available in the Massachusetts Guide to Benefits for Claimants with Wisconsin’s Handbook for Claimants. Notice the kind of information available in Massachusetts and the tone of how that information is presented as compared to Wisconsin.

For example, in Wisconsin there will now be a question about school attendance. See p.3. Usually, when you attend school during your regular work shift you are ineligible for unemployment benefits. But, if you work during the evenings while attend classes during the day, you should still be eligible for unemployment benefits when laid off from your evening job. In this case, the schooling does not interfere with your availability on your typical work shift. The new Internet filing form, however, only asks about attending classes during the day and does not include or ask for any information about regular work shifts.

Able and available status are now two separate questions as well. See pp.4 and 5. Missing work because of illness usually leads to a reduction in weekly benefits because work was missed. The question on p.4, however, only asks about your regular employer. Because many claimants who have temporary, part-time work do not think of those employers as their “regular” employers, they will not think a question about missing work with a temporary employer because of sickness is included in this question. This question should be asking about any current or future employer and make no reference to a “regular” employer.

Problems with other questions continue. Claimants are supposed to report all wages earned in the week for which they are filing, regardless of when they are actually paid those wages. So, the Department goes into detail about how to report those wages and hours (and minutes) of work for employers (see pp.6-8) as well as how commission work and sales are to be reported (see p.9). But, then the Department asks about sick pay, bonus pay, holiday pay, and other kinds of pay (see pp.10-12) as already received for the week — “did you receive?” — or to be received — “will you receive?” As a result, these questions imply that regular wages that are to be paid in the future do not need to reported since there is no question about reporting wages that “will be received?” Instead of two questions for vacation pay et al., only one should be asked: “Are you to receive?” And, instead of all of these separate kinds of wage income that now has to be reported separately, the Department should simply ask claimants to report “Any and all kinds of income connected to the work with EMPLOYER you are to receive for the week at issue.” By breaking these kinds of income into separate categories, the Department is requiring claimants to have an accountant’s understanding of their income in order to correctly fill out their weekly claim certifications rather than just asking for the total, gross amount of all income regardless of kind.

NOTE: The Department will even have a screen for miscellaneous income, such as baby-sitting, that has to be reported. See p.13.

Specific work search information for each job action will also now have to be provided. See p.15.

Given all the information that has to be provided in the proper category now, opportunities for mistakes will abound. And, any mistake will be an opportunity for charging claimants with fraud. In short, this new Internet filing process will NOT make it easier for claimants to file their weekly claims. But, this new process will make it easier for the Department to charge claimants with concealment.

DWD gets a slush fund for “program integrity”

At the December 17th Advisory Council meeting, the Department presented two new proposals for providing additional funds for program integrity — aka charging claimants with concealment.

D15-14 allows the Department to use leftover special assessment funds for program integrity purposes instead of transferring those leftover monies to the balancing account. At present, this leftover amount is approximately $9.3 million (for comparison, the federal funds DWD currently receives this fiscal year for administering the state’s entire unemployment program is around $56 million).

D15-15 will allow the Department to siphon off 0.01% (i.e., 0.0001) of employers’ UI taxes for program integrity purposes. Employers’ accounts are still credited for these amounts, so employers see no increase in the UI taxes they pay. The balancing account, however, receives less because the funds are being diverted to cover program integrity costs. As a result, this assessment will only occur when there is no danger of the fund turning red (which is extremely unlikely given the low amount of benefits currently being paid out).

How much will this assessment be? As of December 12th, UI tax receipts in 2015 amount to $1.04 billion. Now, a portion of these tax receipts go into a general solvency account to cover benefit payments that are not chargeable to any employer (such as when a claimant is forced to quit a job because of a child care emergency). But, assuming $650 million of these tax receipts are going towards employers’ UI accounts, then a 0.01% assessment will allow $65,000 annually for funding a staffer dedicated to “program integrity.” Add the $9 million plus available under D15-14, then the Department will essentially have for the next several decades its own slush fund for hiring program integrity staffers.

The Department explained that the savings from these increased program integrity efforts will be “multiple times greater” than any expenses incurred from paying out UI benefits to claimants. The Advisory Council subsequently approved both proposals.

UI jurisdiction changes going forward

In September of this year, the Department of Workforce Development announced in D15-11 a new, comprehensive rewrite of circuit court review of unemployment decisions. Some of the problems with these changes were previously described in this blog.

At its October 12th meeting, the Advisory Council approved of the changes in D15-11 before the Labor and Industry Review Commission could even respond. Just prior to the council’s October 29th meeting, the Commission did provide a response to D15-11 and asked the council to reconsider its approval of D15-11 in light of those comments. The council asked the Commission to make a formal presentation about the issue that was no more than ten minutes in length at the Council’s November 19th meeting.

The Commission did so and asked the Advisory Council to hold off on D15-11 so that the Department and the Commission could discuss these changes and work out a compromise. The Commission pointed out that D15-11 had been developed without consultation with the Commission and, given the Commission’s role in circuit court review of Commission decisions, there should be some consultation with the Commission in these matters. In the meantime, the Department presented a response to the Commission’s comments. Without comment or explanation regarding the Commission’s plea for some consideration in making these changes, the council approved of LRB draft legislation that had already incorporated D15-11.

The Commission’s comments point to some obvious defects in the Department’s proposed changes. And, the Department’s response highlights a fundamental defect in the Department’s rationale and reasoning for these changes. The Department maintains that a party in an unemployment case who does not file an answer is subject to default and should be subject to default.

Under the proposed change, a court may enter an order declaring that a non-appearing party is in default for failing to timely or properly answer the complaint. In the absence of a defendant’s excusable neglect for failing to answer the complaint, that declaration of default should ordinarily be the result. The defaulting party should be precluded from seeking to litigate the case later. The proposal conforms to the longstanding law and practice in court actions in Wisconsin in cases of other types.

DWD Response to LIRC Comments at 1-2. Right now, the parties who have “won” a Commission decision receive the following cover letter from the Commission when a circuit court complaint seeking review of a Commission decision is filed:

On [date], the Labor and Industry Review Commission received copies of pleadings seeking judicial review of the commission’s decision noted above. You are named as a party in these judicial review proceedings. As required by Wis. Stat. § 102.23, we are sending you a copy of these pleadings. You have the right to participate in this proceeding if you choose.

The commission will file a timely responsive pleading and will defend its position before the court. We will send you a copy of the commission’s response when we file it with the court.

We will be happy to answer any questions you may have about the case.

In other words, parties who agree with the Commission decision essentially piggy-back on the Commission’s efforts in defending its decision. Because unemployment proceedings are not intended to entail much administrative costs, this procedural mechanism for defending the parties interest during court review of a Commission decision makes a great deal of sense. Understandably, when parties feel that they have a concern or interest in a case distinct from the Commission, they have the option of filing their own answer to a complaint.

The Department’s now council-approved changes in D15-11 up end this procedure and require any party in an unemployment to file its own answer to a complaint or risk a default judgment. For employers who are NOT sole proprietors, such answers MUST be drafted by an attorney since corporations can only appear in Wisconsin courts through legal representation. For employer-side counsel, this requirement will certainly lead to more billable hours. For employers who have to hire attorneys to file these answers . . . well, attorneys usually are not cheap.

Final concealment language approved and drafted

Today at the November 19th Advisory Council meeting, the Department presented the final concealment language that the Advisory Council previously approved at its October 29th meeting.

In this final proposal (cf. to the original proposal), claimants have “a duty of care to provide accurate and complete” responses to Department inquiries and that the following six factors will be used for determining whether a claimant intended to mislead the Department:

1. Whether the claimant failed to read or follow instructions or other Department communications,
2. Whether the claimant relied on statements or representations of non-Departmental employees,
3. Whether the claimant has a limitation or a disability and the claimant provided evidence of that limitation or disability to the Department,
4. The claimant’s claims filing experience,
5. Prior instructions or concealment determinations issued or provided to the claimant, and
6. Any other relevant factor providing evidence of the claimant’s intent.

While concealment still “means to intentionally mislead” the Department, a third sub-section declares that: “Nothing in this subsection requires the department, when making a finding of concealment, to determine or prove that a claimant had an intent or design to receive benefits to which the claimant knows he or she was not entitled.”

So, concealment is still an intentional act, but the Department does not need to demonstrate an intent to conceal. These two provisions contradict each other, and the only way to make sense of them is to ignore the contradiction and conclude that: (1) concealment is intentional in name only and (2) can be demonstrated by any claimant mistake that led to an over-payment of unemployment benefits. The only apparent way a claimant can avoid a concealment charge is if she can show that her mistake was not intended (i.e., she did not intend to answer “no” instead of “yes” in response to a question and somehow did not have the chance to review and correct that mistaken answer). Under such a framework, concealment is pretty much a guarantee for almost all claimant mistakes.

NOTE: The number of LIRC decisions overturning concealment charges showcase how claimants are already being charged with concealment for nothing more than accidental claim-filing mistakes. Under this new definition of concealment, however, the statutory basis for requiring an actual intent to deceive for a finding of concealment will no longer exist. As a result, the Commission will not have a statutory basis for overturning these concealment charges.

The Labor and Industry Review Commission previously presented to the Advisory Council a memorandum about the Department’s proposed changes to the definition of concealment (see the discussion in this post for a discussion of the Department in 2014 changed how it handled concealment cases and now seeks to cement that new practice in the statutes). This proposal essentially adopts the Department’s current practices in charging concealment against claimants. As I noted already, “Unemployment claims . . . have . . . become a vehicle for alleging concealment against claimants,” and the unemployed should now generally NOT file claims for unemployment benefits.

NOTE: Because benefit payments have plunged to record lows, it appears that many of the unemployed have already adopted this position and avoided filing claims altogether.

To compound matters, the effort to criminalize concealment has been renewed in AB533 [UPDATE 4 December 2015: companion bill SB401 has also been taken up with hearings] with the re-introduction of the criminal penalties that were removed from Governor Walker’s budget bill. The Department’s original Budget Act memo on these felony penalties for concealment details the consequences to claimants charged with concealment. So, if AB533 [or SB401] passes, prison terms will be applied to claimants who are being held strictly liable for their claim-filing mistakes. YIKES!

On-line claims filing updates

The Department of Workforce Development issued the following press release on Nov. 3rd about on-line claims filing.

UI Online Upgrades Modernize Initial Claims Filing in Wisconsin

90% of initial claims that are started online are now completed without the need to speak to a specialist

MADISON – One year after the Department of Workforce Development (DWD) rolled out a redesigned online system to help Unemployment Insurance (UI) claimants start and complete their initial claims for unemployment benefits through the Internet, over 90% of initial claimants who start the filing process online are completing their claim without the need to speak to a specialist.

“We’re pleased with the success of our new system, as evidenced by the increase in the percentage of people who are completing online initial claims without the need to speak to a specialist,” DWD Secretary Reggie Newson said. “The investments we have made in a robust, nimble and customer-friendly online claims system will pay dividends in the form of added efficiency and convenience as federal UI financial support declines due to the state’s improving economy, and as we transition to a 21st century customer-service model that more fully uses online tools.”

The November 2014 rollout of the UI initial claims redesign featured new tools to enter accurate information, the ability to save work and finish claims later, additional flexibility to resolve eligibility questions online quickly, and other enhancements that reduce the need to talk to a specialist and are prompting claimants to file online instead of by phone.

Highlights of the positive impact that the UI online initial claim filing system has had over the past 12 months include:

• Of those who start an initial claim online, the percentage of claimants who complete initial claims online increased from about 57 percent to 90 percent.
• The percentage of claimants who start their initial claim online has also risen. As a result of these two improvements, the percentage of people who are using online services from start to finish without needing to speak to a claims specialist has nearly doubled.
• 78 percent of claimants who are required to search for work file their weekly claims online, in part to enter their weekly searches in work search logs that now must be provided either online or by fax or mail before claimants can collect unemployment benefits.
• UI estimates 57,000 initial claims that have been completed online would have required a claim specialist’s assistance before the initial claim redesign took effect in November 2014.

While DWD’s telephone-based automated filing system will remain an option for claimants who prefer to file claims by phone instead of through the Internet, DWD is responding to customer trends toward online and helping to minimize call wait times across the week by fully implementing a call scheduling system called guaranteed call priority this month for claimants who file initial claims by phone or are calling with a general question.

Mondays, Tuesdays and Wednesdays each will be assigned to one-third of claimants who file by phone, with Thursdays and Fridays open to all claimants who file by phone. Online services will be available to all claimants seven days a week. UI is proactively notifying claimants that guaranteed call priority takes effect November 9 and will help ensure call wait times are minimized throughout the week.

Secretary Newson noted that other states have implemented assigned days to reduce wait times, and Wisconsin has done so on a voluntary basis since summer 2014. “We will continue to encourage all claimants to file online, which they can do any day of the week,” he said.

Note that telephone claim services are now being limited. Mondays, Tuesdays and Wednesdays will be limited by one-third in some way (it is unclear whether one-third of the staffers are available or one-third of the claimants can call on these days). On Tuesdays and Thursdays, however, no call-in limits will be in place.

Feds release two important advisories about claimant access

On Friday, October 2nd, the Department of Labor issued two advisories — officially called program letters — about maintaining claimant’s access to their unemployment benefits.

The first concerns the due process protections claimants have when charged with concealment. In particular, this advisory spells out the requirement that whenever unemployment benefits are denied:

[T]he individual must receive a written copy of that determination and must have the right to appeal the denial. States are not required to conduct a full, formal evidentiary appeal hearing before determining that an individual was overpaid, but they must offer the individual an opportunity to know and rebut the information in fact finding before issuing a decision that the individual is not eligible and was overpaid.

UIPL 01-16 (1 October 2015) at 4. Furthermore, once a claim for unemployment benefits is underway, payment of those benefits cannot be stopped until a determination about the claimant’s eligibility has been issued.

If the state agency cannot make an eligibility determination before the date of a timely payment, the state agency “presumes the claimant’s continued eligibility until it makes a determination otherwise.” Additionally, a state must inform individuals that the pending eligibility issue may affect their entitlement to [unemployment compensation] and may result in an overpayment.

Id. And, in that investigation about the claimant’s continued eligibility for unemployment benefits, the unemployment agency must independently verify any computer match information casting doubt on the claimant’s continued eligibility, notify the claimant about the doubts on his or her continued eligibility, and give the claimant time to respond to the accusation.

States may not make determinations of overpayments and/or fraud using automated systems without the input of agency staff. The individual must also be informed of the information received as a result of the match with the Federal database and given the opportunity to be heard before a determination of an overpayment may be issued.

Id. at 5. This specific statement that fraud determinations CANNOT be based on automated systems seems specifically targeted against the fraud by algorithm process currently taking place in Michigan. The advisory closes with the requirements needed for any fraud notice.

[A] fraud determination notice must be sufficient to allow the individual to know the potential penalties or other consequences of a fraud determination as well as his or her rights with respect to an appeal. The individual must be provided additional information on the appeal process including the right to have representation; to present testimony and other evidence relative to the appeal; to subpoena witnesses and records; and to be apprised of the consequences of failing to attend an appeal if one is requested. Communications must be in plain language and using methods that ensure the communication is most likely to be successful for all populations, including individuals with limited English proficiency.

Id. at 6. Given the push in Wisconsin for pursuing concealment charges against claimants for claim-filing mistakes, this advisory applies with equal force to Wisconsin.

The second advisory concerns preventing program discrimination because of age, national origin, or language proficiency and making sure that new, computerized filing and notification procedures are as user-friendly as possible. This lengthy memorandum begins by spelling out the legal requirements for open access to claims information.

[S]tate UI agencies must ensure that use of new technologies and systems for administering UI programs and providing services do not create barriers (e.g., procedural, technological, or informational) that may prevent individuals from accessing UI benefits, such as by denying them a reasonable opportunity to establish their eligibility. The U.S. Department of Labor (Department) has determined that “access” for purposes of conforming to Section 303(a)(1) of the [Social Security Act] means individuals’ ability to complete, submit, and obtain information about their initial and continued claims, appeals, reemployment services, and any other information, program functions, or services available for all claimants.

* * *

Thus, while states may offer claimants a variety of methods to receive information, the content of a written determination, whether it is a letter mailed to the claimant or provided in an electronic medium, must comply with the requirements in the Standard for Claim Determination specified [in Employment Security Manual, Part V, Section 6013.C.1.c.].

UIPL 02-16 (1 October 2015) at 3-4.

Electronic-only communication requirements may well run afoul of these non-discrimination requirements.

The nondiscrimination laws that apply to state UI agencies prohibit discrimination based on both disparate treatment — intentionally treating members of protected groups differently based on their protected status — and disparate impact — the use of policies or practices that are neutral on their face, but have a disproportionate impact on members of some protected groups. In addition, as detailed below, regulations implementing these laws prohibit states from establishing policies or procedures that, while not directly barring access to benefits or services for individuals who have disabilities and/or are [Limited English Proficient], indirectly prevent or limit access. The use of a website and web-based technology as the sole or primary way for individuals to obtain information about UI benefits or to file UI claims may have the effect of denying or limiting access to members of protected groups in violation of Federal nondiscrimination law.

* * *

States may offer individuals the option of receiving the information, services, etc., discussed in this guidance via electronic methods, but may not require that individuals communicate only through electronic means. Such policies unduly restrict program access, as not all individuals have the ability or capacity to communicate electronically.

Id. at 4-5. This advisory then goes into detail about what these non-discrimination requirements mean and describes the numerous steps that state agencies need to take. Of particular note are the following requirements and objectives:

Use of free, web-based translation services (also known as machine translation software) is not sufficient to ensure that the translation is appropriate and conveys the same meaning as the English version. Information about effective translation resources may be found at: [Lost in Translation.]

* * *

State UI agencies should also ensure that web-based claims filing systems also maintain a system for receiving and addressing complaints from limited English proficient persons and persons with a disability. This includes, but is not limited to, providing in-language notice regarding how to file an online complaint about delayed or denied service resulting from language barriers.

* * *

States may promote on-line filing as a primary method of filing UI claims, but they may not have policies and operational practices that make on-line filing the exclusive method of filing and certifying UI claims. As with persons with disabilities or those with [Limited English Proficiency], or older individuals, states must offer an alternative option for accessing information and benefits, such as by telephone and/or in person, in a manner that ensures equal access for persons unable to access or use a web-based system in order to avoid disparate impact on other protected groups. Further, states must broadly and conspicuously disseminate information about alternative access options in ways that ensure that people who may need to use such options are aware of the options. State UI agencies must ensure that use of new technologies and systems for administering UI programs and providing services do not create barriers (e.g., procedural, technological, or informational) that may prevent individuals from accessing UI benefits, such as by denying them a reasonable opportunity to establish their eligibility.

* * *

State UI agencies must also take reasonable steps to ensure that, if technology or other issues discussed in this UIPL interfere with claimants’ access, they have established alternative methods of access, such as telephonic and/or in-person options. The alternative access points must be communicated clearly in a manner that reaches the population that may need to use them. The processes the state UI agency uses to offer alternative methods of access must be documented in the agency’s policy documents and operating procedures. In addition, a state must train UI and American Job Center staff on the alternative methods of access to ensure that claimants and others who experience challenges are properly directed to alternative access options so that they may be served in a timely manner. Excessive delays experienced by potential claimants as they are referred to alternative access methods can result in a denial of access to services, in conflict with Federal UI law and nondiscrimination law requirements.

* * *

Action Required. State Administrators must:

1. Ensure that processes exist or are implemented to provide all claimants access to UI benefits as discussed in this UIPL;
2. Disseminate this guidance to appropriate state agency staff, including the state’s [Equal Opportunity] Officer;
3. Ensure that state [Equal Opportunity] Officers are involved early in all appropriate information technology modernization and business process reengineering plans to promote the full integration of equal opportunity requirements into agency technology plans; and
4. Work with state [Equal Opportunity] Officers to evaluate the avenues available to the public to participate in the UI process to help ensure access to everyone including individuals with disabilities and [Limited English Proficient] individuals.

Id. at 9, 10, 12, 13, and 14.

The recent developments in Florida and the push in Wisconsin for similar obstacles to filing unemployment claims have been going on for some time now. See, e.g., the posts about job searches changes and waivers. These advisories, however, demonstrate for the first time that federal authorities are pushing back. Stay tuned to see what happens next. The National Employment Law Project has declared: “By staking out a strong enforcement position in support of fairness and accessibility, we believe that the Department [of Labor] has taken a critical first step toward ensuring that unemployment insurance will be there when America’s workers need it, no matter who you are or where you live.”

More on the UI audit

One of the recommendations from the audit report is that the annual reports to the Advisory Council about recouped over-payments identify the year at issue for the over-payment (see p.35).

In his letter attached to the report, Secretary Newson notes:

• The overpayment recoupment rate on which the LAB focuses its recommendation is consistent with the federal overpayment recovery measures and is defined as the amount of improper overpayments recovered divided by the amount of improper overpayments identified within the same year, expressed as a percentage. The U.S. Department of Labor (USDOL) includes this measure in its annual Improper Payment Recapture Activities report.
• Providing a more specific breakdown per LAB’s recommendation will give broader context for this measure in Wisconsin. We would offer that this breakdown be provided along with the current overpayment recoupment rate so that we remain consistent with the federally defined measure as included in the USDOL’s report.

Newson is right to make these observations. The most recent federal UNEMPLOYMENT INSURANCE PROGRAM LETTER No. 09-13 to address these issues states (see p.9):

One state felt that this measure, as proposed, did not take into account differences in state law that could make reaching the targets easier for some states. Also, the commenter stated, TOP [Treasury/income tax offsets] recoveries may not meet expectations, which are based on preliminary estimates; UI overpayments would have to “stand in line” with other claimant obligations such as child support and student loan debt. According to this commenter, targets may also be unrealistic due to changing economic conditions. Because an overpayment may be recovered some time after it is initially established, and economic conditions may differ at those two stages, as the economy improves and benefit levels fall, there will be fewer benefits against which to offset overpayments and, consequently, states will have a harder time meeting these targets.

Another state did not agree with the methodology, arguing that matching overpayment amounts with overpayments established all from the same CY was not a valid indicator of recovery rate because recovery of overpayments, when it occurs, is often years after the original overpayments are established. This commenter recommended, instead, comparing data for the most recent five-year period.

Department staffers some time ago told me that these concerns were their own. In other words, any kind of annual tracking of over-payment recovery efforts is problematic at best and of limited usefulness in practical terms. Hence, the annual percentage specified in this program letter provides the best overall rate of effectiveness.

And, speaking of effectiveness, Wisconsin was number one in this program letter for over-payment recovery, with a 91.34% recovery rate — almost double the national average (see p.B-2). So, any complaints about Wisconsin needing to improve on this front are dubious to say the least.

EUC benefits expiring in two weeks

Extended Unemployment Compensation (EUC) benefits are slated to expire at the end of 2013. An extension is not part of the budget deal recently announced by Congress, despite much press coverage about the need for continuing EUC benefits (see below):

Folks,

We wanted to share this excellent  Washington Post piece on the massive state press coverage placing pressure on Congress to reauthorize federal jobless benefits.

Of special note to state advocates, check out the excellent graphic that the Dems on the Ways and Means Committee produced documenting the front page press coverage around the states and the interactive state map they developed with lots of helpful state facts and figures.

Best,
Maurice

Maurice Emsellem, Director
Access and Opportunity Program
National Employment Law Project

Wisconsin’s DWD recently updated its EUC information page with this information:

**Update 12/13/2013**

Under federal law, EUC benefits are set to expire on December 28, 2013. After that date, EUC benefits will no longer be available.

Claimants who remain unemployed are not prohibited from continuing to file weekly UI claims and will be notified if Congress passes a new extension of benefits.

Claimants receiving Regular Unemployment Insurance (UI) may continue receiving regular state unemployment benefits until their eligibility for those benefits ends. Claimants exhausting their regular UI benefits after December 21, 2013 will not be eligible for federal benefit extensions, under current federal law.

In early January, many in Congress hope to take up the issue of continuing EUC benefits. Accordingly, if you are currently receiving EUC benefits and want to continue receiving those benefits in 2014, keep filing weekly claims even after EUC benefits have expired. If Congress does renew the program, then that weekly filing will mean all EUC benefits due you will be restored. And, even if your regular unemployment benefits run out in January, keep filing weekly claims so that you can receive EUC benefits if Congress does renew the program.

By the end of January 2014, we should know whether Congress will take action on EUC benefits or not.

Looming end to EUC benefits will have big impact in Wisconsin

Extended Unemployment Compensation (EUC) benefits are scheduled to expire at the end of this month. The abrupt end of this program will leave a large hole in household budgets.

Nationally, around 1.3 million workers currently receiving federal EUC benefits who will be abruptly cut off in the week between Christmas and New Year’s, and an additional 850,000 workers will run out of state unemployment insurance in the first three months of 2014. The National Employment Law Project has a report with the relevant details.

In Wisconsin, 23,700 individuals are slated to lose their EUC benefits at the end of December according to this House report. That’s about one out of every 242 residents having their income slashed just before the New Year.

In comparison, only 8,500 residents in Minnesota are slated to lose their EUC benefits, nearly three times less than in Wisconsin. Both Illinois and Michigan will experience a similar impact to what will happen in Wisconsin in regards to the lose of EUC benefits. Relative to their populations, the ratio of individuals affected by the end of EUC benefits is one out of every 200 in Illinois and one out of every 226 in Michigan. Indiana presents better numbers, as one out of every 340 of its residents will lose EUC benefits at the end of December if the program is not renewd by Congress.

In other words, a great many residents in Wisconsin (and Illinois and Michigan) still need EUC benefits.