The United States Capitol in Washington.
Photo credit: Stefani Reynolds / Bloomberg
Photo credit: Stefani Reynolds / Bloomberg
The Republican-favored proposal to extend supplemental unemployment benefits that help millions of Americans who became unemployed by Covid-19 could lead some states to implement the rest of the year.
That is a conclusion of a note prepared by the National Association of State Workforce Agencies, obtained by Bloomberg News, about plans to cut unemployment benefits due this month. At stake is maintaining support for an economy facing renewed business closure measures thanks to record virus cases.
Replacing the $ 600 per week supplements that expire with a percentage of a worker’s previous wages could take most states eight to 20 weeks to implement, after receiving the Department of Labor Guidance, the memorandum from the July 23th. Reprogramming Aged Computer systems would bring states a wide range of timelines to implement, and some would move faster.
“It is one thing to add this administrative burden when states have no other problems, but doing it over a period of time with so many things reaching the states at once is just a nightmarish proposition,” said Michele Evermore, principal investigator and policy analyst. for the National Employment Law Project.
More time
Republicans It launched a proposal Monday that calls for reducing unemployment benefit supplements to $ 200 a week from $ 600 and moving to a 70% wage replacement formula by Oct. 5. States can request an additional two months if they need more time to reprogram their computers, falling weeks below estimates of the time they will need
Senate Finance President Chuck Grassley said his party’s plan to cut pandemic unemployment benefits and link them to a worker’s salary is more responsible than a general extension of the current deal.
“When you pay people more so they don’t work, what do you expect? People don’t go to work, “he said.
Meanwhile, the state unemployment offices, which distribute the payments, are still struggling to process the $ 600 per week payments approved months ago.
Still waiting
According to Bloomberg’s calculations, more than $ 100 billion in unemployment benefits have yet to reach beneficiaries after some states took months to make the changes to their computer systems. Florida did not begin processing independent worker claims until the last week of June, approximately two months after the CARES Act was passed.
Read more: Thousands of $ 600 checks never reached unemployed Americans
The plan is the Republican opening offer to extend unemployment benefits, which began to expire over the weekend, as negotiations with Democrats begin this week. Democrats have proposed extending the flat rate amount of $ 600 until the end of the year and then gradually reducing payments as economic conditions improve.
“It’s the final disconnect with what real Americans experience if they think $ 200 is enough,” said Rep. Dan Kildee, a Michigan Democrat.
Almost half of the people currently receiving unemployment insurance are covered by the special pandemic benefits and do not necessarily have a salary history that is easy to determine. That benefit currently covers workers in the concert economy and even people who have had a terminated job offer due to the pandemic and may not have a salary history, Evermore said.
Long-term
Switching to a wage replacement formula is a sign that lawmakers are thinking about the long-term future of the unemployment benefits system, but it will be very difficult to implement in two months, said Michael Graetz, law professor emeritus at Columbia Law. . School and former official of the Treasury Department.
“States will have to collect salary data on self-employed workers,” who make up a large part of the workforce, he said.
Even for traditional salaried workers, state systems are not currently designed to replace a fixed portion of workers’ wages. Arizona, for example, has a maximum state unemployment benefit of $ 240, just a fraction of many workers’ past wages.
The Republican plan would require state systems to verify an employee’s pre-payment, calculate their state benefits, and then add a federal amount to reach 70% of past wages, which means the calculation will be different for each worker.
The proposal would also add another element to the unemployment office’s to-do lists: They must notify unemployment applicants and employers of state job requirements, an individual’s rights to refuse to return to work or to refuse suitable work, and how an individual can contest denial of a claim as a result of these requirements.
According to the Labor Department, there were more than 16 million people on jobless claims during the week until July 11. The total figure, including the pandemic assistance program, is roughly double that, though that estimate is inflated by multiple counts and illegitimate claims, another demonstration of the challenges in processing the system.
– With the assistance of Erik Wasson
(Updates with legislative details from the fifth paragraph.)
.
