Colorado, Georgia Tweak Jobless Aid in Back-to-Work Policy Push

Colorado and Georgia would increase the amount workers can earn without reducing unemployment benefits, under bills awaiting governors’ signatures—one policy approach for states looking to nudge people back to work during the pandemic.

The bills give laid-off workers incentive to return to work on a part-time or gradual basis as businesses reopen and return to more normal operations. Increasing the allowable wages for unemployment recipients is one of several ideas policymakers have explored, as businesses fear a shortage of willing workers due to health concerns and the extra $600 in weekly unemployment benefits that are set to expire July 31.

In Georgia, the idea began as part of the state’s coronavirus response via emergency rulemaking at the state labor department, but it came to be seen as potentially a good permanent policy, said Mark Butler, the state’s labor commissioner.

Georgia law only lets unemployment recipients earn $50 per week before their unemployment benefits are reduced. Butler said that serves as a disincentive for workers to take on part-time work while unemployed, both during the pandemic and under normal economic conditions. The state’s labor department temporarily raised that threshold to $300 in response to the pandemic.

The legislation (HB 1090) that awaits a decision by Gov. Brian Kemp (R) would give Butler authority to determine the threshold and periodically adjust it within the $50 to $300 range. It also would give the department additional flexibility to change rules in response to a state of emergency, such as waiving the work-search requirement.

“The income disregard really hasn’t been looked at in decades,” Butler said. “The more we got to thinking about it from a policy point of view, it makes sense to encourage someone to take some type of work, rather than discourage that.”

Kemp’s office is reviewing all recently passed legislation, spokeswoman Candice Broce said. State lawmakers passed HB 1090 with large bipartisan support on June 26, in the final hours of their 2020 session.

Colorado Bill Doubles Limit

A similar Colorado bill (SB 207) would double the amount that workers can earn while still collecting full unemployment benefits—setting the threshold at 50% of the benefit amount, up from the current cap of 25%.

If signed by Gov. Jared Polis (D), the increase would remain in effect for two years. The governor’s office didn’t immediately respond to a request for comment.

“We’re really trying to give both the employer and the employee more flexibility,” said state Sen. Chris Hansen (D), the measure’s sponsor. It would make other changes to unemployment policy, such as clarifying when workers can reject a job offer and still qualify for benefits if a workplace isn’t following appropriate health and safety protocols.

The Colorado and Georgia bills also address a similar but separate return-to-work policy option—work-share programs that let employers reduce their workers’ hours and arrange for them to receive partial unemployment benefits to compensate for lost income.

The Colorado bill calls for the state labor department to write rules establishing the percentage range of hour reductions that qualify for the program. The Georgia bill authorizes the labor department to create a work-share program, though Butler said the department doesn’t have bandwidth to implement a new program right away.

Budget Constraints in NJ

New Jersey lawmakers pursued a similar concept on earnings relative to unemployment benefits but were rebuffed when Gov. Phil Murphy (D) vetoed the bill (A4132), in part because of his concerns about the impact on state finances.

The bill, like Colorado’s, would have doubled the amount workers can earn on the job before their unemployment benefits are reduced. In the New Jersey proposal, the threshold would have increased to 40% of the weekly benefit amount, up from 20%.

Murphy raised concerns in a June 29 veto statement about a separate provision of the bill that would have expanded eligibility for state unemployment benefits through Dec. 31, 2020. It would have shifted costs onto the state that the federal government already has agreed to cover, since the federal CARES Act provided a similar expansion of benefits to workers who exhaust their state benefits.

Murphy proposed in his conditional veto a rewrite of the bill that would strike out the increase of the wage disregard.