The Senate GOP plan to replace the across-the-board unemployment supplement with a more complex model linked to a person’s prior wages would give states two months to adjust their processing systems, but also include an option to apply for more time.
The GOP proposal unveiled Monday would slash the $600 weekly benefits boost to $200 per week for two months, giving states a cushion as they transition to meet a mandate to replace 70% of workers’ prior wages. States that aren’t ready to launch the individualized model after two months would be able to apply to the labor secretary for a waiver granting them two additional months of lead-time, according to text of the bill from Senate Finance Committee Chairman
Republicans designed the two-step proposal to encourage people to return to work, given that the expanded $600 weekly benefit Congress provided in late March pays many workers more than they were earning before the pandemic squeezed them out of a job. But Democrats have dug in ahead of formal virus-relief talks in support of extending the $600 weekly supplement through Jan. 31, 2021.
The proposal to replace lost wages would be based on weekly payments capped at $500 that, when combined with regular state unemployment compensation, equal 70% of each worker’s prior earnings. All states currently offer close to 50% wage replacement, though the exact method varies.
State workforce agencies
The waiver option in the Republican plan could help ease the transition for some states by giving them until Dec. 1 to ready their systems, but the more complicated model would still be a challenge for state agencies. It would require them to track down wage documentation that often isn’t readily available, particularly for self-employed workers taking part in the new Pandemic Unemployment Assistance program. It also could create more confusion for benefits recipients and increase call volume at already-burdened state unemployment offices.
Forging a compromise on enhanced unemployment insurance is one of the chief sticking points as negotiators move toward formal talks on a larger stimulus bill. There’s pressure on lawmakers to extend some form of a financial cushion on top of regular unemployment compensation, as the $600 supplement began expiring over the weekend.
Grassley’s bill also would mandate that states notify all unemployment insurance recipients about relevant state law on requiring individuals to accept suitable return-to-work offers and any state law covering the rights of workers to refuse such offers.