Lamont taps state unemployment trust fund

Moves for benefits for 38K workers who lost jobs amid pandemic

Gov. Ned Lamont on Friday tapped Connecticut’s already-depleted unemployment trust fund to deliver benefits to 38,000 low-wage workers who lost their jobs in the pandemic but are ineligible for federal money.

The benefits are tied to the Lost Wages Assistance program funded last summer by federal disaster relief. It was intended to replace a $600-a-week emergency federal supplement that expired July 31 when the Democratic-led House and Republican Senate failed to agree on an extension or replacement.

In Connecticut, more than 160,000 workers who lost their jobs received aid over six weeks from July 26 to Sept. 5, Labor Commissioner Kurt Westby told reporters during an online news conference. To qualify, workers had to have a minimum benefit of $100 a week, but 38,000 were disqualified because they received less.

Lamont issued an executive order directing the state to tap nearly $7.7 million from the unemployment trust fund to provide additional funding. Providing an average $43 a week for each jobless worker will bring unemployment funding to $100 weekly in state aid and make workers eligible retroactively for the six weeks of federal benefits.

Workers potentially can receive an additional $1,800 each, or $300 a week from the federal disaster relief program.

“It’s good news for our residents, it’s good for our economy, it bolsters economic activity,” Westby said.

Dipping into the state unemployment trust fund will bring $55 million in federal aid and potentially drive $115 million in economic activity as workers spend money for groceries, holiday gifts and other items, state offi

cials say.

“This is a $7.5 million investment by the state of Connecticut and it’s going to return $55 million to working moms, dads around the state of Connecticut,” Lamont said.

The average weekly unemployment benefit is about $270.

Connecticut has borrowed $419 million from the trust fund, and spent $6 billion so far, Westby said.

Lamont ruled out state assistance to businesses that will be assessed a fee next year to repay federal loans to the state to fill the trust fund.

“Are we going to pour state taxpayer dollars into the unemployment fund now? No,” he said. “Am I going to take money away from testing in schools and pour it into the unemployment fund at this point? I’m not thinking about doing that.”

“That’s not our plan. We have better uses for that money really related to public health,” the governor said.

Eric Gjede, vice president for government affairs at the Connecticut Business & Industry Association, said businesses already reeling from the pandemic will be pressed further to replenish the unemployment trust fund.

“This is yet another big ask from the business community, especially coming on the heels of borrowing upward of $1 billion to make sure the trust fund remains solvent,” he said.

Businesses have previously lobbied the General Assembly to raise the minimum income threshold set decades ago at $600 a year that qualifies a worker for unemployment compensation; that workers be required to exhaust severance payments before receiving benefits; and freezing for three years benefits that rise by $18 a year for maximum earners, Gjede said.

“We really need to see a serious commitment from lawmakers more than we see now to deal with the solvency issue with the trust fund,” he said.