Some basics on unemployment benefits
More than 270,000 people have filed claims for unemployment benefits in Wisconsin since business began closing March 15 in response to the coronavirus outbreak. For most people, it was the first time they've applied for benefits.
The process can be complicated and time-consuming in the best of times, and just now is far removed from that. The Department of Workforce Development's system is overwhelmed by the onslaught of claims.
The result is certain to make the process more time-consuming, not to mention frustrating.
“To be fair, no one is staffed for this,” said Victor Forberger, a lawyer based in Madison who specializes in labor and employment law. “This is like Godzilla destroying the city. No one plans for Godzilla.”
There also are a number of federal programs that significantly increase benefits and expand eligibility for unemployment benefits.
Here is a brief overview of the basics of current unemployment benefits.
Question: How much money will I get?
Answer: The standard unemployment benefit in Wisconsin — it varies by state — is 40% of your average wage up to a maximum of $370. But under a new federal program, the minimum payment in Wisconsin is $163 a week. And under yet another program, the federal government also will pay people who are unemployed an additional $600 a week through July 31.
In short, people who have lost their job in Wisconsin will get a minimum of $763 a week through July 31.
Q: Can I get benefits if I work parttime?
Yes. For regular unemployment benefits, the formula is complicated and there's a cutoff. But if people are not eligible for regular unemployment benefits, they should qualify for a federal program that will pay them the minimum of $163 a week, plus the additional $600 a week.
This includes people — say a college student who picked up a part-time job six months ago — who have not worked long enough to be eligible for regular unemployment benefits.
“That's exactly the kind of scenario
where the PUA (Pandemic Unemployment Assistance) program is going to be really helpful,” said Maurice Emsellem, director of the Fair Chance Program at the National Employment Law Project. “It’s intended to fill in those gaps.”
Q: Can I get benefits if I am selfemployed?
A: Yes. Under a federal program, people who are self-employed, including independent contractors and freelancers, now are eligible for unemployment benefits. They previously were not.
The Department of Workforce Development, however, has asked that people who were self-employed wait to file for benefits because its system is not set up to accept the claims. It expects to complete the changes by midto-late April.
Benefits will start from the time that the person became eligible for unemployment — not when the claim is filed — and people also will receive the additional $600 a week.
Q: Does the federal law expand eligibility for other people.
A: Yes. For example, people who normally would not be eligible because they work for religious organizations will receive benefits through the federal programs.
Q: How soon can I get benefits? A: Normally there is a one-week waiting period. But the federal law that increases benefits and expands eligibility requires states to waive this. (The federal government will pay the full cost of the benefits for the week.) A bipartisan bill is being circulated in the state Legislature to do this.
Q: Does this mean that I will begin receiving benefits immediately?
A: Probably not. The Wisconsin Department of Workforce Development faces a herculean task — one that was inconceivable until a few weeks ago — in processing claims. The country has never shut down large swaths of its economy in a matter of weeks. Past recessions took hold over many months. “The workload is just going to be phenomenal there,” said Forberger, the lawyer who specializes in labor and unemployment law.
The Department of Workforce Development has received approval to 25 additional people to help process the unprecedented number of claims. It also said on Thursday that 98%of the people applying were able to file their claim online without needing to contact a claims specialist.
Q: Should I wait then to file my claim?
A: You can may go back two weeks from the week you start your initial application or claim for benefits. And, again, people who were self-employed and others who previously were not eligible for benefits have been asked to wait for the Department of Workforce Development to update its system. You still will receive your full benefits.
Q: Do I have to look for a job even though many businesses are shut down?
A: No. Gov. Tony Evers has waived this requirement — for obvious reasons. People shouldn’t be looking for work when everyone is supposed to stay at home to help prevent the virus from spreading. The federal law also requires states to waive any requirement that people look for work. In the past, people had to prove that they applied for four jobs in their field or occupation a week.
Q: What else has changed?
A: The federal law extends benefits to 39 weeks in place of the 26-week limit. The same was done during the Great Recession. But now the federal government will pay the full cost, as opposed to 50%, of providing benefits for 13 additional weeks. The extension applies to people who were unemployed when all this hit and were at risk of exhausting their benefits.
Q: I’m among those who were unemployed when all this hit. Am I eligible for the additional $600 a week?
A: Yes. But the additional payments start from when the program kicks in and are not retroactive. In other words, you won’t get $600 a week for the time that you’ve previously been unemployed.
Q: I’m furloughed and my employer is paying for part of my health insurance until I’m called back. Am I still eligible for unemployment benefits?
A: Yes. You will be eligible either for regular unemployment insurance or the federal program that expands eligibility.
Q: Will the Department of Workforce Development be able to handle the volume of claims?
A: It will be a challenge. But Scott Manley, who is on the Wisconsin Unemployment Insurance Advisory Council, noted that waiving the requirement that people apply for four jobs a week will free up staff to help process claims. “That is going to make it much easier on us as a state to deal with the influx,” he said. The additional 25 people that the Department of Workforce Development plans to add to its staff also will help.
Q: Why do you say that applying for benefits can be complicated?
A: The formula for determining how much money you will receive is complicated. So, too, are the regulations on part-time work. But the emergency measures taken by the federal government could make applying much simpler, given that everyone, including part-time workers, will receive a minimum benefit of $163 a week.
Q: What’s time-consuming?
A: For one thing, you have to provide documentation of your work history. And, again, many of the people who have lost their jobs in the past few weeks probably have never applied for unemployment benefits before.
“They are going to have to make it as easy as possible,” said Emsellem, of the National Employment Law Project. “It’s a lot of money, and we are not just talking about the workers here. We are talking about for the Wisconsin economy. It’s a huge amount of money that is going to benefit Wisconsin’s economy.”
Q: Is the process more complicated for people who are self-employed?
A: It can be. You eventually may have to provide additional documentation on your income. But Emsellem said the hope is the state will streamline the process.
“It’s in everybody’s interest — the state’s interest, the workers’ interest — to really streamline the process of applying and all the extra documentation that they normally would ask for,” he said. “There’s just no way this program is going to work if they have to stop and go through all these extra hoops to process every claim.”
Q: How much money does the state unemployment insurance fund have now?
A: The fund ended last year with $1.9 billion in reserves after the longest economic expansion in the state’s history and record low unemployment. “The good news is that it is well-positioned to absorb the shock,” said Manley, of the Wisconsin Unemployment Insurance Advisory Council. “Whether we can fully absorb the shock from this economic hit remains to be seen.”
Q: Will the state unemployment insurance reserve fund run out of money?
A: It could, but it doesn’t matter. The fund had a negative balance from 2009 through 2013 after the Great Recession and from 1983 through 1985 after a particularly brutal recession. But the state can borrow money from the federal government when this happens.
“The important news and the good news for workers and their families is even if that $2 billion ends up being entirely depleted, there will be resources there to pay unemployment benefits,” said Manley, who is executive vice president of government relations for Wisconsin Manufacturers & Commerce, the state’s chamber of commerce.