report analyzes several types of recent changes to state Unemployment
Compensation (UC) programs. Three categories of UC state law issues are
considered: (1) changes in the duration of state UC unemployment benefits;
(2) changes in the UC weekly benefit amount; and (3) the enactment into
state law of two trigger options for the Extended Benefit (EB) program.
Over the last several years, some states have enacted legislation to decrease
the maximum number of weeks of regular state UC benefits. Until recently,
all states paid at least up to 26 weeks of UC benefits to eligible,
unemployed individuals. In 2011, however, six states passed legislation to
decrease their maximum UC benefit durations: Arkansas, Florida, Illinois, Michigan,
Missouri, and South Carolina. In 2012, Georgia also passed legislation to
decrease the maximum UC benefit duration. In 2013, North Carolina enacted
similar legislation, which will be effective beginning July 1, 2013.
Changes in UC benefit duration have consequences for the duration of federal
unemployment benefits that may be available to unemployed workers. Since
state UC benefit duration is an underlying factor in the calculation of
duration for additional federal unemployment benefits, reducing UC maximum
duration also reduces the number of weeks available to unemployed workers
in the federal extended unemployment programs (including the Emergency Unemployment
Compensation [EUC08] and EB).
States are temporarily subject to a “nonreduction” rule (under P.L. 111-205, as
amended), which makes the availability of federally financed EUC08
benefits contingent on not actively changing the state’s method of
calculation for UC benefits, if it would decrease weekly benefit amounts. Some
states, however, make automatic adjustments to weekly benefit amounts under
existing state law. Consequently, when these states experience certain
conditions, such as a decrease in the average weekly wage used in the
automatic adjustment calculation, their maximum weekly UC benefit amount
may be decreased without violating the “nonreduction” rule. P.L. 112-96
provided a specific exception to the “nonreduction” rule in the case of
state legislation enacted before March 1, 2012. More recently, North
Carolina enacted legislation that does actively reduce UC weekly benefit
amount calculations. Because this North Carolina law does not make this change effective
until July 1, 2013, EUC08 benefits are currently available in that state. Any
reduction to the UC weekly benefit amount also translates into reduced
EUC08 and EB weekly benefit amounts.
Finally, there are various optional EB trigger components—authorized under
permanent federal law (P.L. 91-373, as amended) and temporary federal law
(P.L. 111-312, as amended, and P.L. 111-5, as amended)—that states may opt
to enact under their state UC laws. Currently, 11 states have adopted an
optional trigger for the EB program, based on a state’s total unemployment rate (TUR),
into permanent state law. An additional 28 states have enacted this EB TUR
trigger temporarily, linking its expiration to the expiration of the
temporary 100% federal financing of the EB program under federal law (P.L.
111-5, as amended). Thirty-two states have adopted a three-year lookback
for this optional TUR trigger under current state law (temporarily authorized under
P.L. 111-312, as amended) to continue to meet the trigger criteria and continue
to pay EB benefits. In general, only states that have enacted at least one
of these EB trigger options (i.e., the TUR trigger or the three-year
lookback) had been able to pay EB benefits in 2011 and 2012. As of the
week of February 24, 2013, only one state (Alaska) meets the requirements to
trigger onto EB.
Date of Report: February 28, 2013
Number of Pages: 22 Order Number: R41859 Price: $29.95
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