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Urgent Changes to State Unemployment Rules - Legislative Update March 18, 2020

03/19/2020 11:51 AM | Denis Bourbeau (Administrator)

DRM | Downs Rachlin Martin PLLC

3.18.20

Senate Economic Development

The committee reviewed H.681, (the Vermont Bill) a bill focusing on unemployment insurance as it pertains to COVID. Here is a summary of the bill. This bill still needs to pass the state senate.

Damien Leonard, Legislative Council, did an overview of UI as Cameron Wood of DOL wasn’t able to call in due to his workload. UI is a very complex system and financed by a payroll tax that is based on employers’ experience with UI. A high ratio of layoffs relative to payroll means the business will have a higher tax rate. This builds a pool of funds that can be drawn on when needed.

Currently there is $500 million in the UI Trust Fund. Projections are that 60-70% of this funds will be drawn down in a recession. Our fund is in very good shape which is unique in the US.

To qualify one needs to have been working for at least 2 quarters in the last 5 quarters and hit a minimum income threshold. If one becomes unemployed or under-employed and is able and available to work and is actively seeking work then they are qualified for UI.

If the employer is intending to bring the workers back the DOL may waive the requirement that the employee look for work.

UI benefits cover about 50% of income with a statutory cap of $513/week.

This week the number of people filing is rapidly growing. These claims could have an adverse impact on tax rates for employers unless the law is changed for COVID related claims.

Testimony moved on to:

Michael Harrington

Interim Commissioner of Labor

There has been a drastic spike in initial claims. There is a bottleneck in initial claims filings. In the last 48 hours the department as increased their call center staff from 10-12 to 25-30.They will monitor to see if they need more people. The department has prepared an on-line form that is up for the public right now. This isn’t a permanent solution. Usually there are about 400 claims a week. Yesterday alone there were 500 claims. 21K employed in food service industry and it is anticipated that half will be filing.

The department prefers people to file the online form but if they need help by phone:

1-877-214-3330 – for initial claims

1-877-214-3332 – for general assistance

1-802-828-4344 – for employers.

Harrington went on to discuss the federal bill, HR6201. Here a summary. If Congress passes the bill it will provide flexibility that the state currently doesn’t to pay benefits and relieve employers of charges.

Anyone who is laid off will be eligible for benefits. As long as they are laid off for less than  10 weeks they don’t need to do a work search. They are working to expedite claims so there is no waiting period – current delay is due to a number of systematic steps that need to occur. They are working to shorten that time

Sirotkin asked if there was more the Senate could add to H.681. Harrington said no but the committee will discuss this further tomorrow. Some states are trying to expand UI benefits to sole proprietors and independent contractors and the self-employed. They aren’t contributed into the fund and we have to consider the fund’s sustainability.

Committee is looking to tweak the bill and will meet tomorrow morning at 10am.


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