Men lined up to collect unemployment compensation in the 1930s. (Photo by The New York Public Library on Unsplash)
With unemployment claims on hold for more state residents than live in all but two of Wisconsin’s cities, Democrats in the Wisconsin Legislature unveiled a package of proposed bills on Thursday to overhaul the system.
The Democratic bills would largely remove measures that Republicans put in place over the last decade that make it harder for people who lose their jobs to collect unemployment insurance (UI) — and which the Democrats argue are at least partly responsible for the bottleneck in the record number of applications that have overwhelmed the state amid the COVID-19 pandemic.
The legislation, now being circulated for co-sponsors, comes a week after Republican lawmakers told reporters at a news conference on the Capitol steps that Gov. Tony Evers should use some of the state’s federal COVID-19 relief money to front loans to applicants for jobless pay without determining whether they qualify.
“We felt if they’re actually interested in addressing the root of the problem, let’s do it and put forward legislation that patches up a lot of holes that they blew in the UI system years ago that are causing the biggest delays,” Sen. Chris Larson (D-Milwaukee) tells the Wisconsin Examiner.
Several of the Democratic bills would roll back restrictions enacted during the administration of former Gov. Scott Walker. The bills include measures that would:
- Eliminate the one-week waiting period before a person on unemployment insurance can claim benefits.
- Allow Social Security Disability (SSDI) recipients to qualify for UI benefits.
- Restore the right of people who are enrolled in extended occupational training to receive extended UI benefits.
- Temporarily suspend a rule that bars unemployment benefits for people who receive more than $500 in a week in work-related pay.
- Allow DWD to employ administrative rules to determine what is “suitable work” that a person collecting UI must accept if offered.
- Expand DWD’s authority to waive requirements through administrative rules.
- End the practice of disqualifying UI applicants whom employers accused of “substantial fault” leading to their termination.
- Reduce the number of work searches required for UI recipients from four a week to two, and repeal the DWD’s ability to require recipients to make additional work searches.
Some of the restrictions the bills would change have been temporarily suspended during the pandemic, including the one-week waiting period for claiming benefits and the work-search requirement.
But over the course of a decade and half, Wisconsin and many other states have ratcheted up restrictions on unemployment compensation, according to a 2017 report from the National Employment Law Project (NELP), which found both tougher state laws and stiffer federal regulations responsible for the trend.
In Wisconsin, NELP reported, just 32% of jobless Wisconsin residents were collecting unemployment in 2016, down from 50% in 2007. By 2019, according to a recent New York Times report, the number was down to 30%.
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In Wisconsin as well as nationally, unemployment soared beginning in March as the pandemic, and government attempts to slow the spread of COVID-19, led to widespread business closures and layoffs.
The total number of people claiming unemployment insurance rose more than six-fold, with more than 430,000 people collecting nearly $2.6 billion in unemployment benefits, according to DWD figures.
The crush in claims led to complaints from applicants of difficulty getting through to file a claim or to check up on the status of their claims. The DWD reported this week that currently, claims are on hold for about 140,000 people as the department verifies information about their former jobs and assesses whether they qualify for unemployment compensation.
DWD has blamed the backlog in large part on its computer system, which dates back decades. Democratic lawmakers have blamed the tighter Walker-era laws. And Republicans have accused the Evers administration of not adequately preparing for the surge in applications and not staffing up sufficiently in anticipation of it.
The state has been reassigning employees from across agencies to assist with UI claims along with temporary hires and outside contractors, bringing the current number of UI-processing employees from 500 in mid-March to more than 1,800, according to the state Department of Administration.
“The system is broken. The governor’s trying to fix it,” says state Sen. Dave Hansen (D-Green Bay). He says the Republican idea of a loan program would merely create “another bureaucracy” while only providing funds to a fraction of the people currently in the backlog.
Victor Forberger, a Madison unemployment lawyer who blogs on unemployment compensation policy and has been critical of both the Walker administration and the Evers administration on the issue, says the Republican restrictions under Walker probably do account for some of the backlog that has plagued the system this spring and summer.
“The more issues you have to look at, the more you’re going to slow down the claims process,” Forberger tells the Wisconsin Examiner. “Basically what happened over the past 10 years was creating a bunch of issues to slow down the claims-processing process — making it much harder to file unemployment claims.”
Blame to go around?
To that extent, the Democratic proposals would ease matters. But Forberger also criticizes DWD for not using more discretion in handling claims — discretion that he contends the agency can employ even under current laws, which would allow it to move claims through faster.
“Wisconsin has done nothing to adjust its claims-filing process,” Forberger says.
For example, he believes the department could act on its own to accept unemployment claims from Social Security Disability recipients. In June DWD indicated it would stop denying those claims, but Forberger says the agency hasn’t yet followed through.
Republicans said their proposal for loans to applicants awaiting approval — which Evers and other Democrats have dismissed as a “political stunt” — could be implemented without legislation, and therefore without the Legislature ever meeting. GOP leaders in both the Assembly and the Senate have said they have no plans to meet until after the November elections.
“It just kind of showed how hypocritical they were going to be,” Larson says. “They came out to a press conference saying, ‘here’s what should happen,’ without bringing the Legislature back or talking about actually passing anything [when] they have the ability to bring forward ideas and to vote on them.”
The GOP leadership Thursday dismissed the Democrats’ legislative package. “The tired proposals trotted out today would only serve to expand eligibility to an already strained system and fuel the flames of the problem at hand,” Assembly Majority Leader Jim Steineke (R-Kaukauna) said in a statement that reiterated the Republican proposal.
Democrats acknowledge that their proposals are not likely to get enacted this year, given the Republican unwillingness to call the Legislature back into session. But state Rep. Tip McGuire (D-Kenosha) says introducing legislation that they believe is necessary is still worthwhile.
“It is very important, especially in a democracy, to make sure that people understand what their government is capable of doing — ways that we can be helpful, ways that we can ease the difficulties that they’re going through,” McGuire says. “A lot of people are struggling right now. If we were to just sit here and not discuss the options that we have for moving forward and helping Wisconsinites move forward, I think that would be a dereliction of duty.”
Clarification: As originally published, this story stated that DWD had stopped denying SSDI unemployment insurance claims in mid-June. It has been updated to reflect that the department has not yet acted on its stated intention to do so.
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