State’s unemployment waiting period back on, delaying added federal benefit

Democrats urge action while Vos suggests jobless are getting too much money

Bill collectors waving bills at a broken piggy bank representing debt unemployment
Illustration by iStock / Getty Images Plus

A provision in the new federal COVID-19 relief law extends $300 a week in additional federal unemployment benefits to laid-off workers — but newly unemployed Wisconsin residents must wait a week.

The reason: The state’s requirement that workers who lose a job must wait one week before they can receive unemployment insurance (UI) is now back in effect. Under the federal law, Wisconsin must waive that requirement in order to receive the supplemental funds in the first week.

The most recent waiting-period waiver expired March 14, however, and Republican leaders in the Legislature haven’t said whether they’ll move legislation to reinstate it. The result was a one-week delaying in Wisconsinites receiving benefits.

Speaker Robin Vos at 11/17/20 news conference
Assembly Speaker Robin Vos

“We haven’t talked about it” in the Republican caucus, said Assembly Speaker Robin Vos (R-Rochester) in a news conference before Tuesday’s Assembly floor session. But he questioned whether the state should enable jobless workers to collect an additional $300 a week while they are out of work, claiming that “in some circumstances, people are being paid more to not work than they are to actually go and find a job.” 

After the Assembly adjourned for the week on Wednesday, however, Democratic lawmakers criticized Republican leaders in both houses for not acting immediately to again suspend the waiting period.

“An additional $300 per week can mean saving a family from having to make the choice between paying for groceries or paying for rent,” stated Rep. Jodi Emerson (D-Eau Claire). “These funds have already been authorized for use by Congress and we owe it to our constituents to do everything in our power to get those dollars into their pockets.”

Rep. Jodi Emerson

The $300 supplement is part of the $1.9 trillion American Rescue Plan Act (ARPA), which President Joe Biden signed last week. It’s a continuation — although at a reduced rate — of the $600 federal supplemental jobless pay program first provided in the Coronavirus Aid, Relief and Economic Security (CARES) Act, which was passed in March 2020.

In order to get the supplemental funding immediately, the CARES Act required states that impose waiting periods for UI applicants to waive that requirement. The Wisconsin Legislature included a waiver in Act 185, the law passed in April 2020 to implement the CARES Act here, suspending the state’s one-week UI waiting period that was first enacted in 2011 under then-Gov. Scott Walker.

Wisconsin’s waiver expired early in 2021. The Legislature extended it in February, but only until March 14. At the time that legislation passed, the Republican majority in both the Senate and the Assembly rejected Democratic amendments to continue the waiver until the federal government ends the supplemental program.

In his comments to reporters on Tuesday, Vos said he was waiting for a Legislative Fiscal Bureau analysis on the impact of not taking the additional funds. But he said that he was more concerned that “the fact that people have been getting these large deposits into their checking accounts has made some folks suspend their own search for work. They have money in their checking accounts and are not looking for a job.”

Vos noted that the state’s unemployment rate “is already somewhat similar to where it was pre-pandemic.” The Assembly speaker said employers have told him they cannot find enough workers as their businesses have ramped up again.

“It’s a concern to a lot of us, myself included, that we are creating a disincentive to work,” Vos said, “so that if you are in the workforce and you are working 40 hours a week, you are earning less than somebody who chooses not to look for work — who’s getting the bonus federal unemployment,” he said.

Similar claims have been made going back to the original CARES Act supplement. But at least three reports published last summer found no evidence for such assertions.

“Workers who experienced larger increases in UI generosity did not experience larger declines in employment when the benefits expansion went into effect,” stated the authors of a Yale University report from July 2020.

While the Department of Workforce Development reported last week that unemployment had fallen to 3.8% in January 2021, the number of non-farm jobs remained more than 150,000 below January 2020.

Democratic lawmakers called on the Legislature to act quickly and once again suspend the waiting period so jobless Wisconsin residents qualify for the $300 weekly supplement from the first week.

Rep. Sara Rodriguez

“We owe it to our struggling constituents to act with urgency and bring home critical federal dollars to Wisconsin families,” Rep. Sara Rodriguez (D-Brookfield) said Wednesday, suggesting that failing to act would “punish the people of Wisconsin just to settle a political score.” 

In the Senate — where Democrats have introduced a bill extending the suspension of the waiting period to Sept. 5 — Sen. Jeff

Sen. Jeff Smith

Smith (D-Brunswick) criticized his Republican colleagues for not acting as well this week.

Smith noted that when the original CARES Act was signed in late March, Republican leaders in the Legislature delayed convening until mid-April. Because they didn’t waive the waiting period sooner, the state lost an estimated $25 million in federal reimbursement tied to the end of the waiting period.

A DWD spokesperson said Friday that while the agency has fully implemented the supplemental unemployment benefit called Federal Pandemic Unemployment Compensation (FPUC)  newly jobless people will have to wait one week before receiving it.

“People receive the $300 FPUC supplement when they are currently receiving benefits from an unemployment program,” DWD communications specialist Alaina Knief told the Wisconsin Examiner. 

“Claimants eligible for unemployment benefits will continue to receive FPUC payments any week they are eligible for benefits through the week ending September 4, 2021,” Knief explained. People who are serving a one-week waiting period before receiving benefits “will not receive an FPUC payment for that week.”

For states that waive the waiting period, ARPA provides a 100% reimbursement from the federal government for the first week of all unemployment benefits paid, including the FPUC supplement, she said.

This article has been updated to clarify that the loss of supplemental benefits is only for the waiting period week, not beyond that.

Erik Gunn
Senior Reporter Erik Gunn reports and writes on work and the economy, along with related subjects, for the Wisconsin Examiner. He spent 24 years as a freelance writer for Milwaukee Magazine, Isthmus, The Progressive, BNA Inc., and other publications, winning awards for investigative reporting, feature writing, beat coverage, business writing, and commentary. An East Coast native, he previously covered labor for The Milwaukee Journal after reporting for newspapers in upstate New York and northern Illinois. He's a graduate of Beloit College (English Comp.) and the Columbia School of Journalism. Off hours he is the Examiner's resident Springsteen and Jackson Browne fanboy and model railroad nerd.