Bills take away unemployment pay, other aid, to fill more jobs

Advocates for workers and the poor say measures won’t help employers who have trouble hiring

By: - February 10, 2022 7:00 am
Mural depicting workers

Mural depicting workers painted on windows of the Madison-Kipp Corp. by Goodman Community Center students and Madison-Kipp employees with Dane Arts Mural Arts. (Erik Gunn | Wisconsin Examiner)

A batch of bills on the fast track in the state Capitol would kick people off of Medicaid if they turn down a job or a promotion, reinstate work and drug-testing rules for people on federal nutrition programs, and add new requirements for jobless workers to maintain their unemployment compensation.

The Republican lawmakers advancing the bills and the business groups that back them characterize them as tools to expand the workforce at a time when unemployment is at a record low and employers across the state are struggling to find available workers.

“Anyone who has been out in the public and has talked to any business owner throughout the state of Wisconsin, it has been consistently clear — we need workers,” said Sen. Patrick Testin (R-Stevens Point) at a hearing Wednesday in the Senate Economic and Workforce Development Committee. “We need workers, we can expand, we can grow, but we can’t find people. And I think there’s a direct correlation that the reason they can’t find people is because we are incentivizing them not to work.”

But advocates for low-income people and workers say the legislation is unlikely to help, and could make matters worse for people in poverty as well as for businesses.

“They’re trying to block jobless workers from getting the support they need, rather than taking an approach to tackling the barriers to employment,” says Tamarine Cornelius, an analyst for the Wisconsin Budget Project. Those barriers include access to affordable child care and transportation to connect people with potential jobs that might be far from home.

None of the bills address the demographic trends that are a major source of the trouble employers are having, Cornelius says. “Wisconsin is a lot older than we used to be, and we’re getting older. A lot of people are aging out of the workforce.”

Some of the proposals might violate federal laws governing the aid programs, according to witnesses and state officials who provided testimony at public hearings Tuesday and Wednesday.

Committee votes scheduled

In addition to the Senate hearing Wednesday, two Assembly committees held hearings Tuesday on the legislation. The Legislature’s procedures usually require a public hearing to qualify a proposal for a floor vote. Committee votes in the Assembly on more than a half-dozen of the measures are scheduled for Thursday. That means at least some of the bills could get a vote in that house next week.

A common thread connecting each of the pieces of legislation is the assumption that one reason employers are having so much trouble filling job openings is that benefit programs from FoodShare and Medicaid to unemployment insurance have prompted adults who would otherwise be employed to forgo work.

In interviews and in hearing testimony, however, advocates for low-income and jobless people have rejected those characterizations.

The organizations and lawmakers promoting the legislation periodically referred to the programs as aid meant for the “truly needy” that has gone, instead, to a much broader group of people than it was intended for.

One bill would penalize unemployment compensation recipients who “ghost” employers by not showing up for a job interview or not responding to job offers.

“This has made it extremely difficult for employers to find capable workers and has wasted business valuable time and resources,” said Rep. Jon Plumer (R-Lodi). The bill would require the state Department of Workforce Development (DWD) to create an online portal where employers could report applicants who didn’t show up for interviews. It would require the department to follow up in the event the person was receiving unemployment compensation.

Madison lawyer Victor Forberger, whose clients include unemployed people whose claims have been denied, says the bill duplicates existing law.

“Missing a job interview is already a disqualification, and Wisconsin has provided an 800 fraud number for employers to call when [prospective] employees miss job interviews,” Forberger said in an email message to a national network of employment lawyers shared with the Wisconsin Examiner.

The claim that jobless people are routinely skipping scheduled interviews and collecting benefits “with no intention of ever working” is “legal and factual hogwash, and it makes absolutely no sense in a state with a record low unemployment rate of 2.8%,” Forberger added. “If employees are skipping an interview, it is because they got hired by a better employer.”

Scaling benefits to jobless rate

Another bill would tie the maximum number of weeks a person can collect unemployment insurance — currently 26 — to the unemployment rate from three to nine months earlier. When that rate is 3.5% or less, benefits would end after 14 weeks. The cap would grow with higher unemployment rates, reaching the 26-week limit only if unemployment exceeded 9%.

“Our current programs provide for a prolonged stay on welfare programs, when we should be encouraging people to get back to work,” said Rep. Alex Dallman (R-Green Lake) one of the lead authors, in his Senate hearing testimony Wednesday. Florida, Georgia, North Carolina and Tennessee have adopted the bill’s approach and reduced benefit costs and cut unemployment insurance premiums for employers, he added, and recipients have returned to work in half the time.

But Abby Bar-Lev Wiley, the legislative director for Legal Action of Wisconsin, which provides legal help in civil cases for low-income people, said in other states, such policies “have created higher rates of food insecurity and housing instability, disproportionately impacting particularly people of color.”

Cornelius of the Wisconsin Budget Project said that the bill is little more than a way to simply cut the number of weeks a person can collect jobless pay. Reviewing data from more than three decades going back into the 1980s, she found only five quarters in which the jobless rate was high enough to trigger the full 26-week limit.

The three- to nine-month gap between the quarter for which the unemployment rate sets an individual’s maximum number of benefit weeks “is far enough in the past that it could potentially have very little bearing on the economic conditions at the time you’re looking for a job,” Cornelius adds.

Allowing time for employees to find an employer who is a good fit, and for the employer to do likewise, helps both of them, she says. Compressing the timeline “could lead to more church in the employment market.”

Tying Medicaid to work

Another bill would terminate BadgerCare, the state’s Medicaid program that covers health care for adults with incomes at or below the federal poverty guideline, for a person who turns down a job or a promotion.

Testifying for the bill Wednesday, Sen. Chris Kapenga (R-Delafield) gave an account of a part-time employee who turned down an offer for full-time work. Kapenga quoted the unnamed woman as saying, “I can continue on with the benefits that I get.”

“The programs are meant for people who cannot get employed,” Kapenga said. “That’s what the safety net is for. And we don’t want to have situations where those resources are being used for people who can be employed full time.”

Barbara Sella of the Wisconsin Catholic Conference, which opposes the bill, said it makes no allowances for why a person would turn down the job. “It doesn’t take into account the benefits that the offer might have,” Sella added. “So, if there is no health insurance [with the offer], the person might be better off turning down the job and looking for a job that offers health benefits.”

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In testimony on behalf of the bill in the Assembly hearing Tuesday, Rep. Tyler August (R-Lake Geneva) said people who lose Medicaid coverage because of the bill “would still have health care options — the Affordable Care Act would provide health care to these individuals at little to no cost depending on their income level.”

But William Parke-Sutherland, health policy analyst for Kids Forward, said in testimony submitted to the Assembly committee that, while the Affordable Care Act (ACA) offers more affordable health insurance options than were previously available, its out-of-pocket costs exceed those of Medicaid. In addition, enhanced ACA subsidies currently in place expire at the end of 2022.

Parke-Sutherland noted in an interview that “seven out of 10 adults on BadgerCare are working.” 

Medicaid also offers patients stronger due-process protections than private insurers to appeal denied claims, he says. “The ACA brought coverage to hundreds of thousands of Wisconsinites,” Parke-Sutherland says, “but it’s not perfect.”

In Wisconsin, 66% of adults are working or want to work, which exceeds the national average of 60-62%. But a representative of a Florida-based organization that lobbies for rolling back government benefits programs and raising barriers to them testified that the labor force participation rate topped 74% more than two decades ago.  

“The ethic of work, the expectation of work is failing,” claimed Chase Martin of the Opportunity Solutions Project, part of a larger network the Center for Media and Democracy has linked to various right-wing interests. “Wisconsin needs to use every tool at its disposal to get folks back to work.”

Among the differences between now and then, however, is child care, says Laura Dresser, associate director of COWS, a University of Wisconsin center that publishes research and policy on the economy and working people. 

When the labor force participation was even higher in the late 1990s, the state also offered stronger child care assistance than it does now as part of its “work first” approach to ending traditional welfare programs, Dresser observes.

“We know that the pandemic has increased the care duties of women in the state. We know that better supports — child care, health care, stronger job quality — are the sorts of things that help bring women into the labor force,” Dresser says.

“Fundamentally, a state isn’t going to build a strong labor force by vilifying workers and creating desperate need,” she adds. “In state policy, increasing labor force participation happens with policy that supports workers by making work possible for people, especially women, by making sure they have the access to good jobs, decent, affordable child care, and the health care they need.”

Unemployment, aid bills summarized

Here are seven of the bills in the Legislature that Republicans have advanced to cut back public benefits in response to employers who have said they are unable to fill job openings.

AB-935/SB-902: Would require the state Department of Health Services (DHS) to start enforcing the state’s work, job-training and drug testing and treatment requirement in the FoodShare program for able-bodied adults without dependents who are not already employed.

FoodShare provides food to needy people and families under the federal Supplemental Nutrition Assistance Program (SNAP), colloquially referred to as food stamps.

The federal government required the state to put the work, training and drug-testing requirements on hold because of the COVID-19 pandemic, according to the DHS, which submitted written testimony for Tuesday’s hearing in the Assembly’s Public Benefit Reform Committee. The federal suspension remains in effect until late June.

AB-934/SB-905: Would require DHS to review Medicaid participants for eligibility every six months instead of every year, disenrolling any who are no longer eligible, and forbid the department from automatically updating a person’s enrollment form.

Disenrollment is currently barred by the federal government, part of the federal response to the COVID-19 pandemic.

AB-936/SB-912: Would disqualify from Medicaid (BadgerCare) a person who turns down a job or a promotion that pays more than the maximum income to qualify for BadgerCare.

AB-942/No Senate counterpart: Would increase the duties of the DHS inspector general, a position created in 2013 to identify and prevent fraud, waste and abuse in FoodShare, Medicaid and other DHS public assistance programs.

AB-937/SB-906: Would tie the maximum number of weeks a person can collect unemployment to the unemployment rate in a previous quarter.

AB-938/SB-932: Would expand the grounds on which employers can fire workers for misconduct, disqualifying a claim for unemployment insurance; require random audits of at least 50% of work search actions by people collecting unemployment; give the Joint Finance Committee the right to review and terminate enhanced federal unemployment compensation programs, such as were enacted early in the COVID-19 pandemic.

AB-939/SB-911: Would tighten return-to-work requirements for people collecting unemployment compensation; would create more channels for employers to report applicants who fail to return to work when called back, decline job interviews or fail to show up for interviews, disqualifying those applicants from unemployment compensation.

Additional bills that are not part of this group also would make various changes in the unemployment insurance system.

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Erik Gunn
Erik Gunn

Deputy Editor Erik Gunn reports and writes on work and the economy, health policy and 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.

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