Unemployment Insurance:
Programs and Benefits
Julie M. Whittaker
Specialist in Income Security
Katelin P. Isaacs
Analyst in Income Security
September 19, 201217, 2013
Congressional Research Service
7-5700
www.crs.gov
RL33362
CRS Report for Congress
Prepared for Members and Committees of Congress
Unemployment Insurance: Programs and Benefits
Summary
Various benefits may be available to unemployed workers to provide income support. When
eligible workers lose their jobs, the Unemployment Compensation (UC) program may provide up
to 26 weeks of income support through the payment of regular UC benefits. Unemployment
benefits may be extended for up to 47 weeks by the temporarily authorized Emergency
Unemployment Compensation (EUC08) program. Unemployment benefits may be extended for
up to a further 13 or 20 weeks by the permanent Extended Benefit (EB) program under certain
state economic conditions.
Certain groups of workers who lose their jobs because of international
competition may qualify
for income support through Trade Adjustment Act (TAA) programs.
Unemployed workers may be
eligible to receive Disaster Unemployment Assistance (DUA)
benefits if they are not eligible for
regular UC and if their unemployment may be directly
attributed to a declared major disaster.
Former U.S. military servicemembers may be eligible for
unemployment benefits through the
unemployment compensation for ex-servicemembers (UCX)
program. The Emergency
Unemployment Compensation Act of 1991 (P.L. 102-164) provides that
ex-servicemembers be
treated the same as other unemployed workers with respect to benefit
levels, the waiting period
for benefits, and benefit duration.
On February 22, 2012January 2, 2013, the President signed P.L. 112-96, the Middle Class Tax Relief and Job
Creation Act of 240, the American Taxpayer Relief Act of
2012. P.L. 112-96240 extends the authorization for the EUC08 program through the
week ending on
or before January 2, 20131, 2014, as well as alters the structure and availability of
EUC08 benefits in
states. P.L. 112-96240 also extends the temporary 100% federal financing of EB
and the option to
allow states to use three-year lookback calculations in their EB triggers through
December 31, 2012.
This report previously contained a section on unemployment insurance legislation. This
information is now included as part of CRS Report R41662, Unemployment Insurance:
Legislative Issues in the 112th Congress, by Julie M. Whittaker and Katelin P. Isaacs December 31,
2013.
For an overview of expiring UI provisions and their consequences for UI benefit availability and
financing, see CRS Report R41508, Temporary Unemployment Insurance Provisions, by Katelin
P. Isaacs.
For an explanation of the impact of sequestration on unemployment insurance benefits, see CRS
Report R43133, The Impact of Sequestration on Unemployment Insurance Benefits: Frequently
Asked Questions, by Katelin P. Isaacs and Julie M. Whittaker.
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Unemployment Insurance: Programs and Benefits
Contents
Introduction...................................................................................................................................... 1
Unemployment Compensation ........................................................................................................ 2
Authorization....................................................................................................................... 3
Appropriation and Outlays .................................................................................................. 3
Administration..................................................................................................................... 3
Eligibility for Regular Unemployment Compensation .............................................................. 3
Broad Federal Guidelines Result in Different State Requirements ..................................... 3
Base Period.......................................................................................................................... 4
Qualifying Wages or Employment ...................................................................................... 5
Data Collection Considerations ........................................................................................... 5
Determination and Duration of Regular Unemployment Compensation .................................. 6
UC Benefit Financing: Unemployment Taxes on Employers ................................................... 8
Federal Unemployment Tax Act.......................................................................................... 8
ARRA Temporary Changes to Federal Financing of Unemployment Benefits .................. 9
State Unemployment Tax Acts ............................................................................................ 9
Outstanding Loans from the Federal Unemployment Account ......................................... 12
Federal Additional Compensation ................................................................................................. 1213
Emergency Unemployment Compensation Program..................................................................... 13
EUC08 Benefit Amounts, Tiers, and Duration ........................................................................ 15
Current EUC08 Benefit Availability.........EUC08 Benefit Availability Prior to P.L. 112-96 .............................................................. 15
Current EUC08 Benefit Availability ................................................................................. 16 15
EUC08 Eligibility Requirements Beyond Requirements for Regular UC .............................. 1716
First Claimed Regular UC Benefits On or After May 7, 2006 .......................................... 1716
Exhausted Regular UC Benefit ......................................................................................... 1716
“20 Weeks” of Full-Time Insured Employment or Equivalent ......................................... 1817
Reemployment and Eligibility Assessments (REAs) ........................................................ 17
EUC08 Financing .................................................................................................................... 1817
Interaction of EUC08 Benefits and Qualifying for a “Second Benefit Year”.......................... 1817
EUC08 and EB Interactions .................................................................................................... 1918
Extended Benefit Program ............................................................................................................. 1918
How an Extended Benefit Period isIs Activated (and Deactivated) ........................................... 2019
Special Rule ...................................................................................................................... 20
EB Eligibility Requirements Beyond Requirements for Regular UC ..................................... 2120
2009 Stimulus Provisions Affecting EB Financing ................................................................. 22
Figures
Figure A-1. Unemployment Insurance Benefits: November 8, 2009-February 18, 2012.............. 24
Figure A-2. Unemployment Insurance Benefits: February 19, 2012-December 29, 2012 ............ 25
Tables
Table 1. State Unemployment Compensation Benefits Amounts, July 2012................................... 6
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Unemployment Insurance: Programs and Benefits
Table 2. State Unemployment Taxes: Taxable Wage Base and Rates, July 2012 .......................... 10
Unemployment Insurance and the Sequester ................................................................................. 22
Figures
Figure A-1. Sequence of Unemployment Benefits: UC, EUC08, and EB ..................................... 24
Figure A-2. Benefits Available in Emergency Unemployment Compensation (EUC08)
July 6, 2008-December 28, 2013 ................................................................................................ 25
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Unemployment Insurance: Programs and Benefits
Tables
Table 1. State Unemployment Compensation Benefit Amounts, July 2013 .................................... 6
Table 2. State Unemployment Taxes: Taxable Wage Base and Rates, July 2013 ............................ 9
Table 3. Revenue and Expenditures Associated with
Unemployment Compensation, FY2001-FY2012FY2013 ...................................................................... 1112
Table B-1. Emergency Unemployment Compensation Program: Public Law, Benefits,
Effective Dates, and Financing ................................................................................................... 26
Appendixes
Appendix A. Unemployment Insurance Benefits .......................................................................... 24
Appendix B. Summary of EUC08 Program .................................................................................. 26
Contacts
Author Contact Information........................................................................................................... 28
Congressional Research Service
Unemployment Insurance: Programs and Benefits
Introduction
A variety of benefits may be available to unemployed workers to provide them with income
support during a spell of unemployment. The cornerstone of this income support is the joint
federal-state Unemployment Compensation (UC) program, which may provide income support
through the payment of UC benefits for up to a maximum of 26 weeks.1 Other programs that may
provide workers with income support are more specialized. They may target special groups of
workers, be automatically triggered by certain economic conditions, be temporarily created by
Congress with a set expiration date, or target typically ineligible workers through a disaster
declaration.
UC benefits may be extended at the state level by the permanent Extended Benefit (EB) program
if high unemployment exists within the state. Once regular unemployment benefits are exhausted,
the EB program may provide up to an additional 13 or 20 weeks of benefits, depending on worker
eligibility, state law, and economic conditions in the state. The EB program is funded 50% by the
federal government and 50% by the states, although the 2009 stimulus package (P.L. 111-5, as
amended) temporarily provides for 100% federal funding of the EB program.
A temporary unemployment insurance program, the Emergency Unemployment Compensation
(EUC08) program, began in July 2008. The authorization for the EUC08 program expires the
week ending on or before January 2, 20131, 2014. Therefore, the last day of EUC08 availability is
December 29, 201228, 2013 (December 30, 201229, 2013, for New York). This was the eighth temporary program
Congress has created to provide extended unemployment compensation during an economic
slowdown.2 The EUC08 benefit is 100% federally funded. State UC agencies administer the
EUC08 benefit along with regular UC benefits. See Appendix A for diagrams of the variouscurrent
unemployment benefits currently available to workers as well as those unemployment benefits
available immediately prior to P.L. 112-96a detailed diagram of the expansions and
contractions of the EUC08 benefit.
Former U.S. military servicemembers may be eligible for unemployment benefits through the
unemployment compensation for ex-servicemembers (UCX) program. The Emergency
Unemployment Compensation Act of 1991 (P.L. 102-164) provides that ex-servicemembers be
treated the same as other unemployed workers with respect to benefit levels, the waiting period
for benefits, and benefit duration. (Please see CRS Report RS22440, Unemployment
Compensation (Insurance) and Military Service, by Julie M. Whittaker.)
If an unemployed worker is not eligible to receive UC benefits and the worker’s unemployment
may be directly attributed to a declared major disaster, a worker may be eligible to receive
Disaster Unemployment Assistance (DUA) benefits under the Stafford Act. The federal disaster
declaration will include information on whether DUA benefits are available. For information on
1
Arkansas and Illinois provide up to 25 weeks; Michigan, Missouri and South Carolina provide up to 20 weeks; and
the maximum duration of UC in Florida and Georgia, Georgia, and North Carolina is variable, based on the state unemployment
rate. For more
details on these states with less than 26 weeks of UC available, see CRS Report R41859, Unemployment
Insurance:
Consequences of Changes in State Unemployment Compensation Laws, by Katelin P. Isaacs. In addition,
the maximum
UC duration in Montana is 28 weeks and Massachusetts is 30 weeks. In conjunction with federal unemployment
benefitsbenefits from
the Extended Benefit (EB) program, however, UC duration is capped at 26 weeks.
2
The other temporary programs became effective in 1958, 1961, 1972, 1975, 1982, 1991, and 2002. For details on
these programs, see CRS Report RL34340, Extending Unemployment Compensation Benefits During Recessions, by
Julie M. Whittaker and Katelin P. Isaacs.
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Disaster Unemployment Assistance, see CRS Report RS22022, Disaster Unemployment
Assistance (DUA), by Julie M. Whittaker.
Certain groups of workers who lose their jobs because of international competition may qualify
for additional or supplemental support through Trade Adjustment Act (TAA) programs or (for
certain workers aged 50 or older) through Reemployment Trade Adjustment Assistance (RTAA).
This report does not describe the TAA or RTAA programs. (Please see CRS Report R42012,
Trade Adjustment Assistance for Workers, by Benjamin Collins for information on these
programs.)
Within the unemployment insurance system, there are also two programs that provide alternative
benefits in lieu of benefits through the UC program: the Short-Time Compensation (STC) or
“work sharing” program and the Self-Employment Assistance (SEA) program. For details on
STC, see CRS Report R40689, Compensated Work Sharing Arrangements (Short-Time
Compensation) as an Alternative to Layoffs, by Alison M. SheltonJulie M. Whittaker. For details on SEA, see CRS
Report R41253, The Self-Employment Assistance (SEA) Program, by Katelin P. Isaacs.
Some, but not all, types of unemployment insurance expenditures are subject to sequestration
under the Budget Control Act of 2011 (P.L. 112-25, as amended).3 UC, UCX, and UCFE
payments are exempt from the sequester, but EB, EUC08, and most forms of administrative
funding are subject to the sequester reductions. For details on the impact of sequestration on UI
benefits, see CRS Report R43133, The Impact of Sequestration on Unemployment Insurance
Benefits: Frequently Asked Questions, by Katelin P. Isaacs and Julie M. Whittaker.
This report describes three kinds of unemployment benefits: regular UC, EB, and EUC08. The
report explains their basic eligibility requirements, benefits, and financing structure.
Unemployment Compensation
UC is a joint federal-state program financed by federal taxes under the Federal Unemployment
Tax Act (FUTA) and by state payroll taxes under the State Unemployment Tax Acts (SUTA). The
UC program has a direct impact on almost every business in the United States as most businesses
are subject to state and federal unemployment taxes. An estimated $5.23 billion in federal
unemployment taxes and $50.5 billion in state unemployment taxes will be collected in FY2012.
In FY2012FY2014.
In FY2014, states will spend a projected $44.340.5 billion on regular UC benefits. The federal
government will spend additional amounts, described in section “Appropriation and Outlays.”
Approximately 127.7Approximately
130.3 million jobs are covered by the UC program. At the end of the week of
August 4, 2012, 3.217, 2013,
2.9 million unemployed workers received UC. TheAs of July 2013, the 12-month average weekly
UC UC
benefit was $299 in July 2012307.
Originally, the intent of the UC program, among other things, was to help counter economic
fluctuations such as recessions.34 This intent is reflected in the current UC program’s funding and
benefit structure. When the economy grows, UC program revenue rises through increased tax
revenues while UC program spending falls as fewer workers are unemployed. The effect of
3
For details on the sequester under the Budget Control Act of 2011, as amended, see CRS Report R42050, Budget
“Sequestration” and Selected Program Exemptions and Special Rules, coordinated by Karen Spar.
4
See, for example, President Franklin Roosevelt’s remarks at the signing of the Social Security Act at
http://www.ssa.gov/history/fdrstmts.html#signing.
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Unemployment Insurance: Programs and Benefits
collecting more taxes than are spent dampens demand in the economy. This also creates a surplus
of funds or a “cushion” of available funds for the UC program to draw upon during a recession.
In a recession, UC tax revenue falls and UC program spending rises as more workers lose their
jobs and receive UC benefits. The increased amount of UC payments to unemployed workers
dampens the economic effect of earnings losses by injecting additional funds into the economy.
3
See, for example, President Franklin Roosevelt’s remarks at the signing of the Social Security Act at
http://www.ssa.gov/history/fdrstmts.html#signing.
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Unemployment Insurance: Programs and Benefits
Authorization
The underlying framework of the UC system is contained in the Social Security Act. (the Act).
Title III of
the Act authorizes grants to states for the administration of state UC laws, Title IX
authorizes the
various components of the federal Unemployment Trust Fund (UTF), and Title XII
authorizes authorizes
advances or loans to insolvent state UC programs.
Appropriation and Outlays
The federal government appropriates funds for federal and state UC program administration, the
federal share of EB payments, the EUC08 program, and federal loans to insolvent state UC
programs. In FY2011, states received $5.0 billion from the federal government for the
administration of their UC programs, $11.6 billion for the federal share of EB payments, and
$52.7 billion for the temporary, federally financed EUC08 program. In FY2012 projections from
the Midsession Review of the President’s Budget Proposal FY2013 are that the states will receive
FY2013, states are projected to receive an estimated $5.24.7 billion from the federal
government for the administration of their UC
programs (this includes additional payments as required by P.L. 112-96), $4.5 programs, $0.12 billion for the
federal share of EB
payments, and $40.925.7 billion for the temporary EUC08 program.5
Administration
The U.S. Department of Labor (DOL) administers the federal portion of the UC system, which
operates in each state, the District of Columbia, Puerto Rico, and the Virgin Islands. Federal law
sets broad rules that the 53 state programs must follow. These include the broad categories of
workers that must be covered by the program, the method for triggering the EB and EUC08
programs, the floor on the highest state unemployment tax rate to be imposed on employers
(5.4%), and how the states will repay UTF loans. If the states do not follow these rules, their
employers may lose a portion of their state unemployment tax credit when their federal income
tax is calculated. The federal tax pays for both federal and state administrative costs, the federal
share of the EB program, loans to insolvent state UC accounts, and state employment services.46
Eligibility for Regular Unemployment Compensation
Broad Federal Guidelines Result in Different State Requirements
Whereas federal laws and regulations provide broad guidelines on UC benefit coverage,
eligibility, and benefit determination, the specifics of regular UC benefits are determined by each
state. This results in essentially 53 different programs. States determine UC benefit eligibility,
payments, and duration through state laws and program regulations. Generally, UC eligibility is
based on attaining qualified wages and employment in covered work over a 12-month period
(called a base period) prior to unemployment.
4
5
U.S. Department of Labor, UI Outlook, Midsession Review, July 2013, available at
http://www.workforcesecurity.doleta.gov/unemploy/content/midsession_review.asp.
6
For more information on job search assistance and job search training for unemployed workers, see CRS Report
RL34251, Federal Programs Available to Unemployed Workers, coordinated by Katelin P. Isaacs.
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based on attaining qualified wages and employment in covered work over a 12-month period
(called a base period) prior to unemployment.
Base Period
The base period is the time period during which wages earned or hours/weeks worked are
examined to determine a worker’s monetary entitlement to UC. Almost all states use the first four
of the last five completed calendar quarters preceding the filing of the claim as their base period.
This may result in a lag of up to five months between the end of the base period and the date a
worker becomes unemployed. As a result there are some instances when workers with substantial
labor market attachment are ineligible for UC benefits. In particular, recent entrants to the
workforce, or re-entrants, may be ineligible under this definition. Federal law allows states to
develop expanded definitions of the base period.
A list of states’ base periods can be found at http://ows.doleta.gov/unemploy/pdf/uilawcompar/
20122013/monetary.pdf, in Table 3-2.
Alternative Base Period
Almost two-thirds of states allow the use of an alternative base period (ABP) for workers failing
to qualify under the regular base period. For example, if the worker fails to qualify using wages
and employment in the first four of the last five completed calendar quarters, then the state might
use wages and employment in the last four completed calendar quarters.
Extended Base Period
Several states allow workers who have no wages in the current base period to use older wages
and employment under certain conditions. These conditions typically involve illness or injury. For
example, a worker who was injured on the job and who has collected workers’ compensation
benefits may use wages and employment preceding the date of the worker’s injury to establish
eligibility.
Base Period Provisions in the 2009 Stimulus Package
The 2009 stimulus package (P.L. 111-5) provided up to $7 billion to states as an incentive to
make changes to their unemployment programs. States had to apply for these funds by August 22,
2011, and no payment could occur after September 30, 2011. A total of $4.4 billion of the $7
billion fund was distributed to states. By law, the remaining $2.6 billion became unrestricted
funds within the Federal Unemployment Account of the Unemployment Trust Fund.
One-third of a state’s share of this amount was contingent on state law allowing use of a base
period that includes the most recently completed calendar quarter before the start of the benefit
year for the purpose of determining UC eligibility. The remaining two-thirds of a state’s share of
the $7 billion was contingent on qualifying for the first one-third payment (by adopting an
alternative base period definition), plus adopting two of four additional provisions.5
57
7
For more information on unemployment modernization provisions in the American Recovery and Reinvestment Act
of 2009 (P.L. 111-5), please see CRS Report R40368, Unemployment Insurance Provisions in the American Recovery
and Reinvestment Act of 2009, by Alison M. Shelton and Julie M. Whittaker.(continued...)
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Unemployment Insurance: Programs and Benefits
Qualifying Wages or Employment
All states require a worker to have earned a certain amount of wages or to have worked for a
certain period of time (or both) within the base period to be monetarily eligible to receive any UC
benefits. The methods that states use to determine monetary eligibility vary greatly.
Multiple of High-Quarter Wages. Under this method, workers must earn a certain dollar amount
in the quarter with the highest earnings of their base period. Workers must also earn total baseperiod wages that are a multiple—typically 1.5—of the high-quarter wages. For example, if a
worker earns $5,000 in the high quarter, the worker must earn at least another $2,500 in the rest
of the base period. States require earnings in more than one quarter to minimize the likelihood
that workers with earnings in only one quarter receive benefits. Although the worker might be
monetarily eligible based upon the earnings accrued in one quarter, these “multiple of high
quarter wages” states do not deem those workers to be substantially attached to the labor market.
Multiple of Weekly Benefit Amount. Under this method, the state first computes the worker’s
weekly benefit amount. The worker must have earned a multiple—often 40—of this amount
during the base period. For example, if a worker’s weekly benefit amount equals $100, then the
worker will need base period earnings of 40 times $100, or $4,000, before any UC would be paid.
Most states also require wages in at least two quarters. Some states have weighted schedules that
require varying multiples for varying weekly benefits. Some states allow a reduced weekly
benefit amount to meet the multiple requirement.
Flat Qualifying Amount. States using this method require a certain dollar amount of total wages to
be earned during the base period. This method is used by most states with an annual-wage
requirement for determining the weekly benefit and by some states with a high-quarter
wage/weekly benefit requirement.
Weeks/Hours of Employment. Under this method, the worker must have worked a certain number
of weeks/hours at a certain weekly/hourly wage.
Data Collection Considerations
The wide variation seen in state UC program laws and regulations also exists among the states’
data collections. All states collect information on earnings by quarter for each worker. A handful
of states collect information on the number of weeks worked during the base period. Even fewer
states collect information on the numbers of hours worked during a quarter. As a result, most
states use information on quarters worked, quarterly earnings, and cumulative earnings in
determining eligibility and the amount of benefit.68 It does not appear that any state uses both
hours of work and weeks of work in the base period calculation.
6
The U.S. DOL 2012(...continued)
of 2009 (P.L. 111-5), please see CRS Report R40368, Unemployment Insurance Provisions in the American Recovery
and Reinvestment Act of 2009, by Julie M. Whittaker.
8
The U.S. DOL 2013 Comparison of State Unemployment Insurance Laws reports that the following states used the
measure of “weeks” in determination of eligibility or benefit amount: New Jersey, Ohio, and Pennsylvania. Only
Washington appears to use the number of hours worked in eligibility or benefit determination.
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Determination and Duration of Regular
Unemployment Compensation
Generally, benefits are based on wages for covered work over a 12-month period (the “base
period” or “alternative base period,” described above). Most state benefit formulas replace half of
a claimant’s average weekly wage up to a weekly maximum. All states disregard some earnings
during unemployment as an incentive to take short-term or part-time work while searching for a
permanent position. Generally, the worker’s UC payment equals the difference between the
weekly benefit amount and earnings.
Table 1 lists the minimum and maximum UC benefits for each state. Weekly maximums in July
20122013 ranged from $133 (Puerto Rico) to $653674 (Massachusetts) and, in states that provide
dependents’ allowances, up to $9791,011 (Massachusetts). In July 20122013, the average weekly benefit
was $299307. Benefits are available for up to 26 weeks in most states (30 weeks in Massachusetts; 28
weeks in Montana; 25 weeks in Arkansas and Illinois; 20 weeks in Michigan, Missouri, and
South Carolina; 12-23 weeks in Florida, depending on the state unemployment rate; 14-20 weeks
in Georgia, depending on the state unemployment rate). The average ; and 12-20 weeks in North Carolina,
depending on the state unemployment rate). Among individuals receiving benefits, the average
regular UC benefit duration
in July 20122013 was 17.416.8 weeks. In July 20122013, approximately 3.23 million
unemployed workers
received regular state UC benefits in a given week.
Table 1. State Unemployment Compensation BenefitsBenefit Amounts, July 20122013
(in dollars)
Minimum Weekly
UC Benefit
Amount
Minimum If
Dependents’
Allowancea
Maximum Weekly
UC Benefit
Amountb
Alabama
45
Alaska
56
Arizona
119122
240
Arkansas
81
451
Maximum If
Dependents’
Allowancea
265
128
370
442
California
40
450
Colorado
25
466
513
Connecticut
15
573
648
Delaware
20
330
District of Columbia
50
359
Florida
32
275
Georgia
44
330
Hawaii
5
523534
265
128
370
442
529
30
591
Idaho
72
343
Illinois
51
Indiana
37
Iowa
5960
Kansas
114
456
Kentucky
39
415
Louisiana
10
247
Congressional Research Service
30
77
403
549
390
71
396
486117
469
Kentucky
39
415
Congressional Research Service
Maximum If
Dependents’
Allowancea
666
357
77
413
562
390
73
408
501
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Unemployment Insurance: Programs and Benefits
Minimum Weekly
UC Benefit
Amount
Minimum If
Dependents’
Allowancea
Maximum Weekly
UC Benefit
Amountb
Maximum If
Dependents’
Allowancea
Maine
65
97
372
558Louisiana
10
Maine
66
99
378
Maryland
50
90
430
Massachusetts
33
49
653674
Michigan
117
147
362
Minnesota
38
38524
393
Mississippi
30
235
Missouri
35
320
Montana
127
446132
464
Nebraska
70
354362
Nevada
16
396407
New Hampshire
32
427
New Jersey
87
100
611624
New Mexico
74
111
39776
114
407
New York
64
405
North Carolina
45
52215
350
North Dakota
43
516570
Ohio
111
400115
413
Oklahoma
16
368386
Oregon
122
524126
538
Pennsylvania
3570
Puerto Rico
7
Rhode Island
4342
South Carolina
42
326
South Dakota
28
333
979
597
427
43
573
447
539
581
133
93
80
566
Tennessee
30
Texas
61
426
275
Utah
25
467
Vermont
69
425
Virginia
60South Dakota
28
Tennessee
30
Texas
62
440
Utah
26
479
Vermont
58
425
Virginia
54
378
Virgin Islands
33
494491
Washington
143
604148
624
West Virginia
24
424
Wisconsin
54
363
Wyoming
33
459
70734
471
Maximum If
Dependents’
Allowancea
247
78
573
567
1,011
610
457
557
581
133
92
566
707
326
345
80
275
325
Source: Congressional Research Service (CRS) table compiled from Significant Provisions of State Unemployment
Insurance Laws, July 20122013, U.S. Department of Labor, Employment and Training Administration, at
http://owswww.workforcesecurity.doleta.gov/unemploy/content/sigpros/2010-2019/July2012July2013.pdf.
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a.
The figures for minimum and maximum benefits include dependents’ allowances for the maximum number
of dependents.
b.
If a state has dependents’ allowances and only one amount is given, the maximum is the same with or
without the allowance.
UC Benefit Financing: Unemployment Taxes on Employers
UC benefits are financed through employer taxes.79 The federal taxes on employers are under the
authority of the Federal Unemployment Tax Act (FUTA), and the state taxes are under the
authority given by the State Unemployment Tax Acts (SUTA). These taxes are deposited in the
appropriate accounts within the Unemployment Trust Fund (UTF).
Federal Unemployment Tax Act
The net FUTA tax rate on employers in states with UC programs that are in compliance with all
federal rules is 0.6% on the first $7,000 of each worker’s earnings. The FUTA tax rate for
employers is 6.0% on the first $7,000 of each worker’s earnings, but a 5.4% credit against the
federal FUTA tax is available to employers in states with complying UC programs, bringing the
net FUTA tax down to 0.6%.810 The 0.6% FUTA tax funds both federal and state administrative
costs as well as the federal share of the EB program, loans to insolvent state UC accounts, and
state employment services. Federal law defines which jobs a state UC program must cover,
provides rules concerning state borrowing from the UTF, and provides broad guidelines
concerning benefit eligibility, in order for the state’s employers to avoid paying the maximum
FUTA tax rate (6.0%) on the first $7,000 of each employee’s annual pay. The U.S. DOL projects
that $5.3 billion in FUTA taxes were collected in FY2013.
Federal law requires that a state must cover jobs in firms that pay at least $1,500 in wages during
any calendar quarter or employ at least one worker in each of 20 weeks in the current or prior
year. The FUTA tax is not paid by government or nonprofit employers, but state programs must
cover government workers and all workers in nonprofits that employ at least four workers in each
of 20 weeks in the current or prior year.9
Approximately $6.6 billion in FUTA taxes were collected in FY2011. The “cash-on-hand”
balance in the federal accounts of the UTF (the Employment Security Administration Account,
the Extended Unemployment Compensation Account for the EB and EUC08 programs, and the
Federal Unemployment Account for federal loans to the states) on July 31, 2012, was
approximately $4.0 billion. Additionally, the federal account owed $38.0 billion in general
revenue advances to the UTF. Offsetting this debt, are the outstanding federal advances to
insolvent states to pay for state UC benefits ($26.0 billion).
711
Congress first passed a temporary FUTA surtax in 1976 and since 1983 the surtax had been
applied as 0.2% on the first $7,000 of employee wages for a net total FUTA tax rate of 0.8%. P.L.
111-92 was the last law to extend the authorization of the FUTA surtax (through June 2011).
Since July 1, 2011, the authorization of the 0.2% FUTA surtax has lapsed.
9
For a more detailed description of UC financing, see CRS Report RS22077, Unemployment Compensation (UC) and
the Unemployment Trust Fund (UTF): Funding UC Benefits, by Julie M. Whittaker.
810
In tax year 2011, 202012, 18 states and the Virgin Islands had a state tax credit reduction applied to the calculation of the
FUTA tax. This tax credit reduction ranged from 0.3%-0.91.5%. For more details, see CRS Report RS22954, The
Unemployment Trust Fund (UTF): State Insolvency and Federal Loans to States, by Julie M. Whittaker.
911
Employers who are required to provide unemployment insurance coverage, but who are not required to pay the FUTA
FUTA tax, generally reimburse state governments for the benefit payments related to their workers. States are
reimbursed for
expenditures related to federal workers by the federal government.
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Congress first passed a temporary FUTA surtax in 1976 and since 1983 the surtax has been
applied in its current form (0.2% on the first $7,000 of employee wages for a net total FUTA tax
rate of 0.8%). Most recently, P.L. 111-92 extended the authorization of the FUTA surtax through
June 2011. Since July 1, 2011, the authorization of the 0.2% surtax has lapsed.
ARRA Temporary Changes to Federal Financing of Unemployment Benefits
ARRA (P.L. 111-5) made several important, albeit temporary, changes to the federal role in
financing unemployment benefit programs. Under ARRA (as amended), the federal government
temporarily uses UTF monies to finance 100% of EB payments through December 31, 20122013
(under permanent law EB payments are financed 50% by the federal government and 50% by
states). The federal government also used UTF funds to finance a $500 million transfer to states
for administering unemployment programs, and used UTF funds for the $7 billion in incentive
monies to states for undertaking modernization of their unemployment programs. ARRA also
changed the financing of the EUC08 program, which from its implementation in July 2008 had
been financed from the UTF, but starting with enactment of ARRA (on February 17, 2009) has
been financed from general revenues of the Treasury. States continue to finance regular UC
through SUTA revenues.1012
State Unemployment Tax Acts
States levy their own payroll taxes (SUTA taxes) on employers to fund regular UC benefits and
the state share of the EB program. The state unemployment tax rate on an employer is
“experience rated” in all states, that is, the SUTA rate is based on the amount of UC paid to
former employees. Generally, the more UC benefits paid to its former employees, the higher the
tax rate of the employer, up to a maximum established by state law. The experience rating is
intended to ensure an equitable distribution of UC program taxes among employers in
relationship to their use of the UC program, and to encourage a stable workforce. State ceilings
on taxable wages in July 20122013 ranged from the $7,000 FUTA federal ceiling (three states) to
$3839,800 (HawaiiWashington state). The minimum SUTA rates ranged from 0.00% (five states) to 2.6880%
(Pennsylvania) in July 20122013. Maximum SUTA rates ranged from 5.4% (eightnine states) to 13.50%
(Maryland12.27%
(Massachusetts) in July 20122013. A projected $50.5 billion in SUTA taxes will be collected in FY2012
FY2014.
State UC revenue is deposited in the U.S. Treasury. These deposits are counted as federal revenue
in the budget. State accounts within the UTF are credited for this revenue. The U.S. Treasury
reimburses states from the appropriate UTF state accounts for their benefit payments. These
payments do not require an annual appropriation, but the reimbursements do count as federal
budget outlays.
10
Table 2. State Unemployment Taxes: Taxable Wage Base and Rates, July 2013
State
2013 Wages Subject
to Tax ($)
Alabama
2013 Minimum State
Unemployment Tax (%)a
2013 Maximum State
Unemployment Tax (%)a
8,000
0.59
6.74
Alaska
36,900
1.54
5.40
Arizona
7,000
0.02
6.67
Arkansas
12,000
0.10
6.00
12
For details on changes to UI programs under ARRA (P.L. 111-5) beyond these financing provisions, see CRS Report
R40368, Unemployment Insurance Provisions in the American Recovery and Reinvestment Act of 2009, by Alison M.
Shelton and Julie M. Julie M.
Whittaker.
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Unemployment Insurance: Programs and Benefits
Table 2. State Unemployment Taxes: Taxable Wage Base and Rates, July 2012
State
2012State
2013 Wages Subject
to Tax ($)
Alabama
20122013 Minimum State
Unemployment Tax (%)a
20122013 Maximum State
Unemployment Tax (%)a
8,000
0.59
6.74
Alaska
35,800
1.31
5.40
Arizona
7,000
0.02
6.38
Arkansas
12,000
1.20
7.10
California
7,000
1.50
6.20
Colorado
11,000
1.00
11.02300
0.66
8.90
Connecticut
15,000
1.90
6.80
Delaware
10,500
0.3010
8.2000
DC
9,000
1.60
7.00
Florida
8,000
1.5102
5.40
Georgia
8,500
0.04
8.10
Hawaii
38,800
1.20
59,500
0.02
5.40
Hawaii
39,600
1.80
6.40
Idaho
34,100800
0.9678
6.80
Illinois
13,56012,900
0.55
9.458.95
Indiana
9,500
0.50
7.40
25,300
0.00
9.0053
7.90
26,000
0.00
8.50
Kansas
8,000
0.11
9.40
Kentucky
9,000300
1.00
10.00
Louisiana
7,700
0.10
6.20
12,000
0.8889
8.1021
8,500
2.20
131.00
10.50
14,000
1.26
12.27
9,500
0.06
11.0510.30
Minnesota
2829,000
0.67367
10.8781
Mississippi
14,000
0.9545
5.40
Missouri
13,000
0.00
9.75
Montana
27,000900
0.8262
6.12
Nebraska
9,000
0.00
6.495.40
Nevada
26,400900
0.25
5.40
New Hampshire
14,000
2.60
7.00
New Jersey
30,300
0.60
6.40900
1.20
7.00
New Mexico
22,400900
0.0510
5.40
8,500
0.90
8.90
North Carolina
20,400900
0.2400
6.84
North Dakota
27,900
0.20
9.9131,800
0.17
9.78
9,000
0.30
8.40
Oklahoma
20,100
0.30
9.20
Oregon
34,100
2.20
5.40
Pennsylvania
8,500
2.80
10.89
Puerto Rico
7,000
2.40
5.40
Iowa
Maine
Maryland
Massachusetts
Michigan
New York
Ohio
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20122013 Wages Subject
to Tax ($)
State
Ohio
20122013 Minimum State
Unemployment Tax (%)a
2012 Maximum State
Unemployment Tax (%)a
9,000
0.70
9.10
Oklahoma
19,100
0.30
9.20
Oregon
33,000
2.20
5.40
Pennsylvania
8,000
2.43
10.58
Puerto Rico
7,000
2.40
5.40
19,600b
2.20
10.3020,200b
1.69
9.79
South Carolina
12,000
0.098
8.68609
7.85
South Dakota
1213,000
0.00
9.50
Tennessee
9,000
0.5040
10.00
Texas
9,000
0.6154
7.5835
Utah
29,50030,300
0.40
7.40
Vermont
16,000
1.30
8.40
8,000
0.8368
6.9378
Virgin Islands
23,700
0600
1.50
6.00
Washington
38,200
0.1439,800
0.17
5.84
West Virginia
12,000
1.50
87.50
Wisconsin
1314,000
0.27
9.80
Wyoming
23,000800
0.6563
10.00
State
Rhode Island
Virginia
2013 Maximum State
Unemployment Tax (%)a
Source: CRS table compiled from Significant Provisions of State Unemployment Insurance Laws, July 20122013, U.S.
Department of Labor, Employment and Training Administration, at http://owswww.workforcesecurity.doleta.gov/
unemploy/content/
sigpros/2010-2019/July2012July2013.pdf.
a.
Tax rates apply only to experience-rated employers; states apply different rates to new employers. These
rates reflect tax year 2012, which in some states ends on June 30, 2013.
b.
Or $21,100700 for high tax group employers.
Generally, during economic expansions, FUTA and SUTA revenue collections will exceed UC
outlays. During economic recessions, revenues generally will be less than UC outlays. For
example, UTF outlays significantly exceeded trust fund revenue in FY2001-FY2004, and again
starting in FY2008. From FY2005 to FY2007, UC revenue exceeded total UC outlays. Table 3
lists the total revenue and outlays associated with the UC program from FY2001 through FY2012FY2013
(estimated).
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Table 3. Revenue and Expenditures Associated with
Unemployment Compensation, FY2001-FY2012FY2013
(in billions of dollars)
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012a2012
2013a
27.8
27.5
33.2
39.3
41.8
43.0
41.20
39.4
37.8
44.7
55.9
55.164.7
56.0
Federal Unemployment
Tax (FUTA)
6.9
6.6
6.5
6.6
6.7
7.1
7.3
6.4
6.6
State Unemployment
20.8
20.9
26.7
32.7
35.1
35.9
33.7
38.3
49.3
UC revenue, total
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7.2
32.2
6.7
31.1
5.2
50.1
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Unemployment Insurance: Programs and Benefits
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012a7.2
6.7
6.4
6.6
5.4
5.3
State Unemployment
Taxes (SUTA)
20.8
20.9
26.7
32.7
35.1
35.9
33.7
32.2
31.1
38.3
49.3
59.3
50.7
28.1
50.9
54.3
42.5
32.6
31.75
32.7
43.0
119.7
156.3
116.8
91.2
Regular benefits (UC)90.4
68.0
27.3
42.0
42.0
36.9
31.2
30.2
31.4
38.1
75.3
63.0
48.5
44.3
Extended benefits (EB)40.9
b
0.16
0.32
0.16
b
0.20
b02
0.02
0.02
4.1
8.0
11.9
4.6
72.1
52.7
Taxes (SUTA)
UC outlays, total9
0.12
Emergency
Unemployment
Compensation
(EUC08)
—
7.9
11
4.1
—
—
—
3.6
32.7
72.1
52.7
39.6
25.7
Federal Additional
Compensation (FAC)
—
—
—
—
—
—
—
—
6.5
11.7
1.9
0.0
0.0
UCFE/UCXc
0.5
0.5
0.6
0.8
0.8
0.8
0.7
0.7
1.0
1.3
1.6
1.4
1.1
Trade Benefits
0.3
0.3
0.4
0.5
0.6
0.5
0.6
0.6
0.1
0.2
0.2
0.32
0.2
3.6
3.7
4.1
3.9
3.8
3.9
3.7
3.9
4.3
5.5
5.0
5.2
Administrative costs
3.6
32.7
40.94.9
4.7
UC revenue, total
UC outlays, total
Regular benefits (UC)
Extended benefits (EB)
Administrative costs
Source: U.S. Department of Labor, UI Outlook, January 2001-July 20122013, and updates.
a.
Estimated for FY2012FY2013.
b.
Less than $5 million.
c.
UC benefits for federal employees (UCFE) and former military servicemembers (UCX).
Outstanding Loans from the Federal Unemployment Account
If a state trust fund account becomes insolvent, a state may borrow federal funds.1113 DOL
maintains a list of all states with loans and includes the loan amounts.1214 States are charged interest
on loans that are not repaid by the end of the fiscal year in which they were obtained.
The American Recovery and Reinvestment Act of 2009 (P.L. 111-5, the 2009 stimulus package)
temporarily waived interest payments, and no interest will accrue on interest payments that come
due from the time the stimulus package was enacted (February 17, 2009) until December 31,
2010. Although states did pay interest during this period, they were still required to repay the
principal on the underlying loans according to the schedule provided in federal law. If a state does
not pay back loaned funds within the prescribed amount of time or make good progress as
determined by the U.S. Secretary of Labor, the state unemployment tax credit will be reduced.
13
For detailed information on loans to the states within the UTF, see CRS Report RS22954, The Unemployment Trust
Fund (UTF): State Insolvency and Federal Loans to States, by Julie M. Whittaker.
14
See http://www.workforcesecurity.doleta.gov/unemploy/budget.asp#tfloans.
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Federal Additional Compensation
P.L. 111-5 created the now-expired Federal Additional Compensation (FAC), a $25 weekly
benefit supplement for individuals receiving benefits from all unemployment compensation
programs: UC, EUC08, EB, Disaster Unemployment Assistance (DUA), and Trade Adjustment
Assistance (TAA). The authorization for the FAC $25 weekly benefit expired on May 29, 2010. It
11
For detailed information on loans to the states within the UTF, see CRS Report RS22954, The Unemployment Trust
Fund (UTF): State Insolvency and Federal Loans to States, by Julie M. Whittaker.
12
See http://www.workforcesecurity.doleta.gov/unemploy/budget.asp#tfloans.
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has not been extended by subsequent unemployment insurance legislation (P.L. 111-205; P.L.
111-312; P.L. 112-78; or P.L. 112-96).
If an unemployed individual was receiving any type of unemployment benefit—UC, EUC08, EB,
DUA, or TAA—from February 22, 2009 (February 23, 2009, for New York) until May 29, 2010
(May 30, 2010, for New York), that individual continued to receive the weekly FAC until he or
she exhausted all unemployment benefits from all unemployment programs (i.e., UC, EUC08,
EB, DUA, and TAA) or until December 11, 2010 (December 12, 2010, for New York), whichever
date came first. Individuals who began receiving unemployment benefits after May 29, 2010
(May 30, 2010, for New York) did not receive the FAC. All FAC payments have ended.
Emergency Unemployment
Compensation Program13Program15
On June 30, 2008, the President signed the Supplemental Appropriations Act of 2008 (P.L. 110252) into law. Title IV of this act created a new temporary unemployment insurance program, the
EUC08 program. This is the eighth time Congress created a federal temporary program that
extended unemployment compensation during an economic slowdown. Until February 16, 2009,
the EUC08 program was financed with funds within the UTF. However, with the passage of P.L.
111-5, the EUC08 benefit is now 100% federally funded from general funds within the U.S.
Treasury. State UC agencies administer the EUC08 benefit along with regular UC benefits.
On November 21, 2008, the President signed P.L. 110-449, the Unemployment Compensation
Extension Act of 2008, into law. P.L. 110-449 expanded the potential duration of the EUC08
benefit from up to 13 weeks of EUC08 to a maximum of 20 weeks. It also created a second tier of
benefits for workers in states with high unemployment of up to a maximum of an additional 13
weeks of tier II EUC08 benefits (for up to a cumulative 33 weeks of EUC08 benefits).
On February 27, 2009, the President signed the 2009 stimulus package, P.L. 111-5, known as the
American Economic Recovery and Reinvestment Act, or ARRA. ARRA authorized the EUC08
program through December 2009. The 2009 stimulus package also contained temporary
provisions for 100% federal financing of the EB program and to create an additional $25 weekly
benefit for those receiving regular UC, EUC08, EB, DUA, or TAA. EUC08 benefits had been
financed from the EUCA in the UTF. Since the enactment of the 2009 stimulus package EUC08
benefits have been financed from general revenues.
15
For an expanded version of this section, see CRS Report R42444, Emergency Unemployment Compensation
(EUC08): Current Status of Benefits, by Julie M. Whittaker and Katelin P. Isaacs.
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Unemployment Insurance: Programs and Benefits
On November 6, 2009, the President signed P.L. 111-92, the Worker, Homeownership, and
Business Assistance Act of 2009, into law. P.L. 111-92 expanded benefits available in the EUC08
program. Tier I benefits increased up to 20 weeks in duration and tier II benefits increased to 14
weeks in duration (compared with 13 previously) and were no longer are dependent on a state’s
unemployment rate. The new tier III benefit provided up to 13 weeks of EUC08 benefits to those
workers in states with an average unemployment rate of 6% or higher. The new tier IV benefit
provided up to an additional six weeks of benefits if the state unemployment rate is at least 8.5%.
13
For an expanded version of this section, see CRS Report R42444, Emergency Unemployment Compensation
(EUC08): Current Status of Benefits, by Julie M. Whittaker and Katelin P. Isaacs.
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Unemployment Insurance: Programs and Benefits
On December 21, 2009, the President signed P.L. 111-118, the Department of Defense
Appropriations Act of 2010, into law. P.L. 111-118 extended the EUC08 program through
February 28, 2010.
On March 2, 2010, the President signed P.L. 111-144, the Temporary Extension Act, which
extended the EUC08 program until April 5, 2010.
On April 15, 2010, the President signed P.L. 111-157, the Continuing Extension Act of 2010 into
law. P.L. 111-157 extended the availability of EUC08 until the week ending on or before June 2,
2010.
On July 22, 2010, the President signed P.L. 111-205, the Unemployment Compensation Extension
Act of 2010, into law. P.L. 111-205 extended the availability of EUC08 until the week ending on
or before November 30, 2010.
On December, 17, 2010, the President signed P.L. 111-312, the Tax Relief, Unemployment
Insurance Reauthorization, and Job Creation Act of 2010. P.L. 111-312 extended the authorization
of the EUC08 program until the week ending on or before January 3, 2012.
On December 23, 2011, the President signed P.L. 112-78, the Temporary Payroll Tax Cut
Continuation Act of 2011. P.L. 112-78 extended the authorization for the EUC08 program until
the week ending on or before March 6, 2012.
TheOn February 22, 2012, the President signed P.L. 112-96, the Middle Class Tax Relief and Job
Creation Act of 2012, on
February 22, 2012. P.L. 112-96 authorizesauthorized EUC08 benefits until the week ending on or before
January 2, 2013. P.L. 112-96 also made changes to the structure of the EUC08 program, including
the duration and availability of EUC08 tiers dependent on the calendar date. As of the week
beginning September 2, 2012, Tier I provides no more than 14 weeks of EUC08 benefits. Tier II
continues to provide up to14 weeks and has required an average unemployment rate of at least
6% since the second phase of the law was implemented in June 2012. Tier III provides no more
than 9 weeks of EUC08 benefits (and since the June 2012, requires an unemployment rate of at
least 7%). Tier IV provides up to a total of 10 weeks of benefits if the state unemployment rate is
at least 9%. Therefore, EUC08 benefits are currently available through December 29, 2012
(December 30, 2012 for New York) and may provide up to 47 additional weeks of unemployment
benefits in states with very high unemploymentThose changes are
explained in detail in CRS Report R42444, Emergency Unemployment Compensation (EUC08):
Current Status of Benefits, by Julie M. Whittaker and Katelin P. Isaacs.
On January 2, 2013, the President signed P.L. 112-240, the American Taxpayer Relief Act of
2012. P.L. 112-240 authorizes EUC08 benefits until the week ending on or before January 1,
2014. Thus, the EUC08 program is authorized in all states until December 28, 2013 (December
29, 2013, for New York).
See Appendix B for a summary of public laws, benefits, effective dates, and financing issues
related to the EUC08 program.
Previous Temporary Unemployment Compensation Extensions
Previously, Congress acted seven times—in 1958, 1961, 1971, 1974, 1982, 1991, and 2002—to
establish similar temporary programs of extended UC benefits. These programs extended the
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Unemployment Insurance: Programs and Benefits
period an individual might claim UC benefits (ranging from an additional 6 to 33 weeks) and had
expiration dates.1416 Some extensions took into account state economic conditions; many temporary
14
For more information on these programs, see CRS Report RL34340, Extending Unemployment Compensation
Benefits During Recessions, by Julie M. Whittaker and Katelin P. Isaacs.
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Unemployment Insurance: Programs and Benefits
programs considered the state’s total unemployment rate (TUR) or the state’s insured
unemployment rate (IUR) or both.
EUC08 Benefit Amounts, Tiers, and Duration
The amount of the EUC08 benefit is the equivalent of the eligible individual’s weekly regular UC
benefit and includes any applicable dependents’ allowances. Since the creation of the EUC08
program in June 2008, Congress has made several changes to the structure of the EUC08
program. These structural changes have consequences for the availability of EUC08 tiers and
benefits in states.
See Appendix AFigure A-1 for the flow of available unemployment insurance benefits—including EUC08
(plus, UC and EB)—during the two most recent periods: November 8, 2009-February 18, 2012
(Figure A-1) and February 19, 2012-December 29, 2012 (Figure A-2).15
EUC08 Benefit Availability Prior to P.L. 112-96
Between the initial authorization of the EUC08 program (P.L. 110-252) and the enactment of P.L.
112-96, EUC08 benefit availability varied across three time periods:
•
July 6, 2008-November 22, 2008: 13 weeks of benefits available in all states.
•
November 23, 2008-November 7, 2009:
•
•
Tier I: 20 weeks of benefits available in all states.
•
Tier II: 13 weeks of benefits available in states with an average total
unemployment rate (TUR) of 6% or higher or in states with an average
insured unemployment rate (IUR) of 4% or higher.16
November 8, 2009-February 18, 2012:
•
Tier I: 20 weeks of benefits available in all states.
•
Tier II: 14 weeks of benefits available in all states.
•
Tier III: 13 weeks of benefits available in states with an TUR of 6% or
higher or in states with an IUR of 4% or higher.
15
.17
Current EUC08 Benefit Availability
The EUC08 program has been amended eleven times, most recently by P.L. 112-240.18 The
EUC08 benefit amount is equal to the eligible individual’s weekly regular UC benefits and
includes any applicable dependents’ allowances. The most recent modifications to the underlying
structure of the EUC08 program were made by P.L. 112-96. These modifications included
changes to the number of weeks available in each EUC08 tier as well as the state unemployment
rates required to have an active tier in that state. These requirements were implemented during
2012 in three separate phases.19 Currently the following weeks of benefits are available in the
tiers listed below: See Figure A-2 for a diagram of EUC08 benefits available from 2008 to the
present.
•
Tier I is available in all states, with up to 14 weeks of EUC08 benefits provided
to eligible individuals.
•
Tier II is available if the state’s total unemployment rate (TUR)20 is at least 6%,
with up to 14 weeks provided to eligible individuals in those states.
16
For more information on these programs, see CRS Report RL34340, Extending Unemployment Compensation
Benefits During Recessions, by Julie M. Whittaker and Katelin P. Isaacs.
17
Calendar dates provided in this section refer to all states except New York. New York defines a benefit week
differently than all other states. In New York, a benefit week is a period from Monday through Sunday rather than
Sunday through Saturday, as in all other states. Therefore, all effective dates for New York are one day later than the
dates listed.
16
The TUR is the ratio of unemployed workers to all workers (employed and unemployed) in the labor market. The
TUR is essentially a weekly version of the unemployment rate published by the Bureau of Labor Statistics (BLS) and
based on data from the BLS’ monthly Current Population Survey. The IUR is the ratio of UC claimants divided by
individuals in UC-covered jobs. The IUR is substantially different than the TUR because it excludes several important
groups: self-employed workers, unpaid family workers, workers in certain not-for-profit organizations, and several
other, primarily seasonal, categories of workers. In addition to those unemployed workers whose last jobs were in the
excluded employment, the insured unemployed rate excludes the following: those who have exhausted their UC
benefits (even if they receive EB or EUC08 benefits); new entrants or reentrants to the labor force; disqualified workers
whose unemployment is considered to have resulted from their own actions rather than from economic conditions; and,
eligible unemployed persons who do not file for benefits.
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•
Tier IV: 6 weeks of benefits available in states with an TUR of 8.5% or
higher or in states with an IUR of at least 6%.
Previous “Grandfathering” of EUC08 Benefits
Prior to the enactment of P.L. 112-96, EUC08 benefits were “grandfathered.” That is, eligible,
unemployed individuals who qualified for a tier I, II, III, or IV EUC08 benefit prior to the
program expiration date were permitted to finish out any remaining weeks of EUC08 eligibility
for only the specific tier they had entered before program expiration. These individuals continued
to receive payments for the number of weeks they were deemed eligible until a last payable date
specified under each EUC08 authorization extension law. The last law to authorize the
grandfathering of EUC08 benefits was P.L. 112-78. Thus, the grandfathering of EUC08 benefits
ended February 18, 2012 (February 19, 2012 in New York).
Current EUC08 Benefit Availability
Under P.L. 112-96, the potential duration of EUC08 benefits available to eligible individuals
depends on state unemployment rates as well as the calendar date:
•
Tier I is available in all states, up to 20 weeks until September 1, 2012, when the
maximum number of weeks of available benefits decreases to 14 weeks.
•
Tier II is available in all states, up to 14 weeks until May 26, 2012. Beginning
May 27, 2012, the state’s TUR must be at least 6% to have tier II benefits
available in the state.
•
Tier III is available in states with a TUR of at least 6% (or an IUR of at least
4%) for up to 13 weeks until May 29, 2012. Beginning May 27, 2012, the state’s
TUR must to be at least 7% (or IUR of at least 4%) to have tier III benefits
available in the state. Beginning September 2, 2012, the maximum number of
weeks of UI benefits available in tier III decreases from 13 to 9 weeks.
•
Tier IV is available in states with an active EB program and a TUR of at least
8.5% or an IUR of at least 5% until May 26, 2012, for up to 6 weeks. However,
in states that do not have an active EB program and have a TUR of at least 8.5%
(or an IUR of at least 5%), the maximum potential duration is up to 16 weeks.
The 16-week provision for states without an active EB program terminates in
June 2012.
•
Beginning May 27, 2012, tier IV benefits are available in a state if that the
state’s TUR is at least 9% (rather than 8.5%) or the IUR is 5% (unchanged).
Thus, for all states meeting the unemployment rate criteria, the maximum
potential duration is up to 6 weeks.
•
Beginning September 2, 2012, the maximum potential duration of tier IV
increases to 10 weeks18
The eleven amendments are P.L. 110-449, P.L. 111-5, P.L. 111-92, P.L. 111-118, P.L. 111-144, P.L. 111-157, P.L.
111-205, P.L. 111-312, P.L. 112-78, P.L. 112-96, and P.L. 112-240. Summary details on all of these laws are provided
in Table 1 of CRS Report R42444, Emergency Unemployment Compensation (EUC08): Current Status of Benefits, by
Julie M. Whittaker and Katelin P. Isaacs.
19
See CRS Report R42444, Emergency Unemployment Compensation (EUC08): Current Status of Benefits, by Julie
M. Whittaker and Katelin P. Isaacs for details on how these changes were implemented.
20
The TUR is the ratio of unemployed workers to all workers (employed and unemployed) in the labor market. The
TUR is essentially a weekly version of the unemployment rate published by the Bureau of Labor Statistics (BLS) and
based on data from the BLS’ monthly Current Population Survey.
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•
Tier III is available if the state’s TUR is at least 7% (or an insured
unemployment rate, IUR,21 of at least 4%), with up to 9 weeks of provided to
eligible individuals in those states.
•
Tier IV is if the state’s TUR is at least 9% or the IUR is 5%, with up to 10 weeks
provided to eligible individuals in those states.
Current EUC08 Program Expiration
All tiers of EUC08 benefits are temporary and expire in the week ending on or before January 2,
20131,
2014. Thus, on December 29, 201228, 2013 (December 30, 201229, 2013, for New York), the EUC08 program
ends. There is no grandfathering of any EUC08 benefit after that date.
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Current “Grandfathering” of EUC08 Benefits if Number of Weeks Available in
Tier Subsequently Increases (or Decreases)
Individuals are grandfathered into the available weeks of a particular EUC08 tier at the date of
entrance into that new tier even if the number of weeks available in that tier increases or
decreases after that calendar date.
For example, individuals who enter tier IV after February 22, 2012, and are originally eligible for
6 weeks of tier IV benefits (because the state has an active EB program at that time) do not
retroactively become eligible for 16 weeks of benefits if the state’s EB program becomes inactive.
Similarly, if an individual exhausts tier III benefits in August 2012 (or earlier) and enters into tier
IV with a maximum potential entitlement of 6 weeks, that individual will not be eligible for an
additional 4 weeks of benefits from tier IV of EUC08 beginning on September 2, 2012.17
“grandfathering” of any EUC08 benefit after that date.
EUC08 Eligibility Requirements Beyond Requirements for
Regular UC
First Claimed Regular UC Benefits On or After May 7, 2006
Applicants must have been eligible for regular UC benefits and have exhausted their rights to
regular UC compensation with respect to a benefit year that expired during or after the week of
May 6, 2007.1822 For most states, this would apply to individuals who had filed UC claims with an
effective date of May 7, 2006, or later. For the state of New York this would apply to original
claims filed with an effective date of May 1, 2006, or later.1923
Exhausted Regular UC Benefit
The right to regular UC benefits for an individual must be exhausted to be eligible for EUC08
benefits. Although federal laws and regulations provide broad guidelines on regular UC benefit
coverage and eligibility determination, the specifics of regular UC benefits are determined by
each state. As noted earlier, this results in 53 different programs.2024 In particular, states determine
UC benefit eligibility, amount, and duration through state laws and program regulations.21
17
For additional special considerations regarding the maximum potential weeks of EUC08 benefits available, see CRS
Report R42444, Emergency Unemployment Compensation (EUC08): Current Status of Benefits, by Julie M. Whittaker
and Katelin P. Isaacs.
1825
21
The IUR is the ratio of UC claimants divided by individuals in UC-covered jobs. The IUR is substantially different
from the TUR because it excludes several important groups: self-employed workers, unpaid family workers, workers in
certain not-for-profit organizations, and several other, primarily seasonal, categories of workers. In addition to those
unemployed workers whose last jobs were in the excluded employment, the insured unemployed rate excludes the
following: those who have exhausted their UC benefits (even if they receive EB or EUC08 benefits); new entrants or
reentrants to the labor force; disqualified workers whose unemployment is considered to have resulted from their own
actions rather than from economic conditions; and eligible unemployed persons who do not file for benefits.
22
Arkansas has a unique approach to calculating a benefit year. In Arkansas, the benefit year begins the first day of the
quarter in which an individual files a valid UC claim. Thus, it is unlikely that many individuals in Arkansas who filed
UC claims before July 2006 would be eligible to receive EUC08 benefits.
1923
Note that the effective date is not necessarily the actual date when an individual filed for UC. A claim filed on May
10, 2006, may have had an earlier effective date if a state allows retroactive claims.
2024
The 50 states, the District of Columbia, Puerto Rico, and the Virgin Islands provide UC benefits to their workers.
2125
Individuals in the Massachusetts and Montana UC programs may have regular UC durations that exceed 26 weeks.
Those additional weeks are considered to be “sharable” compensation if the state is in an active EB period and these
weeks are paid as if they were EB payments during those periods. The additional weeks of regular UC beyond 26 are
not used to calculate EUC08 duration.
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“20 Weeks” of Full-Time Insured Employment or Equivalent
In addition to all state requirements for regular UC eligibility, the EUC08 program requires
claimants to have at least 20 weeks of full-time insured employment or the equivalent in insured
wages in their base period. The definition of “20 weeks” is discussed in the “Methods for
Determining 20 Weeks of Full-Time Insured Employment” section of this report.
Reemployment and Eligibility Assessments (REAs)
P.L. 112-96 amended EUC08 law to require states to provide reemployment and eligibility
assessments to most EUC08 claimants. EUC08 claimants must participate in reemployment
services if referred. States receive $85 in federal funding per EUC08 claimant who receives
reemployment and eligibility assessments.
EUC08 Financing
Until February 16, 2009, the EUC08 program was federally financed from the extended
unemployment compensation account (EUCA) within the Unemployment Trust Fund (UTF).
With the passage of the 2009 stimulus package (P.L. 111-5), however, EUC08 is now financed
from general funds of the U.S. Treasury through the expiration of the EUC08 program. States do
not need to repay these funds.
Interaction of EUC08 Benefits and Qualifying for a
“Second Benefit Year”
The relationships between the various unemployment compensation programs currently
available—regular UC, EUC08, and EB—have meant that unemployed workers who participate
in additional paid work (while receiving benefits or temporarily stopping benefits) may create a
new entitlement to regular UC as part of a “second benefit year.” This new entitlement may be
based on significantly lower earnings and/or fewer hours of employment, which could then lower
an individual’s weekly unemployment benefits.
This situation exists because (1) the EUC08 and EB laws require individuals to exhaust all
regular UC benefits prior to being eligible to receive EUC08 or EB benefits and (2) after 52
weeks (i.e., after an individual’s first benefit year) states are required to begin checking for any
additional work performed by beneficiaries that would make them eligible for additional state UC
benefits before any additional EUC08 or EB benefits would be paid.
Because some eligible individuals in many states may have been entitled to more than 52 weeks
of UI benefits, states are required by federal law to identify individuals who established a new
entitlement to regular UC benefits via additional qualifying employment (even if the work was
part-time, seasonal, or low-pay and did not result in permanent employment). This potential new
entitlement means that states must shift back eligible individuals to regular UC (beginning a
second benefit year) from EUC08 and EB. The amount of the new regular UC benefits may be
significantly lower than the individual’s (first benefit year) EUC08 and EB benefits.
P.L. 111-205 addressed this “second year benefit” issue for the EUC08 program. It did not
address the equivalent issue in the EB program. Effective July 22, 2010, individuals who
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currently receive EUC08 or EB benefits, but have been determined by states to be eligible for a
second benefit year based on additional work are allowed to opt to continue in the EUC08
program if their weekly unemployment benefits would be reduced by at least $100 or 25% by
switching back to the regular UC program based on their additional employment. Only
beneficiaries who are determined by their state to have a second benefit year after the date of
enactment are allowed this option. Those beneficiaries who were determined by their state prior
to July 22, 2010, to have a second benefit year entitlement do not have this option.
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EUC08 and EB Interactions
The EUC08 program should not be confused with the similarly named EB program (see
description below). The EUC08 program is temporary and the availability of each EUC08 tier
depends on state unemployment rate and calendar date. The EB program is permanently
authorized and applies only to certain states on the basis of state unemployment conditions
specified in law.
Prior to the enactment of P.L. 112-96, states were permitted to determine which benefit, EB or
EUC08, was paid first. Alaska was the only state to pay EB first when this option was available.
P.L. 112-96 now requires that states pay EUC08 benefits before EB benefits.
The activation or deactivation of a particular tier of EUC08 follows the same rules as found in the
EB program. See the section titled “How an Extended Benefit Period isIs Activated (and
Deactivated)” for details.
Extended Benefit Program
The EB program was established by the Federal-State Extended Unemployment Compensation
Act of 1970 (EUCA), P.L. 91-373 (26 U.S.C. 3304, note). EUCA may extend receipt of
unemployment benefits (extended benefits) at the state level if certain economic situations exist
within the state.
The EB program is triggered when a state’s IUR or TUR reaches certain levels. All states must
pay up to 13 weeks of EB if the IUR for the previous 13 weeks is at least 5% and is 120% of the
average of the rates for the same 13-week period in each of the two previous years. There are two
other optional thresholds that states may choose. (States may choose one, two, or none.) If the
state has chosen a given option, they would provide the following:
•
Option 1: an additional 13 weeks of benefits if the state’s IUR is at least 6%,
regardless of previous years’ averages.
•
Option 2: an additional 13 weeks of benefits if the state’s TUR is at least 6.5%
and is at least 110% of the state’s average TUR for the same 13 weeks in either of
the previous two years; an additional 20 weeks of benefits if the TUR is at least
8% and is at least 110% of the state’s average TUR for the same 13 weeks in
either of the previous two years.
Each state’s IUR and TUR are determined by the state of residence (agent state) of the
unemployed worker rather than by the state of employment (liable state). EB benefits are not
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“grandfathered” when a state triggers “off” the program. When a state triggers “off” of an EB
period, all EB benefit payments in the state cease immediately regardless of individual
entitlement.22
22
EB benefits on interstate claims are limited to two extra weeks unless both the agent state (e.g., Texas) and liable
state (e.g., Louisiana) are in an EB period.
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Temporary EB Trigger Modifications in P.L. 111-312
P.L. 111-312 made some technical changes to certain triggers in the EB program. P.L. 111-312, as
amended, allows states to temporarily use lookback calculations based on three years of
unemployment rate data (rather than the permanent-law lookback of two years of data) as part of
their mandatory IUR and optional TUR triggers if states would otherwise trigger off or not be on
a period of EB benefits. Using a two-year vs. a three-year EB trigger lookback is an important
adjustment because some states are likely to trigger off of their EB periods in the near future
despite high, sustained—but not increasing—unemployment rates.
States implement the lookback changes individually by amending their state UC laws. These state
law changes must be written in such a way that if the two-year lookback is working and the state
would have an active EB program, no action would be taken. But if a two-year lookback is not
working as part of an EB trigger and the state is not triggered on to an EB period, then the state
would be able to use a three-year lookback. This temporary option to use three-year EB trigger
lookbacks expires the week on or before December 31, 20122013.
How an Extended Benefit Period isIs Activated (and Deactivated)
The timing of when an EB period is activated depends on whether the trigger is based on the
state’s IUR or TUR.
•
If EB is activated based upon the IUR (triggers “on”), the EB period is
immediately in effect. Few states trigger on to EB using an IUR based measure.
•
If EB is activated based upon the TUR, the activation is subject to a different
requirement. By law, a state triggering on to an EB period based upon a TUR
based trigger will begin to offer those benefits on the third week after the first
week for which there is a state “on” indicator.2327
The analogous rules apply for deactivating an EB period.
•
If an EB period is deactivated based upon the state failing to meet IUR based
trigger requirements (triggers “off”), the EB period is immediately ended.
•
If an EB period triggers off based upon a state failing to meet TUR based trigger
requirements, the EB period will end on the third week after the first week for
which there is a state “off” indicator.24
Special Rule
By federal law, no EB period shall last for a period of less than 13 consecutive weeks, and no EB
period may begin before the 14th week after the close of a prior EB period with respect to such
state.25
23
28
26
EB benefits on interstate claims are limited to two extra weeks unless both the agent state (e.g., Texas) and liable
state (e.g., Louisiana) are in an EB period.
27
Section 203(a)(1) of P.L. 91-373, as amended.
28
Section 203(a)(2) of P.L. 91-373, as amended.
25
Section 203(b) of P.L. 91-373, as amended
24
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Special Rule
By federal law, no EB period shall last for a period of less than 13 consecutive weeks, and no EB
period may begin before the 14th week after the close of a prior EB period with respect to such
state.29
The Department of Labor produces trigger notices indicating which states qualify for both EB and
EUC08 benefits and provides the beginning and ending dates of payable periods for each
qualifying state. The trigger notices covering state eligibility for these programs can be found at
http://ows.doleta.gov/unemploy/claims_arch.asp. The IUR statistics change weekly, as they are
based upon weekly programmatic data. The TUR statistics change monthly, as they are based
upon monthly Local Area Unemployment Statistics (LAUS) data.2630
EB Eligibility Requirements Beyond Requirements for Regular UC
The EB program imposes additional federal restrictions on individual eligibility for benefits
beyond the state requirements for regular UC. The EB program requires that a worker make a
“systematic and sustained” work search. Furthermore, the worker may not receive benefits if he
or she refused an offer of “suitable” work, which is defined as “any work within such individual’s
capabilities”. In addition, P.L. 97-35, among other items, amended the EUCA to require that
claimants work at least 20 weeks of full-time insured employment or equivalent in insured wages
during their base period.
The 2009 stimulus package affects a further requirement for EB eligibility. As the EB program
has operated in the past, a beneficiary had to be within his or her original “benefit year”2731 when
the EB program triggered “on” in their state in order to receive EB benefits. Thus, on the
condition that the state triggered “on” during an individual’s benefit year, he or she could receive
EB benefits during the benefit year, or even after the benefit year expired, that is, at the time he or
she exhausted regular unemployment compensation or EUC08 benefits even if this occurred after
the expiration of the benefit year. However, if the state’s most recent EB period triggered on after
the individual’s benefit year ended, the beneficiary would not receive EB. As a result, in states
that have recently triggered “on” to EB because of rising unemployment rates, many individuals
may be ineligible for EB benefits. For example, if an individual’s benefit year expired in July
2008, this person would be ineligible for EB benefits if his or her state triggered “on” for EB in
November 2008.
Under the 2009 stimulus package (as amended), states have the option of ignoring the benefit
year requirement and instead using EUC08 exhaustion as an eligibility requirement, as long as the
state’s EB period falls between enactment of the stimulus package and December 31, 2012. This
has the effect of allowing more individuals to be eligible for the EB program.28
As described above, the EUC08 program contains a “reachback” clause under which EUC08
benefits were made available to individuals who had exhausted regular UC benefits with respect
to a benefit year that expired during or after the week of May 6, 2007. Before the stimulus
package, many individuals who had exhausted EUC08 benefits would have been ineligible for EB
benefits if the state triggered “on” for EB after their benefit year expired. Under the stimulus
26
32
29
Section 203(b) of P.L. 91-373, as amended
The release schedule for LAUS data may be found at http://www.bls.gov/lau/lausched.htm.
31
The benefit year is a one-year period during which a worker may receive benefits based on a previous period of
unemployment. In all states, the beginning date of the benefit year depends on when a worker first files a valid claim,
meaning the worker meets minimal wage and employment requirements.
2832
States would once again be responsible for 50% of the cost of new entrants to the EB benefit program after
December 31, 2012, however, as 100% federal financing of the EB plan ends. The federal government would continue
to pay 100% of EB benefits for individuals who were receiving EB during the week ending on December 31, 2012 for
the duration of their EB receipt.
27(continued...)
30
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As described above, the EUC08 program contains a “reachback” clause under which EUC08
benefits were made available to individuals who had exhausted regular UC benefits with respect
to a benefit year that expired during or after the week of May 6, 2007. Before the stimulus
package, many individuals who had exhausted EUC08 benefits would have been ineligible for EB
benefits if the state triggered “on” for EB after their benefit year expired. Under the stimulus
package, however, all individuals who have exhausted EUC08 benefits would be eligible for EB
benefits, regardless of the timing of their benefit years.
Methods for Determining 20 Weeks of Full-Time Insured Employment
States use one, two, or three different methods for determining an “equivalent” to 20 weeks of
full-time insured employment. These methods are described in both law (Section 202(a)(5) of the
EUCA) and regulation (20 CFR 615.4(b)). In practice, states that require any of these three
methods for receipt of regular UC benefits and do not allow for exceptions to those requirements
do not need to establish that the worker meets the 20 weeks of full-time insured employment. The
three methods are listed below:
•
earnings in the base period equal to at least 1.5 times the high-quarter wages; or
•
earnings in the base period of at least 40 times the most recent weekly benefit
amount, and if this alternative is adopted, it shall use the weekly benefit amount
(including dependents’ allowances) payable for a week of total unemployment
(before any reduction because of earnings, pensions or other requirements) that
applied to the most recent week of regular benefits; or
•
earnings in the base period equal to at least 20 weeks of full-time insured
employment, and if this alternative is adopted, the term “full-time” shall have the
meaning provided by the state law.
The base period may be the regular base period or, if applicable in the state, the period may be the
alternative base period or the extended base period if that determined the regular UC benefit.
The underlying reasoning behind the requirements seems to be the following:
•
Because there are 13 weeks in a quarter, 1.5 times the high-quarter wage is
roughly equivalent to 1.5 times 13 weeks of wages or about 20 weeks of wages.
(Many states require high quarterly earnings of under $2,000, which works out to
less than $4/hour under full-time assumptions. This is less than the federal
minimum wage of $5.85/hour.)
•
Similarly, because the weekly benefit amount is roughly equivalent to half the
average weekly wage, 40 times the weekly benefit amount is roughly equivalent
to 20 weeks of wages.
(...continued)
the duration of their EB receipt.
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2009 Stimulus Provisions Affecting EB Financing
Under permanent law, EB benefits are funded half (50%) by the federal government through its
account for that purpose in the UTF. States fund the other half (50%) through their state accounts
in the UTF. The federal government pays 100% of EB administrative costs.
The 2009 stimulus package, as amended, temporarily changes the federal-state funding
arrangement. The federal government finances 100% of EB benefits through December 31, 20122013,
through the EUCA of the UTF, with the exception of “non-sharable” benefits (generally, these are
former state and local employees’ EB benefits). The EB program’s 100% federal financing has
prompted some states to adopt the optional triggers to provide 20 weeks of extended benefits. The
exception for non-sharable benefits, however, has made some states reluctant to adopt the
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optional 20-week EB triggers, or the stimulus provision that allows them to use EUC08
exhaustion rather than benefit year as a requirement for EB eligibility.
For individuals who were receiving EB payments on December 31, 20122013, the federal government
will continue to pay 100% of EB benefits for the duration of these individuals’ benefits (but not
for new entrants to the EB program starting after that date). The stimulus package also continues
the temporary suspension of the waiting week requirement for federal funding until the week
ending on or before June 30, 2013.29
292014.33
Unemployment Insurance and the Sequester34
The sequester order required by the Budget Control Act of 2011 (P.L. 112-25) and implemented
on March 1, 2013 (delayed by P.L. 112-240),35 affects some, but not all, types of unemployment
insurance expenditures:
•
Exempt from sequester are UC, UCX, and UCFE payments.
•
Subject to sequester are EB, EUC08, and most forms of administrative funding.
The current sequestration percentage reductions apply to the budgetary resources provided for all
of FY2013 (October 1, 2012, through September 30, 2013)—but the actual EB and EUC08
payment reductions began to be implemented the week beginning March 31, 2013. The Office of
Management and Budget’s sequester order for FY2013 requires a 5.1% reduction to be applied on
all nonexempt nondefense mandatory expenditures.36 Thus, EUC08 and EB payments are
33
States that do not require a one-week UC waiting period, or have an exception for any reason to the waiting period,
pay 100% of the first week of EB. Twenty-five states, including Rhode Island and North Carolina, do not require a oneweek UC waiting period in all cases. P.L. 110-449 (as amended by P.L. 111-5, P.L. 111-118, P.L. 111-144, P.L. 111157, P.L. 111-205, P.L. 111-312, P.L. 112-78, and P.L. 112-78) suspends this requirement.
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Appendix A. Unemployment Insurance Benefits
Figure A-1. Unemployment Insurance Benefits: November 8, 2009-February 18, 2012
Source: Congressional Research Service.
Notes: Benefits were available for up to 26 weeks in most states for most of this period. Exceptions to this
were as follows: 30 weeks in Massachusetts; 28 weeks in Montana; 25 weeks in Arkansas and Illinois; 20 weeks in
Michigan, Missouri, and South Carolina; and 12-23 weeks in Florida, depending on the state unemployment rate.
For the implications of providing less than 26 weeks of regular UC benefits on the calculation of EUC08 and EB
maximum durations, see CRS Report R41859, Unemployment Insurance: Consequences of Changes in State
Unemployment Compensation Laws, by Katelin P. Isaacs.
Under permanent law (P.L. 91-373 [26 U.S.C. 3304, note]), the EB program trigger lookbacks make use of
unemployment rate data from either of the two previous years. Under temporary law (P.L. 111-312, as
amended), however, states have the option to use the last three years of unemployment rate data for their EB
program triggers.
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Figure A-2. Unemployment Insurance Benefits:
February 19, 2012-December 29, 2012
Source: Congressional Research Service240) suspends this requirement.
34
For additional details on the sequester of certain components of the unemployment insurance system, see CRS
Report R43133, The Impact of Sequestration on Unemployment Insurance Benefits: Frequently Asked Questions, by
Katelin P. Isaacs and Julie M. Whittaker.
35
For additional details on the sequester, see CRS Report R42050, Budget “Sequestration” and Selected Program
Exemptions and Special Rules, coordinated by Karen Spar.
36
Office of Management and Budget, OMB Report to the Congress on the Joint Committee Sequestration for Fiscal
Year 2013, Washington, DC, March 1, 2013, http://www.whitehouse.gov/sites/default/files/omb/assets/
legislative_reports/fy13ombjcsequestrationreport.pdf.
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required to be reduced by 10.7% for benefits paid for weeks of unemployment beginning on
March 31, 2013, to meet the 5.1% reduction target for FY2013.
The U.S. DOL released guidance on how states should implement the sequester reductions to
unemployment benefits, administrative grants, and other types of unemployment benefit
expenditures for FY2013.37 These reductions to unemployment insurance expenditures generally
began the week beginning on or after March 31, 2013. For states that were not able to implement
these reductions by March 31, 2013, the reduction applied to benefits increased the later that state
implementation began.38 No unemployment benefits already paid to individuals were recovered to
satisfy the sequestration reductions.
37
Employment and Training Administration, U.S. Department of Labor, Unemployment Insurance Program Letter
(UIPL) 13-13, March 8, 2013, http://wdr.doleta.gov/directives/attach/UIPL/UIPL_13_013_Acc.pdf.
38
See pages 5 and 6 of UIPL 13-13, http://wdr.doleta.gov/directives/attach/UIPL/UIPL_13_013_Acc.pdf. Not all states
implemented the sequestration reductions uniformly across all EUC08 beneficiaries. Several states were unable to
implement the preferred method of reduction as outlined by the U.S. DOL and used alternative measures instead. For
an overview of these alternative measures, see CRS Report R43133, The Impact of Sequestration on Unemployment
Insurance Benefits: Frequently Asked Questions, by Katelin P. Isaacs and Julie M. Whittaker.
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Appendix A. Unemployment Insurance Benefits
Figure A-1. Sequence of Unemployment Benefits: UC, EUC08, and EB
Source: Congressional Research Service.
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Figure A-2. Benefits Available in Emergency Unemployment Compensation
(EUC08) July 6, 2008-December 28, 2013
Source: Congressional Research Service.
Notes: Because New York defines a week as a period from Monday through Sunday, the effective dates for
New York are one day later than those shown above. For example, the EUC08 program first became active in all
states except New York on July 6, 2008. The EUC08 program first became active in New York on July 7, 2008.
The total unemployment rate (TUR) is the 13-week average ratio of unemployed workers to all workers
(employed and unemployed) in the labor market. The TUR is essentially a three-month average of the seasonally
adjusted unemployment rate for each state published by the Bureau of Labor Statistics from its Local Area
Unemployment Statistics (LAUS) data. It is possible to have tier III or tier IV available based upon a 13-week
average insured unemployment rate (IUR). These options are not depicted in this figure. The IUR is a programbased statistic: the ratio of Unemployment Compensation (UC) claimants to individuals in UC-covered jobs. The
ratio does not include those unemployed workers who are receiving EUC08 or EB payments, or any other type
of unemployed worker except those who are currently receiving regular UC benefits.
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Appendix B. Summary of EUC08 Program
Table B-1. Emergency Unemployment Compensation Program:
Public Law, Benefits, Effective Dates, and Financing
Public Law
Benefit Tiers and Availability
Dates in Effect and Financing
Supplemental Appropriations Act of
2008, Title IV Emergency
Unemployment Compensation (P.L.
110-252), signed June 30, 2008
13 weeks (all states)
Unemployment Compensation
Extension Act of 2008 (P.L. 110-449),
signed November 21, 2008
Tier I: 20 weeks (all states)
Tier II: 13 additional weeks (33 weeks
total) if state total unemployment rate
(TUR) is 6% or higher or insured
unemployment rate (IUR) is 4% or
higher.
11/23/2008-3/28/2009
(No benefits past 8/29/2009)
Same as above.
2/22/2009-12/26/2009
(No benefits past 6/5/2010)
American Recovery and Reinvestment
Act of 2009 (P.L. 111-5), signed
February 17, 2009
Worker, Homeowner, and Business
Assistance Act of 2009 (P.L. 111-92),
signed November 6, 2009
Funded by federal Emergency
Unemployment Compensation
Account (EUCA) funds within
Unemployment Trust Fund (UTF).
[Act included several other
interventions that augmented UC
benefits: the Federal Additional
Compensation (FAC) benefit of
$25/week; at state option, EB benefit
year could be calculated based upon
exhausting EUC08 benefits; 100%
federal financing of EB program; and
the first $2,400 of unemployment
benefits were excluded from income
tax in 2009.]
Tier I: 20 weeks (all states)
Tier II: 14 additional weeks (34 weeks
total, all states)
Tier III: 13 additional weeks if state
TUR is 6% or higher or IUR is 4% or
higher (47 weeks total)
Tier IV: 6 additional weeks if state
TUR is 8.5% or higher or IUR is 6% or
higher (53 weeks total)
[Act included 1.5 year extension of the
Federal Unemployment Tax Act
(FUTA) surtax.]
Department of Defense Appropriations
Act, 2010 (P.L. 111-118), signed
December 19, 2009
7/6/2008-3/28/2009
(No benefits past 7/4/2009)
Same as above.
Funded by federal EUCA funds within
UTF.
Funded by general fund of the
Treasury. (Additionally, the FAC
program is funded by the general fund
of the Treasury. The 100% financing of
the EB program is funded by the
EUCA funds within the UTF.)
11/8/2009-12/26/2009
(No benefits past 6/5/2010)
Funded by general fund of the
Treasury.
Extended FUTA surtax
through June
2011. The estimated
revenues revenues
collected from FUTA surtax
provision provision
were $2.578 billion and
offset the
estimated direct spending
costs for
unemployment insurance
provisions of
$2.42 billion.
12/27/2009-2/27/2010
(No benefits past 7/31/2010)
Funded by general fund of the
Treasury.
Congressional Research Service
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Unemployment Insurance: Programs and Benefits
Public Law
Temporary Extension Act of 2010 (P.L.
111-144), signed March 2, 2010
Benefit Tiers and Availability
Same as above.
Dates in Effect and Financing
2/28/2010- (retroactive)—4/3/2010
(No benefits past 9/4/2010)
Funded by general fund of the
Treasury.
The Continuing Extension Act of 2010
(P.L. 111-157), signed April 15, 2010
Same as above.
4/4/2010 (retroactive)-5/29/2010
(No benefits past 11/6/ 2010)
Funded by general fund of the
Treasury.
The Unemployment Compensation
Extension Act of 2010 (P.L. 111-205),
signed July 22, 2010
Same as above.
[Note this did not include an
extension of the Federal Additional
Compensation (FAC) benefit of
$25/week for those receiving UC,
EUC08, EB, Disaster Unemployment
Assistance, or Trade Adjustment
Assistance. The FAC expired on June
2, 2010.]
The Tax Relief, Unemployment
Insurance Reauthorization, and Job
Creation Act of 2010 (P.L. 111-312),
signed December 17, 2010
Same as above.
The Temporary Payroll Tax Cut
Continuation Act of 2011 (P.L. 112-78),
signed December 23, 2011
Same as above.
5/30/2010 (retroactive)-11/27/2010
(No benefits past 4/30/2011)
Funded by general fund of the
Treasury.
11/28/2010 (retroactive)-12/31/2011
(No benefits past 6/9/2012)
Funded by general fund of the
Treasury.
1/1/2012-2/18/2012
(No benefits past 8/11/2012)
Funded by general fund of the
Treasury.
P.L. 112-78 included offsets; for
example, the auction of spectrum
licenses and increased federal
retirement contributions.
Middle Class Tax Relief and Job
Creation Act of 2012 (P.L. 112-96),
signed February 22, 2012
Congressional Research Service
Tier I: 20 weeks (all states)
Tier II: 14 additional weeks (34 weeks
total, all states)
Tier III: 13 additional weeks if state
TUR is 6% or higher or IUR is 4% or
higher (47 weeks total)
Tier IV: 6 additional weeks if state
TUR is 8.5% or higher or IUR is 6% or
higher (53 weeks total); 16 weeks if no
EB and all other conditions met (63
weeks total)
2/19/2012-5/26/2012
Funded by general fund of the
Treasury.
27
Unemployment Insurance: Programs and Benefits
Public Law
Benefit Tiers and Availability
Dates in Effect and Financing
Middle Class Tax Relief and Job
Creation Act of 2012 (P.L. 112-96),
signed February 22, 2012
Tier I: 20 weeks (all states)
Tier II: 14 additional weeks if TUR is
6% or higher (34 weeks total, all
states)
Tier III: 13 additional weeks if state
TUR is 7% or higher or IUR is 4% or
higher (47 weeks total)
Tier IV: 6 additional weeks if state
TUR is 9.0% or higher or IUR is 6% or
higher (53 weeks total)
5/27/2012-9/1/2012
Congressional Research Service
Funded by general fund of the
Treasury.
Funded by general fund of the
Treasury.
27
Unemployment Insurance: Programs and Benefits
Public Law
Middle Class Tax Relief and Job
Creation Act of 2012 (P.L. 112-96),
signed February 22, 2012
Benefit Tiers and Availability
Tier I: 14 weeks (all states)
Tier II: 14 additional weeks if TUR is
6% or higher (28 weeks total)
Tier III: 9 additional weeks if state
TUR is 7% or higher or IUR is 4% or
higher (37 weeks total)
Tier IV: 10 additional weeks if state
TUR is 9.0% or higher or IUR is 6%
(47 weeks total)
Dates in Effect and Financing
9/2/2012-12/29/2012
(No benefits past 12/29/2012)
Same as above.
12/30/2012 (retroactive)-12/28/2013
American Taxpayer Relief Act of 2012
(P.L. 112-240), signed January 2, 2013
Funded by general fund of the
Treasury.
Funded by general fund of the
Treasury.
Funded by general fund of the
Treasury.
Source: Congressional Research Service.
Author Contact Information
Julie M. Whittaker
Specialist in Income Security
jwhittaker@crs.loc.gov, 7-2587
Congressional Research Service
Katelin P. Isaacs
Analyst in Income Security
kisaacs@crs.loc.gov, 7-7355
28