The last-minute objections threaten to delay the passage of a $2 trillion economic rescue package Senate leaders were hoping to wrap on Wednesday.
The issue stems from what a group of GOP senators called a “drafting error” they argued would incentivize workers to leave their jobs and stay laid off.
“This bill pays you more not to work than if you are working,” Sen. Lindsey Graham (R-S.C.) said at a press conference on Wednesday.
Sen. Tim Scott (R-S.C.) added: “We cannot encourage people to make more money in unemployment than they do with employment.”
Lawmakers have not yet finalized the actual text of the legislation, which was negotiated by the Trump administration and leaders of both parties on Capitol Hill. Democrats said the unemployment provision would boost weekly benefits by $600, a massive increase to payments that average $364.
In normal times, unemployment insurance recipients are required to search for jobs and not reject offers that are comparable in pay to their previous positions. A bill Congress passed last week encouraged states to suspend those rules, however, as part of the government’s effort to encourage people to stay home so they don’t spread the coronavirus.
As a result of widespread school and business closures, many Americans have already been laid off or forced to stay home from work, and unemployment claims are surging.
Senate Minority Leader Chuck Schumer (D-N.Y.) bragged Tuesday that the extra money would amount to full replacement of lost wages for people who have to stop working due to illness ― either their own or a family member’s ― or for those whose employers have shut down due to the outbreak. Benefits normally replace about 50% of someone’s lost wages.
The extra benefits would only last for four months and would indeed encourage people to stay home instead of looking for work. For some workers, the $600 boost could push their total benefit above what they previously earned from their jobs.
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Though Republicans called it a drafting error, it wasn’t an accident.
Democrats came up with the $600 figure because it’s roughly the difference between the average unemployment benefit and the average weekly wage, which was $981 in February. A Democratic aide said they would have preferred to actually match a person’s previous wage, but U.S. Labor Secretary Eugene Scalia shot that idea down, saying it would be too complicated for state workforce agencies. A Labor Department spokesperson did not immediately respond to a request for comment.
The Democratic aide said it was possible the provision could change before the text is finalized.
A Republican spokesman for the Senate Finance Committee said negotiators opted for a temporary across-the-board $600 boost in unemployment benefits because it offered faster relief than would have been possible by tinkering with different programs administered by the states.
“Nothing in this bill incentivizes businesses to lay off employees, in fact it’s just the opposite,” the spokesman said.
Before Wednesday, the unemployment benefits had not been one of the more controversial pieces of the legislation, which would also direct cash payments to most American households and set up a corporate bailout fund.
It’s unclear whether the new objections to the unemployment provisions of the bill will derail its passage. Republicans said they were hoping to secure a vote on an amendment to the bill to fix it, but Democrats insisted it was a compromise reached in bipartisan negotiations.
Graham has previously urged speedy passage of the bill. “There is no good reason left to deny the American people the relief they need,” he tweeted Wednesday. “Enough already. Pass the damn bill!”
Sen. Bernie Sanders (I-Vt.), meanwhile, issued a statement Wednesday threatening to hold up the bill over its corporate provisions if the Republican senators did not drop what he called their “anti-worker objections” to unemployment assistance.
“It would be an outrage to prevent working-class Americans to receive the emergency unemployment assistance included in this legislation,” he said.
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