Unemployment insurance is normally for workers who are laid off due to a bad economy, but some lawmakers are realizing they can use the program to help people stay healthy and keep from going broke in the process due to the coronavirus outbreak.
Democrats in the U.S. House are considering legislation that would expand eligibility for benefits as part of a broader package to reduce the inevitable economic damage caused by widespread illness and social distancing.
The state of Washington, meanwhile, has already changed its unemployment policy in order to help people who are quarantined.
Federal rules require that claimants must be looking for work to remain eligible for benefits, but Washington state has relaxed this and other requirements in response to the emergency.
“Workers that are asked to isolate or quarantine by a medical professional or public health official as a result of exposure to COVID-19 may receive unemployment benefits and work search requirements could be waived, so long as they have a return date with their employer,” Washington state’s Employment Security Department announced Monday.
The state also will pay benefits to workers and waive related business taxes if a firm has to shut down temporarily because of an infected employee. Washington state also approved benefits for part-time workers who lose hours due to the outbreak.
Given how the coronavirus outbreak will hurt the economy, one of the best ways to mitigate the consequences is to send people money. Doing so will enable more to stay home and reduce the spread of infection. And among social programs, economists say unemployment insurance has one of the biggest effects on the economy, since claimants tend to spend that money pretty quickly.
Washington state’s move conforms with federal requirements, according to Michele Evermore, an unemployment insurance expert with the National Employment Law Project. She said Congress should encourage other states to take similar steps by creating an incentive for them to waive work search requirements for unemployment compensation.
States will quickly run out of money if this epidemic spreads and a whole bunch of people go out on employment and then those funds run out, Rep. David Cicilline (D-R.I.)
The point of work search requirements is to sure someone receiving unemployment compensation is still attached to the labor force and isn’t just getting paid not to work. But public health experts say one of the best ways to mitigate the spread of the coronavirus is social distancing, which in many cases means avoiding economic activity like working or seeking employment.
Work search requirements can be more stringent in some states than others. In Florida, for example, unemployment claimants have to provide a record of five job contacts each week, with phone numbers for each one.
“Any state could waive those in an emergency,” Evermore said.
She said Congress should also encourage states to get rid of waiting periods for benefits and undo other benefit cuts they’ve imposed over the past few years. Lawmakers could also consider an infusion into state unemployment trust funds.
Rep. David Cicilline (D-R.I.) told HuffPost money for states was one idea under consideration.
“States will quickly run out of money if this epidemic spreads and a whole bunch of people go out on employment and then those funds run out,” Cicilline said.
He added that unemployment insurance is a crucial benefit for “people who are low-wage workers who might not have paid sick leave who need to stay home for their wellbeing and the wellbeing of their colleagues.”
UPDATE: March 12 ― House Democrats unveiled legislation Wednesday night that includes $1 billion to help states administer their unemployment programs, with half of the total reserve for states that experience a spike in unemployment so long as they waive work-search and other requirements.