Thousands in Oregon face loss of federal unemployment benefits
More than 70,000 Oregonians are facing a bleak day after Christmas.
Dec. 26 is when federal unemployment benefits expire for workers who until this year were not covered by the current system — self-employed people, plus workers such as freelancers, independent contractors, gig and temporary workers. The program is known as Pandemic Unemployment Assistance.
Also ending Dec. 26 is a 13-week extension of benefits, known as Pandemic Emergency Unemployment Compensation, for people whose benefits expired during the COVID-19 pandemic that started in March.
An additional 3,400 workers had drawn up to 20 weeks of extended unemployment benefits, which will be scaled back to the regular 13 weeks starting Dec. 13. This reduction will take place because Oregon's average unemployment rate has dropped below the 8% trigger required for the additional benefits.
All of them got payments under the $2.2 trillion CARES Act, which Congress passed in March. But political disputes between Democrats and Republicans, the House and Senate, and the incoming and outgoing presidents have stalled approval of a follow-up aid plan. These benefits are separate from the regular unemployment fund, which comes from payroll taxes on Oregon employers.
Even if Congress were to approve a plan soon — and political prospects for it are uncertain before lawmakers break for the holidays — employment agencies in Oregon and other states say it would take them time to reprogram their aging computer systems to deliver the benefits.
"I do not see a scenario where I see no lapse in benefits," David Gerstenfeld, acting director of the Oregon Employment Department, told reporters Dec. 2 during a weekly conference call.
"The loss of the safety net is going to be incredibly difficult."
Sen. Ron Wyden championed the CARES Act expansion of unemployment benefits, which included additional $600-per-week payments that ended July 25.
The Oregon Democrat decried the lack of movement on the part of the Senate's majority Republicans, even as the House's majority Democrats have retreated from overall aid plans of $3.4 trillion and $2.2 trillion.
House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer endorsed a $908 billion plan as a starting point — as has President-elect Joe Biden — but Senate Majority Leader Mitch McConnell has stuck with a $500 billion plan that even his own party has not fully embraced. The Senate GOP plan, which some senators believe is still too much, proposes a $300-per-week payment of extra unemployment benefits; much of the rest is earmarked for businesses.
President Donald Trump has left detailed negotiating to his chief of staff and Treasury Secretary Steven Mnuchin.
Wyden: Act now
"With the economy backsliding as COVID-19 cases explode nationwide, Senate Republicans are set to push millions of American families off a cliff, leaving them with no way to pay rent or feed their families the day after Christmas. Our bill would provide relief for workers who are hanging by a thread through no fault of their own," Wyden said to reporters last week in Washington.
"The road to recovery will be a long one, particularly for workers in the hardest-hit services industries, whether it's bars, restaurants, events, or tourism. In recognition of this painful reality, our bill ties relief programs to economic conditions on the ground. Whether or not you can pay rent or feed your family should not depend on whether or not Mitch McConnell sees it in his political interest."
Wyden, the top Democrat on the tax-writing Finance Committee, joined Schumer and three other Democrats on Dec. 1 to renew their call for extension of unemployment benefits based on state and national average unemployment rates.
Their bill differs from one that Wyden and Schumer introduced five months ago, although the extended benefits are still tied to economic conditions, not a specific date. Key provisions:
• The $600-per-week boost in unemployment benefits would be extended to October 2021, and retroactive payments would be made.
• Federal benefits to self-employed and gig workers would continue as well. The Pandemic Unemployment Assistance program also would cover workers who need to care for children whose schools are not fully open for in-person learning, or whose employers are not following COVID-19 health and safety rules.
• Both sets of benefits would remain as long as the three-month average national unemployment rate is greater than 5.5%, and in states where the average stays above that mark.
• For those who receive regular unemployment benefits, payments would be extended by 26 weeks. An additional 13 weeks of benefits would be added for each percentage point a state's unemployment rate rises above 5.5%, up to a maximum of 78 weeks when a state's unemployment rate is above 8.5%.
Rebecca Dixon, executive director of the National Employment Law Project in Washington, added her voice in support.
"These dual crises have devastated Black and Latinx workers the most," she said. "it is imperative that Congress proceed with relief that will make support accessible to every worker possible."
Gerstenfeld said it will take time for the information technology staff — some of them retirees who have returned to help out — to reprogram Oregon's three-decade-old mainframe system to put any changes into effect.
He said Congress, in passing the CARES Act, changed the unemployment benefits system beyond what its architects drew up back in 1935 during the Great Depression. The system was intended to provide only a portion of lost wages while workers awaited callbacks to their old jobs or found new ones.
He said he and counterparts in other states have advised Wyden and other senators about which actions could be taken quickly — and which would take more time given the current computer systems in many states.
"We hope that whatever ultimately happens, happens quickly, so that we can start on that work and make changes when we know what the new laws are going to be," Gerstenfeld said.
The Employment Department is still in the process of choosing a vendor to implement a new computer system to take on these tasks. The systems also will implement Oregon's paid family leave program, which is due to start receiving its first contributions from employers and employees in January 2022 — and make its first benefit payments a year later.
"The infrastructure that is designed to be able to add new programs quickly is what our modernization program is all about. There is no way to speed that up for any changes under discussion now," Gerstenfeld said. "That is the long-term solution to the underlying issue."
NOTE: Modifies story to reflect the uncertain state of congressional negotiations.
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