Relates to voluntary separations from work for compelling family reasons and to extended benefits

Sections 2 and 3 of the bill would amend Labor Law §593(2) and §596(5) to provide that individuals who work part-time and are unwilling or unable to work full-time would not be disqualified from receiving benefits if they refuse to accept full-time employment.

Section 4 of the bill would make the following changes to Labor Law §601:

* Labor Law §601(1)(a) would be amended to create a new unemployment rate trigger, known as the "total unemployment rate (TUR)," to make New York eligible for federally-funded unemployment benefits whenever Congress provides 100% reimbursement for benefits.

* Labor Law §601(1)(a) (2) would be amended to provide that a "state off indicator" would end the trigger if the conditions creating it no longer exist.

* Labor Law §601(1)(a)(4) would be added to provide a definition for the TUR trigger.

* Labor Law §601(1)(b) would be amended to extend the UI eligibility period to include the alternate eligibility period provided by federal law.

* The definitions for "extended benefits" and "regular benefits" would be amended to conform to federal law.

* Labor Law §601(2)(t) would be amended to conform language regarding earning requirements to federal law.

* Labor Law §601(3} would be amended to provide additional benefits during "periods of high unemployment," where Congress provides 100% sharing of the benefit costs.

* Labor Law §601(4} would be amended to conform UI benefit charging for Indian tribes to federal law, and to charge the benefit costs for a federal extended benefit program to the UI general account.

* Labor law §601(5} would be amended to conform state law to federal law which excludes individuals from work search requirements if they are receiving unemployment benefits while in approved training programs, and to conform state law concerning work requirements to reestablish eligibility for unemployment. Section 7 of the bill establishes the effective date.

Existing law

Labor Law § 593(1} provides that a voluntary separation from employment may be with good cause if the separation resulted from circumstances where the claimant was a victim of domestic violence. Labor Law § 593(2} provides that a claimant shall not be ineligible for unemployment benefits as a consequence of refusing to accept employment under certain circumstances. Labor Law § 596(5} provides that a claimant who is unable or unwilling to work full-time and customarily works less than the usual full time hours at his place of employment, shall register as a short time worker and be considered to have worked a full-time week. Labor Law § 601 provides that a state "on indicator" to trigger extended benefits must be based on state's Insured Unemployment Rate (IUR), which may be federally reimbursed at a 50% rate. Labor Law § 601(1}(a)(4) defines "eligibility period" as the period beginning within an extended benefit period until the end of that period. Labor Law § 601(2}(f) provides that a claimant must have twenty weeks of full-time employment or remuneration equal to 40 times his most recent benefit rate to qualify for extended benefits. Labor Law § 601(4} provides that governmental entities that do not contribute to the Unemployment Trust Fund must assume the cost of extended benefits.

Prior legislative history

This is a new proposal.

Justification

New York is eligible to receive more than $600 million in federal funds for unemployment benefits and administration approved by Congress under the American Recovery and Reinvestment Act of 2009 (ARRA). This legislation would allow the state to use part of these funds to provide an additional 13 weeks of unemployment benefits to approximately 120,000 New Yorkers who are out of work. Previously, Congress approved 33 weeks of extended unemployment benefits beyond the 26 weeks of regular benefits allowed under state law, but these extended benefits will start to run out in mid-May. Unless this legislation is adopted, 56,000 New Yorkers will lose their unemployment benefits at that time, and an additional 5,000 to 8,000 will exhaust their benefits in each week after that. If these benefits are not continued, the impact on local governments statewide will be immediate since the potential exists for many of these New Yorkers to enter the social services system at once. Since unemployment benefits are the only Source of income for many unemployed workers, the failure to provide benefits will also impact local economies. Studies show that every dollar paid to workers returns approximately $1.64 to local businesses from spending on food, rent and other basic needs. This bill would also create an alternate trigger to allow New York to receive federal funds for extended benefits whenever Congress appropriates 100% reimbursement for extended benefits. The alternative trigger would be based on the state's total unemployment rate (TUR). Currently, the state trigger is based uninsured rate of employment (IUR) , which is limited to the average weekly number of individuals filing claims. New York's most recently calculated TUR meets the federal threshold, but the IUR falls short and is not expected to trigger on this year. An amendment to the state law is needed to include the TUR to allow New York to receive 100% reimbursement for extended benefits under the ARRA. In addition, the bill would provide several hundred million dollars to the Unemployment Insurance Trust Fund which pays benefits to unemployed workers. The Fund is currently insolvent. New York has had to borrow money from the federal government for which state interest is owed. In order to qualify for these funds, the state unemployment law must conform to ARRA language to allow individuals to receive benefits when they voluntarily separate from employment for compelling family reasons, including domestic violence, the illness or disability of an immediate family member, and the need to accompany the individual's spouse to a new location of employment. Each of these compelling reasons has long been recognized under state case law and statutes, and would not create new grounds for benefit eligibility in New York. In light of current economic conditions, the State must do all it can to deliver UI benefits to the unemployed, and make maximum use of all funds available to meet its UI costs.

Fiscal implications

The changes proposed in this legislation will bring an estimated $645 million in new federal funding to New York to Cover the costs of UI benefits, extended benefits, and the administration of the State UI system. The bill would increase costs on the State and localities during 2009 for which benefits are not federally funded under ARRA, by $4 million and $24 million respectively. These added costs will be offset, in part, by increased tax revenue from recipients of UI benefits.

Effective date

This proposal would take effect immediately upon enactment.