The Return to Work Dilemma

Across the US, employers are sending out the alarm, “We have jobs but no one to fill them.” Despite the widespread availability of vaccines, COVID cases on the decline and states easing the restrictions on business and consumers, employers are still being forced to curtail their operations or close because they can’t get enough staff to fully open back up.

 

Nearly 16.8 million Americans are still collecting unemployment benefits, many for well over 50 weeks now.  The latest report from the Bureau of Labor Statistics reflects 43% of individuals collecting unemployment have been out of work for 27 weeks or longer. So why is there such a disconnect between the number of people still collecting versus the need to hire staff? 

 

One reason may have to do with the additional benefits added to the regular benefits through the various recovery acts.  According to U.S. Chamber of Commerce Executive Vice President and Chief Policy Officer Neil Bradley, “Based on the Chamber’s analysis, the $300 benefit results in approximately one in four recipients taking home more in unemployment than they earned working.” Many states are reporting that with the Federal Pandemic Unemployment Compensation (FPUC), employees earning $15 an hour or less can make more money per week on unemployment than they could if they returned to work.   

 

The following graphic provides an example of wages earned at various hourly rates compared to the current national average weekly unemployment benefits, and ONLY when the hourly wage exceeds $15/hour do the earnings outweigh the UI benefits.

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Comparison based on 40 hour work week

Avg. UI Benefit = *$318 AWBA + $300 FPUC = $618 per week

*Average Weekly Benefit Amount (AWBA) US Department of Labor Insurance Data

 

Work Search Requirements Reinstated

State Workforce Agencies are getting aggressive in working with employers to address this critical shortage in talent. Over half of the states have reinstated their requirements for unemployed individuals to conduct weekly searches for work to continue collecting unemployment benefits.  These requirements were waived at the beginning of the pandemic to ensure the health and safety of employees and employers as well as not to delay the payment of unemployment benefits to those impacted by COVID-19.  Requirements differ by state and for the most current information on which states are reinstating the work search requirements, please refer to the following chart https://support.thomas-and-company.com/hc/en-us/articles/1500005986561-2021-Work-Search-Requirements.

 

Federal Additional Benefits May end Early in Some States

In addition to reinstating work search requirements, some states have made the decision to end the additional federal assistance programs early. A handful of states are withdrawing the FPUC supplement at the end of June rather than waiting for the program to expire in Early September. It is possible that additional states will exit the program early as the extended benefits are often seen as a disincentive to work.

 

Reporting Job Refusals is Another Critical Step in Returning to Work

Employers can have a direct impact by reporting Job Refusals to the State Workforce Agency when an offer of work is turned down. As a reminder, individuals who refuse an offer of suitable work or refuse to return to suitable work without good cause are not eligible to receive unemployment benefits. A general fear of exposure to COVID-19 does not constitute good cause under state or federal law. In addition, employers should be aware that they’re obligated to report refusals of suitable work to state unemployment agencies.

 

The characteristics of a Job Offer include:

  • A “bona fide”, genuine offer of work with details of hours, wages, etc.
  • Written/verbal offer of work made…not just a Help Wanted ad
  • Offer must be suitable to match skills, experience, pay, hours
  • Individual must have known the offer was made and refused – silence is not a refusal of work.

Typically the state will want to know the following about a job offer:

  • Claimants Name and SSN
  • Job Title
  • Rate of Pay
  • Reason the claimant provided for refusing the job offer
  • How the job offer was made (verbal or in writing) and who made the offer
  • If you can provide details around the hours/schedule, location, and other information about the job offer, that can be useful in the state's investigation

It is critically important for employers to report Job Refusals to slow the ongoing depletion of State Unemployment Trust Funds and mitigate the unemployment tax increases which will be necessary to replenish those funds over the next several years.

 

How do I report these job refusals to Thomas & Company?

Complete our online refusal of work form at https://jobrefusal.thomas-and-company.com/ . We will take care of the rest. We will notify the state and provide copies of the information you shared on the specifics of the refusal.

If you work with us mainly through SHIELD or have access to our online reporting portal you can access the form from the navigation bar in SHIELD. Simply click “Did an employee file for UI and refuse work?” option and you will be taken directly to the form.

If you have questions, Thomas & Company is happy to offer a dedicated email to assist you in this process. Please contact us at job-refusal@thomas-and-company.com or reach out directly to your Client Relationship Manager.

 

Our office has been monitoring the impact of COVID-19 on the Unemployment benefit process since the beginning of the pandemic.  We will continue to provide updates to our clients as they become available.  As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.