OLR Bill Analysis
AN ACT CONCERNING THE TOTAL UNEMPLOYMENT BENEFIT RATE AND AN ONLINE EMPLOYMENT EXCHANGE.
This bill makes several changes to unemployment benefits and eligibility requirements for receiving them. It:
1. increases from $15 to $50 the minimum amount of weekly unemployment benefits most claimants can receive,
2. increases from $600 to $2,000 the minimum amount most claimants must earn during their base period (the first four of the last five calendar quarters) to be eligible for benefits, and
3. requires most claimants' benefits to be based on their average quarterly wages during all four quarters of their base period, instead of during their two highest earning quarters.
None of the above changes apply to construction workers' unemployment benefits or eligibility.
For all unemployment benefits claimants, the bill also (1) freezes the maximum benefit cap through 2018 and (2) requires claimants who file for benefits after January 1, 2017 to post their resumes on an online employment exchange after they receive benefits for six consecutive weeks.
EFFECTIVE DATE: October 1, 2016
MINIMUM BENEFITS AND EARNINGS
The bill increases the minimum weekly unemployment benefit for non-construction workers from $15 to $50. Because the law requires claimants to have earned at least 40 times their weekly benefit during their base period to qualify for benefits, increasing the minimum benefit also increases what claimants must earn over the course of their base period to qualify for benefits (CGS § 31-235). Thus, to qualify for the bill's $50 minimum weekly benefit, claimants must earn at least $2,000 ($50 x 40) over their base period, instead of the $600 required by current law.
Under current law, a claimant's weekly unemployment benefit is calculated as one twenty-sixth of the claimant's average quarterly wages during the two highest earning quarters of his or her base period. For example, if claimant “A” earns $10,000 per quarter in two quarters and $5,000 per quarter in two quarters, he receives a $384 weekly benefit (1/26 of $10,000). And if claimant “B” earns $10,000 per quarter in all four quarters, he also receives a $384 benefit.
The bill instead requires benefits for non-construction worker claimants to be calculated as one twenty-sixth of the claimant's average quarterly wages during the four quarters of his or her base period. Under this formula, claimant A would receive a $288 weekly benefit (1/26 of $7,500) while claimant B's benefit would remain $384 (1/26 of $10,000).
MAXIMUM BENEFIT CAP FREEZE
The law caps the maximum benefit allowed for any unemployment claimant at 60% of the average wage paid to the state's production (i.e., manufacturing) workers. The labor commissioner adjusts the cap on the first Sunday of each October but cannot increase it more than $18 each year. The bill freezes the cap at its current value ($598) for anyone who files for unemployment in 2016, 2017, or 2018.
ONLINE RESUME POSTING
The bill requires claimants who file for unemployment benefits after January 1, 2017 to post their resumes on an online employment exchange after they receive benefits for six consecutive weeks. Claimants are ineligible for benefits during any week in which the labor commissioner finds they failed to do so. The online exchange must be one designated by the labor commissioner and designed for the state's employers and job seekers. The commissioner may adopt regulations to implement the bill's online resume requirement.
sHB 5369, reported favorably by the Labor and Public Employees Committee, requires the maximum benefit cap to be 50% of the statewide average wage, rather than 60% of the average production wage.
Labor and Public Employees Committee
Joint Favorable Substitute