U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210

CLASSIFICATION

 

CORRESPONDENCE SYMBOL

 

ISSUE DATE

September 30, 1993

RESCISSIONS

None

EXPIRATION DATE

September 30, 1994

DIRECTIVE

:

GENERAL ADMINISTRATION LETTER NO. 13-93

 

TO

:

ALL STATE EMPLOYMENT SECURITY AGENCIES

 

FROM

:

Barbara Ann Farmer
Administrator for Regional Management

 

SUBJECT

:

Phaseout of the Emergency Unemployment Compensation (EUC) Program

 

  1. Purpose: To provide operating instructions for the phaseout of the EUC program if not further extended.

  2. Contact: Questions regarding this directive should be directed to the respective Regional Office.

  3. References: Titles I and II of the Emergency Unemployment Compensation Act (EUC Act) of 1991 (Public Law (P.L.) 102-164), as amended by P.L. 102-182, P.L. 102-244, P.L. 102-318, and the Emergency Unemployment Compensation Amendments of 1993, P.L. 103-6; the Federal-State Extended Unemployment Compensation (FSEUCA) Act of 1970, as amended by P.L. 102-318; GAL 10-92; GAL 12-92 and Changes 1-4 (57 Fed. Reg. 54106, 58 Fed. Reg. 34484); UIPL 9-92 and Changes 1-5; UIPL 45-92 (57 Fed. Reg. 47871, 47873); GAL 7-93, dated March 5, 1993; 20 CFR Part 615; ET Handbook 392; ET Handbook 399.

  4. Background: P.L. 102-318 and P.L. 103-6 amended several sections of the EUC Act of 1991 and the FSEUCA. However, this letter will focus on the provisions that are effective with respect to weeks beginning after October 2, 1993. Section 2(b) of P.L. 103-6 amended Sections 102(f) and 106(a) of the EUC Act of 1991 to end the EUC program, with respect to new EUC claims, after October 2, 1993. The EUC program will be phased out between October 3, 1993 and January 15, 1994. (The phase-out period.) The phase-out period covers claimants who established their EUC claim effective prior to October 3, 1993.

    The amendments to Section 101(e) of the EUC Act of 1991 terminate the Governor's option to elect to trigger off an extended benefit (EB) period (with respect to any EB period beginning after October 2, 1993) and provides, instead, that individuals eligible under both the EB and EUC programs shall be paid for weeks of unemployment beginning after October 2, 1993, under the program where the greater entitlement exists. This requirement necessitates special handling of such claims to determine the appropriate program for payment.

  5. Controlling Guidance: The interpretations in these EUC operating instructions are issued to the States and cooperating State agencies as guidance provided by the Department of Labor in its role as the principal in the EUC program and supplement GAL 12-92 and Changes 1-2 (57 Fed. Reg. 54106) and GAL 7-93 (dated March 5, 1993). As agents of the United States, the States and cooperating State agencies may not vary from the operating instructions in this document (or subsequent or supplemental operating instructions) without the prior approval of the Department of Labor.

  6. Eligibility During Phaseout of EUC Program: The EUC program is scheduled to phase-out after October 2, 1993, and no EUC will be paid on any new claim to establish an EUC account effective after that date. Individuals who established an EUC claim effective before October 2, 1993, will continue to be eligible for any week thereafter if otherwise eligible for EUC. However, under no circumstances will any payments of EUC be made for any week beginning after January 15, 1994.

  7. Payment of the Greater of EB or EUC Entitlement: Section 101(d)(2) of P.L. 102-318 amended the EUC Act by adding a new subsection 101(e)(2) to provide that an individual with EB entitlement, whether or not the individual applies therefor, in a State in an EB period after October 2, 1993, and who has a EUC account balance shall receive, for weeks of unemployment beginning after October 2, 1993, payments under the program, either EUC or EB, under which the individual's monetary entitlement is the greater. This provision requires that EUC shall be paid only to an individual whose potential EUC benefits are greater than the EB entitlement (maximum benefit amount), as of the beginning of the first week beginning in the EB eligibility period for such individual, whether a claim for EB has been filed or not. The intent of this provision is to provide the individual with the greater level of extended compensation available for weeks of unemployment beginning during the individual's EB eligibility period. Therefore, to determine the "greater" benefit level available to the claimant, the State agency must determine the maximum monetary amount of EUC or EB benefits that is potentially payable to the individual. This means that if the end of the EUC program (January 15, 1994), the end of the individual's benefit year, or rights to regular benefits, will prevent the individual from receiving the level of benefits determined under the provisions of Section 102(b) of the EUC Act or State law provisions in conformity with Section 202(b), FSEUCA, the State agency must make a one-time determination specific to the individual's situation based on the actual potential maximum benefit amount that could be payable if all other eligibility requirements are met. No redetermination of the "greater" level of benefits available is made as benefits subsequently paid under the required program reduce the benefit balance. When a State is in an EB period and the potential EB and EUC entitlements are equal, the State shall pay EB.

    To determine the program under which the claimant is to be paid, the State must examine each individual's specific situation as follows:

    1. Claimant Receiving EUC Based on a Prior Benefit Year Under Section 101(f) of the EUC Act Effective for Weeks Beginning After July 3, 1992. A claimant who is receiving EUC based on a prior benefit year, having postponed establishing a new benefit year for regular benefits, is not an "exhaustee" for EB purposes. Additionally, the claimant does not have an "applicable benefit year" for EB purposes, as the benefit year upon which the EUC is based ended prior to the beginning of the EB period. Therefore, no determination of "greater" entitlement is appropriate. Such an individual, who is not eligible for EB, will remain potentially eligible for EUC under the provisions of Section 101(f) of the EUC Act.

    2. Claimant Receiving EUC Based on a Current Benefit Year. A claimant who is receiving EUC based on a current benefit year is an "exhaustee" for EB purposes. Therefore, the State must determine the claimant's EB entitlement in accordance with State law provisions which conform to Section 202(b), FSEUCA, and shall pay either EUC or EB for weeks of unemployment beginning after October 2, 1993, whichever the monetary entitlement is the greater, as explained above. When the current benefit year upon which the EUC or EB is based ends, the State agency must further review the claimant's specific situation as follows:

      1. When "Greater" Entitlement is under the EUC Act. When a claimant's "greater" entitlement is under the EUC program, and the current benefit year ends and the claimant has rights to establish a new benefit year for regular benefits, Section 101(f) of the EUC Act applies and the claimant has an option to continue to receive EUC, on the existing EUC claim, or file for regular benefits;

      2. When "Greater" Entitlement is under the FSEUCA. When the claimant's "greater" entitlement is under the EB program, and the current benefit year ends and the claimant has rights to regular benefits, the claimant ceases to be an "exhaustee" for EB purposes and has no further rights to EB. Such an individual has no option to postpone establishing a new benefit year for regular compensation under the provisions of Section 101(f) of the EUC Act,as the requirements of Section 101(e) which deny EUC to individuals with greater EB entitlement, effectively terminates all rights to EUC based on the prior benefit year. Therefore, such an individual has rights to establish a new benefit year for regular benefits only.

  8. Administrative Funding: When an EB period triggers "on" in a State between October 3, 1993 and January 15, 1994, the State agency will receive additional administrative funds to determine that an EUC claimant's "greater" entitlement exists under the EUC program as of the beginning of the first week beginning in the EB eligibility period for such individual or as of the beginning of the first week beginning in the high extended benefits eligibility period for such individual, as appropriate, through the contingency funding process. Staffyears earned will be computed by using a minutes per unit (MPU) value of no more than 20 minutes. States have the option to use a lesser value MPU if they deem appropriate. This information shall be included on line 13 of the regular UI-3 worksheet, Section B. Staffyears used for this activity should be included on line 1, Section A.

    Funding for this assessment when the "greater" entitlement is under the EB program is covered by the regular EB initial claims MPU. Funding for the denial of further EUC benefits, when the "greater" entitlement is under the EB program, is covered by the allocated non-monetary determination MPU.

  9. Action Required: State Administrators are requested to make a copy of this letter available to all appropriate staff.