Who doesn’t love a surprise? Well, other than my spouse, Becky. Especially when I say, “I’ve got a surprise for you!” and she needs to wait to get whatever it is.
Governor Cuomo and the state’s department of labor (“DOL”) have a surprise for many New Yorkers. As part of his executive budget proposal, the Governor calls for the DOL to significantly change how partial unemployment insurance (“UI”) benefits are calculated for individuals who work during a benefit week. But claimants won’t need to wait because the Governor instructed the DOL to immediately implement “emergency measures” regarding the new rule. [But if it’s in the Governor’s budget proposal, and the legislature hasn’t passed the budget, how can the new rule be implemented immediately?] Because the Governor said so, that’s all you need to know!
Historically, under NY law, UI benefits have been reduced by 25 percent for each day any work was performed. For example, Blake and Terry are neighbors, and both are unemployed. They were both hired by a small business, each working eight hours and earning less than $504 weekly. Blake worked all eight hours in one day, while Terry worked two hours, four days per week. Based on the number of days worked and weekly earnings, Blake’s weekly benefits were reduced 25 percent, and Terry’s were reduced 100 percent. That’s right, although they both worked the same number of hours, Terry was ineligible to receive any weekly UI benefits.
First, the good news, after decades of a statutory calculation that was, at best, a disincentive to working part-time during a job search, NYS made a change. Effective January 18, 2021, NYS implemented an “hours-based” calculation for partial weekly UI benefits. Also, as was the case under the previous rule, if a claimant’s gross earnings are more than $504 during a benefit week, they are not eligible for UI benefits that week regardless of the number of hours worked.
Now the not-so-good news. The new “hours-worked” approach is more complicated than the old “days-worked” system. Why? Because, once again, NYS is not in any way even remotely prepared for this change. From the guidance provided to date, it appears no modifications have been made to the state’s reporting system to allow claimants to report the number of hours worked. Instead, claimants must first convert hours-worked to days-worked, then report the number of days based on the state’s new calculations. SURPRISE!
It’s astounding that NYS would implement a significant overhaul to the UI reporting process – a process already replete with issues and errors – and expect claimants to essentially calculate their own partial benefits, using what is basically a series of if/then statements, without the assistance of any online tools.
Below is the basic process as I understand it:
Step 1: If the claimant’s gross earnings are more than $504, they are ineligible for UI benefits that week. If gross earnings for the week are $504 or less, continue to the next step.
Step 2: To determine the number of days-worked and whether the week’s benefits will be reduced, the claimant must convert the number of hours they worked during the week to days-worked, based on the following chart:
- 0 to 4 hours worked – report 0 days worked to UI – no reduction in weekly benefits.
- 5 to 10 hours worked – report 1 day worked to UI – benefits reduced by 25 percent.
- 11 to 20 hours worked – report 2 days worked to UI – benefits reduced by 50 percent.
- 21 to 30 hours worked – report 3 days worked to UI – benefits reduced by 75 percent.
- 31+ hours worked – report 4 days worked to UI – benefits reduced by 100 percent.
- If the total hours worked for the week includes a partial hour, the claimant should round up to the next whole hour. For example, if a claimant worked a total of four hours and 15 minutes during the week, they must round up to five hours and report one day worked.
- If a claimant works more than 10 hours in a single workday, they should count only the first 10 hours. For example, claimant A worked two 12-hour shifts for a total of 24 hours. So claimant A counts only 10 hours of each shift, a total of 20 hours, and reports two days worked. However, although claimant B also worked 24 hours, they worked 6-hour shifts on four separate days. Therefore, claimant B must report three days worked.
Step 3: The claimant reports the total days-worked they calculated to NYS UI. (Claimants who choose the alternative of walking away muttering curse words under their breath should not expect to receive UI benefits that week.)
Employees working part-time and collecting partial UI benefits may turn to their employers with questions on the new calculation and reporting process. Employers and claimants can find information on the new partial benefits process at: dol.ny.gov/unemployment/partial-unemployment-eligibility.
Finally, employers participating in the state’s Shared Work program should be aware that, according to the NYS DOL, Shared Work is a separate program with its own rules, which are not affected by recent changes to the partial UI benefits process described above.
Confused? I’m not surprised.
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Posted by Frank Cania, president of HR Compliance Experts LLC.
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Disclaimer: This content is for informational purposes only, does not constitute a legal opinion, and is not legal advice. The facts of each situation should be considered and analyzed individually. Therefore, you should always consult with competent employment counsel regarding any issues discussed here.
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