Congress Extends Unemployment Assistance through 2012

Feb 17, 2012

By Neil Ridley

Millions of jobless workers will continue to receive federally funded unemployment benefits through the end of 2012 thanks to the Middle Class Tax Relief and Job Creation Act, which Congress passed today. The complex bill, a far-from-perfect compromise struck by a House and Senate conference committee, also extends the payroll tax cut through 2012, extends Temporary Assistance for Needy Families block grants to states through Fiscal Year 2012 and avoids a cut to the Medicare reimbursement rate for doctors.

The unemployment provisions maintain a high level of assistance to workers in hard-hit states during most of 2012 and gradually ratchet down the number of weeks available to jobless workers. Workers in states with high unemployment will receive between 89 and 99 weeks of benefits until May 2012. The maximum duration of benefits will gradually be reduced to 73 weeks by Sept. 2012.

The final bill leaves out a highly controversial provision in the House-passed version of H.R. 3630, which would have set minimum educational requirements for receipt of unemployment benefits. This provision, which CLASP and an array of workforce, education, labor and faith-based groups strongly opposed, would have created new barriers to eligibility for workers without a high school diploma or GED and would have overwhelmed state and local adult education programs.

The conference report also rejects another damaging proposal in the House-passed version of H.R. 3630, which would have granted states sweeping authority to drug test UI applicants. However, the final compromise allows limited use of drug testing in two cases:  1) if the individual applying for benefits was terminated from a previous job because of drug use; and 2) if the individual is seeking a job for which drug testing is routinely used. The U.S. Department of Labor is expected to issue regulations that will clarify the scope of this authority.

The final bill includes a number of measures designed to help unemployed workers get back to work. It creates consistent work search requirements for individuals receiving unemployment benefits. It provides one-time funding for reemployment services and in-depth assessments of benefit recipients. And it directs grants to states for self-employment assistance programs, which allow jobless workers to start a business while collecting unemployment benefits.

 In a major step forward for work sharing, the final bill provides new funding for state programs that give employers an alternative to layoffs. Under work sharing, employers can reduce work hours instead of laying off workers, and eligible employees can apply for pro-rated unemployment benefits to help make up for lost wages. The conference report adopts most of the provisions in the Layoff Prevention Act introduced by Sen. Jack Reed and Rep. Rosa DeLauro in 2011. It clarifies the federal framework for state work sharing programs and creates new incentives for states to adopt or expand these programs. CLASP has long advocated for greater use of work sharing programs.



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