Unemployment Insurance.

The unemployment insurance (UI) system, administered by the Employment Security Department (ESD), is designed to provide partial wage replacement for unemployed workers.  An individual is eligible to receive benefits if he or she:  worked at least 680 hours in covered employment in his or her base year, was separated from employment through no fault of his or her own or quit work for good cause, is able to work, and is actively searching for work. 

Benefits.  Eligible workers can receive up to 26 weeks of UI benefits in a benefit year.  The weekly benefit amount is calculated based on the eligible worker's earnings in the prior base year and then adjusted based on a statutory formula.  The current maximum weekly benefit amount is $1,079.  With some exceptions, an individual must be eligible for a one-week waiting period before receiving benefits.

When an individual is paid UI benefits that the person was not entitled to, the ESD must issue an overpayment assessment explaining the reasons for and the amount of the overpayment.  The ESD must impose interest of 1 percent per month on the outstanding balance if the individual fails to repay the overpayment and fails to arrange a repayment plan. 

Payroll Taxes.  Most employers are contribution-paying employers, referred to as taxable employers.  For this category, benefits are financed through employer contributions, referred to as payroll taxes.  An employer's contributions are determined by multiple factors, including an experience rating based on the benefits paid to its employees.  By default, benefits are proportionally charged to base-year employers according to the amount of wages paid to the person by each employer in the person's base year compared to the wages paid by all employers.  In some specific instances, benefits are charged only to the separating employer, and in other instances, benefits are not charged to any employer.  If benefits are not charged to any employer, those costs are socialized and shared evenly by all employers participating in the UI system.

State and local governments, federally recognized tribes, and some nonprofit organizations qualify as reimbursable employers.  For this category, the employer reimburses the ESD for benefits actually paid to separated employees, instead of paying payroll taxes.

Strikes and Lockouts.

An individual is disqualified from receiving benefits if he or she is unemployed because of either:

• a strike; or
• a lockout initiated by an employer, who is a member of a multi-employer bargaining unit, after another member of the multi-employer bargaining unit has been struck by its employees as a result of the multi-employer bargaining process.

The disqualification does not apply if the individual is not financing, or participating or directly interested in the strike or lockout, and if the individual does not belong to a grade or class of workers financing, or participating or directly interested in the strike or lockout.

The disqualification coincides with the strike or lockout, and therefore ends when the strike or lockout is terminated.

Strikes.

The time period for which individuals are disqualified from UI benefits based on a strike is modified, effectively allowing striking workers to receive benefits in some instances.  The disqualification ends at the earlier of:

• the second Sunday following the first date of the strike, provided that the strike is not found to be prohibited by federal or state law in a final judgment; or
• the date the strike is terminated.

The worker is subject to the one-week waiting period before receiving benefits.  The worker may receive weekly benefits for no more than 12 weeks.  However, any weekly benefits received unrelated to the individual's unemployment due to a strike may not be counted toward those 12 weeks.  The ESD must issue an overpayment assessment for recovery if benefits if the worker subsequently receives retroactive wages for any week for which he or she received benefits, or a final judgment finds that a strike is prohibited by state or federal law.  For contribution-paying employers, benefits paid to striking workers are charged only to the experience rating of the separating employer.

These provisions expire December 31, 2035, after which the provisions disqualifying a worker for the duration of a strike are reinstated.

By December 31, 2025, and continuing annually each year until 2035, the ESD must submit a report to the Legislature on the prevalence of strikes and the impact of strikes on the UI Trust Fund.  The report must include certain data elements described in the bill, including for example, the total number of strikes, the number of employees that participated in each strike, the number of UI claims paid to workers participating in the strikes, the total amount of UI benefits paid, the number of employers who experienced a rate class increase in the year following a labor strike, any increase in the social cost factor rate, and the UI benefits paid which are charged to employers who make payments in lieu of contributions.

Lockouts.

The disqualification based on a lockout of employees in a multi-employer bargaining unit is removed, thereby allowing those individuals to qualify for UI benefits.  For contribution-paying employers, the benefits paid to a locked out individual are charged to all base year employers, unless an exception applies for the particular claim.

These provisions expire December 31, 2035, after which the provisions disqualifying a worker based on a lockout are reinstated.