UIPL 05-24.pdf

ETA Advisory File Text

EMPLOYMENT AND TRAINING ADMINISTRATION ADVISORY SYSTEM U.S. DEPARTMENT OF LABOR Washington D.C. 20210 CLASSIFICATION Unemployment Insurance CORRESPONDENCE SYMBOL OUI DL DATE December 2 9 2023 RESCISSIONS None EXPIRATION DATE Continuing ADVISORY UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 05-24 T O STATE WORKFORCE AGENCIES FROM B RENT PARTON Principal Deputy Assistant Secretary SUBJECT Application of State Finality Laws Regarding Temporary Unemployment Compensation UC Programs under the Coronavirus Aid Relief and Economic Security CARES A ct 1.Purpose. To announce th e Department of Labor s Department s interpretation concerning the application of state finality laws to temporary UC programs created under the Coronavirus Aid Relief and Economic Security CARES Act as amended. 2.Action Requested. The D epar tment s Employment and Training Administration ETA requests that State Workforce Agency Administrators provide information contained in this Unemployment Insurance Program Letter UIPL to appropriate staff. 3. Summary and Background.a.Summary Many states have finality provisions in their state UC laws that limit when the state may reconsider a prior decision or determination made on a UC claim. The Department defers to states to apply their finality laws to CARES Act UC claims. b.Background The CARES Act Public Law Pub. L. 116-136 enacted on March 27 2020 allows among other things states to enter into an agreement with the Secretary to administer the Pandemic Unemployment Assistance PUA Federal Pandemic Unemployment Compensation FPUC and Pandemic Emergency Unemployment Compensation PEUC programs and to receive full federal funding for the first week of compensable regular unemployment for states with no waiting week. See UIPL No. 14- 20. The Continued Assistance for Unemployed Workers Act of 2020 Continued Assistance Act Pub. L. 116-260 set forth at Division N Title II Subtitle A of the Consolidated Appropriations Act 2021 extended the dates for states to administer these programs and allowed states to also enter into an agreement with the Secretary to administer the Mixed Earners Unemployment Compensation MEUC program. See UIPL No. 09-21. The American Rescue Plan Act of 2021 ARPA Pub. L. 117-2 further extended the dates for states to administer the PUA FPUC PEUC and MEUC programs and to receive full federal funding for the first waiting week through September 6 2021. See UIPL No. 14-21. 2 A ll states voluntarily signed an Agreement Implementing the Relief for Workers Affected by Coronavirus Act Agreement with the Secretary in March 2020 to administer the PUA FPUC and PEUC programs. States without a waiting week also signed an addendum to receive full federal funding for the first week of compensable regular unemployment. The Agreement applied to the CARES Act and any future amendments. It also required states to use the CARES Act funds for the purpose for which the money was paid to the state and to take such action as reasonably may be necessary to recover for the account of the United States all benefit amounts erroneously paid and restore any lost or misapplied funds paid to the state for benefits or the administration of the Agreement. Agreement paragraphs I VII VIII . Nearly all states signed an addendum to the Agreement in January 2021 to also administer the MEUC program. The Agreement incorporates amendments to the CARES Act made by the Continued Assistance act and ARPA. T here are situations where states have not yet implemented certain CARES Act UC requirements or have implemented or operated the CARES Act UC programs out of alignment with federal law regulation or policy. Typically this would require the state to retroactively implement the requirements or correct the errors. However some states have indicated that they cannot take the required actions to resolve the findings due to finality provisions of their UC laws prohibiting them from reconsidering a prior determination after a specified period of time has elapsed. The Department has consistently deferred to state finality laws with regard to the regular UC program. In this UIPL we are providing updated guidance on the application of finality laws to the CARES Act programs. 4. Guidance. a. Application of State Finality Provisions to CARES Act UC Programs. The CARES Act UC programs are administered through voluntary agreements between states and the Department. With respect to the PUA program the Department s prior guidance has advised that where the CARES Act and the Department s operating instructions are silent states should refer to the Disaster Unemployment Assistance DUA regulations at 20 C.F.R. Part 625 to the extent required by CARES Act section 2102 h and where DUA regulations are silent states should follow applicable state law for administering the regular UC program. See UIPL No. 16-20 Change 1. The DUA regulation provides that t he provisions of the applicable State law concerning the right to request or authority to undertake reconsideration of a determination pertaining to regular compensation under the applicable State law shall apply to determinations pertaining to DUA. 20 C.F.R. 625.9 c . T he laws creating FPUC MEUC PEUC and federal funding for the first week of benefits for states without waiting weeks specifically provide that a ny determination by a State agency under this section shall be subject to review in the same manner and to 3 the same extent as determinations under the State unemployment compensation law and only in that manner and to that extent. See CARES Act 2104 f 4 regarding FPUC and MEUC 2105 f regarding the federal funding of the waiting week and 2107 e 4 regarding PEUC . PUA did not include a similar provision. P ursuant to the Department s authority under the CARES Act and amendments and the Agreement States were instructed to retroactively implement new CARES Act requirements and correct implementation errors. See e.g. UIPL 16-20 Changes 5 and 6. States were also advised that a state s jurisdictional limitation cannot prevent the Department from taking action if a state is found to be out of compliance with the requirements of the CARES Act Agreement. UIPL 16-20 Change 6 4.a.ii. See International Union United Auto. Aerospace and Agric. Implement Workers of America International Union v. Brock 477 U.S. 274 292 1986 . The Department made funding available to the states to recover CARES Act overpayments. See e.g. UIPL 28-20 Changes 2 and 4. The CARES Act benefits programs ended on September 6 2021 and the Department has been working with States to implement modernization efforts under ARPA. The Department is now updating its guidance to defer to states to apply their finality laws to the CARES Act UC programs. This means the Department will no longer exercise its authority to require retroactive actions for CARES Act UC programs where a State s finality law applies. 1 Deference to state finality laws is both consistent with the CARES Act language referenced above and important to enabling states to concentrate their energies on adjudicating current claims and be forward-looking focusing more of their energies and resources on engaging in the Department s modernization and fraud prevention efforts to ensure that States will be well-prepared in the event of a future economic downturn. 1 There are two commonly understood types of finality. The first limits the ability of the state agency to redetermine or reconsider one of its prior determinations or decisions. The second limits the ability of a claimant or employer to seek redetermination or reconsideration of a decision or to file an appeal from a determination or decision outside of the specific timelines set out in state law. This UIPL applies to the first type of finality state laws limiting the state agency s authority to reconsider or redetermine prior determinations or decisions not those related to appeals. b.Effect of Application of Finality on Outstanding CARES Act Matters that may be Subject to Retroactive Action. Applyi ng state finality laws to the CARES Act UC programs means that in many instances the state will not need to take retroactive action to resolve monitoring findings. However application of state finality laws will not resolve all monitoring findings. For example if a state s law provides a three-year limitation on reconsidering prior determinations the state must retroactively address applicable determinations that have not passed the three-year mark. If a state is relying on its finality law in administering the CARES Act UC programs it should evaluate its outstanding monitoring findings and if the state finality law limits the extent of retroactive action necessary the state should provide an explanation to the appropriate ETA Regional Office. 4 The application of state finality provisions will not prevent law enforcement agencies from investigating and prosecuting fraud under CARES Act programs or from seeking appropriate sentences including monetary penalties and restitution. States should continue efforts to collaborate with law enforcement agencies and refer potential CARES Act UC fraud cases for investigation and prosecution. See TEN No. 12-23. 5.I nquiries. Ple ase direct inquiries to the appropriate ETA Regional Office. 6.References. American Rescue Plan Act of 2021 ARPA including Title IX Subtitle A Crisis Support for Unemployed Workers Pub. L. 117-2 Consolidated Appropriations Act 2021 including Division N Title II Subtitle A The Continued Assistance for Unemployed Workers Act of 2020 Continued Assistance Act Pub. L. 116-260 Coronavirus Aid Relief and Economic Security Act CARES Act including Title II Subtitle A Relief for Workers Affected by Coronavirus Act Pub. L. 116-136 Title III Social Security Act of 1935 42 U.S.C. 503 et seq. 20 C.F.R. Part 625 Disaster Unemployment Assistance UIPL No. 14-21 American Rescue Plan Act of 2021 ARPA Key Unemployment Insurance UI provisions issued March 15 2021 https www.dol.gov agencies eta advisories unemployment-insurance-program-letter-no- 14-21 UIPL No. 09-21 Continued Assistance for Unemployed Workers Act of 2020 Continued Assistance Act - Summary of Key Unemployment Insurance UI Provisions issued December 30 2020 https www.dol.gov agencies eta advisories unemployment- insurance-program-letter-no-09-21 UIPL No. 28-20 Change 4 Support for States to Resolve Outstanding Items from the Expired Coronavirus Aid Relief and Economic Security CARES Act Unemployment Compensation UC Programs Including Additional Funding to Assist States with Reporting and Detection and Recovery of Overpayments issued July 22 2022 https www.dol.gov agencies eta advisories uipl-no-28-20-change-4 UIPL No. 28-20 Change 2 Additional Funding to Assist with Strengthening Fraud Detection and Prevention Efforts and the Recovery of Overpayments in the Pandemic Unemployment Assistance PUA and Pandemic Emergency Unemployment Compensation PEUC Programs as well as Guidance on Processes for Combatting Identity Fraud issued August 11 2021 https www.dol.gov agencies eta advisories unemployment-insurance-program-letter-no- 28-20-change-2 UIPL No. 16-20 Change 6 Pandemic Unemployment Assistance PUA Program Updated Operating Instructions and Reporting Changes issued September 3 2021 https www.dol.gov agencies eta advisories unemployment-insurance-program-letter-no- 16-20-change-6 5 UIPL No. 16-20 Change 5 Expanded Eligibility Provisions for the Pandemic Unemployment Assistance PUA Program issued February 25 2021 https www.dol.gov agencies eta advisories unemployment-insurance-program-letter-no- 16-20-change-5 UIPL No. 16-20 Change 1 Coronavirus Aid Relief and Economic Security CARES Act of 2020 - Pandemic Unemployment Assistance PUA Program Reporting Instructions and Questions and Answers issued April 27 2020 https www.dol.gov agencies eta advisories unemployment-insurance-program-letter-no- 16-20-change-1 UIPL No. 14-20 Coronavirus Aid Relief and Economic Security CARES Act of 2020 Summary of Key Unemployment Insurance UI Provisions and Guidance Regarding Temporary Emergency State Staffing Flexibility issued April 2 2020 https www.dol.gov agencies eta advisories unemployment-insurance-program-letter-no- 14-20 TEN No. 12-23 Reminder on Federal Statute of Limitations on Criminal Prosecutions of Unemployment Insurance UI Fraud issued December 1 2023 https www.dol.gov agencies eta advisories ten-12-23 and International Union United Auto. Aerospace and Agric. Implement Workers of America v. Brock 477 U.S. 274 1986 . 7. Attachment s . None.