Unemployment Insurance Reforms

Rationale

Unemployment insurance benefits are payable as a matter of right to workers who have enough qualifying wages and yearly work experience to meet their state's minimum conditions; who are free from disqualification on the basis of their separation from their last place of employment; and who are ready, willing, and able to work. If unemployment insurance is going to remain the first line of defense against hardship and the erosion of assets, certain state reforms are necessary to bring the system more into sync with the new economy:

• Adopting an alternative base period for determining eligibility. States often consider the earnings of workers during the first four of the five most recently completed yearly quarters when considering unemployment insurance benefits. This policy harms low-wage workers who may not have the work history to qualify for unemployment insurance benefits. By allowing an alternate base period, such as counting the four most recently completed quarters, states require fewer weeks worked and will reach more low-income workers through unemployment insurance.
• Changing eligibility rules to require a minimum number of hours worked rather than an earning threshold. Eligibility for unemployment insurance benefits is often too stringent for the lowest-income workers, many of whom fail to qualify for benefits at all. States with unemployment insurance eligibility based on earnings, as opposed to hours worked, are unfairly treating low-income workers.

About Measure

States receive credit for one of more of the following: 1. adopting alternative base periods for determining unemployment insurance eligibility, 2. covering workers who only earn the minimum wage, 3. eliminating restrictions on seeking part-time work. A state receives 0 points if it does not have any of the initiatives, 0.33 points if it has one, 0.67 points if it has two, and 1 point if it has all three. economy.

Source

Economic Policy Institute, Center on Budget and Policy Priorities, & National Employment Law Project. (2001). Failing the unemployed: A state by state examination of unemployment insurance systems. Washington D.C.: Author.