Oregon has a "working while claiming" unemployment insurance program that allows workers to still receive partial unemployment insurance benefits if their work hours are reduced. OED's related guidance is HERE.
This is different that the Workshare program that has its own set of rules and benefit calculations.
Workers in the leisure and hospitality industry have been disproportionally impacted by COVID related closures and partial re-openings. Attracting employees back with reduced hours may also be a challenge for employers especially for leisure and hospitality workers who may have already have had less than 40 hour weeks before the pandemic.
I thought it might be useful to see how Oregon's "working while claiming" unemployment program could benefit these kind of workers. I used an average wage of $25,000 because that was close to the industry average wage in 2019; the base weekly UI benefit amount I calculated was based on 32 hours of work a week for 12 months.
I looked at impacts with and without the current 11 week $300 a week UI bonus.
WITH $300 UI Bonus:
When coupled with the temporary 11 week $300 unemployment bonus leisure and hospitality workers with an annual wage of $25,000 whose hours are reduced from an average of 32 hours a week to 20 hours or week or FEWER can replace MORE than 100% of their full 32 hour wages ($481).
The graph below shows the total income for these workers including part time income, regular unemployment insurance, and the $300 supplement.
In ALL scenarios shown total income is more than 32 hour a week income. Total income with a reduction of 12 hours, to 20 hours produces the highest income at $913; full unemployment (no hours) produces the lowest total income of $600 [still more than 32 hour wage income].
As the chart shows workers with reduced hours that are MORE than 20 do NOT qualify for unemployment insurance and therefore their income will be LESS than their 32 hour wage.
WITHOUT the temporary 11 week $300 unemployment bonus SOME leisure and hospitality workers with an annual wage of $25,000 whose hours are reduced from an average of 32 hours a week to 12-20 hours or week can still replace MORE than 100% of their full 32 hour wages ($481).
The graph below shows the total income for these workers including part time income, regular unemployment insurance, and NO $300 supplement. In THREE scenarios shown total income is more than 32 hour a week income; 20 hours, 16 hours, and 12 hours. Total income with a reduction of 12 hours-to 20 hours-produces the highest income at $613; full unemployment (no hours) produces the lowest total income of $300 which would now be below the 32 hour a week wage of $481.
As the graph shows workers with reduced hours that are MORE than 20 do NOT qualify for unemployment insurance and therefore their income will be LESS than their 32 hour wage.
I don't know how many leisure and hospitality workers are working reduced hours, but with these assumptions the working while claiming program clearly could help those whose hours have been cut back, and especially so for the period that the $300 supplement remains.
NOTES:
Because of the Oregon working while claiming restriction that prevents part time wages from equaling or exceeding the weekly benefit amount, as incomes climb "working while claiming" may provide lesser benefits to higher wage workers.
There may be legislative opportunities to make reforms that would allow greater income disregards or adjust formulas to allow higher partial UI payments with smaller reductions in hours than existing formulas permit.. For example, Idaho allows workers to still qualify for partial unemployment benefits if their earnings are less than 150% of their unemployment weekly benefit vs the 100% maximum allowed in Oregon. A change like this would require careful analysis to evaluate the impact that it might have on the solvency of the unemployment insurance trust fund and the tax rate paid by employers.
Originally created and posted on the Oregon Housing Blog.
No comments:
Post a Comment