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Sunday, April 20, 2014

California EDD: New Developments on Federal Unemployment Extensions and Benefit Cuts (Updated September 17, 2013)

En español

September 17, 2013 4:10 p.m.

Updated: The number of individuals who have run out of benefits is now over 1,146,700.

The California Employment Development Department (EDD) is reminding recipients of unemployment insurance benefits that we are fast approaching the end of Tier 4 federal unemployment extension benefits.  This means up to ten weeks of additional unemployment benefits normally available once someone runs out of regular state-provided benefits and Tier 1, 2 and 3 extension benefits, will no longer be available for individuals who finish their Tier 3 extension benefits after August 11, 2013. The U.S. Department of Labor has officially notified EDD that California no longer meets the minimum criteria to file Tier 4 extensions because the state’s three-month average unemployment rate has dropped below 9%.

This means the EDD cannot start Tier 4 federal extensions with a beginning date of August 18, 2013, and after.  Individuals who begin receiving Tier 4 federal extension benefits on an extension with a beginning date of August 11th or before will continue to receive these benefits until they exhaust them or until December 28, 2013, whichever comes first. Refer to the Potential Maximum Weeks of Benefits Provided chart for the filing deadlines for all federal extension benefits available in California.

In July, the EDD announced that because of its improving job market, California is no longer eligible for new Tier 4 benefits. The federal government provides the Tier 4 benefits only to states where the unemployment rate averages 9 percent or higher for three months in a row. California’s 8.5 percent June unemployment rate brought its three-month average below 9 percent.

On Thursday, August 8, 2013, the EDD was notified by the U.S. Department of Labor that the EDD can now allow people who finish their Tier 3 federal extension benefits before August 11, 2013, to qualify for the Tier 4 federal extension. Based on the U.S. Department of Labor’s interpretation of the federal law, this provides an additional week before the Tier 4 extensions trigger off.

The EDD will automatically file Tier 4 federal extensions for those eligible individuals who finish their Tier 3 federal extension before August 11, 2013.  These individuals will receive a notice of eligibility and their next continued claim form.  There is no need for these individuals to contact the Department.

The EDD originally estimated that approximately 100,000 Californians collecting benefits as part of the Tier 3 federal extension will be the first to be impacted by the loss of Tier 4 eligibility.  While some of these individuals will now qualify for the Tier 4 federal extensions, at this time the EDD cannot estimate how many more may qualify as these individuals are still in the midst of collecting Tier 3 benefits.

Tier 4 benefits have been payable in California since February 2010 when unemployed individuals run out of their regular state-provided benefits and then Tiers 1, 2 and 3 of federal extension benefits. The loss of Tier 4 extension benefits means the new maximum potential benefit amount is up to 63 weeks, including up to 26 weeks of state-provided regular benefits and up to 37 additional weeks of federal extension benefits. (See chart below.)

In addition, Californians collecting Unemployment Insurance (UI) benefits should be aware that all tiers of federal extension benefits are set to expire at the end of 2013. Unless the U.S. Congress makes any further changes on December 29th, the maximum amount of unemployment benefits available to Californians will return to the up to 26 weeks of benefits available under a regular UI claim. At the peak of the recession, up to 99 weeks of benefits were available through a combination of state and federal extension benefits.

Sequestration Cuts

As part of sequestration, Congress requires that all states cut the benefit amounts of the federal Emergency Unemployment Compensation, or EUC, program. In California, this means a cut of 17.69% on the weekly and maximum benefit amounts for all new federal extensions (Tiers 1 through 4) filed with an effective date of April 28, 2013, or after.

This cut will NOT impact anyone collecting federal extension benefits on an existing tier filed with an effective date before April 28, 2013. The cut will be implemented when an individual ends that current tier and becomes eligible to receive benefits on the next extension tier filed with an effective date of April 28, 2013, or after.

Below is a breakdown of the benefits that will be impacted by the sequestration cuts in California. After each federal extension is filed, an eligibility notice is mailed providing the effective date of the extension, the weekly benefit amount, and the maximum benefit amount available. For federal extensions filed with an effective date of April 28, 2013, or after, the notice will reflect a 17.69% cut in the weekly and maximum benefit amounts.

We encourage you to use the Sequestration Reduction Calculator to estimate what your weekly benefit amount will be after the 17.69% sequestration cut.

BENEFITS IMPACTED BY SEQUESTRATION CUTS
Claim/
Extension
Effective Date
BEFORE April 28, 2013
Effective Date
April 28, 2013 – December 22, 2013
Regular Claim Benefits are not impacted Benefits are not impacted
Tier 1 Benefits are not impacted Benefits will be cut by 17.69%.
Tier 2 Benefits are not impacted Benefits will be cut by 17.69%.
Tier 3 Benefits are not impacted Benefits will be cut by 17.69%.
Tier 4 Benefits are not impacted Benefits will be cut by 17.69%.

For more information on the sequestration cut, please visit our frequently asked questions on the FAQ – Extended Unemployment Benefits page or review the Critical Information About Cuts to Federal Extension (DE 6331SEQ)insert.

Potential Maximum Weeks of Benefits Provided

Federal extensions of unemployment benefits first became available in California in June 2008 and since then a total of more than $41 billion in extension benefits have been paid in the state. Once offering up to 73 additional weeks of unemployment after someone ran out of their regular up to 26 weeks of state-provide benefits, federal extensions will now provide up to 37 additional weeks of benefits.

The following chart is a breakdown of the federal extension benefits and the total maximum weeks of unemployment benefits available in California. The total number of potential maximum weeks of benefits available depends on when your regular UI claim and extensions are filed.

Note: The sequestration cuts do not change the potential maximum number of weeks available but will reduce the weekly and maximum dollar amounts potentially payable by 17.69%. For example, individuals whose federal EUC extension weekly benefit amount is $450 and maximum benefit amount is $6,300 will have a reduced weekly benefit amount of $371 and maximum benefit amount of $5,186 after the sequestration cut. The amount of weeks available within each extension tier remains the same; only the overall benefit amount available is cut.

Federal Unemployment Benefit Extensions
Potential Maximum Weeks Of Benefits Provided
Claim/
Extension
Filing Date
Feb 19, 2012 –
May 6, 2012
May 13, 2012 –
May 20, 2012
May 27, 2012 –
Aug 26, 2012
Sep 2, 2012 –
Aug 11, 2013
Aug 18, 2013 –
Dec 22, 2013
Claim/Extension Filing Deadline DateLast Payable Week Ending Date
Regular
Claim
Up to 26 weeks Up to 26 weeks Up to 26 weeks Up to 26 weeks Up to 26 weeks Once someone becomes unemployed Once someone collects all available benefits or the claim ends, whichever occurs first
Tier I Up to 20 weeks Up to 20 weeks Up to 20 weeks Up to 14 weeks Up to 14 weeks December 22, 2013 December 28, 2013*
Tier 2 Up to 14 weeks Up to 14 weeks Up to 14 weeks Up to 14 weeks Up to 14 weeks December 22, 2013 December 28, 2013*
Tier 3 Up to 13 weeks Up to 13 weeks Up to 13 weeks Up to 9 weeks Up to 9 weeks December 22,
2013
December 28, 2013*
Tier 4 Up to 6 weeks Up to 16 weeks Up to 6 weeks Up to 10 weeks 0 weeks August 11, 2013 December 28, 2013*
Separate
FED-ED
Up to 20 weeks 0 weeks 0 weeks 0 weeks 0 weeks May 6, 2012 May 12, 2012
TOTAL Up to 99 weeks Up to 89 weeks Up to 79 weeks Up to 73 weeks Up to 63 weeks

*There are special claims that have a week ending date other than Saturday. In those cases, benefits may be payable for the week ending January 1, 2014.

Work Search Requirements for Eligibility of Extensions Benefits

Federal legislation on extension benefits requires individuals to meet specific work search requirements to be paid benefits on their federal extensions. Those collecting federal extensions could lose their benefits if they fail to comply with the work search requirements of the federal law. Individuals collecting regular UI benefits and federal extension benefits have always been required to look for work. However, this legislation requires individuals collecting federal extension benefits (Tiers 1-4) to also meet the following work search requirements, in addition to meeting all other UI eligibility requirements:

  • Document their work search efforts, which now must include contacts with at least three different employers each week; and
  • Provide their work search documentation upon request to the EDD; and
  • Ensure they are registered in EDD’s CalJOBSSM, California’s online job listing and resume service, by entering or updating their résumé in the system.

In addition, those individuals collecting benefits on the first or second Tier of federal extension benefits must appear at a local America’s Job Center of CaliforniaSM (formerly known as One-Stop Career Centers) to learn about employment services offered by the EDD and local partners, and to verify that they are complying with UI eligibility requirements. Individuals who must complete these mandatory Reemployment and Eligibility Assessments (REA) appointments will receive notices on appointment details. They could lose their benefits if they fail to appear for that appointment and/or fail to comply with other requirements of the law. For more information on the REA appointments, please visit the Reemployment Eligibility Assessment page.

For more information on the work search requirements, please visit our frequently asked questions on the FAQ – Extended Unemployment Benefits page.

Current Benefits Status

Currently, there are more than 750,000 people certifying for benefits in California. Almost half of these customers are collecting on a federal extension claim while the remainder are somewhere in the midst of a regular unemployment claim.

Between regular and federal extension benefits, the EDD has paid a total of $17.1 billion in benefits for calendar year 2011, $13.8 billion for calendar year 2012, and about $5.8 billion through June 2013. These benefits provide critical sustenance to unemployed workers and their families, in addition to local businesses where much of the benefits are spent on basic needs.

Customers Who Have Run Out of Maximum Benefits

As of September 16, 2013, there have been close to 1,146,700 unemployed workers in California who have run out of all available benefits.

Unemployed individuals may be eligible for assistance to meet basic needs as well as other services such as health care, counseling, employment and training assistance. For more information, read the Assistance for Unemployed California Residents flyer and the Job Dislocation Brochure: EnglishSpanish.

For any further developments in the Unemployment Insurance program, as well as all other EDD programs and services, we encourage our customers to watch for updates on our website and on our EDD Twitter and Facebook pages.

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