Plain Language Summary of 2011 UI Law Changes
A complete Plain Language Summary (PDF) of Wisconsin Act 198 and 236
Forfeiture for Concealment
Currently, a claimant who commits concealment forfeits an amount of benefits equal to a full week of future benefits payable at the weekly benefit rate (WBR), for each act of concealment of work, wages or a material fact related to benefit eligibility. After the department issues a first determination of concealment, the forfeiture for subsequent acts of concealment escalates to 3 times WBR and, following a second determination, the forfeiture is 5 times the WBR. Act 198 increases the escalating scale by increasing the respective forfeiture amounts from 1 times, 3 times and 5 times to the higher amounts of 2 times, 4 times and 8 times WBR.
Current law provides the employer’s account is charged for “forfeited” benefits, even though the benefits remain in the Unemployment Reserve Fund and are not paid to a claimant. Act 198 repeals the charging of benefits to the employer and changes the “forfeiture” concept to “ineligibility” for benefits in the amounts of 2 times, 4 times or 8 times the weekly benefit rate (WBR).
Benefit ineligibility under these circumstances will no longer result in an employer charge. In addition, the claimant does not have to pay taxes as this "ineligibility" is no longer considered a benefit payment.
Finally, the claimant will not receive a waiting period credit under s. 108.04(3) for the period of ineligibility for concealment.
EFFECTIVE DATE for changes to s. 108.04(11)(a), (b), (be) and (bm): October 21, 2012.
Ineligibility of claimants for benefit year earnings
The current disqualification for full-time work is complex. Act 198 denies benefits to a claimant who, during a particular week, for 32 hours or more:
- performs work;
- has wages ascribed to the claimant under s. 108.04(1)(bm) (i.e., could have performed work available to him or her);
- and/or received holiday pay, vacation pay, termination pay, or sick pay under circumstances satisfying requirements for treating such compensation as “wages” for these purposes. See s. 108.05(4), (5) or (5m).
Under current law, a claimant might qualify for a minimal benefit amount ($5) notwithstanding wage earnings of as much as $565. Act 198 provides that a claimant is ineligible to receive benefits for a week if the claimant receives more than $500 during a week or receives sick pay, holiday pay, vacation pay, or termination pay which by itself or in combination with wage earnings is equivalent to more than $500.
EFFECTIVE DATE for changes to s. 108.05: October 21, 2012.
Repeal of suspension for failure or refusal to take a test for illegal drugs
Act 198 repeals the benefit suspension enacted in 2011 (in the state budget bill) for a claimant’s failure of a pre-employment drug test or refusal to take such test. Act 198 also eliminates requirements related to employer record keeping and the department retention of such reports.
EFFECTIVE DATE for repeal of s. 108.04 (8)(b), (13)(cm) and 108.09 (4r): Weeks of unemployment beginning April 22, 2012.
Amend ineligibility for failure to perform work searches
Act 198 creates s.108.04 (2) (bm): “A claimant is ineligible to receive benefits for any week for which there is a determination that the claimant failed to conduct a reasonable search for suitable work and the department has not waived the search requirement under par. (b). If the department has paid benefits to a claimant for any such week, the department may recover the overpayment under s. 108.22 (8).”
This statute overrides the provisions of Wis. Admin. Code §DWD 127.08, which prohibits disqualification in certain kinds of cases for claim weeks already paid prior to the eligibility determination, unless the claimant made a false statement or concealed or misrepresented information pertaining to his/her work search efforts. As a result of Act 198, a claimant is ineligible to receive benefits for any week in which there is a department determination that the claimant failed to conduct a “reasonable work search” (as detailed in Wis. Admin. Code Ch. DWD 127 Work Search), except when the work search requirement has been waived. The part of the rule that is the contrary to the new statute, §DWD 127.08, should be disregarded as overridden by the statute. If DWD paid benefits to a claimant for any week the claimant did not meet the work search requirement, DWD may recover the overpayment.
EFFECTIVE DATE for treatment of s. 108.04(2)(a)3. (intro.) and (bm): (a) Determinations issued beginning April 22, 2012 or (b) in relation to determinations that are appealed, to decisions issued beginning April 22, 2012.
Tighten benefit eligibility requirement of availability for work
Act 236 provides that a claimant does not satisfy the requirement of availability for work in any week in which he or she is located outside of the U.S or Canada for more than 48 hours unless the claimant: (1) has authorization to work in that country; and (2) there is a reciprocal agreement concerning the payment of unemployment benefits between that country and the United States.
EFFECTIVE DATE of s. 108.04(2)(ae): Weeks of unemployment beginning April 22, 2012.
Assess and collect a 15% penalty on benefit overpayments resulting from fraud
In November 2011, the federal government enacted a mandate that states impose a 15% penalty on overpayments resulting from claimant fraud (i.e. “concealment”) by October 21, 2013, to be placed in states’ unemployment reserve funds. Act 236 requires the department to assess the 15% penalty and authorizes the issuance of determinations, appeals, warrants and levies to enforce and collect the penalties. The penalty proceeds initially will be used to fund program integrity functions for the UI program, pursuant to Act 198. The law provides for a separate, nonlapsible program integrity fund, to which recovered penalties will be credited beginning October 21, 2012. Penalty proceeds for overpayments established after October 21, 2013 will be payable to the Unemployment Reserve Fund.
EFFECTIVE DATE of s. 108.04 (11) (bh), 108.09 (2) (b), (3) (a) 1, and (8)
(b), 108.22 (8) (bh), 108.225 (1) (b), (16) (am) 1. (intro.), and (17) and
Weeks of unemployment beginning October 21, 2012.
EFFECTIVE DATE of s. 108.16 (6) (n): The provision crediting overpayments to the unemployment reserve fund first applies to overpayments established after October 21, 2013.
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