Biden's Labor Department probably won't be able to pay out unemployment to workers cut off by their states

·2 min read
Labor Secretary Marty Walsh
Labor Secretary Marty Walsh. Jacquelyn Martin/AP
  • Biden's Labor Department likely won't be able to pay out unemployment benefits to workers who are cut off.

  • Workers in at least 22 GOP-led states are seeing their federal unemployment benefits cut short.

  • Advocates and politicians like Sen. Bernie Sanders had called on DOL to disburse PUA benefits.

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The Department of Labor likely won't be able to step in and pay out unemployment benefits to the millions who will get cut off early.

An administration official told Insider on Thursday that the department has been trying to figure out any possibility for what they can do - if at all - but doesn't see what can be done.

At least 22 GOP-led states have moved to end their participation in federal unemployment benefits early, with many citing a so-called labor shortage as a reason to cut benefits short and compel workers to return. At least 3.5 million workers will be impacted by that aid ending in June or July instead of September.

That means that some workers will lose more than just an additional $300 in weekly benefits. Some will see their entire incomes vanish. Those who are on Pandemic Unemployment Assistance (PUA) - a pandemic-era creation that expands eligibility for benefits to gig workers, among others - would lose their benefits completely. The same is true for workers who have exhausted the standard weeks of unemployment benefits, but continue to receive them through the Pandemic Emergency Unemployment Compensation program.

The official said the DOL's enforcement authority is limited - and generally extends to taking away administrative funding.

The agency will likely release an official letter with guidance on Friday, which CNN and Politico both reported on Thursday evening.

The disbursement of PUA has been one area where politicians and advocates say that the Department of Labor could step in and continue to pay out benefits.

The National Employment Law Project, a progressive think tank, wrote a letter to the Labor Department outlining the obligation to continue to pay out PUA, and potential avenues for getting the aid to recipients. One option: The DOL holds states accountable for paying PUA. Another is having different states disburse benefits to workers in impacted areas, akin to hurricane relief.

"The way that the law, the CARES Act, is written, it requires DOL to provide Pandemic Unemployment Assistance," Steve Gray, senior counsel on NELP's Social Insurance Team, previously told Insider.

Sen. Bernie Sanders had also written a letter to Labor Secretary Marty Walsh compelling the department to take action.

"As Secretary, you are obligated to ensure this aid gets to workers," Sanders wrote in his letter. "To ensure that obligation is met, I urge you to commit to holding states accountable for their role in administering PUA benefits."

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