TASB Risk Management Fund

COVID-19 and Unemployment Compensation: Your Questions Answered

May 18, 2020 James Ezell

COVID-19 unemployment forms

Summer vacation and other scheduled breaks can complicate unemployment claims, even under normal circumstances. The COVID-19 pandemic is forcing all of us to adapt to a new normal that carries even more challenges and complications. Here are the most frequently asked questions about COVID-19 and unemployment claims fielded by TASB Unemployment Compensation Attorney James Ezell.

Benefits eligibility

Q: How will school closures related to COVID-19 affect employees’ ability to pursue unemployment compensation claims?

A: Generally, it will be easier for employees to pursue claims during the pandemic. Because of COVID-19, the Texas Workforce Commission (TWC) waived the required “waiting week” and job search requirements.

Q: Will substitutes and others who don’t receive pay during a closure be eligible to file for unemployment compensation benefits?

A: Likely, yes. If an employee, including a substitute employee, is not working or receiving pay, through no fault of their own, they likely will be able to file a valid claim for benefits.

Q: Are employees who are getting some pay, but not as much as before, eligible for unemployment compensation benefits?

A: They might be, depending on how much they are earning now compared with what they normally earn. Employees working a reduced schedule earning less than 125 percent of their unemployment weekly benefit amount (WBA) can receive benefits totaling the difference between their weekly wage and 125 percent of their WBA. If an employee’s reduced weekly wage amount exceeds 125 percent of their WBA, they will receive no benefits that week.

Q: What if an employee who is collecting unemployment compensation benefits refuses our return-to-work offer?

A: If you offered any of your employees a chance to return to work and they refused, notify the Texas Workforce Commission by completing the Employer Work Refusal Documentation form.

Q: What should we tell employees who ask questions about filing for benefits?

A: Refer them to the TWC. As the state agency charged with administering unemployment, the TWC is the best-qualified source of information. You might inadvertently give the employee inaccurate information, even with the best intentions. You can also direct employees to the TWC unemployment benefits FAQ.

Q: Are there minimum and maximum weekly benefit amounts employees might be eligible for?

A: Yes, the minimum is $69, and the maximum is $521. The TWC calculates an employee’s benefit amounts based on his or her past wages. For more information about calculating benefit amounts, visit the TWC website.

Letters of reasonable assurance

Q: Would a letter of reasonable assurance protect my district from unemployment compensation claims filed during the pandemic-related closure?

A: No. Letters of reasonable assurance protect districts during normal scheduled breaks, such as summer or winter vacation. An emergency closure is not “an established and customary vacation period or holiday recess,” as indicated in the Texas Labor Code. Reasonable assurance letters may be used to protect your district against current claims that extend into summer break. So, it is important to issue these letters as usual.

Q: How can districts prepare for the resumption of normal operations after the pandemic?

A: At your normal time, at least before school ends, issue your letters of reasonable assurance to non-contract employees for next year. If an employee refuses to sign, handle the situation as if they quit, just as you always have. When summer break begins, be prepared to inform the TWC when a claimant has received reasonable assurance of work from your district. The TWC will adjust the benefit amount due to the claimant and protect the district from further charges over break. Lastly, stay flexible. The coronavirus pandemic rapidly evolves. The TWC could update rules and regulations as conditions change. Districts should stay informed and prepared to respond.

Responding to claims

Q: How should we respond to the TWC if a substitute files an unemployment compensation claim?

A: Respond that this is a temporary layoff and the employee is called on an as-needed basis. Cite the last day the substitute physically worked as the last date of employment. You should make sure the claimant is not:

  • A long-term substitute your board decided to continue paying
  • Receiving retirement payments from the Teacher Retirement System (if so, notify the TWC)

Remember that substitutes generally qualify for much lower benefit amounts than regular employees. Unemployment compensation claim amounts are based on an employee’s earnings over the past 18 months. Substitutes have irregular work schedules, and many work fewer than 30 hours per week.

Q: What should we do if a regularly scheduled employee receiving normal pay during the pandemic files an unemployment compensation claim?

A: Generally, he or she will not be eligible for benefits, and the TWC should void the claim.

Here is a sample response from your district to the TWC:
The claimant has not been separated and continues to receive their regular wages. The claimant is still on call and expected to work remotely where possible and be able to return or perform duties when asked. The claimant has reasonable assurance of continued work after summer break, which begins on <<DATE>> and ends on <<DATE>>.

Q: What should we do if we are not going into the office at all, we’re only going in periodically, or the mail is delayed and we get a TWC notice that is past due?

A: If you receive correspondence that is past the due date for a response, you can still reply. You will most likely get scheduled for a hearing where you can present your case and explain the reason for your late reply. You should be prepared to present impartial evidence, such as documentation from your local post office that states carriers stopped delivering mail. The TWC increased the capability and bandwidth for their online response service, so consider setting up an online employer account.

Most mail service is not being delayed, so the TWC presumes mail was delivered three days after it was sent. Overcoming this presumption is a tough hurdle. Furthermore, the TWC has no way of knowing you are not checking your mail or that you instructed the post office to hold your mail. If you do either, you run the risk of losing your rights to remain a party of interest by responding late.

Q: The TWC is granting most claims for day-to-day subs, and we are receiving a high volume of claims. Do we still need to respond to them?

A: Yes, it is a good idea to respond to all claims so you remain a party of interest, even if you are not contesting the merits of the claim. You will retain your rights to submit further information to the TWC as the situation changes over summer break. You may tell the TWC when your summer break begins and that the person has reasonable assurance to return to work when the next school term begins.

Substitute employees have always been eligible to claim benefits in between assignments. The response for the current situation is to tell the TWC that the person is a substitute who is called on an as-needed basis. Use the last day they physically worked as their last date of employment. Select temporary layoff with a recall date of the beginning of your next school term.

Q: Can we save time by filing one response to the large volume of claims coming in for substitutes?

A: Yes, as long as the facts of each claim are the same. For example, if multiple substitutes were temporarily laid off because of the pandemic, it would be appropriate to file a single response with the TWC. Simply list your TWC account number (printed on the correspondence from TWC), the substitutes’ names, the last four digits of their Social Security numbers, and the rest of the reply mentioned in the previous question. If the facts are different, use a separate reply. For example, a substitute who was fired or quit should get their own unique response.

Q: What does "chargeback” mean, and how should I appeal if TWC correspondence notes that chargeback does not apply?

A: You do not need to appeal. Chargeback has to do with taxed employers who must pay quarterly taxes to the TWC. It does not apply to schools, which are reimbursing accounts. A reimbursing account reimburses the TWC for benefits paid out to claimants; it does not pay a "chargeback."

Federal relief

Q: What is the CARES Act?

A: The Coronavirus Aid, Relief, and Economic Security (CARES) Act dated March 27, 2020, provides additional unemployment benefits to qualifying claimants. Section 2103 of the CARES Act provides that reimbursing employers, including school districts, will receive 50 percent of the benefits they pay as a refund.

Q: Can you share an example of how the Act helps claimants?

A: Claimants who qualify to receive regular unemployment benefits may receive an additional $600 per week through July 31, 2020, by adding the Federal Pandemic Unemployment Compensation (FPUC) benefit. The extra $600 per week ends on July 31, 2020, but regular benefits may continue. This $600 in federal money goes to all employees who qualify for unemployment benefits — even partially unemployed individuals such as substitutes. According to the Department of Labor, “[i]f the individual is eligible to receive at least one dollar ($1) of underlying benefits for the claimed week, the claimant will receive the full $600 FPUC.”

This may generate pushback from employees who have a very real possibility of receiving more in benefits than they did when they were working. Because of the 50 percent benefit refund under the CARES Act, it remains important to closely monitor claims as a party of interest.

Q: Where can I get more information about unemployment benefits generally and the CARES Act specifically?

A: The TWC is a reliable source of information because it is tasked with setting the rules, making the decisions, and implementing the policy for benefits to be paid. For general benefits information, take advantage of these COVID-9 employer resources. For information about federal funding, see this CARES Act overview.

How the Fund can help

Fund Unemployment Compensation program members who have questions can contact TASB Unemployment Compensation Attorney James Ezell at james.ezell@tasb.org. Anyone can visit our InsideRM blog for best practices and timely information about unemployment compensation claims.

Editor's note: This article was originally published in April 2020 and has been updated for accuracy and comprehensiveness.

Tagged: benefits, claims, coronavirus, COVID-19