Getting employees off unemployment and back to work

May 30, 2020

Now that Virginia, and other parts of the country, are finally opening up and returning to business, employers are facing an unexpected concern: employees who are refusing to return to work.

Employers claim the reason is because many employees are earning more money collecting the enhanced unemployment benefits than they would otherwise earn working.

To address the pandemic, Congress passed a variety of unemployment insurance programs, including the “Relief for Workers Affected by Coronavirus Act,” which enhanced unemployment payments to the tune of an additional $600 a week from what employees would otherwise receive.

This benefit, provided through July 31, would permit an individual in Virginia who has suffered a lack of work (furlough/layoff) due to the pandemic a maximum benefit of $978 a week or almost $51,000 annually. Without the enhancement, the benefits are traditionally capped at $378 per week in Virginia.

While some employers questioned how an employee who earns much less than $600 a week could receive the benefit, the Department of Labor stated an individual is entitled to the full $600-per-week enhancement if the person earned “at least one dollar” of underlying benefits for the claimed week.

The law also provided enhanced benefits to those otherwise ineligible, including independent contractors and self-employed workers.

The DOL has already addressed some concerns from employers. For example, it issued guidance making clear that an individual who quits work without good cause to obtain additional benefits would be fraud and the person would be subjected to prosecution.

Some lawmakers are seeking to extend this enhanced benefit past July 31, which concerns employers who are seeing employees refusing to return to work since they would earn less working than receiving unemployment.

The Virginia Employment Commission has posted a variety of resources for employers to report employees who have been offered a return to work but who are refusing to return at https://www.vec.virginia.gov/html/employer-issue-report.html.

Through this webpage, the VEC is asking employers to provide information concerning individuals employers have hired/rehired, paid during the COVID-19 pandemic, or who have refused an offer to return to work.

One form is a “Job Refusal” form and addresses a scenario where an employer attempted to recall an employee from layoff/furlough and the person has refused the offer of work. https://employer.vec.virginia.gov/eForms/ff01

Another form addresses “Payment to Workers on Furlough during COVID-19.” This form is to be completed by employers who may have received funds from the Small Business Administration under the Paycheck Protection Plan (PPP) and are paying an employee his or her wages or paying the employee from another source, and the employer has received notice that the employee is also receiving unemployment benefits. https://employer.vec.virginia.gov/eForms/ff03

Employers who are aware of employees receiving unemployment and who have been rehired can also complete the “Employer’s Report of Rehire” to notify the VEC that the employer has recently hired or rehired an individual. https://employer.vec.virginia.gov/eForms/ff02

Unemployment benefits are a safety net and aren’t designed to be unlimited income replacement indefinitely, including where work is available. Unemployment exists where there is lack of work, not where work is available but where it is more lucrative to stay on unemployment.

Employers need to be vigilant in reporting these situations so the benefit is used properly and employers can get the necessary labor support needed to get back to business.