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Post-Covid Public Benefits: How to Protect Your Clients Amidst the Chaos

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Post-Covid Public Benefits: How to Protect Your Clients Amidst the Chaos

This program will focus on Workers Compensation, Social Security Disability Benefits, and Unemployment Benefits. After an overview of each program’s basics, we will begin with a recapturing public benefits policies from the Covid-19 Pandemic. We will review and assess the current state of these benefits programs in terms of both legal changes and operational changes. The final portion of the program will look at the political, global, and economic factors impacting these programs. We will focus on predicting the impacts on public benefits and proactive steps we can take to best prepare your clients.

Transcript

 Hi everyone. My name is Maren Miller Bam. I'm an Attorney and owner of Salus Disability Law. My presentation is entitled, "Post-COVID Public Benefits." How to protect your clients amidst the chaos. The purpose of this presentation is to really go over what governmental or public benefits programs existed during the COVID-19 pandemic. What the state of those benefits programs are today and the best ways that you can advise your clients so that they can make good choices specifically regarding their employment, their employees, employment, and their health. So the first thing that's critical is to understand what is a public benefit. According to usa.gov, a public benefit or governmental benefits are local state or federal benefits that provide income or other necessities like food, shelter or medical care. Some examples of public benefits include Medicaid, TANIF, SNAP, SSDI/SSI, unemployment, workers compensation, housing assistance, WIC, FMLA and financial aid. Although there are many other public benefits that can be available. During the COVID-19 pandemic, there was significant expanded aid available to people across the nation for a variety of different areas. Specifically there were economic impact payments. This is straight cash assistance provided to individuals who met the criteria. There were advanced child tax credits. These were refundable tax credits paid in advance of filing your taxes based on the number of children you have and the cost of childcare and your income. There was also an eviction moratorium in a number of states. This prevented people from losing their housing, even if they could not make rent payments. There were also a number of utility services that were reduced price, reduced price internet became a big one as schools moved to online education in many states. Also there were programs through FEMA for funeral expenses if anyone passed away due to the COVID-19 pandemic, they could get their funeral expenses covered. There was also student loan forbearance, and the ability to ensure that you could make payments for your other bills and put off your student loans if necessary. There are also a number of longstanding public benefits programs that exist for people. These programs have been around both pre-pandemic and continue to exist post-pandemic. The ones that we're going to really focus in on today are Social Security benefits, specifically disability based benefits. Although we will touch on retirement benefits, unemployment benefits and benefits under the Family Medical Leave Act. These benefit programs existed pre-pandemic, but experienced some major and significant shifts during the pandemic and impact generally in many ways a similar population of the country. These are focused on individuals who have been members of the workforce and are falling out of the workforce, whether they're becoming unemployed, whether they're needing to take leave, or whether they are disabled and unable to work in general, this generally is something that in the context of working, we can really map out. So as this presentation focuses on these three benefits types, it's important to understand exactly where these benefits came from and how they exist in the world today. So just in terms of the basics, the Social Security act was signed in 1935, but monthly benefits for most individuals did not start until 1940, socialsecurity.govs frequently asked questions, outlines how the act was implemented. And when benefit payments started. FMLA was signed into law as the Family and Medical Leave Act of 1993 according to the department of labor.gov. This act was only signed in about 30 years ago and created a federal concept of leave for individuals. Unemployment benefits were also created in 1935. They're considered what's called a federal state program per the Center on Budget and Policy Priorities. What that means in terms of federal state program is the states have the authority to implement the program, set their own criteria, but funding is earmarked from the federal government, not entirely but at least to an extent. While these programs are distinct in many ways, the impact of the pandemic on people's abilities to work was indisputable. And the commonality of these three programs is that they frequently assist individuals who cannot work on a consistent basis. The pandemic has shown us that there are some major shifts that have occurred in the workforce. The COVID-19 pandemic changed the landscape of work as we know it. Workers were sent home, certain roles were deemed essential. Others were deemed non-essential or shut down entirely. Telecommuting became a new normal and many schools closed for in person classes. These shifts dramatically impacted the way individuals participated in the labor force. CDC guidelines on the need to quarantine following COVID-19 exposure symptoms or positive tests required many employers to allow individuals to stay home for extended periods of time. The shifting landscape left many individuals in the hospitality industry specifically as unemployed. Many individuals with children or sick family members required leaves of absences to be able to keep their families safe. Many workers who were barely hanging on due to medical problems or age fell out of the labor force entirely. The Kansas City Federal Reserve Bank noted that 2 million workers fell out of the labor force due to the pandemic. This essentially constitutes a labor forage shrinkage of 2 million people in excess of what would normally occur based on age and our shifting population specifically with baby boomers leaving the labor force. On March 13th, 2020, President Trump declared a national emergency. And by March 15th, 2020 states began shutting down. As of May 9th, 2020, the United States unemployment rate hit 14.7%. This was the highest unemployment rate since the Great Depression according to the CDC COVID-19 timeline. Throughout 2021, the US Bureau of Labor Statistics reported that over 47 million people quit their jobs. And this phenomenon has been called the Great Resignation. So how does the shifting labor force impact our legal practice? While this may sound in many ways like a water down economics lesson, or even a very basic review of recent history, the economic and political climate absolutely impact the legal profession and I'd argue that they do so on a daily basis. It is critical for us to stay abreast of change, to make sure that we can help our clients, help them manage their situations and cases to anticipate their needs and keep our businesses afloat as we navigate the complex landscape. This presentation is intended to benefit employment law and disability law attorneys, and to help people get a bird's eye view of what's on the horizon as we continue to see our labor force shift and our economic and political climate change. We're going to take the presentation one program at a time to deep dive what had been occurring in each public benefit and where it's headed now. So starting with FMLA or the Family and Medical Leave Act, just to recap, this was established in 1993 by 29 USC Section 2601. And it's administered through the department of labor, according to the department of labor, FMLA applies to all public agencies, all public and private elementary and secondary schools and companies with 50 or more employees. Smaller companies with less than 50 employees are not required to provide FMLA and federal employees are typically protected under a different program. What does FMLA require for employers? Typically an employer must provide an eligible employee with up to 12 weeks of unpaid leave each year for any of the following reasons, the birth and care of the newborn child of an employee, for placement with the employee of a child for adoption or foster care, to care for an immediate family member, i.e, a spouse, child, or parent with a serious health condition, or to take medical leave when the employee is unable to work because of their own serious health condition. Employees are eligible for leave if they have worked for their employer for at least 12 months, at least 1,250 hours over the past 12 months and work at a location where the company employees 50 or more employees within 75 miles. Whether an employee has worked the minimum 1,250 hours of service is determined according to FLSA principles for determining compensable hours of work. We're not going to deep dive so heavily into how somebody becomes eligible for FMLA, but rather look at what happened to FMLA during the pandemic, and then the state of FMLA today, and what is potentially on the horizon? During the pandemic, there were some key changes made to FMLA. These were made under FFCRA. This is the Family's First Coronavirus Response Act. This was promulgated by the Secretary of Labor and signed by President Trump. It is a time limited and temporary statute that became effective on April 1st, 2020, and had a set end date of December 31st, 2020. According to the Federal Register, the FFCRA expanded FMLA in two distinct ways. It essentially created two separate programs, the Emergency Paid Sick Leave Act or EPSLA, and the Emergency Family and Medical Leave Expansion Act. The EFMLEA. So this program is important to note that these two programs were created under a temporary rule. They were not to last forever. It really addressed some core objectives from multiple angles. It was focusing on the public health crisis that we were dealing with due to the COVID-19 pandemic and orders to stay home. It was also addressing challenges that arise based on exposure to COVID-19 and the potential to pass along the virus. It recognized that the impact of the pandemic was hitting both employees and employers and where this rule was very effective, is that it sought protections for both. Specifically the Department of Labor used the FFCRA to implement paid leave policies, to address the public health crisis during the pandemic. It allowed companies with less than 500 employees to use tax credits to help finance the cost of paid leave. So it was not only providing paid leave, which is new from FMLA to an employee, but it was also helping employers afford that so that they could make decisions that benefited society during a public health crisis. So as this was being expanded, there were a few challenges. Specifically the State of New York sued the Department of Labor in the Southern District of New York for violating the Administrative Procedure Act. Specifically this is a case entitled, "The State of New York Versus the US Department of Labor." And for anyone interested in looking it up, it's 20 CV 3020. The case centered on four main issues with the FFCRA, the work availability requirement, the definition of healthcare provider, the provisions about intermittent leave and the documentation requirement. In response to this case, the FFCRA was amended by the Department of Labor on September 16th, 2020. Most of the amendments just clarified the main rule and shifted some definitions to expand clarity, but the substance of the rule remained largely the same. The FFCRA also was expanded a number of times, specifically the Consolidated Appropriations Act expanded the tax credits to employers who voluntarily extended the paid leave until March 31st, 2021. And then as part of the American Rescue Plan, President Biden expanded the FFCRA tax credits through to September 30th, 2021. So what did they expand? What is the program? As we mentioned, there are really two distinct programs available under this. So under 29 CFR Subsection 826, there were two key programs created. The first is the Emergency Paid Sick Leave Act. This is under 29 CFR subsection 826.22. This provides two weeks or 80 hours of paid sick leave if an individual is subject to quarantine. It also provides two weeks of Paid Sick Leave at the two thirds the pay rate, if the individual is caring for somebody who's subject to a quarantine, the eligible employer is entitled to a fully refundable tax credit equal to the required paid sick leave. If they allow their employees to take the time. This tax credit also includes the eligible employer's share of Medicare, tax comp, taxes imposed, and all eligible cost of maintaining health insurance coverage for the employee during the sick leave period. The eligible employer is not subject to the employer's share of Social Security tax imposed on those wages. This comes from the IRS's FFCRA fact sheet. They basically put out an entire publication that tells employers how the tax credit works and what they will receive. So to kind of recap a couple of the key elements of this it's a two week provision paid sick leave. So paid in full if the employee is quarantined. Is two thirds pay rate if they're caring for an individual subject to quarantine. So think immediate family members, spouse, young children, sometimes parents, depending on the scenario, then the employer receives a refundable tax credit. So it's not the same as just getting a normal tax credit where at the end of the year you owe X in taxes and you may get a refund if you have paid in more than you owe. This is directly refundable in real time essentially to employers. The other side of this expansion was the Emergency Family and Medical Leave Expansion Act. An employee may receive paid family and medical leave equal to two thirds of the employee's regular pay up to a maximum of $200 per day and $10,000 in the aggregate for up to 10 weeks. This is under 29 CFR Subsection 826.24. Eligible employers are entitled to receive a credit in the full amount of the qualified sick leave wages and qualified family leave wages plus eligible qualified health plan expenses, and the eligible employer share of Medicare tax. So this is virtually synonymous with the Emergency Paid Sick Leave Act tax credits. This went from April 1st, 2020 and ended in March 31st, 2021, according to the IRS's FFCRA fact sheet. Employers with fewer than 25 employees do not have to restore employees to their former position at the position held by the employee when they leave. Commenced does not exist due to economic conditions or other changes in the employer's operating conditions that affect employment and are caused by a public health emergency during the period of leave. This is 29 CFR Subsection 826.130. So that provides a key carve out for small employers. It's interesting because traditionally FMLA's carve outs begin at the 50 employee mark. Here this is even smaller employees, 25 or less, and they're essentially not requiring employers to hold a position open during the pandemic while their business may already be struggling for when people come back to work. So to kind of dig a little bit deeper into the Emergency Paid Sick Leave Act. This is under 29 CFR 826.20, eligible employers provide employees with paid sick leave if the employee is unable to work, including telework due to any of the following. So this is how you establish eligibility. The employee is under a federal State or local quarantine or isolation order related to COVID-19. The employee has been advised by a healthcare provider to self quarantine due to concerns related to COVID-19. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis. The employee is caring for an individual who is subject to a federal State or local quarantine or isolation order related to COVID-19, or has been advised by a healthcare provider to self quarantine due to concerns related to COVID-19. The employee is caring for the child of such employee if the school or place of care of the child has been closed, or the childcare provider of such child is unavailable due to COVID-19 precautions, the employee is experiencing any other substantially similar conditions specifies by the US Department of Health and Human Services. This is essentially catchall provision for something that's close, but doesn't quite fit. So what do we have here? Essentially, we have two ways that an employee can be covered under the Emergency Paid Sick Leave Act. They're dealing with something that makes them unavailable due to their own exposure to COVID or somebody they care for needs their care due to some exposure to COVID. So whether it's a mandate by the government, a diagnosis or advice by a healthcare provider, or some other fundamental difficulty with childcare, as a result of the pandemic, really looking to the schools and day cares being shut down. So this essentially ties in anything that has to do with exposure to COVID. For the Emergency Paid Sick Leave Act for the employee and the employer, there's a couple other rules that are included. So we talked about that the pay rate for the first 80 hours so long as it's based on the employees need to use this was their pay rate. There is a cap on it, and there's a floor on it. So it's interesting to note that the minimum is actually federal minimum wage. So in states that pay less than the federal minimum wage, the person's income would be bumped up to meet that. Similarly, there's a cap of $511 per day, or $5,110 in the aggregate. So there is an element where some parts of the population wouldn't receive their full pay rate. Similarly, they initially started out that the 80 hours of two thirds, an employee's pay rate were available for paid sick leave if they were caring for somebody else, but that was also capped, it still has essentially a floor from the federal minimum wage rate, but then two thirds of it. But it's $200 per day and kept at $2,000 in the aggregate, both instances again come with this fully refundable tax credit. And you're really looking at 29 CFR Subsections 826.21 and 0.22. There were also additional exemptions for less than 50 employees. So employers with fewer than 50 employees may be exempt from providing paid sick leave to an employee who is unable to work because the employee is caring for his or her son or daughter due to childcare or school closures. This essentially creates a carve out for small businesses if the viability of the business is jeopardized by letting all of the employees capitalize on a leave, it basically recognizes that there's a tension in keeping everyone employed and keeping a business afloat when they're less than 50 employees. And again this is where you can see some inconsistency in the rules. Some provisions are for 25 or fewer employees, and some are for 50 or fewer. The other program that was created under this is the Emergency Family and Medical Leave Expansion Act, or the EFMLEA. This applies to employees of covered employers if such employees have been employed by the employer for at least 30 calendar days. So thinking back to FMLA that required individuals to be employed for a year, 12 calendar months. Now we're talking one month. It includes employees who were laid off or otherwise terminated on or after March 1st, 2020, had worked for the employer for at least 30 of the prior 60 calendar days and were subsequently rehired or otherwise re-employed by the same employer. So essentially if right around the time things were shutting down, an employer fired their staff because they weren't sure how they'd pay them and then rehired them. And then immediately upon rehiring, somebody needs to take a leave. This is how they can become eligible. It's important to note that this program works directly in conjunction with the EPSLA. So the way it stacks is essentially the first two weeks, usually 10 days of this leave are unpaid through the EFMLEA, but the person should be able to capitalize on leave through the EPSLA. So they basically substitute paid sick leave. Then following those two leaves, they transition into this 10 week cycle, unlike FMLA leave which is taken for other reasons. So something like family planning or something that's not related to the COVID crisis, a person would take those two weeks and then the 10 weeks would be unpaid. So a person could be using their 12 weeks of FMLA and part of it could be paid outta their sixth time. And then the remainder would be unpaid. Here we're stacking paid leave on top of paid leave, but from two separate sources. The EFMLEA also provides that if the need for expanded family and medical leave is foreseeable, employees shall provide employers with notice of the leave as soon as practicable, this is under 29 CFR Subsection 826.90. So this is a critical component, they're essentially requiring that employees provide notice. So if you go out on the two week EPSLA leave as an employee, and you see that school's gonna be closed for months on end, or that you know have a family member who can't risk exposure, and you need to provide care, then you need to notify your employer. They put this burden on the employee. It's mainly because they don't want people going out on leave, and then leaving employers high and dry, especially in a difficult work or labor market. There were a few additional expanded provisions that came under the American Rescue Plan, that extended some of the COVID-19 provisions. Individuals could receive paid time off if they were obtaining a COVID-19 immunization. This again goes to the objective of solving the public health crisis, ensuring that individuals had access to immunization. So they could essentially use their sick time under the EPSLA to take a day off to go get their vaccine. The employee also would be covered if they're recovering from an injury, disability, illness, or condition related to the immunization, or the employee is seeking or waiting the results of a COVID-19 test or diagnosis when the employee has either been exposed to COVID-19, or the employer requested the test or diagnosis. So as the pandemic progressed, and for many people, myself included kind of feels like a blur, but immunization obviously was not there at the outset, testing wasn't even readily and easily available at the beginning. So once those things came into play, it allowed more definitive diagnoses, but also created gaps in the law. The a RPA sought to both expand the law, but also clear up those gaps and explain better what was covered. So what do you do to advise employers and employees on leave? First and foremost, the leave requirements have come to an end, all of the provisions, the tax benefits, the paid leave that has ended. So we still have COVID-19. It still exists. And while the pandemic and the numbers are constantly changing, and I have no idea where those numbers will be when you're listening to this presentation, employers and employees may have differing problems as we've moved away from all these expanded protections. We are back to a traditional FMLA model, which involves unpaid leave. So as employment attorneys what do you do? Your clients whether they're employers or employees, they've now weathered shutdowns high unemployment rates, the Great Resignation, and are dealing with the shrinking labor force. When you think about employers and you're advising them, some of the things you want to be thinking about are mitigating cost and ultimately mitigating risk. FMLA as an unpaid federal policy has returned, the tax credits are gone. And employee protections from a legal standpoint are no longer required. However, the CDC still says at the time of this, that a positive COVID-19 test requires a five day quarantine, but employees are no longer guaranteed payment during that time. Similarly, employers are not incentivized to pay for sick leave. So when you're advising employers, you need to think in terms of the cost of turnover, the benefits of providing paid leave versus the cost to the business. And that will vary depending on the structure of the business, the size of the business, the person's role within the business. And frankly it varies depending on the employee's need for leave. How regular is this? Is this one off that the person was exposed to COVID? They need to be out for five days, and you want to ensure that people stay out when they're sick. So you give them additional paid sick time due to a positive COVID-19 test or due to symptoms. And that's where there's a lot of ambiguity now, when you're advising employers and you really have to dive into the nuts and bolts of their business, how much of your workforce could they take out if somebody comes to work with symptoms, because they cannot afford to go five days without pay and analyze really whether or not the cost benefit works. Can you have people telework? Can that be something that the employer keeps in their business model? That once somebody has symptoms, they simply switch to telework. You don't have to pay for leave. You can still pay for them to work, but you prevent exposure. And this is really where employment attorneys have a difficult job to dive in. Similarly, employment attorneys who are working with employees need to think about what the needs of their employees are. So in that sense when you're advising employees, think in terms of documentation, ensuring that they meet employer requests and the state of the current job market. It's easier for an employee to hold their ground and make a determination if they know they can go somewhere else to get a job. That changes as the labor market changes. And as we have an impending recession coming, employees need to think about the risks to themselves. The best thing I think an employment attorney can do is we navigate this new landscape with no protections currently in place. They really need to think in terms of what does the employer require if you need to miss work due to COVID-19 symptoms, COVID-19 exposure or COVID-19 test. How do you make sure you meet those requirements? How do you document what your situation is to ensure if there's not a solid policy in place that you're protecting yourself as an employee. And this is where the attorney hat really needs to be on and being strategic. In short, the past protections due to the COVID-19 pandemic for both employers and employees are gone, but COVID-19 has not been eradicated and the need to quarantine per the CDC still exists. Adding to that we are facing an impending recession and dealing with the need for sick time and leave, it's only going to get more nuanced. keep in mind that it may be worthwhile for employers and employees to strongly consider the need to implement short-term disability policies as a benefit to employees to create an additional layer of protection. When people need to go out on leave, it can allow for payment. It can take some of the decision making out of the hands of the employer, but instead into the hands of a third party system. And simultaneously when it works well, can provide an additional layer of protection for employees. This creative thinking is going to be even more important as we move further and further from the pandemic and deal with the shifts in our economic climate. The next section of this presentation is really going to deal with unemployment benefits. They were significantly expanded and in many ways streamlined nationwide during the pandemic that is shifting back, and we need to analyze what was available, how that impacted the labor market, what's available now, and what the labor market looks like. How to ensure we protect both employers and employees dealing with these programs. According to the Department of Labor's Unemployment Insurance fact sheet, the purpose of unemployment is to provide temporary financial assistance to unemployed workers. Each state administers the program and sets the laws regarding benefit amounts, eligibility requirements, and the duration of payments. So, but for the period of time during the COVID pandemic, states set the rules, they set eligibility, they set duration and they calculated the amounts. The majority of states are funded entirely by attacks solely on employers. However, three states require a minimal employee contribution. Most states require a base period or a certain number of months or quarters of work for eligibility. There's also a requirement that the unemployed individual is not at fault for causing their employment. And these are some of the standards that are essentially available nationwide. Most states have an ongoing reporting requirement and require availability for work. So somebody needs to be actively seeking employment. Typically the maximum period of benefits is 26 weeks, but can vary state by state. So what shifted during the pandemic? Unemployment benefits under the CARES Act is kind of the first area we're going to look at. Federal law allows considerable flexibility for states to amend their laws to provide Unemployment Insurance benefits in several COVID-19 situations. States for instance can pay benefits when an employer temporarily closes due to the pandemic, preventing employees from going to work. A person is quarantined and anticipates going to work after the quarantine is over. A person stops work due to the risk of COVID-19 exposure or infection to care for a family member or to homeschool their children. So these are the first brush broad stroke expansions that occurred. You'll notice a couple of these just thinking in terms of the framework, the last one specifically due to the risk of exposure. This is in some ways a voluntary quit scenario, which is unique in that typically speaking unemployment in most states is not available when you quit your job. If you quit for certain reasons, you may have a carve out or an exception, but the broad rule is typically that quitting makes you ineligible. Here you can quit, and they've kind of enumerated very specific COVID related reasons. There were a number of different unemployment programs that ran during the pandemic. Here are some of just the basic ones that existed. The PEUC or Pandemic Emergency Unemployment Compensation, PUA, Pandemic Unemployment Assistance, FPUC, Federal Pandemic Unemployment Compensation, MEUC, the Mixed Earners Unemployment Compensation. So starting with Federal Pandemic Unemployment Compensation, or FPUC benefits. These were a stackable benefit on top of any other unemployment benefit program. On July 31st, 2020, the CARES Act provided an additional $600 a week that could be stacked on top of any other weekly unemployment benefit. Under the American Rescue Plan in September, 2021, they finally put an end to this. They essentially stopped benefits September 6th. And prior to that, they had reduced benefits from the $600 mark under the continued Assistance Act. It decreased the benefits to 300 per week, but extended it through March 14th, 2021. So essentially from July of 2020, an individual could stack $600 extra per week of unemployment. Then in March they could stack 300 and then eventually in September it phased out. One of the main benefits programs was the Pandemic Emergency Unemployment Compensation program. This was created by the CARES Act and its primary function was it extended unemployment benefits by 13 weeks to individuals who had exhausted their benefits. The benefits were initially due to expire on December 31st, 2020, but the PEUC was extended through September 6th, 2021 initially by the continued Assistance Act. And then by the American Rescue Plan, the PEUC increased the total number of weeks than an individual can claim benefits from 13 to 53 weeks. Per the Department of Labor's frequently asked questions, states are required to offer flexibility to applicants in meeting PEUC eligibility requirements related to the concept of actively seeking work. If an individual's ability find work is affected by the pandemic. This essentially carved out many states chose to just remove the concept of needing to actively seek work. And simply if somebody was unemployed due to the pandemic, they were eligible and they didn't have to meet those weekly reporting requirements or this looking for other work requirement. The next benefit program is PUA or Pandemic Unemployment Assistance, according to the Department of Employment Services and the PUA fact sheet, this program was developed to assist self-employed individuals. This is something that's pretty new for unemployment benefits. Traditionally speaking as self-employed individuals, weren't covered. This covered self-employed individuals and even enumerated contractors, freelancers, and individuals who worked part-time or who didn't have a sufficient work history. So to greatly expand it, who counted in terms of unemployment benefits? The program provides 39 weeks of unemployment benefits, and it commenced beginning February 8th, 2020 through September 4th, 2021 for individuals who otherwise didn't qualify for unemployment benefits. 26 states actually ended this benefits program early, according to a number of news sources USA Today, CNBC and CBS did some stories outlining as states continued to end this program early. The next benefits program is MEUC benefits. This is essentially the mixed benefits program, the Mixed Earners Unemployment Compensation program. This program is for people who are currently receiving unemployment benefits from another program, other than Pandemic Unemployment Assistance. Because like we mentioned Pandemic Unemployment Assistance was for self-employed individuals. So this program is for people who are considered a mixed earner, meaning part of their work comes from being an employee. And part of it comes from self-employment. The people who claimed this benefit must have been receiving unemployment benefits for weeks covered by the program, which ran from essentially January 12th, 2021 through March 13th, 2021. So this is a very limited time period. They had to apply online. They had to submit proof of self-employment income. This means that the net earnings from self-employment obtained during a taxable year. So if your initial self-employment claim was filed in 2020, you needed to provide documentation from 2019. This program provided just an additional $100 in compensation. And again, this is for people who were getting their unemployment benefits primarily based on being a W-2 employee, but it was working to offset the fact that some people had multiple jobs and some of its self-employment and some of its employed work or W-2 type work. Executive Order 14042. So Executive Order 14042 came about from President Biden and on September 9th, 2021, he decided that all federal employees and contractors needed to be vaccinated by December 8th, 2021. So to kind of frame this, at the end of September of 2021, all of the unemployment protections for individuals due to the pandemic went by the wayside. There were no expanded benefits. At that exact same time, there's now a requirement starting with federal employees and contractors that they get vaccinated to combat the pandemic. There were specific prescriptions with this Moderna, Pfizer and Johnson and Johnson were the three main vaccines, and they all required dosing in a specific way. So if you got Johnson and Johnson, which was a single vaccine, you had to be vaccinated by November 24th, 2021. If you did Pfizer, your first dose had to happen by November 3rd. If you did Moderna, your first dose had to happen by October 27th. This created some new problems in the unemployment landscape. So essentially what was happening is President Biden made this policy for federal employees. OSHA issued their emergency temporary standard, came out of Biden's path out of the pandemic, and it applied to companies with a 100 or more employees, and it requires either vaccination or weekly testing. And it was effective essentially immediately until a formal rule was promulgated. As many of you are aware and without having any political stance, there is divisiveness about the effectiveness of the vaccine. The harmful nature of the vaccine, and some of the challenges that come from needing to be vaccinated. This was something that employers and employees dealt with some major tension over. Clearly it was causing employment conflicts. It likely is still causing employment conflicts. So it's important to be aware of this in the realm of employment law, as we continue to see how things progress. So what happened? Two lawsuits happened Missouri v. Biden and the National Federation of Businesses versus OSHA. These two cases went to the Supreme Court and a split decision was issued, Missouri v. Biden allowed the Biden administration to tie Medicare and Medicaid funding to a vaccine mandate for covered entities. So as part of some of the things that President Biden was doing, he required vaccinations for entities that received funding from the federal government. This was allowed, the Supreme Court said, "If you're going to accept funding and you're a covered entity, then they can issue this rule." However, National Federation of Independent Businesses versus OSHA, came down the opposite way. They struck down the rule that would require businesses, employing a 100 or more workers to insist that their employees be vaccinated or wear masks and undergo weekly testing. So this creates kind of a framework to show that there were tensions in how this was a applied. There were people who either left their jobs or were fired from their jobs due to the mandate before these decisions came down. So it was creating again, this climate of additional employment issues for attorneys to be working through. So what happens from here? After the Supreme Court struck down OSHA's emergency temporary standard, the states have divided on what to do, on whether or not an individual can collect unemployment if they're unemployed due to not falling an employer's vaccine requirements. This is an area of ongoing work for practitioners. And we may see this continue to grow as we hit a recession, if more and more people are falling outta the labor force, this issue may continue to grow depending on your state the rules are going to vary. So the uniformity that we had during the pandemic is now gone, and states can have different views on this. Likely they align with political leanings, so getting a sense of that political climate is going to help you advise both employees and employers of their obligations to set forth vaccine requirements and what happens if somebody doesn't comply. Because this very state by state, it's even more complicated that a number of states decided they weren't going to lean either direction and wouldn't take a clear stance. So there's no rule to point the employer in or employee to do, to say this is what you should do. Instead it becomes an individual decision on a case by case basis that makes it even more complicated for practitioners. So what happens if we have a recession? According to the Bureau of Economic Analysis, Real GDP dropped by 1.4% in Q1 of 2022. As I'm filming this, essentially we're days away from the end of Q2, but the Oxford dictionary defines a recession as a period of economic decline for two successive quarters. As of May, 2022, the average inflation rate for the last 12 months was 8.6%. And the current inflation rate. So as of May was 8.3%. The consumer price index was up 1% in May, 2022. In economics the Phillips curve is often used to show the inverse relationship between inflation and unemployment. So as US continues to see high inflation, it's expected that essentially interest rates will continue to rise to try to offset this. That will be the tool or vehicle used, and unemployment would have been low, but as we bring inflation down, unemployment will rise. Practitioners should expect to see rising unemployment rates and claims for unemployment benefits. It is unclear whether the backlog that was created by all of the federal programs due to the pandemic will compound this impact. So we talked about all these great programs, but the problem is they have created massive backlogs in the ability to process unemployment claims. To the extent that in December of 2021, the House actually proposed a bill specifically HR6224, entitled very beautifully, "Fix the Unemployment Backlogs Act." That was going to cut federal funding to states that had more than 45,000 cases backlogged. Clearly this demonstrates that a number of cases are still not processed from the pandemic. This rule didn't pass, but it should give you as a practitioner a sense of the lingering impact of the pandemic and what we may be seeing up ahead, if cases compound and the backlogs not cleared. The next kind of area of law we want to focus in on is Social Security disability benefits. We're going to keep this part of it to an extent it's a little bit briefer because this program didn't have as many significant changes during the pandemic, but it has had some major impacts. So just starting really, basically, what are Social Security's programs? What are disability benefits? There are two main programs, Social Security Disability Insurance, SSDI, or Supplemental Security Income, SSI, SSDI is a disabled workers' program. This is for individuals who have worked consistently and recently typically five out of the last 10 years and have paid FICA taxes. SSI is a needs based program for individuals who do not qualify for SSDI, this program is impacted by an individual's income and resources. So what happened to disability benefits during the pandemic? In February, 2022, NOSSCR, which is the National Organization of Social Security Claimants' Representatives, reported that based on its Social Security's own data sheets, the backlog of claims at the initial level from December of 2021 was 971,226. So almost a million cases were backlogged. This was a 27% increase over what the numbers were in 2019, pre-pandemic. Per CNBC's article on Social Security staffing cuts, 10 states nationwide lost over 20% of their Social Security staff since 2010. And DDS, which is the State Disability Determination Services that partners with Social Security is funded by Social Security, decrease their staffing nationwide by 16%. The article sites a number of issues, high turnover, decreased budget, and hiring freezes. According to Social Security's Open Data in 2022, an initial claim is processed on average in 178 days. This is a significant increase from 2016 where the number was 110 days. Similarly, the 2021 data for reconsideration. This is the first appeal that many claims need to go through. It had an average wait time of 147 days, and was up from 103 days in 2016. Hearing wait times vary nationwide, but are currently ranging between six and 17 months. So Social Security case the way it processes, somebody files an initial claim. If that is denied they file a reconsideration. If that is denied they request a hearing. The vast majority of cases are one at the hearing's level. So you're looking at somebody who's doing an average of 178 days plus 147 days plus six to 17 months. We're talking upwards of two years to get the benefits that are supposed to be a safety net. Some other things that have impacted Social Security is inflation as we noted was averaging over 8.6%, but Social Security's 2022 cost of living adjustment. This applies to Social Security disability benefits and Social Security retirement benefits was only 5.9%. And it will not be adjusted again until 2023. So the value of their benefits, anyone who's receiving disability or retirement, significantly decreased during the pandemic. There are few other things that happened during the pandemic that impacted Social Security's programs, specifically looking at Social Security's retirement programs. The National Institute for Retirement Security found that 2 million older Americans left the workforce during the COVID-19 pandemic. I previously noted a 2 million person shrinkage. In addition to the norms, this essentially is almost entirely older Americans. There's also a note that there was a 5% decrease in older workers due to the pandemic. This came from the Schwartz Center. During the Great Recession, so looking back to the last time we dealt with a recession, early retirement claims rose between two to 3%. This is from Social Security's Research, Statistics and Analysis page. The data however dealt with two competing phenomenon, the decline in wealth causing individuals to delay retirement and try to wait it out. And the increase in unemployment causing people to simply choose to retire because they were of an age where they wouldn't be able to easily get back into the workforce. There was correlation where states with unemployment that rose over 10% saw these increases in early retirement claims. So overall despite the two competing phenomenon, if unemployment increases over 10%, the early retirement claims will rise. And as we've noted, Social Security is already dealing with budget issues, staffing issues, and a shortage. The last thing that I want to just remind everyone, what are the important things to take away? Practitioners across all programs, anyone who deals in employment law in disability law are working with people, really needs to see what's on the horizon. We are likely headed to a recession. We are dealing with high levels of inflation. We are coming off of a pandemic that reshaped what the labor force looks like. This means individuals need to really be seeing what's coming ahead for sea case delays and lags, expect an increase in need for your services. Prepare to pivot. Things are going to be constantly changing. If nothing else the pandemic should show you that they can give something and take it away in a very short window of time, often before we're ready. Anticipate that your clients are going to deal with increased stress, that the crisis situation for them will increase. Thinking along these lines, will help you effectively represent your clients and help them prepare to deal with the ever changing economic, climate and political climate post the COVID-19 pandemic. Thank you.

Presenter(s)

MMBJ
Maren Miller Bam, JD
Owner
Salus Disability Law and the Disability Benefits Deadline Initiative

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