Senate Democrats want to replace most of your lost paycheck with permanently boosted unemployment benefits

Ron Wyden
Sen. Ron Wyden (D-OR).

  • Senate Democrats have unveiled a plan to boost unemployment benefits permanently.
  • The plan aims to replace 75% of a worker’s lost paycheck.
  • It also sets up a $250 weekly benefit for gig workers who don’t qualify for regular unemployment.
  • See more stories on Insider’s business page.

A pair of Senate Democrats introduced a plan on Wednesday to permanently boost unemployment benefits, making state checks larger to cover most of a worker’s lost wages.

The plan from Sens. Ron Wyden of Oregon and Michael Bennet of Colorado would mandate states to replace up to 75% of a person’s income at their last job. It also sets up a $250 “jobseeker allowance” for gig workers and contractors – essentially a weekly benefit that replaces Pandemic Unemployment Assistance so those types of workers are no longer barred from receiving state unemployment.

Gig workers have secured access to unemployment benefits in 2020 and 2021, but only on an emergency basis via the pandemic-related stimulus programs. PUA is slated to end on Labor Day.

“Unemployment programs are critical to helping workers stay afloat during difficult times – but too many workers still struggle to access their benefits in our patchwork of outdated state systems,” Wyden said in a statement.

“This proposal will protect workers by strengthening and expanding benefits, modernize UI infrastructure with needed technology investments, and prepare us for the future by tying benefits to economic conditions” Bennet said.

The plan also requires states to provide a minimum 26 weeks of unemployment benefits, which varies greatly from one state to another. An additional 13 weeks are triggered if the unemployment rate climbs above 6.5% at the national or state level, tying the flow of aid to economic conditions. More weeks would become available if the jobless rate surges.

Under the proposal, states face some tax penalties if they break from these standards. It’s unclear whether the unemployment reforms will eventually form part of Biden’s infrastructure package.

Currently, laid-off workers are eligible for a $300 weekly federal unemployment benefit – on top of state payouts – which end in early September.

Last year, state unemployment offices were overwhelmed with a surge of claims that strained their antiquated systems to the brink. They struggled to implement a $600 benefit, keeping people from accessing critical aid as the economy tanked due to the pandemic. Democrats and labor advocates are seeking to modernize them to prevent similar chaos.

Most Republicans opposed the renewal of boosted federal unemployment benefits as the economy showed signs of recovering. They argued the federal assistance discouraged people from returning to work.

Republican lawmakers in three states are advancing plans to cut the number of weeks unemployed people can get benefits, HuffPost reported.

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