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Unemployed workers just got a big pay cut

The Laconia Daily Sun
Published: 7/28/2020 1:16:24 PM

Thousands of people drawing unemployment compensation in the Lakes Region and around the state are about to get a $600-per-week cut in benefits.

The federal act providing enhanced benefits specifies that it is to conclude with the week ending on or before July 31. For most states, including New Hampshire, that means it effectively ended on Saturday, July 25.

Congress is considering a new round of pandemic relief that will likely include some kind of provision involving unemployment compensation. Democratic leaders generally favor seeking a higher amount than Republicans.

Richard Lavers, deputy commissioner of New Hampshire Employment Security, said that prior to the pandemic, the average unemployment benefit in the state was $330 to $340 per week. The maximum amount was $427 a week.

So, with the $600 enhancement, people on unemployment were suddenly making nearly $1,000 a week. Until Congress decides on a new bill, they will be back down to $330 to $340.

With the $600 enhancement, they ended up with a level of pay higher than what they were earning when they were employed.

“I think that is true for a great many cases, particularly when you see the sectors that were hit the hardest, hospitality, retail, look at what the average weekly wages are in those sectors,” Lavers said.

Business leaders said people were making so much on unemployment, they didn’t want to return to work.

People are actually not allowed to continue to receive unemployment compensation if offered their old job back, unless they have a COVID-19-related reason such as an underlying medical condition that would make them particularly vulnerable to complications if they got the disease.

A medical provider would need to specify the reason, Lavers said.

Another qualifying reason for not returning to one’s job would be the inability to find child care because of the pandemic, he said.

A generalized fear of being in contact with someone with the virus, or just wanting to collect the higher compensation do not qualify as acceptable reasons for not returning to one’s old job.

Unemployment compensation could be received for up to 46 weeks through state and federal programs, including extensions. Because of the pandemic, the state has lifted the usual requirement that a person has to look for work in order to continue to receive benefits.

Lavers said the state has paid out $1.1 billion in unemployment benefits in four months, which is more than is usually paid out in a decade.

June’s statewide unemployment rate was 11.8 percent, down from a high of 17.1 percent in April.

Mindi Messmer, who is running for the Executive Council and is part of the New Hampshire Science and Public Health Task Force, said the enhanced unemployment could have a public health benefit.

It would be more economical and better for public health to pay increased unemployment compensation rather than the medical costs associated with a life-threatening case of COVID-19, she said.

People could have valid concerns about returning to a public workplace.

“You could be concerned that the state does not have a mandatory mask order, or you could be concerned that you are vulnerable, or somebody you know is vulnerable,” Messmer said.

“New Hampshire is the only state in the Northeast without a mandatory mask order.”

Belknap County Commissioner Dave DeVoy, who owns a convenience store in Gilford and two in Barnstead, said he was able to keep his businesses open. One employee went on unemployment after feeling sick.

He said the enhanced unemployment generally hurts employers’ ability to find workers in a tight labor market.

“Everything is a judgment call,” he said “I’m worried about a lot of restaurants that can’t find employees to work because people feel they are better off on unemployment.”


These articles are being shared by partners in The Granite State News Collaborative. For more information visit collaborativenh.org.


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