Temporary Extension of Unemployment Benefits: Emergency Unemployment Compensation (EUC08)

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The Emergency Unemployment Compensation (EUC08) program was created by P.L. 110-252
and has been amended by P.L. 110-449. This new temporary unemployment insurance program
provides up to 20 additional weeks of unemployment benefits to certain workers who have
exhausted their rights to regular unemployment compensation (UC) benefits. A second tier of
benefits exists in states with a total unemployment rate of at least 6% and provides up to an
additional 13 weeks of EUC08 benefits (for a total of 33 weeks of EUC08 benefits.) The program
effectively began July 6, 2008, and will terminate on March 28, 2009. No EUC08 benefit will be
paid beyond the week ending August 29, 2009. As proposed by the House of Representatives, the
American Economic Recovery and Reinvestment Plan has proposal has an almost identical
provision. It is expected that the Senate stimulus proposal will also have a similar provision.
As proposed by the House of Representatives, the American Economic Recovery and
Reinvestment Plan contains a provision to extend the EUC08 program through the end of
CY2009.
This report will be updated to reflect current congressional action or programmatic changes.
Individuals should contact their state’s unemployment agency to obtain information on how to
apply for and receive EUC08 benefits. The U.S. Department of Labor maintains a website with
links to each state’s agency at http://www.workforcesecurity.doleta.gov/map.asp.

Emergency Unemployment Compensation.....................................................................................1
How Does an Eligible Individual Receive the EUC08 Benefit?...............................................1
How Much is an Eligible Individual’s Weekly EUC08 Benefit?..............................................1
What is the Duration of an Eligible Individual’s EUC08 Benefit?...........................................1
Tier I....................................................................................................................................1
Tier II..................................................................................................................................2
How Is High Unemployment Defined for Purposes of Tier II EUC08?..................................2
When Does the New Expanded Tier II EUC08 Benefit Begin and End?................................2
Begins November 23, 2008.................................................................................................2
Terminates March 28, 2009................................................................................................2
Special Case: Exhausted EUC08 Benefits Before November 23, 2008....................................3
Tier I EUC08 Eligibility Requirements.....................................................................................3
First Claimed Regular UC Benefits On or After May 7, 2006............................................3
Exhausted Regular UC Benefit...........................................................................................3
“20 Weeks” of Full-Time Insured Employment or Equivalent...........................................4
Tier II EUC08 Eligibility Requirements...................................................................................5
Exhausted Tier I EUC08 Benefit........................................................................................5
At or After the Period of Tier I EUC08 Exhaustion, the State Must Currently
Have High Unemployment..............................................................................................5
The Extended Benefit (EB) Program..............................................................................................5
EB Program is Permanently Authorized.............................................................................6
EB Program is 50% Federally Financed and 50% State Financed.....................................6
EUC08 and EB Interactions......................................................................................................6
Which Benefit is Paid First?...............................................................................................6 ^th
Legislation in the 111 Congress..............................................................................................6
Author Contact Information............................................................................................................7

On June 30, 2008, the President signed the Supplemental Appropriations Act of 2008 (P.L. 110-

252) into law. Title IV of this act created a new temporary unemployment insurance program, the ¹

Emergency Unemployment Compensation (EUC08) program. This is the eighth time Congress
has created a federal temporary program that has extended unemployment compensation during ²
an economic slowdown. The EUC08 benefit is 100% federally funded. State unemployment
compensation (UC) agencies will administer the EUC08 benefit along with regular UC benefits.
On November 21, 2008, the President signed P.L. 110-449, the Unemployment Compensation
Extension Act of 2008 into law. P.L. 110-449 expands the potential duration of the EUC08 benefit
from up to 13 weeks of EUC08 to a maximum of 20 weeks. It also creates a second tier of
benefits for workers in states with high unemployment of up to a maximum of an additional 13
weeks of tier II EUC08 benefits (for up to a cumulative 33 weeks of EUC08 benefits).
It is expected that the stimulus package will likely contain a provision to extend the EUC08
program through the end of CY2009.
Individuals should contact their state’s unemployment agency to obtain specific information on
how to apply for and receive EUC08 benefits. The U.S. Department of Labor maintains a website
with links to each state’s agency at http://www.workforcesecurity.doleta.gov/map.asp.
The amount of the EUC08 benefit is the equivalent of the eligible individual’s weekly regular UC
benefit and includes any applicable dependents’ allowances.
The maximum number of weeks an individual may be eligible for these tier I EUC08 benefits is
capped at 20 weeks. Some individuals may be eligible for fewer weeks of the tier I EUC08
benefits if their regular UC benefit entitlement was less than 26 weeks.

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Once an individual has exhausted tier I benefits, a second tier of EUC08 benefits may be
available if the individual worked in a state with high unemployment (6% or higher). The
maximum number of weeks of tier II benefits is capped at 13 additional weeks (for a total of 33
weeks of EUC08 benefits).
The individual must have worked in a state where either the three-month seasonally adjusted
average state total unemployment rate (TUR) must be at least 6% or the insured unemployment
rate (IUR) must be at least 4% in order to qualify for the additional 13 weeks of EUC08 benefits.
Each Monday the Department of Labor issues its “Emergency Unemployment Compensation
Trigger Notice” at http://atlas.doleta.gov/unemploy/claims_arch.asp. If the status column within
the notice is “on” for a particular state’s row, that state is considered to be high unemployment for
the purposes of EUC08.
States were required to enter into an agreement with the U.S. Department of Labor (DOL) to
provide the original EUC08 benefit to unemployed individuals in the state under the original
EUC08. Once the agreement was signed, the EUC08 benefit began the following week (July 6,

2008).

The additional EUC08 benefits become active on November 23, 2008. That is, for weeks of
unemployment that occur on or after November 23, 2008, the 20 weeks for tier I and 13
additional weeks for tier II EUC08 benefits may be paid.
The expanded tier I and tier II EUC08 benefits for that first week will begin to be disbursed the
following week of November 30, 2008.
Both tiers of EUC08 benefits are temporary and expire in March 2009. Those unemployed
individuals who had qualified for the tier I or tier II EUC08 benefit would continue to receive
payments for the number of weeks they were deemed eligible. If an individual exhausts his or her ³
regular unemployment compensation (UC) benefits after March 28, 2009, the individual would
not be eligible for any EUC08 benefit. That is, there are no new entrants into either the tier I or
tier II EUC08 program after March 28, 2009.

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Those beneficiaries receiving tier I or tier II EUC08 benefits are “grandfathered” for their
remaining weeks of eligibility. If eligible to continue to receive the tier I benefit after March 28,

2009, an individual would not be entitled to tier II benefits once those benefits were exhausted.

Neither tier I nor tier II EUC08 benefits are payable for any week after August 29, 2008.⁴
If an individual had exhausted the EUC08 benefit before November 23, 2008, administratively
the individual will mostly likely not have exhausted the tier I EUC08 benefit. These individuals
now may have up to 7 additional weeks of tier I EUC08 benefits available as a result of P.L. 110-
449. Once the new full entitlement (of up to a total of 20 weeks) of tier I EUC08 benefits has
been completed, the individual will then be considered to have exhausted the newly expanded tier
I EUC08 benefit.
No Retroactive Payments for Special Case
There is no payment for the weeks of unemployment during the period when the individual had
exhausted the earlier EUC08 benefit and November 23, 2008.
Applicants must have been eligible for regular UC benefits and have exhausted their rights to
regular UC compensation with respect to a benefit year that expired during or after the week of ⁵
May 6, 2007. For most states, this would apply to individuals who had filed UC claims with an
effective date of May 7, 2006, or later. For the state of New York this would apply to original ⁶
claims filed with an effective date of May 1, 2006, or later.
The right to regular UC benefits must be exhausted to be eligible for EUC08 benefits. Although
federal laws and regulations provide broad guidelines on regular UC benefit coverage and
eligibility determination, the specifics of regular UC benefits are determined by each state. This ⁷
results in 53 different programs. In particular, states determine UC benefit eligibility, amount,
and duration through state laws and program regulations.

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Generally, regular UC eligibility is based on attaining qualified wages and employment in
covered work over a 12-month period (called a base period). Conditional on earnings amounts
and number of quarters worked in the base period, an individual may qualify for as little as one
week of UC benefits in some states and as many as 26 weeks in other states. Individuals with
higher earnings and multiple quarters of work history will generally receive higher UC benefits ⁸
for a longer period of time.
In addition to all state requirements for regular UC eligibility, the EUC08 program requires
claimants to have at least 20 weeks of full-time insured employment or the equivalent in insured
wages in their base period.
States use one, two, or three different methods for determining an “equivalent” to 20 weeks of
full-time insured employment. These methods are described in both law (Section 202(a)(5) of the
Extended Unemployment Compensation Act of 1970) and regulation (20 CFR 615.4(b)). In
practice, states that apply any of these three requirements for receipt of regular UC benefits and
do not allow for exceptions to those requirements do not need to establish that workers meet the
20 weeks of full-time insured employment requirement for the purposes of EUC. The three
methods are as follows:
• earnings in the base period equal to at least 1.5 times the high-quarter wages; or
• earnings in the base period of at least 40 times the most recent weekly benefit
amount, and if this alternative is adopted, it shall use the weekly benefit amount
(including dependents’ allowances) payable for a week of total unemployment
(before any reduction because of earnings, pensions or other requirements) that
applied to the most recent week of regular benefits; or
• earnings in the base period equal to at least 20 weeks of full-time insured
employment, and if this alternative is adopted, the term “full-time” shall have the
meaning provided by the state law.
The base period may be the regular base period or, if applicable in the state, the period may be the
alternative base period or the extended base period if that determined the regular UC benefit.

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^EU^C^{08 be}^ne^f^its^.

The right to tier I EUC08 benefits must be exhausted to be eligible for the tier II EUC08 benefits.
The individual must have worked in a state currently considered to have high unemployment for
the purposes of the EUC08 program. If at the time of tier I exhaustion the state has a TUR of less
than 6% and has an IUR of less than 4%, the individual would not be eligible for tier II benefits.
However, if the state later has a three-month seasonally adjusted average TUR of at least 6% or
an IUR of at least 4%, a (still) unemployed tier I benefit exhaustee would be eligible for tier II
benefits at that time.
Each Monday the Department of Labor issues its “Emergency Unemployment Compensation
Trigger Notice” at http://atlas.doleta.gov/unemploy/claims_arch.asp. If the status column within
the notice is “on” for a particular state’s row, that state is considered to be high unemployment for
the purposes of EUC08.
No Retroactive Payments
No retroactive tier II payments exist for the period during which the individual had exhausted tier
I benefits but the state did not meet the high unemployment criteria.

The EUC08 program should not be confused with the similarly named extended benefit (EB) ⁹
program. The EUC08 program is temporary and applies to all states. The EB program is
permanently authorized and applies only to certain states on the basis of state economic
conditions specified in law. The EB program is currently active in Alaska (as of January 25,
2009), North Carolina, Oregon (all at up to 13 weeks of eligibility), and Rhode Island (up to 20
weeks).
Each Monday the Department of Labor issues its “Extended Benefit Trigger Notice” at
http://atlas.doleta.gov/unemploy/claims_arch.asp. If the “available weeks” column within the
notice has either 13 or 20 for a particular state’s row, that extended benefit program is active in
that state with a potential of up to 13 or 20 weeks of EB for its unemployed workers.

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The EB program is permanently authorized by the Federal-State Extended Unemployment
Compensation Act of 1970 (EUCA), P.L. 91-373 (26 U.S.C. 3304, note). The EB program
provides for additional weeks of unemployment benefits, up to a maximum of 13 weeks during
periods of high unemployment and up to a maximum of 20 weeks in certain states with extremely
high unemployment. When economic conditions in a state no longer meet the criteria for
extended benefits, the EB program becomes inactive. There is no “grandfathering” of the EB
benefit. At the time a state EB program becomes inactive, payment of all EB benefits stop
immediately.
EB benefits are funded half (50%) by the federal government through an account for that purpose
in the Unemployment Trust Fund (UTF). States fund half (50%) through their state accounts in ¹⁰
the UTF.
The EUC08 program allows states to determine which benefit is paid first. Thus, states may
choose to pay EUC08 before EB or vice versa.
States balance the decision of which benefit to pay first by examining the potential cost savings to
the state with the potential loss of unemployment benefits for unemployed individuals in the state.
It may be less costly for the state to choose to pay for the EUC08 benefit first as the EUC08 ¹¹
benefit is 100% federally financed (whereas the EB benefit is 50% state financed). However, if
the state opts to pay EUC08 first, individuals in the state might receive less in total
unemployment benefits if the EB program triggers off before the individuals exhaust their EUC08
benefits.
North Carolina, Oregon, and Rhode Island have opted to pay EUC08 benefits before EB. Alaska
has opted to pay EB before EUC08 benefits.

As proposed by the House of Representatives, the American Economic Recovery and
Reinvestment Plan contains a provision to extend the EUC08 program through the end of
CY2009. The Senate proposal is expected to have a similar provision.

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^J^u^{lie M. W}^h^ittak^e^r
^Specialis^{t i}ⁿ^In^co^m^e^Secu^rit^y
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