Biden Is Planning to Illegally Cut Unemployment Benefits


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In the last month, the governors of at least 19 states announced that they will stop administering the special unemployment benefits that were enacted in the various pandemic relief bills passed over the last 15 months. These benefit cuts will begin as early as June 12, starting with Missouri.

When President Biden passed the American Recovery Plan Act (ARPA) in March, we were told that these pandemic unemployments benefits would remain available until September 6 while the labor market recovered. Now, just two months later, those benefits are being eliminated for millions of workers across the country with the blessing of the Biden administration.

There are three main pandemic unemployment benefits: (1) Pandemic Emergency Unemployment Compensation (PEUC), which extended the duration of ordinary unemployment benefits, (2) Pandemic Unemployment Compensation (PUC), which increased weekly benefit amounts, most recently by $300 per week, and (3) Pandemic Unemployment Assistance (PUA), which extended unemployment benefits to workers who are not typically eligible, such as gig workers, and effectively extended the duration of unemployment benefits by making individuals who run out of unemployment benefits eligible for PUA. PUA effectively duplicates PEUC when it comes to benefit duration, meaning that if PEUC disappears, PUA would effectively resurrect it.

The first two benefits — PEUC and PUC — were enacted as voluntary programs that states could opt in and out of. The statutory text of each program states that “any State which is a party to an agreement under this section may, upon providing 30 days’ written notice to the Secretary, terminate such agreement.” It was a mistake to make these programs voluntary, but it is what it is at this point.

The third benefit — PUA — was not enacted as a voluntary program. The relevant statutory text states that:

The Secretary shall provide the assistance authorized under subsection (b) through agreements with States which, in the judgment of the Secretary, have an adequate system for administering such assistance through existing State agencies.

The statutory text also states that:

Except as provided in paragraph (2), the assistance authorized under subsection (b) shall be available to a covered individual.

The National Employment Law Center has correctly noted that this language means that PUA benefits are not discretionary and cannot be terminated. In fact, the Inspector General of the Department of Labor (DOL) published a memo in June of last year saying that this language means that PUA is not discretionary. From the DOL memo:

The Secretary of Labor (Secretary) must provide PUA benefits to an individual who is determined to be eligible under the method described above. Under Section 2102(b), the Secretary “shall” provide to any covered individual unemployment benefit assistance while such individual is unemployed, partially unemployed, or unable to work for the weeks of such unemployment with respect to which he or she is not entitled to any other unemployment compensation. The relevant language is not discretionary.

The non-discretionary nature of these benefits is reiterated in paragraph (c) of the provision: such assistance “shall be available to a covered individual” for the statutory period provided that the “covered individual’s unemployment, partial unemployment, or inability to work caused by COVID-19 continues.”

The Biden administration could and should ensure that the law enacting these unemployment benefits is enforced as written. As NELP points out, that could take the form of forbidding states from cutting off PUA benefits, e.g. through lawsuits and injunctions. It also could take the form of the federal government contracting with PUA-friendly states to administer the benefits for residents of states where the governors are no longer cooperating. This has happened before, e.g. after Hurricane Katrina when other states stepped in to administer unemployment benefits for affected Louisianans.

Instead we learned last Friday that the Biden administration plans to do none of this. When asked about the issue, spokesperson Jen Psaki said that the states have every right to cut off the unemployment benefits.

This is wrong as a matter of law and crazy as a matter of policy. The DOL’s own legal analysis is that the PUA benefits are non-discretionary. If the DOL does not take action to keep PUA benefits flowing, then the DOL is itself violating the law. If Biden wants to allow PUA benefits to be cut, then he should pass a law to do so, not unilaterally cut them in a Trumpian executive power grab.