Posted by marykeating on February 18, 2010 under Unemployment compensation | 
The latest figures from the Bureau of Labor Statistics show some slight improvement in the rate of unemployment, with women enjoying the biggest job gains. Unemployment among women stands at 7.9%, and men at 10%. Teenage unemployment is higher, but of course teenage employees include those who have not finished high school and have no job experience.
I’m not going to want to look at these figures next month, because who knows how the snow afflicting the Eastern seaboard will mess with the trend. We already know that retail sales were lower (when malls are closed it’s hard to shop), and lots of people worked from home or not at all. But when this glitch is FINALLY over, we can hope that unemployment rates will continue to fall.
Posted by marykeating on February 7, 2010 under Employment at will, Unemployment compensation |
The plight of unemployed workers is inextricably linked to the high rate of foreclosures. These are not the stories of people who bought a house on credit that they could, under no fantasy, afford. Those are the extremes, and were never destined to work out.
These are the stories of ordinary people squeezed by daily expenses, but making it until they were brought down by a prolonged period of unemployment. They lose their houses, their credit is smashed, and when they finally get a new job, they remain insecure. A recent New York Times article details only three such examples, but they are surely worth pondering as we see whether the American mindset will permanently change. Our grandparents (or parents or great-grandparents) who lived through the Great Depression were more likely to believe in saving to the point of miserliness, buying nothing on credit, and putting by for retirement. Yet, as the thirties turned into the forties and fifties, the post-war economy soared, social security was available, good private pensions abounded, and people took more risks. Easier, perhaps, when a lifetime at one company was commonplace.
Now many well-educated, well-trained, hard-working people have lived the reality of employment at will. They may not be able to afford a house again, or be able to handle the commitment required. They know that loyalty to an employer is a one-way relationship. Will their experiences change our priorities and choices, or will our native optimism prevent us from redefining the American dream?
Posted by marykeating on January 7, 2010 under Discrimination in employment |
Yesterday, the Equal Employment Opportunity Commission released statistics showing that charges of job discrimination had risen. “93,277 workplace discrimination charges were filed with the federal agency nationwide during Fiscal Year (FY) 2009.” The federal government’s fiscal year ends on September 30. The highest categories were race, retaliation, and gender. The total claims are the second-highest on record, as were the total age discrimination charges.
Interpreting these statistics without more information involves making a lot of assumptions. The economy tanked and layoffs were rampant. So people who lost their jobs, and could not find another one, may be more likely to file a charge of discrimination. Cash-strapped companies may have been less likely to offer good severance packages. Severance agreements nearly always require the recipient to release discrimination claims.
But the existence of more unhappily unemployed people is only a part of the story. Was there more discrimination as well? When a company has to let go a portion of its workforce, what factors are used? In my interviews with potential clients, I am getting the sense that age is often figured in, though perhaps subconsciously. An employer trying to trim the workforce and decide which workers to retain may utilize biases in favor of the young, such as perceived energy level, ability to keep up with technology, youthful looks, and cheaper health insurance benefits. These same sorts of biases can eliminate women (they won’t work hard if they have or want families), blacks (they don’t fit in here, and we need “team players”), the disabled (they can’t handle the job if it gets harder), and so forth.
The unfortunate part is that proving discrimination in reductions in force is hard, unless a decisionmaker is candid about the reasons for cutting someone. Usually the proof is circumstantial, and the courts can be hostile to these claims. I don’t think that judges can relate to age discrimination, especially, since they are well insulated personally from this kind of bias.
Posted by marykeating on December 5, 2009 under Unemployment compensation |
Receiving unemployment benefits is a mixed benefit: it’s better to have a job, both financially and for the sense of security and accomplishment it gives a worker. Unemployment benefits are a reasonably good safety net, though, when the job search effort is not working out. It might keep the roof over the heads, the mac and cheese in the bellies.
Congress and Maryland have been gradually increasing the number of weeks of benefits allowed, in the context of the lingering recession and the unemployment rate at 10%, according to the latest statistics, but topping that in many places.
This morning’s New York Times reported that we may not see the pattern in former recessions, where unemployment continued to rise even as the economy climbed back.
Still, it could be awhile before the unemployment rate drifts back down to 4 or 5%. Maryland now has increased the maximum weekly benefit, which is now $410. This rate applies to employees who formerly earned from $9,816 per calendar quarter and up. For many people that is a major comedown from their former salaries, but this benefit is necessary for many people to survive. The schedule of benefits can be found here.
Posted by marykeating on October 30, 2009 under Employment benefit issues, Pending legislation |
The Secretary of Health and Human Services released a report explaining in very clear language the effect of health insurance reform on the ability of small businesses to offer health insurance. According to HHS’s report, 56,593 small businesses in Maryland alone would qualify for an attractive tax credit. In addition, health insurance reform would end the catastrophe that effects some businesses when insurers hike premium costs as a result of an illness or injury of even a single worker. Small businesses have been rated by their own experience. So when one person of 50 has a serious illness, incurring hospital care, the rates for the business are directly affected. For a huge business, an illness or two does not alter the experience very much, because of the law of averages. But small businesses can be forced into giving up insurance benefits if two people are diagnosed with cancer.
The new law, if it passes, would forbid rating based on health status. In the end, the law of averages across the spectrum of the state or the country will drive insurance prices. In addition, the new law would end the lifetime cap on insurance benefits. This was an issue advocated by the late Christopher Reeve, who would not have made the progress he did without personal resources.
Finally, the law would end the practice of discrimination against women. There are insurance plans that refuse to cover women of child-bearing years, or treat pregnancies as uncovered conditions. (Maryland law is stronger than some states, and does not permit a blanket prohibition against insurance for childbearing.)
The economic hardships that have befallen many employees and businesses have brought some of these issues to the forefront. I hope we have the fortitude to make some much-needed reform to the existing system.
Posted by marykeating on September 28, 2009 under Unemployment compensation |
The New York Times hit another graphic home run with the simple and dramatic illustration of the competition for jobs during this recession. On average, according to its analysis of Bureau of Labor Statistics, there are six unemployed people for each job opening. Even government openings are down, despite certain areas in which the government is hiring.
Since not all jobs are alike, there are regional differences in these statistics. In addition, a major source of pain shows up in the drop in open manufacturing services positions. Many of these jobs do not require specialized certificates or education, and so career-switchers can think about manufacturing openings (as opposed to an open registered nurse position, for example). But competition remains fierce.
This state of affairs makes the unemployment insurance extension all the more necessary.
Posted by marykeating on September 7, 2009 under Unemployment compensation |
The headlines continue to report, cautiously, that we are out of the recession. But the effects of the recession are still with us. And the recovery has not extended to job creation, at least not yet.
Today’s New York Times explains that unemployment data can be misleading since the percentage of the unemployed counts only those who are actively searching for work. The article focuses on four people, typical of many, who lost their jobs and after numerous fruitless searches for new work, have essentially given up. They may stay home with the kids, go back to school, retire, or simply hang on until times get better. Others are working part-time, but would work full time if they could. If the jobless rate included the “discouraged” and the “marginally attached to the labor market” categories, unemployment would stand at 11%, rather than 9.7%.
The last local report from the Bureau of Labor Standards for Baltimore/Towson is from May; so it does not show any bright spots. For those employed though, state-wide average compensation rose by 2.5% from June 2008 to June 2009.
Posted by marykeating on August 13, 2009 under Wage and hour issues |
Both private and public employers have been experimenting with cutting back employees’ hours instead of choosing some for layoff. The benefits of this strategy include sparing some of the employees from the devastation of a full layoff, improving morale, and saving on the severance or unemployment benefits costs of laying off employees. For employers expecting to bounce back as the recession eases, keeping the employees also will make it easier to spring back into action. Employees are not likely to enjoy the cut in pay, but some may make good use of the extra time.
This practice works most smoothly for hourly employees, who must be paid for all hours worked, at least minimum wage, plus overtime pay. If an employee who used to work five full days per week is reduced to four, the employer must pay him for the four days. This strategy can backfire if the furlough is in name only. If employees actually are working on the days when they are supposed to be off, then the employer is in danger of violating the Fair Labor Standards Act and Maryland’s Wage Payment and Collection Act. Actual work includes checking email and voicemail messages, responding to customers or coworkers, and waiting on call in some instances, depending on the amount of freedom the employee has while waiting to be called into action. If the employee often works from home or from the other end of a telephone or blackberry, the employer needs to be vigilant to be sure that the employee is not responding as usual on a furlough day.
Exempt employees pose a more difficult problem. An employee exempt from overtime compensation requirements must meet responsibility requirements, as well as the salary test, in which the employee must earn $455 or more per week. If the employee does any work during a week, the entire week’s salary must be paid. An exception is made if there is a sick or personal leave policy; in that case full (not partial) days of sick or personal time, or days on which the employee does not work because of disability, may be deducted from pay, with personal/sick leave to fill in the gaps if it is available. The employee’s leave balance can also be used to supplement the employer’s “sick” time, days in which there is not enough work.
In other cases there is not enough sick or other leave time to pay for furlough days, or the employer simply cannot afford to keep so many exempt employees on full-time status. Then to furlough an exempt employee in the private sector, the employer has to cut the employee’s pay. In Maryland, employees are entitled to two week’s notice of a salary reduction. And the new pay may not be less than $455 per week. An employer risks losing the exemption when it violates the rules about deductions from pay.
Posted by marykeating on July 30, 2009 under Unemployment compensation |
The federal government announced today that it was sending more relief to the states, in the form of supplements to their unemployment services.
Maryland will receive $1,019,462 to begin a Re-employment and Eligibility Assessment (REA) Initiative. The funding will pay for counseling, assessment, and crafting individual work-search plans for unemployed people whose industries may have dwindled or disappeared.
Posted by marykeating on July 18, 2009 under Unemployment compensation |
Maryland’s unemployment compensation law was designed to tide over people who became involuntarily unemployed. Until recently, the law applied only to formerly full-time employees, and had a limited time period of 20 weeks. The original assumption, that an unemployed worker looking for work should be able to find a new position within a half year is no longer valid.
New legislation changed several aspects of the law, in an attempt to provide some relief from the economic crisis. The original assumption, that an unemployed worker looking for work should be able to find a new position within a few months is no longer valid. Claimants are now eligible to receive their benefits for 33 weeks. The state maximum weekly benefit amount increased to $410, while federal stimulus money added $25 more per week to the benefits. In addition, people receiving unemployment compensation during 2009 pay no taxes on the first $2,400 in benefits.
Part-time workers are now eligible for benefits. Until recently, part-time workers were ignored in the unemployment compensation system.
The State Department of Labor, Licensing & Regulation has a good overview of the logistics of applying for benefits or registering as an employer, here.
An important revision to the unemployment law, effective June 1, 2009, eliminated the right of certain employees to receive both severance pay and unemployment benefits. The former law provided that an employee whose job was abolished and whose severance package did not completely replace the salary and fringe benefits payable at the job could receive both the severance and the unemployment. This provision was useful in negotiating severance packages; adding the provision that a job was abolished could help the employee earn more than the granted severance weeks, and also gave the employee a blame-free excuse for being unemployed. This can be helpful in searching for new employment. Now, severed employees are ineligible for unemployment compensation for the weeks for which severance is payable.
