Many laid-off workers getting more on unemployment than on the job
WATERTOWN — Many workers who were recently laid-off are slated to collect more money on unemployment than they did at their jobs, which for some business owners is concerning when it comes to hiring them back.
“We have never seen a time where unemployment pay is greater than somebody’s earnings,” said Cheryl Mayforth, director of the Jefferson County Department of Employment & Training at the WorkPlace. “This is going to be interesting how this unfolds when we open for business.”
Although the Department of Labor is backlogged with unemployment applications, the process of filing has become more efficient, Mayforth said. There are multiple tweaks, like instead of having applicants call the department at the end of their online application, a representative will call them. And as of last Thursday, the department had 270,000 calls to return.
“It’s moving much quicker,” she said, “so hopefully people will start to be able to get through on a much faster basis.”
And as more receive unemployment benefits, business owners start to take notice. Typically, unemployment for employees out of a job is around 50 percent of their weekly wage. The CARES Act, a roughly $2-trillion COVID-19 response bill passed in late March, provides up to $600 per week on top of the standard unemployment rate. The additional CARES funding is, as of now, going to last until July 31.
These business owners don’t blame their employees for the additional benefits they are receiving. It’s an unpredictable pandemic, however some are flat-out worried their workers won’t have enough incentive to come back to work when it’s deemed safe as many of those would have to take a pay cut.
Usually, if an employee is recalled to work and they don’t go back, it would be treated as refusing a job, and the employee would be ineligible for unemployment benefits as a result.
An employee, however, could go back to work and continue receiving the CARES Act funding until July 31 if they work fewer than four days a week and make less than around $500 a week, said Madison Anderson, communications director for Congresswoman Elise Stefanik.
Scott Gray, who owns flower shops in Watertown and Carthage — both shops had been deemed nonessential and closed — said he’s concerned with how to bring employees back the right way. If the time to start reopening the economy comes before July 31, he would likely be offering jobs to many workers who are making more money on unemployment.
“We’re competing with the public sector in terms of the unemployment package,” said Gray, who’s also chair of the county board of legislators. “I’ll have some reluctant employees.”
By all accounts, those employees would lose their benefits if they don’t return to work. Regardless, that’s not how Gray wants to restart his business.
“I want employees who want to come back to work,” Gray said. “I don’t want to have to drag them back to work because they’re getting paid so generously on unemployment.”
Stefanik said in a conference call Thursday that small businesses have expressed concerns similar to that of Gray.
“My priority right now are the working families in this district who at no fault of their own are out of jobs,” she said. “And when I talked to constituents who are out of work and are essentially forced to go on unemployment, they’re looking forward to getting back to work and having their jobs back.”
Stefanik said she thinks there is a balanced approach to take between understanding employees are out of work because of a pandemic and addressing these concerns with small businesses.
“I do think this was not predicted by individuals who are out of jobs right now,” she said, “and that safety net during this crisis is very important.”
Stefanik said she believes restarting the economy should be a regionalized approach. She called on Gov. Andrew Cuomo to include Vermont in the states that have been listed as part of the approach, which includes New Jersey, Massachusetts, Connecticut, Rhode Island, Delaware, Pennsylvania and New York.
“This is a continual call my office will make to ensure the unique needs of upstate New York are met,” she said.