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HISTORIC FIX TO NEW YORK’S PART-TIME UNEMPLOYMENT SYSTEM A WIN FOR WORKERS; BOOSTS NEW YORK’S ECONOMIC RECOVERY BY ENCOURAGING RETURN TO WORK

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NEW YORK, June 10, 2021 (GLOBE NEWSWIRE) — This week, New York’s legislature and Governor Cuomo announced a historic deal to fix the state’s worst-in-the-nation unemployment insurance rules for part-time work that were disproportionately hurting low-and-moderate income workers, especially Black and Brown workers, and holding back New York’s economic recovery. Senator Jessica Ramos and Assemblymember Al Stirpe championed this long overdue reform.

Unlike in virtually all other states, New York’s unemployment insurance rules arbitrarily and sharply reduce an individual’s benefits when they return to work part-time a few hours a day spread over several days. The poorly designed policy unduly complicates decision-making by employers and workers considering a partial return to work, hurting hundreds of thousands of part-time workers across the state.

The new pair of measures (S7148 and S1042), collectively revamp New York’s partial unemployment system so that it reduces benefits based on earnings the worker receives from part-time employment, rather than the arbitrary days-worked approach. Currently, the system disincentivizes part-time work by taking away almost all unemployment benefits when a person works just a few hours per week spread out over three or four days.

The new law also establishes an earnings disregard equal to one-half of a worker’s weekly UI benefit. It puts New York on a par with its five neighboring states and a total of thirteen states nationally and the District of Columbia, which all provide for comparable or more generous partial unemployment benefits. The reform especially reduces the heavy burden on part-time workers whose hours are spread over three or four days per week.

In addition, the law requires New York State’s Department of Labor to implement an immediate interim fix by allowing workers to work up to 10 hours a week without reduction in part-time unemployment benefits, up from the current 4 hours. The full reforms implemented in the new law are scheduled to take effect by April 2022.

This historic reform is a meaningful step for New York economic recovery and for the 600,000 workers who currently receive part-time unemployment benefits. More than two-thirds of recipients come from low-and moderate-income industries including accommodations, food services, healthcare, social assistance, and retail and more than half are workers in Black and Brown communities.

“Making critical updates to New York State’s antiquated Partial Unemployment Insurance system is a huge win for working families across our state. By changing the way we calculate eligibility we are ensuring New Yorkers who are working part-time or being called back to work at reduced hours can do so knowing that they will be able to provide for their families no matter how many days and hours of work they are offered each week,” said State Senator Jessica Ramos, the bill’s Senate sponsor.

“For far too long, New York’s unemployment insurance benefits wrongfully penalized claimants seeking part-time work,” said Assemblymember Al Stirpe, the bill’s Assembly sponsor. “These arbitrary regulations have made it incredibly difficult for many part-time workers to make ends meet. After the significant challenges of the pandemic, our state should not have a system with a disincentive to part-time work built in. Instead we should have a system that helps our families get back on their feet and encourages economic recovery and growth.”

“Central to New York’s recovery is getting people back to work,” said Senate Majority Leader Andrea Stewart-Cousins. “Expanding and increasing part-time unemployment insurance benefits will encourage New Yorkers to seek out and secure meaningful part-time work, while ensuring their income is supplemented appropriately to help them get back on their feet. This legislation passed by the New York State Senate Majority stands up for working-class New Yorkers whose hours were cut due to the pandemic or who were left unemployed and will help them in returning to the workforce. I thank Senator Jessica Ramos and Assemblymember Al Stirpe for championing this critical legislation, which will support New York’s economic recovery.”

“My colleagues and I in the Assembly Majority believe in putting New York families first and we know that unemployment benefits are a lifeline for families, especially during this health and economic crisis,” said Assembly Speaker Carl Heastie. “Many workers have faced a reduction in their hours or are only able to find part-time work, and this legislation ensures that they can take that work without losing their unemployment benefits. This change is critical as families and businesses work to get back on their feet. I would also like to thank Assemblymember Al Stirpe for commitment to getting this bill across the finish line.”

“Throughout the pandemic, New York’s stingy partial unemployment rule has been denying urgently needed benefits to workers whose hours have been cut — and now that the pandemic is easing it’s punishing workers who return to work part-time. NELP thanks Senator Ramos, Assemblymember Stirpe, and the legislative leadership for championing this long overdue common-sense reform, and Governor Cuomo for supporting it,” said Paul Sonn, State Policy Program Director at the National Employment Law Project.

“Our research makes it clear that the reform will benefit both the unemployed, incentivizing them to take on part-time work and moderately increase their total income, and employers and the economy overall, supporting a return to work that helps businesses and allows workers to keep their skills current and mitigating the adverse effects of prolonged periods of high unemployment,” said James Parrott, Director of Economic and Fiscal Policies at the Center for New York City Affairs at The New School.

“With the passage of this legislation, New York State moves from one of the worst to one of the best states for part-time workers supporting the most vulnerable and essential workers in our economy. This new system allows more part-time workers to collect unemployment at a time when they need it the most,” said Nicole Salk, Senior Staff Attorney, Legal Services NYC.

“New York has transformed an outdated and unfair part-time Unemployment Insurance system to the benefit of our clients and all hard-working New Yorkers who will no longer be penalized for obtaining part-time work. We applaud State Senator Ramos and Assemblymember Stirpe for their leadership on this important reform,” said Young Lee, Director of the Employment Law Unit at The Legal Aid Society of NYC.

“With the majority of partially unemployed workers being low and moderate income workers who are disproportionately people of color, this long overdue reform to the unemployment insurance system will help reduce material hardship for people who want to return to work. We are grateful for the leadership demonstrated by Senator Ramos, Assemblymember Stirpe, and the Governor in making this vital reform a reality,” said Jason Cone, Chief Public Policy Officer of Robin Hood.

“We are proud to be part of the coalition that fought for and won big improvements for New York’s unemployed workers,” said Stuart Appelbaum, President of the Retail, Wholesale and Department Store Union (RWDSU). “Many non-essential retail workers were laid off during the pandemic and are returning to what are now part-time jobs. These workers and countless others will now be able to return to work part-time without losing their entire unemployment benefit. As a result of the leadership of Senator Ramos and Assemblymember Stirpe, New York will have a faster economic recovery from the pandemic and tens of thousands of unemployed workers will be able to get back to work and still provide for their families.”

“As a statewide legal services organization, we handle many cases where a worker inadvertently loses all of their benefits simply by working a few extra hours.  The effect of the cliff is devastating and unfair. We applaud Senator Ramos, Assemblymember Stirpe and the Governor for implementing this historic reform,” said Kristin Brown, President and CEO of the Empire Justice Center.  

“This historic legislation will benefit thousands of New Yorkers who seek to sustain themselves during this time of economic uncertainty, while also creating a more economically just unemployment system for the future. NCLEJ applauds Senator Ramos and Assemblymember Stirpe for supporting low-wage workers and passing this bill,” said Jarron McAllister, Penn Law Fellow at the National Center for Law and Economic Justice.

“As an organizing project centered around the impacts of COVID, we believe that passing this bill will greatly improve New York State’s recovery, including getting people back to work. We thank Senator Ramos, Assemblymember Stirpe, and all of the legislative leadership for their work on this bill and for Governor Cuomo for signing it,” said Paul Getsos, Project Director of United Together Stronger Tomorrow.

This blog originally appeared at Nelp on June 10, 2021. Reprinted with Permission.

About the Author: For 50 years, NELP has sought to ensure that America upholds, for all workers, the promise of opportunity and economic security through work. NELP fights for policies to create good jobs, expand access to work, and strengthen protections and support for low-wage workers and unemployed workers.


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Changes to Overtime Rules Getting Closer: Act Now!

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erik idoniRecently, the Department of Labor proposed a rule to bring overtime up-to-date. If the proposal goes into effect, an additional 5 million white-collar workers are expected to benefit from overtime. The Department of Labor wants to hear your voice on this proposal and until this Friday, September 4, 2015, they are taking comments on the proposed rule.

Whether a worker receives overtime or not is determined by a three-part test. Under this test, the employee does not receive overtime when:

  1. they are paid a fixed salary;
  2. their salary is at least $455 a week (which equates to $23,660 a year); and
  3. their job primarily involves executive, administrative, or professional duties.

Furthermore, there are exemptions for highly compensated employees who regularly perform executive, administrative, or professional duties and make at least $100,000 a year, including at least $455 a week via salary or fees.

The Department of Labor’s proposal would focus on the salary aspect of the three-part test. Instead of a stagnant number, the salary standard would be set at the 40th percentile of weekly earnings for full-time salaried workers, which is expected to be about $970 a week, $50,440 a year, in 2016. For highly compensated employees, the standard would be set at the 90th percentile, expected to be $122,148 annually.

This proposal would be a drastic change, but a necessary one. The salary threshold has only been updated twice in the last 40 years. As a result, only 8% of full-time salaried workers fall under the threshold. This is a stark contrast from 1975 when 62% of full-time salaried workers fell below the threshold. Under the Department of Labor’s proposal, of the five million new workers expected to qualify for overtime, 53% of them would have college degrees and 56% would be women.

These days, the few that do fall under the salary threshold for overtime likely fall under another threshold, the poverty line. The poverty line for a family of four is $24,008 a year, or $348 more than the overtime threshold. This means that, a worker making $460 a week could work 50 hours every week, receive no overtime pay, and be below the poverty line.

The Department of Labor’s proposal can still change and they want to hear from you on a wide variety of issues. The agency wants your opinion on the proposal to use the 40th and 90th percentiles, or switch to using changes in inflation to determine the salary threshold. They want to know whether the three-part test is working. First and foremost, they want to know what overtime pay would mean to you and your family.

Make your voice heard and make it clear that this is an important issue that has been ignored for far too long. Share your ideas on the proposal here and your story here. You only have until Friday, but please, don’t make the comments too long they would have to work overtime to read them all, and chances are they don’t get paid for that.

 

About the Author: The author’s name is Erik Idoni. Erik Idoni is a student at the George Mason University School of Law and an intern at Workplace Fairness.


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Corporate Profits Hit Record High While Worker Wages Hit Record Low

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A constant conservative charge against President Obama is that he is inherently anti-business. However, businesses keep defying the storyline by making larger and larger profits, rebounding nicely out of the Great Recession.

In the third quarter of this year, “corporate earnings were $1.75 trillion, up 18.6% from a year ago.” Corporations are currently making more as a percentage of the economy than they ever have since such records were kept. But at the same time, wages as a percentage of the economy are at an all-time low, as this chart shows. (The red line is corporate profits; the blue line is private sector wages.):

 

Corporations made a record $824 billion in profits last year as well, while the stock market has had one of its best performances since 1900 while Obama has been in office.

Meanwhile, workers are getting the short end of the stick. As CNN Money explained, “a separate government reading shows that total wages have now fallen to a record low of 43.5% of GDP. Until 1975, wages almost always accounted for at least half of GDP, and had been as high as 49% as recently as early 2001.”

This post was originally posted on Think Progress on December 3, 2012. Reprinted with Permission.

About the Author: Pat Garofalo is the Economic Policy Editor for ThinkProgress.org at the Center for American Progress Action Fund. Pat’s work has also appeared in The Nation, U.S. News & World Report, The Guardian, the Washington Examiner, and In These Times. He has been a guest on MSNBC and Al-Jazeera television, as well as many radio shows. Pat graduated from Brandeis University, where he was the editor-in-chief of The Brandeis Hoot, Brandeis’ community newspaper, and worked for the International Center for Ethics, Justice, and Public Life.


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