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U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210

CLASSIFICATION

UI

CORRESPONDENCE SYMBOL

TEUQI

ISSUE DATE

January 12, 1993

RESCISSIONS

None

EXPIRATION DATE

January 31, 1994

DIRECTIVE

:

UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 13-93

 

TO

:

ALL STATE EMPLOYMENT SECURITY AGENCIES

 

FROM

:

BARBARA ANN FARMER
Administrator
for Regional Management

 

SUBJECT

:

The Treatment of Emergency Unemployment Compensation (EUC) Cases in Unemployment Insurance (UI) Quality Control (QC)

 

  1. Purpose. To explain the policy regarding the handling of EUC cases for purposes of QC, and their implications for QC operations; and to outline the changes that will be made in the QC software to accommodate this policy.

  2. Reference. GAL 12-92 (September 11, 1992)

  3. Background. The amendments to the EUC program (effective July 3, 1992) included a provision that affects the work of QC -- the election provision. Under this provision, a claimant eligible for both regular Unemployment Insurance (UI) and EUC must be allowed to elect which benefit to receive. Although there is a general precedent for the election provision with Combined Wage Claims, this is the first instance of a program eligibility option for an extended benefits program and regular benefits.

    A further aspect is the "retroactive" provision. The election was effective for weeks after July 3, 1992. However, States have varied in how quickly they have implemented the requirements. Claimants must be offered the opportunity to elect EUC for weeks after July 3, 1992 already paid as regular UI or UCFE/UCX, etc., if they have the program eligibility option.

    The program eligibility option feature of the amendments requires the States to offer some claimants an election of EUC vs regular benefits more than once. At the end of the benefit year of a claimant who elects to defer the receipt of regular benefits to receive EUC, the claimant again has an election to postpone establishing a new benefit year to receive EUC on the most recently expired benefit year.

    The amendments affect the QC program as follows:

    1. The QC population includes regular benefit payments; it excludes all extended benefit-type payments, interstate, DUA, and TAA. The retroactive election provision makes this universe conceptually ambiguous. States are deleting retroactive EUC elections from the ET 5-159 report after the fact and unless adjusted the QC Population will diverge from the 5-159 figures.

    2. The election provision introduces two potential sources of payment error into the UI program.

      1. After the EUC amendments have been implemented, States can make mistakes byhandling the election provisions incorrectly. For example, a claimant elects EUC but the State pays regular benefits.

      2. During the period between July 3, 1992 and the date of implementation of the EUC amendments, States will have made regular benefit payments to claimants that have the program eligibility option which were correctly included in the QC population. Some payments will appear in QC samples where the claimants were entitled to have been offered, and upon election receive, EUC payments. By the time QC investigates them, some may have been paid as EUC "retroactive" claims; QC may determine that others should have been paid as EUC claims or that an election should have been offered. Although the original payment decisions that put the payments in the QC sample were correct at the time they were made, some or all could be considered QC overpayments. This situation is complicated by the lack of an implementation period in the EUC amendments to define when retroactive payments are or are not timely. The total number of such payments depends on (a) the number of claimants with a program eligibility option in the State; (b) the speed with which the State implemented the new law; (c) the election decision made by the claimant.

  4. Policy. UI payments which subsequently become EUC payments will not be considered improper payments for QC purposes. Such cases need to be investigated and identified so that the QC population can be adjusted. The policy includes the following:

    1. Investigate all cases in the QC sample following standard QC procedures and code any UI errors.

    2. Identify ("flag") all program eligibility option cases for key weeks after July 3, 1992 and code them appropriately. This will be done by changing the Program Code. Most of the cases will be in the "retroactive" period, but some may also occur after full implementation.

    3. Additions will be made to the QC software to flag the sampled cases and a method will be devised to adjust the QC population.

    4. Program eligibility option cases in which the claimant elected regular benefits will remain in the QC population/sample.

    5. The only situation where the case will remain in the sample is one in which the regular monetary determination was in error: i.e.; the claimant should have exhausted in an earlier week but will receive EUC due to the additional EUC benefits. These are UI overpayments due to monetary determination errors, not related to implementation or operation of EUC.

    6. No EUC-related mistake will be counted as an error for QC purposes. Because the EUC program eligibility option cases are removed from the sample, they will not affect calculations of timeliness. Because they have been investigated fully for regular benefit eligibility, however, they will be counted toward meeting sample allocation requirements.

    7. The "flagged" cases will remain in the QC database for analysis: They may help explain any dramatic changes in a State's error rate from 1991 to 1992, if the program eligibility option cases prove to be significantly more or less error-prone in regard to regular program eligibility.

  5. Procedures. States must continue to fully investigate all cases in the QC sample and ascertain whether they met regular benefit eligibility criteria. States are required to: (a) review completed cases and structure current investigations to identify program eligibility option cases; (b) establish and maintain a list of affected cases for future coding.

    1. Identifying a Program Eligibility Option Payment. There are three basic classes of EUC program eligibility option cases that must be identified. (1) After presentation of the option by the agency, the claimant retroactively elected to substitute an EUC payment for the regular program payment. (2) Upon the presentation of the option by the QC Investigator (QCI) in the course of the QC verification (this could occur either for "retroactive" or post-implementation cases), the claimant elected EUC. (3) After review of completed QC cases, the QCI determines that the case had been or should have been transferred to EUC. Below is a selection of potential situations with coding instructions:

      1. Payment made originally under regular program before State implementation of EUC. During the "implementation" period, State offered EUC, which claimant elected. QC investigation uncovered no regular benefits issues. CODING: Identify as EUC payment, for deletion from QC sample.

      2. Payment made originally under regular program before State implementation of EUC. During the "implementation" period, State offered EUC, which claimant elected. QC investigation revealed that the regular payment was improper. CODING: Identify as EUC payment, for deletion from QC sample.

      3. Regular benefit payment made before State implementation of EUC. During the "implementation" period, State offered EUC, which claimant rejected. QC investigation uncovered no regular payment issues. CODING: Regular payment.

      4. Regular benefit payment made before State implementation of EUC. During the "implementation" period, State offered EUC, which claimant rejected. QC investigation uncovered that a regular payment was improper. CODING: Regular payment.

      5. Regular benefit payment madeafter State implementation of EUC. QC investigation uncovered no regular payment issues; also determined claimant was EUC-eligible, but that State either failed to offer EUC election to claimant, or presented it incorrectly, so that EUC was not elected. Upon presentation by QCI, EUC is elected by claimant. CODING: Identify as EUC payment, for deletion from sample.

      6. Regular benefit payment madeafter State implementation of EUC. QC investigation determines that original payment was improper; also determined claimant was EUC-eligible but that State either failed to offer EUC election to claimant, or presented it incorrectly, so that EUC was not elected. Upon presentation by QCI, EUC is elected by claimant. CODING: Identify as EUC payment, for deletion from sample.

      7. Regular benefit payment madeafter State implementation of EUC. QC investigation uncovered no regular payment issues; also determined claimant was EUC-eligible, but that State either failed to offer EUC election to claimant, or presented it incorrectly, so that EUC was not elected. Upon presentation by QCI, EUC is not elected by claimant. CODING: Regular payment.

      8. Regular benefit payment madeafter State implementation of EUC. QC investigation determines that original payment was improper; also determined claimant was EUC-eligible but that State either failed to offer EUC election to claimant, or presented it incorrectly, so that EUC was not elected. Upon presentation by QCI, EUC is not elected by claimant. CODING: Regular payment.

      9. Regular benefit payment made after State implementation of EUC. During the QC investigation, it was determined that (a) the regular monetary determination was in error and that the claimant should have exhausted regular benefit eligibility before the Key Week; and (b) claimant was EUC-eligible. Claimant elected EUC either as result of either SESA or QCI offer. CODING: Regular UI payment error.

      10. Regular benefit payment made and the QC investigation was completed before State implementation of EUC. During the "implementation" period, State offered EUC, which claimant elected. QC investigation uncovered no regular benefit issues. CODING: Identify as EUC payment, for deletion from QC sample.

      11. Regular benefit payment made and the QC investigation was completed after State implementation of EUC. QC review determined claimant was EUC-eligible, but that State either failed to offer EUC election to claimant, or presented it incorrectly, so that EUC was not elected. Upon presentation by QCI, EUC is elected by claimant. CODING: Identify as EUC payment, for deletion from sample.

    2. Listing of Cases, Coding, Reporting. States are to develop and maintain a list of affected cases for additional coding at a later date. The first release following introduction of the new QC software will contain instructions for coding QC cases impacted by the EUC program. At this point, it is intended that this will involve reopening the case and changing the PROGRAM TYPE to a new code created to embrace EUC. Edits will be changed so that cases with the EUC code are (a) included in case counts for allocation purposes; (b) excluded from timeliness calculations; (c) dropped from the QC sample and thus excluded from the QC annual report; and (d) excluded from other major reports. These cases will be available for analysis.

  6. Action Required. State Administrators should provide this information to the appropriate State staff and ensure that:

    1. All cases in the QC sample that have a program eligibility option are identified; and

    2. A list of all identified cases is established and maintained for future data entry.

  7. Inquiries. Questions should be directed to the appropriate Regional Office.

  8. Attachments. None