HB 3140 Suspends Outmoded Waiting Period to Collect Unemployment Benefits

Fact Sheet
March 23, 2009 Download PDF

HB 3140 would temporarily let workers collect unemployment benefits as soon as they are eligible, rather requiring them to wait a week. By suspending an outdated feature of the unemployment system, it would put benefits in the hands of laid-off workers sooner and allow them to collect the full amount of benefits to which they are due.

The Problem: The first UI check has a one-week wait, but bills don’t

Requiring workers who qualify for unemployment insurance to wait one week before getting their first benefit check is an outmoded practice. The rule was put in place decades ago for two reasons, neither valid today. The first was to allow agencies time for manual claim processing, a problem overcome by modern computer systems. Second, the policy was justified as a means of extending the duration of benefits. Most workers, however, find a new job before exhausting their benefits, so the waiting week effectively denies them a week’s worth of benefits.

When a worker gets laid off, utility bills, rent and food expenses do not wait. Jobless workers who rely on unemployment benefits already experience a substantial drop in their income, as benefits replace only about half of Oregonians’ previous wages, on average. Asking workers to give up a week’s worth of benefits is an unnecessary hardship.

The Fix: Suspend the waiting week

Oregon can fix the problem by eliminating the waiting week. Fourteen states have already eliminated the waiting week requirement.

HB 3140 suspends the waiting week provision through May 30, 2010. The only reason the waiting week is only temporarily suspended rather than outright repealed is out of Employment Department concern that the federal government would not share the costs during extended benefits periods beyond the time period set forth in recent federal stimulus legislation.

The Benefits: Put benefits in the hands of workers immediately

The twin goals of the unemployment system are to support workers’ basic spending during periods of unemployment and to stabilize the economy. By putting benefit checks in workers’ hands immediately, the suspension of the waiting week reinforces both goals.