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State reduces unemployment benefits to strengthen trust fund

Since June 2010, eligible unemployment insurance claimants supporting minor children have been receiving $15 per child, to a maximum of $50, as a dependent allowance added to their weekly unemployment benefit amount.
Those dependent allowance payments will end soon as a result of legislation signed by Governor Bill Haslam that becomes effective July 1, 2013.
In 2009 Tennessee received one-time federal funds in the amount of $141,808,031 as an incentive grant under the American Recovery and Reinvestment Act to strengthen the rapidly depleting Trust Fund and continue providing unemployment insurance payments, including the dependent benefit.
Those provisions were enacted as permanent law that could only be discontinued by repeal by the Tennessee General Assembly.
“This action taken by the legislature is another step that will increase savings to the Unemployment Insurance Trust Fund.” said Labor and Workforce Development Commissioner Burns Phillips.
“The healthier the trust fund, the lower the tax table that determines premium rates for Tennessee employers. The trust fund balance is currently $799 million and is on a positive path to maintain solvency and stability in the event of another recession. Tennessee, unlike 22 states in the nation, has no outstanding loan from the Federal Unemployment Account.”
For claimants currently receiving unemployment, the last payable week to receive dependent benefits will be the week that ends June 29.
Claimants filing new claims for unemployment benefits on June 30 may be eligible to receive only one week of dependency benefits – for the week that ends July 6.
Any unemployment payments for weeks ending after that date will not include dependent allowances.
Other provisions included in the legislative repeal affecting claimant eligibility are these:
•After June 29, Tennessee will no longer use the Alternate Base Period to establish unemployment claims for claimants who did not earn enough in wages to establish a claim using the traditional base period.
•Beginning with the week that ends July 6, claimants will be ineligible for benefits for weeks in which they seek, apply for, or accept only part-time work instead of full-time work if their employment has been customarily full-time.
The Department of Labor and Workforce Development will notify affected claimants when they conduct their weekly certification to continue their benefits.
For updated information on this and other unemployment issues please visit the department’s Web site at http://www.tn.gov/labor-wfd/.


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