Oregon’s new law authorizing unemployment assistance to striking workers could face a challenge from the federal government, which warned states last week about paying people on strike unless those people are also actively looking for new jobs.
“An individual who is on strike must engage in activities that demonstrate to the state (unemployment insurance) agency that he or she is able and available for work and actively seeking work under state law,” Michelle Beebe, head of the U.S. Employment and Training Administration, wrote in a note to Oregon and other state agencies last week.
If states pay unemployment aid to striking workers without ensuring that they are seeking other work while on strike, Beebe cautioned those states could lose federal grants and businesses would lose their eligibility for federal tax credits.
In Oregon, that could cost the state government more than $108 million in federal funding for administering the unemployment insurance program and paying benefits. It could also cost Oregon businesses $500 million a year in tax credits on the federal taxes that help fund unemployment insurance.
The Oregon Employment Department says it is studying the newly issued federal guidance. The agency says it has already been in touch with the U.S. Department of Labor and has established guidelines to comply with the federal rules and the new Oregon law.
“We believe it conforms with the guidance (the Department of Labor) issued last week,” Seth Gordon, spokesperson for the agency, wrote in an email Monday.
Oregon became one of four states that pay jobless benefits to striking workers when the Legislature passed Senate Bill 916 last year. New York and New Jersey have similar laws and Washington passed its own version last year, too.
Oregon’s new law kicked in this month. It pays up to 10 weeks of benefits to striking workers, though they must wait two weeks before becoming eligible. Oregon is also the only state that pays unemployment benefits to public-sector workers while on strike.
The employment department’s rules for administering Oregon’s law do require striking employees to seek other work while on strike. Examples of job-seeking activity include registering for job placement services with the state, attending job placement meetings, joining a networking group, updating a resume and reviewing help-wanted ads or visiting job placement websites.
Oregon’s list of qualifying activities for striking workers does not include actually applying for other jobs. The federal guidance issued last week doesn’t specifically require that, either.
Rep. Dacia Grayber, D-Portland, was among the chief sponsors of last year’s bill. She said Tuesday that she considers the Department of Labor’s memo an endorsement of Oregon’s rules for paying striking workers.
“The discussion around ‘actively seeking work’ and what that means for striking workers compared to other eligible workers is one I support,” Grayber said in a statement. “We want to remain in compliance with federal law, and are happy to get to a solution that works for (Department of Labor) as well as for the people of Oregon.”
Unemployment insurance for striking workers represented a big win for Oregon’s powerful labor unions last year. Nationally, though, unions are on the defensive against Trump administration policies that seek to curb union influence in the workplace.
The Department of Labor didn’t respond Tuesday to an inquiry about whether Oregon’s guidance meets federal standards. Gordon, with the employment department, said the agency expects any federal objection to Oregon’s policies would typically start with a discussion and a joint plan on how to proceed.
In the meantime, Gordon said, “We are ready to receive and process any claims that are filed.”
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