California Proposes Unemployment Benefits for Illegal Immigrants.
Senate Bill 227, also known as the “Safety Net for All Workers Act,” extends unemployment benefits to illegal immigrants. If the bill is passed by the California Assembly, it will need to be signed by Governor Newsom to become law.
The new bill indicates that “[d]espite paying millions of dollars in state and local taxes and making up one-sixteenth of the California workforce, undocumented immigrants are categorically excluded from unemployment insurance.” As a result, “[t]o rectify the unjust exclusion of immigrant workers from an essential social safety net program and build a safer and more resilient economy, this bill would require the Employment Development Department (EDD) to establish an Excluded Workers Program to provide weekly monetary assistance to unemployed workers who are ineligible for state or federal unemployment insurance benefits due to their immigration status.”
To receive “unemployment benefits,” undocumented workers must attest to having worked at least 93 hours or earned at least $1,300 in wages over the course of 3 months in the prior 12 months or in the calendar year prior to his or her application for “unemployment benefits.” In addition, the undocumented worker must produce documents that show he or she met the employment threshold. If he or she is unable to produce documents, the EDD can conduct a credibility interview to determine if the EDD believes the undocumented worker worked 93 hours or earned at least $1,300. Yes, you read that right: the EDD has subjective authority to determine whether or not an undocumented worker is entitled to receive “unemployment benefits.”
The threshold for undocumented workers to receive these “unemployment benefits” is quite low. In essence, the undocumented workers are entitled to $6,000 if: 1) they are willing to say they worked 93 hours or earned $1,300 in the preceding year and 2) (where they have no documentation) they are able to convince the EDD through a credibility interview that they worked 93 hours or earned $1,300 in the preceding year. To make matters worse, the EDD is not allowed to call the employer to verify the undocumented worker’s employment.
How much are the undocumented workers entitled to? The new bill states that the undocumented workers shall receive $300 for each week of unemployment for a maximum of 20 weeks. In total, undocumented workers shall receive approximately $6,000 a year in “unemployment benefits.”
What does this mean for employers? It is likely that employers will be required to pay higher taxes to cover the increase in unemployment benefits being paid out. This is bad news for employers because the EDD is actually in debt to the tune of over $18 billion dollars. In addition, according to a recent Government Accountability office report, it is believed that as much as $135 billion in fraudulent unemployment insurance benefits may have been paid out. The new bill increases the pool of “unemployment benefits” applicants, allows undocumented employees to meet a lower threshold for obtaining “unemployment benefits, and actively ignores the propensity for fraud in these instances.