UNEMPLOYMENT 

INSURANCE

Various Factors Affect 

Head Start and Other 

Early Childhood 

Teachers’ Eligibility for 

Benefits

Accessible Version

Report to Congressional Requesters

October 2016

GAO-17-34

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-17-34, a report to 

congressional requesters

October 2016

UNEMPLOYMENT INSURANCE

Various Factors Affect Head Start and Other Early 

Childhood Teachers’ Eligibility for Benefits

What GAO Found

In response to GAO’s survey, officials from all 50 states, the District of Columbia, 

and two territories reported that they have various laws or policies that may 

affect whether Head Start and other early childhood education (ECE) teachers 

are allowed to collect unemployment insurance (UI) benefits during summer 

breaks. Officials in three states—Indiana, Pennsylvania, and Wyoming—reported 

that Head Start teachers are generally not eligible for UI benefits over summer 

breaks. In other states, officials outlined various factors that can affect eligibility. 

Specifically, officials from 30 states said the type of employer—for-profit, nonprofit, or municipality—can influence eligibility for Head Start teachers (officials in 

28 states reported this for ECE teachers). In addition, officials in 17 states 

reported that eligibility for Head Start teachers can be affected by the program’s 

relationship to a school or board of education (officials in 11 states reported this 

for ECE teachers). For example, West Virginia officials reported that Head Start 

teachers considered under the authority of the board of education are generally

not eligible for UI benefits.

In 2015, about half of the 90,000 Head Start teachers (about 44,800) across the 

country may have been eligible for UI benefits during their summer break, 

according to GAO’s analysis of available data and the information states 

reported about their laws, regulations, and policies in response to GAO’s survey.

The remaining teachers and assistant teachers were likely not eligible because 

they worked for school districts or charter schools (about 14,150); worked in 

programs with breaks that were too short to allow them to collect benefits (about 

28,940); or were generally not eligible under state laws, regulations, or policies 

(about 2,510).

To communicate UI eligibility rules to both employers and employees, state UI 

agencies reported using a variety of methods; however, selected stakeholders 

identified several concerns with these efforts. According to GAO’s survey, state 

directors reported that they use various communication channels to provide 

general information to both employers and employees on matters, such as how 

to file a claim in their states. The three most commonly cited methods used by 

the states included websites, hotlines, and handbooks. Even though most states 

reported that they are using multiple methods of communication with employers 

and employees, some Head Start and ECE stakeholders in five selected states 

told GAO that the complexity of federal and state laws and policies governing 

state programs continue to make UI eligibility rules difficult to understand, even 

with information that their states are providing. While some of this confusion can 

be attributed to the variability and complexities of states’ eligibility policies, GAO 

also found that states are generally not evaluating the effectiveness of their 

communication approaches. Specifically, over half of the states reported that 

they have not evaluated the effectiveness of their communication approaches 

with employees, and about two-thirds reported they have not evaluated the 

effectiveness of their communication approaches with employers. The states that 

were conducting evaluations reported that the feedback allowed them to make 

improvements in their communication materials for both employers and 

employees. For example, some states reported making their claims processing 

applications more user friendly and understandable as a result of this feedback.

View GAO-17-34. For more information, 

contact Cindy Brown Barnes at (202) 512-

7215 or brownbarnesc@gao.gov

Why GAO Did This Study

In 2015, the Head Start child 

development program provided federal 

funds to local grantees that employed 

over 90,000 teachers. Some of these

grantees run programs that do not run 

during the summer, and some teachers 

may, in turn, seek UI benefits to help 

meet expenses during that time. All 

states have laws generally prohibiting 

certain employees of educational 

institutions from collecting UI benefits 

between terms, though they have 

flexibility in setting specific eligibility 

restrictions. GAO was asked to review 

Head Start and other ECE teachers’ 

eligibility for UI benefits during the 

summer months.

This report examines (1) the extent to 

which states have laws or policies that 

affect whether Head Start and other 

ECE teachers are eligible for UI 

benefits during summer breaks; (2) 

how many Head Start teachers may 

have been eligible for these benefits 

during their summer breaks in 2015; 

and (3) what is known about how 

states communicate information about 

eligibility for UI benefit payments to 

Head Start and ECE employees and 

the effectiveness of these efforts. GAO 

surveyed UI directors in all 50 states, 

the District of Columbia, Puerto Rico, 

and the Virgin Islands (with 100 

percent responding); analyzed Head 

Start data from program year 2015;

reviewed relevant federal laws; and 

interviewed federal officials and 

stakeholders, including employer 

associations and teacher associations,

in five states selected using criteria

such as their benefit restrictions.

What GAO Recommends

GAO is not making recommendations.
Letter 1

Page i GAO-17-34 Unemployment Insurance

Background 4

State Officials Reported That State Laws and Policies Can Affect 

Teacher Eligibility for Unemployment Insurance Benefits 5

About Half of All Head Start Teachers May Have Been Eligible for 

Unemployment Insurance Benefits during Summer Breaks in 

2015 9

States Identified Various Communication Efforts with Employees 

and Employers of Head Start and Early Childhood Education 

Programs, and Stakeholders Identified a Number of Limitations 

with These Efforts 11

Agency Comments 15

Appendix I: Objectives, Scope, and Methodology 16

Appendix II: GAO Contact and Staff Acknowledgements 20

Appendix III: Accessible Data 21

Data Tables/Accessible Text 21

Related GAO Products 22

Figures

Figure 1: Estimated Number of Head Start Teachers Potentially 

Eligible to Receive Unemployment Insurance Benefits in 

Summer 2015, after Factoring in State Restrictions 10

Figure 2: Methods Reported by States to Communicate 

Unemployment Insurance Information to Employers 12

Figure 3: Methods Reported by States to Communicate 

Unemployment Insurance Information to Employees 12

Contents
Page ii GAO-17-34 Unemployment Insurance

Abbreviations

DOL Department of Labor 

ECE early childhood education 

HHS Department of Health and Human Services 

UI Unemployment Insurance
Page iii GAO-17-34 Unemployment Insurance

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

without further permission from GAO. However, because this work may contain 

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necessary if you wish to reproduce this material separately.
Page 1 GAO-17-34 Unemployment Insurance

441 G St. N.W.

Washington, DC 20548

October 17, 2016

The Honorable Todd Rokita

Chairman

Subcommittee on Early Childhood, Elementary, and Secondary 

Education

Committee on Education and the Workforce

House of Representatives

The Honorable Vern Buchanan

Chairman

Subcommittee on Human Resources

Committee on Ways and Means

House of Representatives

The Head Start program is one of the largest early childhood education 

(ECE) programs overseen by the federal government. For fiscal year 

2016, Congress appropriated nearly $9.2 billion for the program, and it 

served approximately 1.1 million children in program year 2015. Head 

Start services—including early learning for children and parenting 

guidance and nutrition education for adults—were provided through 

approximately 1,600 local organizations and funded by grants 

administered by the Department of Health and Human Services (HHS). 

Similar to other entities providing educational services, organizations 

administering ECE might not run during the summer months, potentially 

leaving their teachers and teaching assistants without work during that 

time. To help meet expenses, some of these employees may seek 

unemployment benefits until they return in the fall.

The federal-state unemployment insurance (UI) program, nationally 

overseen by the Department of Labor (DOL), temporarily replaces part of 

the lost earnings of those who become unemployed through no fault of 

their own. Federal law provides a broad rule on eligibility for instructional 

employees of certain educational institutions, though the specifics of 

eligibility are determined by each state. Given this state flexibility, state 

laws may vary in whether Head Start and other ECE employees are 

eligible for UI benefits.

In 1985, HHS’s Office of Inspector General audited the Head Start 

program and found widespread problems related to the receipt of UI 

payments by its grantees’ personnel. The Inspector General 

Letter
recommended, in turn, that routine UI payments should be discontinued 

for those employees.

Page 2 GAO-17-34 Unemployment Insurance

1

You asked us to provide information on the eligibility of Head Start and 

other ECE teachers2for UI benefits during the summer months. 

Specifically, this report examines:

1. the extent to which states have laws or policies that affect whether 

Head Start and other ECE teachers can claim UI benefits during 

summer breaks;

2. how many Head Start teachers may have been eligible for UI benefits 

during their summer breaks in 2015; and

3. what is known about how states communicate information about 

eligibility for UI benefit payments to Head Start and ECE employees 

and the effectiveness of these efforts.

To address these questions, we surveyed state UI directors (including all 

50 states, the District of Columbia, Puerto Rico, and the Virgin Islands)3; 

analyzed data from the Head Start program in conjunction with survey 

results; and interviewed stakeholders in four states and one territory. 

Specifically, for the first question we surveyed state UI directors about 

state laws, regulations, and policies that might affect whether Head Start 

and other ECE teachers are eligible to claim UI benefits during summer 

breaks.4 We obtained responses from 100 percent of the states surveyed. 

For the second question, we used data from the Office of Head Start’s 

 

1 The 1985 Inspector General report recommended that HHS conduct “a grantee-bygrantee and state-by-state analysis of the extent and magnitude of the problem of 

unemployment compensations costs.” See “A Program Inspection of Head Start 

Unemployment Insurance Cost.” Office of the Inspector General, Department of Health 

and Human Services. (Washington, D.C. February 1985). During our review, we asked 

HHS officials if the analysis recommended by the report was performed, but officials could 

not determine whether such an analysis was conducted.

2

In this report, “teachers” refers to both classroom teachers and teaching assistants.

3

In this report, we are using the term “states” in reference to the states, the District of 

Columbia, and the 2 territories included in our review.

4 While we asked states to provide a description of their relevant laws, regulations, and 

policies, we did not confirm their description with an independent review of each law, 

regulation, and policy. Thus, in this report all descriptions and analyses of state laws, 

regulations, and policies are based solely on what states reported to us.
Program Information Report, which each Head Start grantee is required 

to submit on an annual basis. In conjunction with data from the 2014-

2015 program year (the most recent available), we used information from 

our survey on state laws, regulations, and policies to estimate the number 

of Head Start teachers and teaching assistants who may be eligible for UI 

benefits during summer breaks.

Page 3 GAO-17-34 Unemployment Insurance

5 After reviewing the Head Start program 

data and interviewing knowledgeable officials about them, we found the 

data to be sufficiently reliable for our purposes. For the third question, we 

used our survey of state directors to ask about their respective states’

efforts to communicate with stakeholders regarding UI eligibility, and how 

they evaluate these efforts. We also selected four states (Alabama, 

Indiana, New Jersey, and Wyoming) and one territory (Puerto Rico) 

where we interviewed state UI directors, Head Start grantees, and other 

stakeholders to gather more in-depth information. We selected these 

states to obtain a mixture of stakeholder experiences based on factors 

such as the number of Head Start centers and survey responses 

regarding eligibility and improper payments. The results of these 

interviews are not generalizable to all states. In addition, we interviewed 

DOL, HHS, and state officials and stakeholders (including the National 

Head Start Association and the National Association of State Workforce 

Agencies) to obtain information on how they have assisted states and 

grantees in communicating UI eligibility restrictions. Lastly, we reviewed 

relevant federal laws, regulations, and policies on agency roles and 

responsibilities. For more information on our methodology, see 

appendix I.

We conducted this performance audit from August 2015 to October 2016 

in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

 

5

In making this estimate we made a number of assumptions that affected our analysis. 

For a discussion of those assumptions, see appendix I.
The Head Start program, which is overseen by HHS’s Office of Head 

Start, performs its mission to promote school readiness and development 

among children from low-income families through its nearly 1,600 

grantees. More specifically, Head Start grants are awarded directly to 

state and local public agencies, private nonprofit and for-profit 

organizations, tribal governments, and school systems for the purpose of 

operating programs in local communities. According to Head Start 

program reports, more than 90,000 employees taught in grantee 

programs during program year 2014-2015.

Page 4 GAO-17-34 Unemployment Insurance

6 Of these employees, about 

half were preschool classroom teachers (44,677), and the other half were 

preschool assistant teachers (45,725). Head Start officials told us that 

many grantees do not run programs during the summer months, which 

could leave these teachers and teaching assistants without wages from 

these employers during that time. According to HHS, Head Start teachers 

were paid about $29,000 annually (compared to annual median earnings 

of nearly $52,000 for kindergarten teachers). Head Start teachers and 

teaching assistants are among the approximately 960,000 ECE 

employees across the nation, according to the Bureau of Labor 

Statistics.7

The nation’s UI system is a joint federal-state partnership originally 

authorized by the Social Security Act and funded primarily through federal 

and state taxes on employers. Under this arrangement, states administer 

their own programs according to certain federal requirements and under 

the oversight of DOL’s Office of Unemployment Insurance, but they have 

flexibility in setting benefit amounts, duration, and the specifics of 

eligibility. In order for employers in the states to receive certain UI tax 

benefits, states must follow certain requirements, including that the states 

have laws generally prohibiting instructional employees of certain 

educational institutions from collecting UI benefits between academic 

 

6 Numbers in this report do not include teachers and assistant teachers in Early Head 

Start programs.

7 This employee group includes preschool teachers, special education preschool 

teachers, and childcare workers. According to the Bureau of Labor Statistics, there were 

approximately 960,000 jobs in these three occupations combined as of May 2014. ECE 

workers had lower wages than Head Start teachers in 2015 with an annual median 

income of about $20,320 (or 30 percent less than Head Start teachers and more than 60 

percent less than kindergarten teachers), according to a 2016 study by HHS and the 

Department of Education.

Background
terms if they have a contract for, or “reasonable assurance” of, 

employment in the second term.

Page 5 GAO-17-34 Unemployment Insurance

8 However, the Act does not define 

educational institution, leaving states discretion with this classification. 

Federal policies regarding the eligibility of Head Start teachers for UI 

benefits have remained the same for decades, according to DOL officials, 

and are stated in a 1997 policy letter in which DOL’s position is clarified 

on applying the federal provision regarding employees of educational 

institutions.9

In responding to our survey, state UI directors reported having to follow 

various state laws and policies that may affect whether Head Start and 

other ECE teachers are allowed to collect benefits during the summer.

In 3 of the 53 states and territories in which we conducted a survey about 

laws and policies that may affect teacher eligibility, officials reported that 

Head Start teachers are generally not eligible for UI benefits over summer 

breaks. Specifically, in 2 of the states we surveyed, officials reported that 

Head Start teachers are generally not eligible for UI benefits over summer 

breaks but other ECE teachers may be. In the first state, Pennsylvania, 

officials told us that because of a 2007 state court decision, Head Start 

teachers are generally not eligible for UI benefits because the state 

generally considers Head Start teachers to be employees of educational 

institutions, and such employees are generally not eligible. For other ECE 

teachers, however, Pennsylvania officials said that eligibility may vary by 

employer. More specifically, the officials told us that employees of for-

 

8 See 26 U.S.C. § 3304(a)(6). This provision applies to educational institutions run by 

states, local governments, Indian tribes, and 501(c)(3) non-profit entities. States may, but 

are not required to, apply this provision to educational institutions run by for-profit entities.

9 See Unemployment Insurance Program Letter (UIPL) No. 41-97, Application of Between 

and Within Terms Denial to Head Start Program Personnel. 

State Officials 

Reported That State 

Laws and Policies 

Can Affect Teacher 

Eligibility for 

Unemployment 

Insurance Benefits

All Head Start Teachers 

are Generally Not Eligible 

in Some States
profit institutions would not be subject to the educational institution 

restriction, and therefore may be eligible for UI benefits over summer 

breaks. In the second state, Wyoming, officials reported that their state 

excludes from UI eligibility those engaged in instructional work of an 

educational institution. The officials also reported that Head Start 

teachers “fall under this provision by consistent interpretation and 

precedent decisions” in Wyoming and therefore are not eligible for UI 

benefits over summer breaks, though other ECE teachers not employed 

by educational institutions are potentially eligible for benefits during that 

time.

Officials in a third state, Indiana, told us that state law restricts eligibility 

for employees who are on a vacation period due to a contract or the 

employer’s regular policy and practice, which affects both Head Start and 

other ECE teachers who are on summer break. The officials explained 

that these workers are not considered unemployed during regularly 

scheduled vacation periods and are therefore not eligible to receive UI 

benefits. This law was not targeted at Head Start or other teachers but 

instead was meant to address those individuals with predictable vacation 

periods, according to officials. Indiana’s Department of Workforce 

Development determines whether the employee is on a regularly 

scheduled vacation period by analyzing historical data, rather than relying 

on the employer to notify the department. Officials told us they have an 

internal unit that works to detect claims patterns over time to identify 

these vacation periods for specific employers.

In contrast, based on what officials in the remaining 50 states and 

territories we surveyed reported to us, Head Start and other ECE 

teachers in the remaining states may be eligible for benefits over summer 

breaks in those states, usually depending on a number of factors, such as 

the type of employer or the program’s connection to a school or board of 

education, as discussed below.

Page 6 GAO-17-34 Unemployment Insurance

10

 

10 In their survey responses, some states used other phrases such as “academic 

institution,” “school system,” or “school board.”
Officials told us that eligibility for UI benefits can be affected by the type of 

employer in 30 states for Head Start and 28 for ECE.

Page 7 GAO-17-34 Unemployment Insurance

11 State officials 

reported having to abide by a wide ranging set of laws and policies in this 

area, including those that sometimes include or exclude certain types of 

organizations from the state’s definition of educational institution. For 

example:

· Employers included as educational institutions. Officials in some 

states told us that their laws include certain types of employers in the 

definition of an educational institution. Consequently, Head Start and 

ECE teachers at these institutions are generally not eligible for UI 

benefits over summer breaks. For example, New York officials told us 

that nursery schools and kindergartens would be considered 

educational institutions but day care providers generally would not. 

Alaska officials reported that the state generally defines an 

educational institution as a “public or not-for-profit” institution that 

provides an organized course of study or training. Head Start 

employees of private for-profit institutions, however, may be eligible.

In a separate example, New Jersey officials told us that teachers who 

work in private preschools mandated by the state to operate in 

districts known as “Abbott districts” are generally not eligible for UI 

benefits during summer breaks, because they are considered 

employees of educational institutions.12 In Abbott districts, they said, 

the state must provide preschool for all students living in that district, 

either directly through a public agency or by contracting with a private 

provider, which could also potentially be a Head Start grantee 

organization. They further explained that Abbott teachers are paid 

significantly higher salaries than Head Start teachers outside of 

Abbott districts are paid. As a result, they said, Abbott teachers may 

be less in need of UI benefits during summer breaks. Furthermore, 

 

11 As mentioned earlier, we are using the term “states” in reference to the states, the 

District of Columbia, and the 2 territories included in our review. In some cases, we were 

not able to definitively categorize state laws or policies based on the state’s responses; in 

addition, some states’ laws or policies could be categorized in multiple categories. 

Therefore, totals may not add to 53.

12 Officials told us that New Jersey has 35 local school districts that were designated as 

“Abbott districts” following state court decisions related to inequity in school funding. 

According to documents provided by the officials, one of these initial court decisions was 

in the case of Abbott v. Burke.

Type of Employer Can 

Affect Eligibility
ECE teachers who work for non-Abbott providers are potentially 

eligible, according to New Jersey officials.

· Employers not considered educational institutions. In other 

cases, state officials reported that their laws specified that certain 

types of employers are not included in the definition of an educational 

institution and that teachers working for these specific types of 

employers are potentially eligible for UI benefits over summer breaks. 

For instance, officials in 10 states for Head Start and 4 states for ECE 

reported that community action groups operating Head Start or other 

ECE programs are not included in the definition of an educational 

institution. Therefore, the general restriction against employees of 

educational institutions getting UI benefits during summer breaks 

does not apply to these teachers. For example, Kansas officials 

reported that private for-profit institutions are not considered 

educational institutions, and California officials reported that nonprofits are not considered educational institutions. Head Start and 

ECE teachers in these types of programs may be eligible for benefits.

Officials in 17 states reported that UI eligibility for Head Start teachers 

can be affected by the program’s relationship to a school or board of 

education, and officials in 11 states reported similar restrictions for ECE 

teachers. For example:

· Program is an “integral part” of a school or school system.

Officials in some states reported that teachers who worked for Head 

Start and ECE programs that operated as integral parts of a school or 

school system could be affected by eligibility restrictions. For 

example, Illinois officials specified in their response to our survey that 

“integral part” means the Head Start program is conducted on the 

premises of an academic institution and that the staff is governed by 

the same employment policies as the other employees of the 

academic institution.

· Program’s relationship with a school board. In other states, 

officials reported potentially allowing or restricting eligibility for Head 

Start and other ECE programs based on the program’s relationship 

with a board of education. West Virginia officials reported that if a 

teacher works for a Head Start program that is “under the influence or 

authority” of a county board of education, and his or her wages are 

reportedly paid by the board of education, the teacher is generally 

considered a school employee and is therefore not eligible for UI 

benefits over the summer break. Colorado officials told us that 

Page 8 GAO-17-34 Unemployment Insurance

The Program’s 

Relationship with a School 

or Board of Education Can 

Affect Eligibility
“educational institution” does not include Head Start programs that are 

not part of a school administered by a board of education.

We estimated that approximately 44,800 of the nearly 90,400 Head Start 

teachers across the country may have been eligible for UI benefits during 

their summer breaks in 2015.

Page 9 GAO-17-34 Unemployment Insurance

13 Among the teachers who were likely 

ineligible for UI benefits, we estimated that about 14,150 were likely not 

eligible because they work in school systems or charter schools, which 

we assumed would be included in the states’ definitions of educational 

institutions. We also estimated that about 28,940 Head Start teachers did 

not have summer breaks long enough to allow them to collect UI benefits. 

Because states pay UI benefits on a weekly basis, and in most states 

individuals must first serve a waiting period of a week, employees must 

have a summer break of at least 2 weeks in most states before they can 

collect benefits.14 This break must be at least 1 week in states without a 

waiting period. We counted those teachers at employers with shorter 

summer breaks than these as likely ineligible. Lastly, we estimated that 

about 2,490 were likely not eligible to receive UI benefits during summer 

breaks because of state restrictions, as shown in figure 1.

 

13 In estimating the population of potentially eligible Head Start teachers, we made a 

number of assumptions that may affect the analysis. For information on these 

assumptions and their potential effects, please see appendix I. 

14 See DOL’s 2016 Comparison of State Unemployment Laws, available at 

http://www.unemploymentinsurance.doleta.gov/unemploy/comparison2016.asp. This 

document contains a summary of the state laws that set waiting periods.

About Half of All Head 

Start Teachers May 

Have Been Eligible 

for Unemployment 

Insurance Benefits 

during Summer 

Breaks in 2015
Figure 1: Estimated Number of Head Start Teachers Potentially Eligible to Receive 

Page 10 GAO-17-34 Unemployment Insurance

Unemployment Insurance Benefits in Summer 2015, after Factoring in State 

Restrictions

Note: We made various assumptions in conducting this analysis that impacted the results. If different 

assumptions were made, the results would have been different.

Based on our analysis of available data, about 2,100 of these teachers 

work in Indiana, Pennsylvania, and Wyoming, where, as mentioned 

earlier, Head Start teachers are generally not eligible for UI benefits over 

summer breaks. The other Head Start teachers we estimated were likely 

not eligible for UI benefits were potentially affected by restrictions on 
teachers who work for certain types of employers, such as government 

agencies or non-profits.

Page 11 GAO-17-34 Unemployment Insurance

15

States reported using a variety of methods to communicate general UI 

eligibility information to both Head Start and ECE employers and 

employees. Specifically, state officials most frequently reported using 

websites to communicate laws, regulations, and policies regarding UI 

benefit eligibility to employers and employees (52 out of 53 states, or 98 

percent), followed by the use of handbooks with 39 out of 53 states (74 

percent) reporting using this method for employers and 47 out of 53 

states (89 percent) reporting using this method for employees. Beyond 

these approaches, state officials often reported being in contact with 

employers through call centers, with 26 out of 53 states (49 percent) 

reporting this method. The other most frequently used communication 

approach for employees was through hotlines, with 44 out of 53 states 

(83 percent) reporting using this method. See figure 2 for more 

information on communication methods states reported using to 

employers and figure 3 for communication methods states reported using 

to employees.

 

15 We were not able to fully identify affected grantees in all states. For example, in New 

Jersey, officials told us that employees who work in private preschools mandated by the 

state to operate in certain school districts are generally not eligible for UI benefits during 

summer breaks. We were not able to identify which grantees are included in these districts 

and therefore did not eliminate any teachers from our estimate. In addition, some states 

reported classifying employees of certain types of employers as subject to benefit 

restrictions, but there may not be grantees that fall into this category. For example, 

Massachusetts officials reported that if a Head Start program is operated by a municipality 

in their state, its employees would be subject to the same restrictions as other school 

employees during the vacation period. However, there were no grantees in this category 

during the 2014-2015 program year, according to Head Start data. 

States Identified 

Various 

Communication 

Efforts with 

Employees and 

Employers of Head 

Start and Early 

Childhood Education 

Programs, and 

Stakeholders 

Identified a Number 

of Limitations with 

These Efforts
Figure 2: Methods Reported by States to Communicate Unemployment Insurance 

Page 12 GAO-17-34 Unemployment Insurance

Information to Employers

Figure 3: Methods Reported by States to Communicate Unemployment Insurance 

Information to Employees
Even with the information states reported providing, the Head Start and 

ECE employer and employee representatives we interviewed said that 

state UI programs can remain difficult to understand because of the 

complexity of the various federal and state laws, regulations, and policies 

governing the programs. For example, one employer in Wyoming told us 

that she did not feel she could effectively advise her employees on 

eligibility policies because there was no clear, readily available 

information or guidance from the state. More specifically, the employer 

told us that a general overview of what the benefits are, how long they 

last, and what requirements claimants have to meet to keep receiving 

benefits would be helpful. However, through our survey, officials in 51 of 

53 states (96 percent) reported that they did not provide any additional 

communication specific to Head Start or other ECE regarding eligibility 

policies. As mentioned earlier, the impact of these eligibility rules can vary 

greatly across states and even within a state, and an employee’s eligibility 

can be affected by certain circumstances, such as the type of employer 

and the employer’s relationship with a school.

State officials also told us that misunderstandings about program 

eligibility can be perpetuated when state officials inconsistently administer 

the policies or delay implementation of new state policies. For example, 

Indiana officials told us the legislature passed a law that eliminated UI 

benefits during regularly scheduled vacation periods in July 2011, but 

officials were not able to fully implement this new law until October 2012 

because it was difficult to identify all of the industries or employees that 

would be affected. As mentioned earlier, instead of relying on employers’

reports, the Indiana office analyzes historical data by employer to help 

identify claim patterns that may indicate a regularly scheduled break. 

Officials said they did not enforce the changes to employees claiming 

benefits during the summer of 2011 and started attempting to enforce it 

during the summer of 2012 to the extent that they were able to detect 

regularly scheduled vacation periods. These officials told us that in 

hindsight they should have reached out to Head Start and ECE 

employees after they began to implement the regularly scheduled 

vacation period provision, but they did not realize the full impact of the 

policy change until after the provision was fully implemented.

Similarly, New Jersey officials told us that they recently had to hold a 

meeting among key internal state officials responsible for initial case 

determinations and appeals because they realized not all staff understood 

state eligibility policies. According to a New Jersey official, in some cases, 

when the initial claims adjudicator denied the case, the employees had 

wrongly obtained benefits through appeals. They also mentioned that 

Page 13 GAO-17-34 Unemployment Insurance
they planned to distribute a letter to the ECE community to clarify the 

state’s eligibility policy.

Due to the complexity of eligibility issues and the potential for inconsistent 

adjudications that may affect the integrity of the program, officials in New 

Jersey and Indiana told us they developed dedicated offices to handle 

claims and monitor improper payments for groups that include Head Start 

and ECE employees. New Jersey officials told us they have a centralized 

office that handles all school employee claims to ensure that the 

adjudication process is uniform and all claims are handled appropriately. 

According to a New Jersey official, 10 of the best examiners were 

selected from various field offices to receive specialized training to handle 

school employee claims from all over the state. Similarly, Indiana officials 

told us they have an office dedicated to resolving claims that may be 

affected by a regularly scheduled vacation period.

To some extent, the concerns raised by stakeholders can be associated 

with the fact that states do not generally assess the effectiveness of their 

communication approaches. Thirty-four of 53 states (64 percent) reported 

that they do not conduct evaluations to assess the effectiveness of their 

communications with employers. Of the remaining 19 states that reported 

conducting evaluations, 12 states said they conducted those evaluations 

on an ongoing basis, such as providing employers the opportunity to 

regularly provide feedback through an evaluation form posted on their 

website. Of the states that reported conducting evaluations of their 

communication efforts with employers, 16 of 19 states reported using the 

results to make program changes. For example, one state reported that it 

has made changes to its online employer handbook by providing a search 

tool that allows employers to find information more quickly. Other states 

reported that they have created employer training materials or mandated 

customer service training for all employees after assessing their 

communication efforts.

Similarly, 29 of 53 states (54 percent) also reported that they do not 

conduct evaluations of their communication with employees. Of the 

remaining 23 states that reported conducting evaluations, 18 states said 

they conduct them on an ongoing basis by providing an evaluation form 

posted on their website.

Page 14 GAO-17-34 Unemployment Insurance

16 When feedback is collected, these states 

 

16 One state did not answer the question.
reported using the information to make program changes. For example, 

one state official told us they have an ongoing satisfaction survey on their 

website that employees can fill out after they apply for benefits and that 

feedback from that survey is used to improve the eligibility determination 

process. Other states reported making significant changes to their claims 

processing systems and making the language on the applications more 

reader friendly and understandable.

We provided a draft of this report to the Department of Health and Human 

Services and the Department of Labor for review and comment. Officials 

from both agencies provided technical comments which we incorporated 

in the draft as appropriate.

As agreed with your offices, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies of this report to the 

Secretary of Health and Human Services, the Secretary of Labor, 

appropriate congressional committees, and other interested parties. In 

addition, the report will be available at no charge on the GAO website at 

http://www.gao.gov. Please contact me on (202) 512-7215 or at 

brownbarnesc@gao.gov if you or your staff have questions about this 

report. Contact points for our Offices of Congressional Relations and 

Public Affairs may be found of the last page of this report. Key 

contributors to this report are listed in 

appendix II.

Cindy S. Brown Barnes

Director

Education, Workforce, and Income Security

Page 15 GAO-17-34 Unemployment Insurance

Agency Comments
Appendix I: Objectives, Scope, and 

Methodology

We examined (1) the extent to which states have laws or policies that 

affect whether Head Start and other ECE teachers can claim UI benefits 

during summer breaks; (2) how many Head Start teachers may have 

been eligible for UI benefits during their summer breaks in 2015; and (3) 

what is known about how states communicate information about eligibility 

for UI benefit payments to Head Start and ECE employees and the 

effectiveness of these efforts.

To address all three objectives, we conducted a web-based survey of 

state UI directors (including all 50 states, the District of Columbia, Puerto 

Rico, and the Virgin Islands) from February to April 2016. The survey 

included questions about state laws, regulations, and policies that might 

affect whether Head Start employees and other ECE teachers are able to 

receive UI benefits during summer breaks. For example, we asked 

whether the type of employer would affect eligibility for benefits. The 

survey also included questions about key internal controls, especially 

those related to communication and monitoring, such as whether states 

targeted communication to Head Start or other ECE employers or 

employees and whether states were aware of improper payments to 

Head Start or other ECE employees. We received responses from all 53 

states.

Page 16 GAO-17-34 Unemployment Insurance

1 We followed up with states when necessary to clarify their 

responses, but we did not independently verify the information they 

provided. For example, while we asked states to provide a description of 

relevant state laws, regulations, and policies, we did not confirm their 

descriptions with an independent review. Thus, in this report all 

descriptions and analysis of state laws, regulations, and policies are 

based solely on what states reported to us.

We used standard descriptive statistics to analyze responses to the 

questionnaire. Because we surveyed all states, the survey did not involve 

sampling errors. To minimize non-sampling errors, and to enhance data 

quality, we employed recognized survey design practices in the 

development of the questionnaire and in the collection, processing, and 

analysis of the survey data. For example, we pretested the questionnaire 

 

1 As mentioned earlier, we are using the term “states” in reference to the states, the 

District of Columbia, and the 2 territories included in our review.

Appendix I: Objectives, Scope, and 

Methodology

Survey of State UI 

Programs

Analysis of Survey 

Responses and Data 

Quality
Appendix I: Objectives, Scope, and 

Methodology

with three state UI directors to minimize errors arising from differences in 

how questions might be interpreted and to reduce variability in responses 

that should be qualitatively the same. We further reviewed the survey to 

ensure the ordering of survey sections was appropriate and that the 

questions within each section were clearly stated and easy to 

comprehend. An independent survey specialist within GAO also reviewed 

a draft of the questionnaire prior to its administration. To reduce 

nonresponse, another source of non-sampling error, we followed up by email with states that had not responded to the survey to encourage them 

to complete it. We reviewed the data for missing or ambiguous responses 

and followed up with states when necessary to clarify their responses. On 

the basis of our application of recognized survey design practices and 

follow-up procedures, we determined that the data were of sufficient 

quality for our purposes.

To address our second objective, we used data from the Office of Head 

Start’s Program Information report, which each Head Start grantee is 

required to submit on an annual basis through HHS’s Head Start 

Enterprise System. We interviewed knowledgeable HHS officials to 

determine the reliability of the data, and we concluded that they were 

sufficiently reliable for the purposes of our audit. We analyzed data from 

the 2014-2015 program year, the most recent available. In conjunction 

with this data, we used information from our survey on state laws, 

regulations, and policies to estimate the number of Head Start teachers 

and teaching assistants who may have been eligible for UI benefits during 

summer breaks in 2015. We assessed the potential eligibility of teachers 

and assistant teachers based solely on their wages while employed by 

Head Start programs. We were not able to identify whether these 

teachers had wages from other employment that would affect their 

eligibility for benefits based on those wages. In addition, we were not able 

to determine whether a Head Start grantee may be offering work to its 

employees during the summer that is outside of the Head Start program, 

which may affect eligibility for benefits.

In conducting this analysis, we made various assumptions that could 

impact the results. For example, we assumed that two grantee types—

charter schools and school systems—are classified as educational 

institutions by all states and are therefore ineligible for UI benefits. This 

assumption may not always be correct, however, as there may be 

instances in which charter schools or school systems are not defined as 

educational institutions in their state. In addition, according to HHS 

officials, grantees self-report their category, and HHS does not verify this 

Page 17 GAO-17-34 Unemployment Insurance

Analysis of Head Start 

Data
Appendix I: Objectives, Scope, and 

Methodology

information. Therefore, there may be grantees that would be classified as 

educational institutions by states because they are charter schools or 

school systems that we were unable to identify in the data. We also 

assumed that all employees have reasonable assurance of continued 

employment after the summer break. However, not all employees may 

have such assurance, which may lead to an underestimation of the 

employees who are potentially eligible for UI benefits between terms. We 

also identified programs that did not have a long enough break to allow 

employees to collect UI benefits by examining the start and end of the 

program year. In doing so, we assumed that all teachers at such 

employers were employed for the full school year and were thus not 

eligible for UI benefits. However, we were not able to identify whether all 

teachers and teacher assistants in those programs were employed for the 

entire length of the program year. Therefore, this may be an overestimate 

of the population with breaks too short to collect UI benefits. In the course 

of following up with certain states, we asked various questions that were 

not asked on the survey, and as a result, these states answered 

additional questions and gave additional details about their state laws 

which affected the results of our analysis for those states. In conducting 

this analysis, when faced with uncertainty about the status of a Head 

Start grantee, we classified employees of such grantees as potentially 

eligible for UI benefits since we did not have enough information to 

conclude that they are ineligible.

Page 18 GAO-17-34 Unemployment Insurance

2 We assessed the potential eligibility of 

teachers and assistant teachers based solely on their wages while 

employed by Head Start programs. We were not able to identify whether 

these teachers had wages from other employment that would affect their 

eligibility for benefits based on those wages.

 

2 For example, Alabama state officials reported that in their state, Head Start teachers 

who are paid over a 12 month period (as opposed to a 9 month period) for 9 months of 

work are ineligible for UI benefits in the summer. Since we did not have data to determine 

how those teachers actually got paid, we assumed that all Head Start teachers in 

Alabama are potentially eligible. Similarly, we were not able to identify employees in New 

Jersey who work for Abbott districts and who according to state officials are generally not 

eligible for UI benefits. We thus assumed that all Head Start teachers in New Jersey are 

potentially eligible. As another example, officials in Puerto Rico and the Virgin Islands 

reported that Head Start employees generally received wages during the summers, thus 

making them ineligible for UI benefits. However, because the Head Start data does not 

indicate whether teachers receive wages during summer breaks, we chose to characterize 

teachers in these territories as potentially eligible.
Appendix I: Objectives, Scope, and 

Methodology

Concurrent with our survey, we conducted site visits to two states, 

Indiana and New Jersey, and phone interviews with officials and 

stakeholders in Alabama, Puerto Rico, and Wyoming. We selected these 

states and that territory based on factors such as the number of Head 

Start centers and survey responses regarding eligibility and experiences 

with improper payments and because they are located in geographically 

diverse regions. In each state, we interviewed state UI program officials 

as well as stakeholders, such as ECE association officials and Head Start 

grantees. The results from our interviews with state UI programs and 

stakeholders are not generalizable. In our interviews with state officials, 

we asked about eligibility policies and changes to such policies, improper 

payments, communication with employers and employees, and other 

internal controls. In our interviews with stakeholders, we asked about their 

awareness of eligibility policies, the extent to which their employees 

collect UI benefits, and their experiences with the state UI department.

We conducted this study from August 2015 to October 2016 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

Page 19 GAO-17-34 Unemployment Insurance

Site Visits
Appendix II: GAO Contact and Staff 

Acknowledgements

Cindy S. Brown Barnes, (202) 512-7215, brownbarnesc@gao.gov.

In addition to the contact named above, Danielle Giese, Assistant 

Director; Amy Sweet, Analyst-in-Charge; Meredith Lilley, and Vernette 

Shaw made significant contributions to this report. Also contributing to this 

report were Amy Buck, David Chrisinger, Alex Galuten, Jill Lacey, Mimi 

Nguyen, Jerome Sandau, and Almeta Spencer.

Page 20 GAO-17-34 Unemployment Insurance

Appendix II: GAO Contact and Staff

Acknowledgements

GAO Contact

Staff 

Acknowledgements
Appendix III: Accessible Data

Accessible Text for Figure 1: Estimated Number of Head Start Teachers Potentially 

Page 21 GAO-17-34 Unemployment Insurance

Eligible to Receive Unemployment Insurance Benefits in Summer 2015, after 

Factoring in State Restrictions

90,400 total Head Start teachers

Minus 14,150 who work for school systems or charter schools and are likely not eligible

Minus 28,940 with breaks likely too short to collect benefits

Minus 2,510 who are likely not eligible under state laws or policies

44,800 Head Start teachers who are potentially eligible for benefits

Source: GAO analysis of Head Start data, survey of state unemployment insurance directors, and interviews of state officials. | GAO17-34

Data Table for Figure 2: Methods Reported by States to Communicate 

Unemployment Insurance Information to Employers

Communication to 

employers Number of states/Percent

Internet/website 52 (98%)

Employer handbook 39 (74%)

Call center/hotline 26 (49%)

Memos or program

letters via mail 18 (34%)

Other 13 (25%)

Employer training 12 (23%)

Memos or program

letters via email 10 (19%)

Employer or industry group 

publications 8 (15%)

Source: GAO analysis of survey of state unemployment insurance directors. | GAO-17-34

Data Table for Figure 3: Methods Reported by States to Communicate 

Unemployment Insurance Information to Employees

Communication to employees Number of states/Percent

Internet/website 52 (98%)

Handbook 47 (89%)

Call center/hotline 44 (83%)

In person service centers 28 (53%)

Other 12 (23%)

Through employers 11 (21%)

Source: GAO analysis of survey of state unemployment insurance directors. | GAO-17-34

Appendix III: Accessible Data

Data 

Tables/Accessible 

Text
Related GAO Products

Unemployment Insurance: States’ Customer Service Challenges and 

DOL’s Related Assistance. GAO-16-430. Washington, D.C.: May 12, 

2016.

Unemployment Insurance: States’ Reductions in Maximum Benefit 

Durations Have Implications for Federal Costs. GAO-15-281. 

Washington, D.C.: April 22, 2015.

Managing for Results: Selected Agencies Need to Take Additional Efforts 

to Improve Customer Service. GAO-15-84. Washington, D.C.: October 

24, 2014.

Improper Payments: Government-Wide Estimates and Reduction 

Strategies. GAO-14-737T. Washington, D.C.: July 9, 2014.

Unemployment Insurance: Economic Circumstances of Individuals Who 

Exhausted Benefits. GAO-12-408. Washington, D.C.: February 17, 2012.

Page 22 GAO-17-34 Unemployment Insurance

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