[Federal Register Volume 65, Number 229 (Tuesday, November 28, 2000)]
[Notices]
[Pages 70939-70947]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-30266]


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DEPARTMENT OF LABOR

Employment and Training Administration


Federal-State Unemployment Compensation Program: Unemployment 
Insurance Program Letter Interpreting Federal Unemployment Insurance 
Law

    The Employment and Training Administration interprets Federal law 
requirements pertaining to unemployment compensation (UC) as part of 
its role in the administration of the Federal-State UC program. These 
interpretations are issued in Unemployment Insurance Program Letters 
(UIPLs) to the State Employment Security Agencies. The UIPL described 
below is published in the Federal Register in order to inform the 
public.

UIPL 04-01

    UIPL 04-01 reminds State Employment Security Agencies of the 
Department of Labor's interpretation of the ``payment when due'' 
requirement of Section 303(a)(1) of the Social Security Act as applied 
during a continued claim series. It also provides clarification 
concerning this interpretation.


[[Page 70940]]


    Dated: November 20, 2000.
Raymond Bramucci,
Assistant Secretary of Labor.

U.S. Department of Labor, Employment and Training Administration, 
Washington, D.C. 20210

Classification: UI
Correspondence Symbol: TEUL
Date: October 27, 2000

Directive: Unemployment Insurance Program Letter No. 04-01

To: All State Employment Security Agencies

From: Grace A. Kilbane, Administrator, Office of Workforce Security

Subject: Payment of Compensation and Timeliness of Determinations 
during a Continued Claims Series

    1. Purpose. To remind States of the Department of Labor's 
(Department's) interpretation of the ``payment when due'' 
requirement of Section 303(a)(1) of the Social Security Act (SSA), 
as applied during a continued claim series, and to provide 
clarification concerning this interpretation.
    2. References. Section 303(a)(1), SSA; California Department of 
Human Resources Development v. Java, 402 U.S. 121 (1971); Fusari v. 
Steinberg, 419 U.S. 379 (1975); Pennington v. Didrickson, 22 F.3d 
1376 (7th Cir. 1994); 20 CFR Parts 602 and 640; Unemployment 
Insurance Program Letter (UIPL) No. 1145 (Procedures for 
Implementation of the Java Decision); UIPL No. 34-85 (Voluntary 
Waiver of Benefit Rights by a Claimant Pending the Outcome of an 
Employer Initiated Appeal); ETA Handbook No. 365 (Unemployment 
Insurance Quality Appraisal (no longer in effect)); ET Handbook No. 
301 (UI Performs: Benefit Timeliness and Quality (BTQ): Nonmonetary 
Determinations Quality Review); ET Handbook No. 401 (Unemployment 
Insurance Reports).
    3. Background. While conducting training for States on the new 
process for reviewing the quality of nonmonetary determinations, the 
Department became aware that, during a continued claim series, some 
States may not properly administer the requirements of Section 
303(a)(1), SSA, concerning payment of unemployment compensation (UC) 
``when due.'' The Department has three specific concerns.
    First, some States may fail to pay benefits to claimants for 
weeks in which no eligibility issue exists when a determination of 
eligibility for a previous week is pending.
    Second, the Department has observed an inconsistency among 
States in the starting date used to calculate timeliness of 
determinations during a continued claim series, a date that should 
be uniformly applied.
    Third, the Department has found that, during a continued claim 
series, some States improperly withhold benefits from claimants when 
the State does not make a determination of continued eligibility in 
a timely fashion.
    The Department is issuing this UIPL in order to address these 
concerns. It clarifies UIPL No. 1145, issued in 1971 but still in 
effect, with respect to the date to be used for calculating 
timeliness of determinations during a continued claim series, and 
clarifies when payment may not be withheld during a continued claim 
series.
    4. Section 303(a)(1), SSA--``Full Payment .... When Due.'' 
Section 303(a)(1), SSA, requires States, as a condition of receiving 
Federal UC administration grants, to provide in their laws for 
``[s]uch methods of administration . . . as are found by the 
Secretary of Labor to be reasonably calculated to insure full 
payment of unemployment compensation when due.'' In the 1971 
decision, California Department of Human Resources Development v. 
Java, the Supreme Court interpreted ``when due'' in Section 
303(a)(1), SSA, to mean ``at the earliest stage of unemployment that 
such payments [are] administratively feasible after giving both the 
worker and the employer an opportunity to be heard.'' Although the 
specific holding in Java required the State to pay benefits to 
claimants initially determined eligible pending an employer appeal, 
the Court's reasoning was broader, requiring promptness at all 
stages of the eligibility determination and payment processes. See 
UIPL No. 1145, Attachment, page 1; Fusari v. Steinberg, 419 U.S. 
379, 387-388 n.15 (1975); and Pennington v. Didrickson, 22 F.3d 
1376, 1386 (7th Cir. 1994) (quoting Jenkins v. Bowling, 691 F.2d 
1225 (7th Cir. 1982)). The Department has issued regulations 
interpreting the promptness requirement of Section 303(a)(1), SSA, 
to require payment of UC to eligible claimants, and the making of 
determinations, ``with the greatest promptness that is 
administratively feasible.'' 20 CFR 640.3(a). In addition, in the 
attachment to UIPL No. 1145, the Department interpreted the 
promptness requirement of Section 303(a)(1), SSA, to require prompt 
determinations on individual claims. See pages 8 & 14, UIPL No. 
1145, Attachment.
    As well as promptness, the Department has always interpreted 
``when due'' in Section 303(a)(1), SSA, to require accuracy in order 
to ensure that payments are not made when they are not due. See 20 
CFR 602.11(a) and 602.21(c). Proper application of Section 303(a)(1) 
requires an appropriate balancing of the dual concerns of promptness 
and accuracy in the ``when due'' provision.
    5. The Need for Payment Without Delay to Claimants in Weeks for 
which They Are Eligible During a Continued Claim Series. As stated, 
a fundamental aspect of payment ``when due,'' for purposes of 
Section 303(a)(1), SSA, is that UC is due to claimants who are 
eligible under State law. Eligibility for UC is determined on a 
week-by-week basis. During a continued claim series, a claimant must 
certify as to continuing eligibility for each week. If information 
provided by the claimant or others establishes eligibility, the 
State agency manifests its determination of eligibility for that 
week by issuing compensation to the claimant. When a question 
concerning continued eligibility for benefits for a given week 
arises, the State agency conducts an investigation of the facts and 
makes a determination of eligibility or ineligibility. While such a 
determination is pending, the State agency need not issue payment 
for the week in question until it issues a determination regarding 
eligibility, provided the determination is timely. Sometimes the 
question of eligibility affects future weeks. In such circumstances, 
not issuing payment for these later weeks because of the earlier 
eligibility issue is acceptable until a timely determination is 
made.
    When the question of eligibility does not affect later weeks, 
however, States must make payment for the later weeks without delay. 
In other words, States may not withhold payment for later weeks in 
which no eligibility issue exists consistent with Section 303(a)(1), 
SSA's requirement to pay benefits ``when due.'' The Department 
clearly expressed this requirement on page 19 of the Attachment to 
UIPL No. 1145, stating ``[w]hen the question [of eligibility] 
relates to eligibility or possible fraud for past weeks only, 
benefits claimed for current weeks may not be suspended while an 
investigation is conducted [emphasis added].'' This requirement is 
still in force.
    6. Timely Determinations in a Continued Claim Series. The 
attachment to UIPL No. 1145 interpreted the ``when due'' provision 
in Section 303(a)(1), SSA, and Java, to require prompt resolution of 
eligibility issues that arise during a continued claim series. That 
Attachment stated that such determinations would be considered to be 
issued ``on time'' within the meaning of the ``when due'' 
requirement, as interpreted in Java, if issued ``no later than the 
end of the week following the week in which [an] issue arises 
[emphasis added].'' Thus, the date on which an issue ``arises'' is 
the critical date for calculating timeliness.
    The term ``arises'' has historically been subject to different 
interpretations. Some States have interpreted the ``arises'' date 
literally to mean the date a claimant engaged in potentially 
disqualifying behavior. Other States have applied the interpretation 
found in ET Handbook No. 365, Quality Appraisal, in effect from 
1992-1996, which says that determinations during a continued claim 
series are timely if ``issued within 7 days from the end of the week 
in which the issue is detected'' (in the case of intrastate claims) 
or the State ``received notification'' of the issue (in the case of 
interstate claims) (emphases added). This approach interpreted the 
``issue arises'' date in UIPL No. 1145 to mean the issue detection 
date. This interpretation is followed in subsequent handbooks, 
including ET Handbook No. 401, the UI Reports Handbook, and Handbook 
301, the BTQ NonMonetary Determination Quality Review Handbook (see 
pages V-9 and V-10). Handbook 401 defines the issue detection date 
as: ``the earliest date that the agency, including organizational 
units . . . , is in possession of information indicating the 
existence of a nonmonetary issue'' (see page V-3-5).
    Although UIPL No. 1145, Attachment, used the term ``arises,'' 
taken in context, that term means, as reflected in later handbooks, 
the date an issue is detected by the State agency. Interpreting the 
``issue arises'' date in the more literal manner followed by some 
States (meaning the date of the potentially disqualifying event) 
would necessarily preclude timely determinations in many cases. For 
example, if a claimant refused a

[[Page 70941]]

job in week one and has until Thursday or Friday of the following 
week to submit a claim certification for week one, it may be 
impossible for the agency to gather facts and issue a decision by 
Friday of week two. Requiring a determination to be made in that 
manner is not reasonable, nor is it necessary under Section 
303(a)(1), SSA. Consequently, States are to use the issue detection 
date as the date from which to calculate timeliness for purposes of 
Federal requirements.
    7. Balancing Timeliness and Accuracy: the Presumption of 
Continued Eligibility. Although Section 303(a)(1), SSA, requires 
timely determinations regarding eligibility for individual 
claimants, States may, in some cases, be unable to issue a 
determination in a timely fashion. UIPL No. 1145 stated that before 
a determination is made in a continued claim series ``benefits will 
not be withheld'' (emphasis added) (see UIPL No. 1145, Attachment, 
page 19). Over the years, the Department has been asked about the 
meaning of this statement, especially in relation to the requirement 
of Section 303(a)(1), SSA, that payment not be made when it is not 
due.
    With this UIPL, the Department clarifies this statement in UIPL 
No. 1145, Attachment, concerning payment during a continued claim 
series. Prior to the date for timely determinations, a State is not 
required to pay UC without a determination. However, when the date 
for a timely determination has passed in a continued claim series, 
the State must either issue a determination of ineligibility for UC 
(where the facts establish ineligibility) or else pay UC 
immediately. Payment would occur under a presumption of continuing 
eligibility. The presumption means that the State has made an 
initial determination of eligibility and, based on that initial 
determination and the absence of facts clearly establishing current 
ineligibility, the State agency presumes the claimant's continued 
eligibility until it makes a determination otherwise. The 
presumption is appropriate in a continued claim series because a 
determination of initial eligibility exists on which the presumption 
can be based. The presumption may not be applied on an initial 
claim.\1\The presumption appropriately balances the timeliness and 
accuracy concerns of Section 303(a)(1), SSA.
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    \1\ This does not imply, however, that Section 303(a)(1), SSA, 
sets no outside time limit on individual determinations of initial 
claims.
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    The presumption of continued eligibility is an expedient for the 
State to facilitate timely payments and may not be used as a 
substitute for the State completing its determination procedures. In 
order to avoid failing to comply with Section 303(a)(1), SSA, by 
paying benefits when they are not due, a State using the presumption 
must issue a determination as soon as administratively feasible 
after payment is made to verify whether the presumption was correct. 
In arriving at such a determination the State must follow the 
predetermination procedures set forth in UIPL No. 1145.
    The Department is aware that making payments based on a 
presumption of continuing eligibility may result in overpayments. 
For that reason, States must make timely determinations whenever 
possible. A certain number of overpayments resulting from 
application of the presumption of continuing eligibility, when the 
agency has been unable to issue a timely determination, are 
inevitable.
    In order to notify individuals of their rights and obligations, 
a State must inform claimants who receive payments under such a 
presumption that a pending eligibility issue may affect their 
entitlement and may result in an overpayment. The State may also 
advise claimants that they may want to defer cashing the 
unemployment check until their eligibility has been verified. This 
may help to deter losses to the State's fund and enable the claimant 
to immediately repay any overpayment. This procedure is consistent 
with Departmental guidance in UIPL No. 34-85, concerning the 
prohibition on voluntary waiver of benefit rights by claimants, 
because a determination has not yet been made.
    8. Action Required. Administrators are to provide this 
information to appropriate staff.
    9. Inquiries. Inquiries should be directed to the appropriate 
Regional Office.
    10. Attachment. UIPL No. 1145.

In reply refer to: MUOC

U.S. Department of Labor, Manpower Administration, Washington, D.C. 
20210

November 12, 1971

Unemployment Insurance Program Letter No. 1145

To: All State Employment Security Agencies
Subject: Procedures for Implementation of the Java Decision
    At a nationwide series of meetings with representatives of all 
State agencies in August 1971, Manpower Administration staff 
discussed draft procedural guides which were proposed for 
implementation of the requirements of the Supreme Court's decision 
in the Java case.
    Under separate cover, we are sending to each State agency five 
copies of the procedures, revised in the light of the August 
discussions.
    UIPL No. 1126 advised that States should issue as quickly as 
possible, but not later than September 1, 1971, predetermination 
procedures to provide for the necessary notice and hearing 
opportunity to claimants and employers. Later the States were 
informed through the Regional Manpower Administrators that any State 
that must have the Java procedures prepared by the Manpower 
Administration before it could implement changes in its 
predetermination procedures would have until two weeks after receipt 
of the Java procedures to effectuate the necessary changes in its 
procedures. Accordingly, States that have not revised their 
procedures should do so as soon as possible, with an implementation 
date not later than two weeks after receipt of the Java procedures.
/s/ PAUL J. FASSER, JR., Deputy Assistant Secretary for Manpower and 
Manpower Administrator

Attachment to UIPL No. 1145

Procedures for Implementing The Java Decision Requirements

Procedures for Implementing the Java Decision's Requirements

I. Introduction

    The material contained in this statement discusses the 
procedural implications of the Java decision by the U. S. Supreme 
Court. The Court's opinion in this case was primarily an explanation 
of the reasons for its decision rather than an explanation of the 
procedures to be followed in applying the decision and its opinion. 
The reasoning of the Court in support of its decision is, however, 
broader in scope than the factual situation in the specific case it 
was considering. Other cases now pending in the Federal Courts may 
reach the Supreme Court and elicit from it more specific guidance as 
to the procedures required in the adjudication of unemployment 
benefit cases.
    Pending such further guidance by the Supreme Court, procedures 
implementing the Java decision must nonetheless be adopted even 
though it is recognized that changes may later be necessary and that 
experience may show that certain of the procedural choices are more 
and others less effective in meeting the requirements stated by the 
Court and attaining the statutory objectives which the Court 
described.
    Unemployment Insurance Program Letter No. 1126 states the 
Manpower Administration's view that to meet the interpretation of 
section 303(a) (1) of the Social Security Act, given by the Court in 
its Java opinion, ``a State's law and procedure must provide for:
    1. Paying benefits promptly, after a determination has been made 
in the claimant's favor, regardless of the pendency of the appeal 
period or of any appeal that has been taken from the determination; 
and
    2. Providing reasonable notice to both the claimant and employer 
of the time and place of the pre-determination factfinding 
hearing.''

Promptness of Determination and Payment

    In considering procedural steps to implement the requirements 
stated by the Court, the fullest weight must be given to the 
emphasis the Court repeatedly placed on the Congressional objective 
of achieving the promptest payment of benefits that is 
administratively possible.
    ``The objective of Congress was to provide a substitute for 
wages lost during a period of unemployment not the fault of the 
employee. Probably no program could be devised to make insurance 
payments available precisely on the nearest payday following the 
termination, but to the extent that this was administratively 
feasible this must be regarded as what Congress was trying to 
accomplish. The circumstances surrounding the enactment of the 
statute confirm this.''
    (After citing the 1935 recommendations of the Committee on 
Economic Security and its staff's estimates of possible amounts and 
duration of unemployment benefits, the Court continued.) ``Other 
evidence in the legislative history of the Act and the commentary 
upon it supports the conclusion that `when due' was intended to mean 
at the

[[Page 70942]]

earliest stage of unemployment that such payments were 
administratively feasible after giving both the worker and the 
employer an opportunity to be heard. The purpose of the Act was to 
give prompt if only partial replacement of wages to the unemployed, 
to enable workers `to tide themselves over, until they get back to 
their old work or find other employment, without having to resort to 
relief.'''
    ``Our reading of the statute imposes no hardship on either the 
State or the employer and gives effect to the congressional 
objective of getting money into the pocket of the unemployed worker 
at the earliest point that is administratively feasible. That is 
what the Unemployment Insurance program was all about.''
    The Court's stress on speeding benefit payments to unemployed 
workers suggests that this factor appropriately is the key criterion 
to be used in choosing among alternative procedures for implementing 
the requirements stated in the decision. This objective of prompt 
payment seems clearly, in the Court's view, to suffuse the entire 
unemployment insurance program. The Court said: ``We conclude that 
the word `due' in Sec. 303(a)(1), when construed in light of the 
purposes of the Act, means the time when payments are first 
administratively allowed as a result of a hearing of which both 
parties have notice and are permitted to present their respective 
positions; any other construction would fail to meet the objective 
of early substitute compensation during unemployment.''

Requirement of Benefit Payment During Pendency of Appeals

    Although the Court's decision dealt specifically only with the 
initial determination of a worker's eligibility made at the time of 
the worker's initiation of a claim series, the reasoning of the 
Court would lead to the conclusion that when redeterminations or 
appeal decisions allow benefits such benefits must be paid promptly 
without delay or suspension because of the pendency of an appeal or 
an appeal period. It would follow also that determinations and 
decisions that disqualify workers for benefits for lesser periods 
than the State statute would permit or for the maximum 
disqualification period do not justify withholding benefits for 
weeks following the benefit denial period specified in the 
disqualifying determination or decision. If the individual is able 
to work and available for work and otherwise meets requirements for 
entitlement for such weeks, he should be paid benefits for such 
weeks.
    The Court did not pass on the effect of a subsequent 
redetermination or appeal decision reversing the initial 
determination awarding benefits or modifying it adversely to the 
claimant. Nor did it deal with the adequacy of a subsequent 
determination, based on a later and different issue, to deny 
benefits to the claimant. In the case of an appeal decision that 
reverses or modifies adversely a determination that allowed 
benefits, it seems clear that such a decision stops the payment of 
benefits. The Court recognized that appeal decisions involve de novo 
considerations and, of course, the parties to an appeal are given an 
opportunity for a fair hearing. As to redeterminations relating to 
the same issue and determinations relating to new and later issues, 
even though it is recognized that both categories are in issue 
before the Federal courts, it seems reasonable to assume that the 
same predetermination process that is sufficient to establish that 
benefits are ``due'' is sufficient to establish that they are not 
``due.'' The procedural discussion in this document proceeds on this 
assumption.\2\
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    \2\ See also UIPL No. 1136, July 19, 1971 ``Draft Language to 
Implement the Java Decision,'' Explanatory Statement, Attachment No. 
1, p. 2.
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Requirement of Notice and Opportunity to be Heard

    Most of the procedural discussion contained in this document 
deals with the predetermination hearing to which the Court referred 
in its conclusion (i.e., ``a hearing of which both parties have 
notice and are permitted to present their respective positions''). 
These particular procedures are not required for conformity with the 
Court's interpretation of section 303(a)(1). They are recommended as 
reasonable approaches which meet the requirements of the statute 
with due regard to the promptness of benefit payments that the Court 
has stressed. But they are not the only such approaches. The Court 
left to the States the choice of procedures to be used in 
predetermination fact finding proceedings, so long as the procedures 
provide to the parties reasonable notice and opportunity to be heard 
and result in the prompt payment of benefits.
    The words ``hearing'' and ``be heard'' as used by the Court in 
the Java opinion are susceptible of more than one interpretation. 
That the Court did not use ``hearing'' to require a ``due process'' 
hearing, ``fair'' hearing or an ``evidentiary'' hearing would seem 
clearly to follow from its careful avoidance of the holding in 
Goldberg v. Kelly (397 U. S. 254), which the Java appellees had 
urged the Court to follow. In Goldberg v. Kelly the Court's majority 
had said that although ``statutory `fair hearing' '' was not 
required (p. 266), welfare payments to a recipient who had initially 
been held eligible could not be suspended without a predetermination 
evidentiary hearing (p. 264). Instead, in Java the Court said 
specifically that:
    ``Although the eligibility interview is informal and does not 
contemplate taking evidence in the traditional judicial sense, it 
has adversary characteristics and the minimum obligation of an 
employer is to inform the interviewer and the claimant of any 
disqualifying factors. So informed, the interviewer can direct the 
initial inquiry to identifying a frivolous or dilatory contention by 
either party.''
    Thus, although a State agency may choose, and in some cases most 
appropriately, to provide a conventional type of hearing such as an 
``evidentiary,'' ``due process'' or ``fair'' hearing before making a 
determination of an unemployment benefit issue case, \3\ it cannot 
be said that this is the Court's requirement.
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    \3\ This would be most appropriate, for example, in cases 
involving difficult issues of fact or law and multiple claimants. 
See UIPL No. 1126 and UIPL No. 1136.
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    The following points as to the character of the predetermination 
factfinding proceeding emerge from the Court's opinion.
    1. The Court equated ``interview'' and ``hearing'' (It (the 
preliminary interview) . . . is an occasion when the claims of both 
the employer and the employee can be heard . . .) (402 U.S. 121, at 
p. 134)
    2. The Court's recitation of the details of the California 
determination procedure early in its decision (402 U.S. 121, at pp. 
126-127) notes carefully that, when the claim is filed, ``the 
employer is asked to furnish, within 10 days, `any facts then known 
which may affect the claimant's eligibility for benefits'.'' 
Subsequently the Court noted, if the employer challenged 
eligibility, the interviewer is required ``to seek from any source 
the facts required to make a prompt and proper determination of 
eligibility.'' ``This,'' said the Court, ``clearly contemplates 
inquiry to the latest employer, among others.'' The Court then 
describes the claimant as appearing for his interview and being 
asked to answer questions, explain inconsistencies and offer his 
version of the facts. ``The interviewer is instructed to make 
telephone contact with other parties, including the latest employer, 
at the time of the interview, if possible . . . Interested persons, 
including the employer, are allowed to confirm, contradict, explain, 
or present any relevant evidence.''
    3. The Court pointed out that a proceeding conducted 
``informally'' which does not ``contemplate taking evidence in the 
traditional judicial sense,'' meets the traditional ``hearing'' 
requirement. (402 U.S. 121, at p. 134)
    4. The purpose of the proceeding is to inquire into the claim 
and to obtain information that supports or opposes the claim.
    5. The employer's contribution to the proceeding is to furnish 
information. His ``minimum obligation . . . is to inform the 
interviewer and the claimant of any disqualifying factors.'' The 
employer who ``has notice of the time and place of the preliminary 
interview'' has a ``responsibility to present sufficient data to 
make clear his objections to the claim for benefits and put the 
interviewer in position to broaden the inquiry if necessary.'' The 
employer ``who fails to present any evidence . . . has in effect 
defaulted . . .'' (402 U.S. 121, at p. 134)
    6. The inquiry is to be controlled by the interviewer. The 
information elicited from the employer and the claimant becomes the 
basis for any necessary further inquiry to develop additional 
information that is required to make a determination. (402 U.S. 121, 
at p. 134)
    Taking these enumerated aspects of the Court's use of the word 
``hearing'' into account, at least two views can reasonably be taken 
of the Court's meaning and intent that are different from the 
conventional type of hearing.
    For purposes of convenience one of these may be labeled the 
``separate interview'' approach and the other the ``investigatory 
proceeding'' approach. (As will presently appear, these are labels 
and not precise descriptions.)

[[Page 70943]]

Separate Interview

    This approach says in effect, that the Court's reference to 
furnishing an employer an opportunity to be heard means giving the 
employer a reasonable opportunity to present his information and 
factual contentions about the claim in an effective manner. To 
provide such an opportunity: (1) the employer must be asked to 
supply a written statement of potentially disqualifying information 
and he may be called on the telephone to give more details when 
further statements from the claimant at the interview or before 
indicate that such a telephone inquiry is appropriate or necessary 
and; (2) in addition, the employer must be advised in any case 
involving a determination issue that he may also, if he wishes, 
appear in person or through a representative at the local office and 
supply such further information with respect to the claim as he may 
have to present. To meet this latter requirement States may request 
employers at the time they respond to the request for separation 
information to indicate whether they wish to appear at the local 
office to present information on the claim. Employers who reply 
affirmatively indicating a desire to appear would be notified of the 
date and place of the claimant interview and advised that they 
should call the local office to arrange for their own appearance and 
interview in sufficient time so that the information they then 
present may be used in the interview with the claimant. When the 
employer appears, a claims examiner will interview him concerning 
the claim and obtain from him such additional information as he has 
to offer.
    As is apparent, this view of the Court's use of the word 
``hearing'' rests on a conclusion that the Court did not refer to a 
proceeding in which both parties must be given an opportunity to 
appear at the same time and place to present their information in 
each other's presence. Instead, the Court used the term broadly to 
encompass a factfinding process which would assure that each party 
was permitted to present his version of the facts in writing and by 
personal appearance, be apprised of the substance of the other's 
position and then be given a further opportunity to respond when a 
response would be material to the determination.

Investigatory Proceeding

    This approach takes a different view of the Court's use of the 
word ``hearing'': The ``hearing'' is to be a proceeding that is held 
at a specific time and place, at which the parties are given an 
opportunity to appear, in each other's presence, and to present 
their information on the issue to the examiner directly and in 
person. Consistent with this view, the notice of the time and place 
of the proceeding serves the purpose of advising the parties when 
and where they should be present if they are to attend.
    The proceeding differs from the conventional hearing in some 
significant respects. The Court indicated that the proceeding is 
conducted in the form of an interview to obtain information, clarify 
or verify questionable statements, and seek explanations of 
inconsistent facts. It is conducted by an examiner whose 
responsibility it is to obtain all of the facts required for a 
prompt and proper determination of the claimant's right to benefits, 
and who may not act merely as an umpire or judge of conflicting 
contentions of opposing parties. Accordingly, he asks the questions 
of the parties and not they of each other (or, through their 
representatives, of themselves). It is informal and does not follow 
traditional modes of taking evidence. Information obtained outside 
the proceeding (written statements by the employer, telephone calls, 
etc.) may be given full consideration. In these circumstances, 
oaths, a verbatim record, subpoenas and cross-examination are not 
required and are not recommended.
    States should also be mindful of our continued recommendation, 
expressed in UIPL 1126 that all State laws should authorize the 
State agency to transfer cases involving difficult issues of fact or 
law and multiple claimants to the appeal tribunal or the board of 
review for determination, following a full and fair hearing. (See 
UIPL No. 1136 for suggested legislative language for such 
authorizing statutory provisions.)

II. Current Claims Taking and Interviewing Procedures Affected by 
the Java Decision

    In many States methods have been devised for identifying claims 
which require special handling for factfinding and nonmonetary 
determination, while permitting routine non-issue cases to be 
processed rapidly and economically.
    Typically, this has involved brief questioning of claimants at 
the initial claims contact to obtain the reason for separation. When 
an issue has been raised by the claimant's statement, arrangements 
have been made for a subsequent factfinding interview at which the 
issue is inquired into. This has afforded time to make the monetary 
determination and obtain employer information. It has also limited 
extensive interviewing to cases where claimants continue to file 
claims. The postponement of the interview has eliminated interview 
and determination time for claimants who return to work or are 
monetarily ineligible.
    Typically, the separating employer has been notified of the 
claim filed and the claimant's stated reason for separation. 
Employers have been asked to respond if they have any reason for 
questioning eligibility. The intent has been to have this response 
on hand when the previously scheduled time for the claimant's 
appearance arrives, thus permitting an interviewer \4\ to conduct a 
factfinding interview based upon the employer's statement, as well 
as the claimant's. This kind of procedure has afforded the claimant 
an opportunity to rebut information furnished by the employer prior 
to the final determination. Interviewers have been expected to seek 
additional information needed for a proper determination if the 
employer statement is inadequate or he fails to respond.
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    \4\ Anyone, whatever his title, who interviews parties and 
others to obtain the facts necessary for making a determination.
---------------------------------------------------------------------------

    The essential elements of this process will continue to be 
necessary under the following procedures. In addition, it will be 
necessary to afford an interested employer notice and opportunity to 
be heard in issue cases.

III. Factfinding Proceeding Required in Issue Cases Only

    Essentially, opportunity for an interested employer to be heard 
is required only when there is an issue as to benefit entitlement. 
Questions involving chargeability only would not be governed by the 
requirements of the Court's decision. When the claimant has 
indicated that he was separated for lack of work, and the employer 
does not dispute this statement, no change in existing procedure is 
required. When the information given by a claimant upon filing his 
claim, taken together with the separation information furnished by 
the employer, can result only in ineligibility or disqualification, 
there is no necessity to afford the employer an opportunity to 
appear. When issues do not involve any employer who is an interested 
party, the predetermination factfinding proceeding presumably would 
differ little from present factfinding interviews.

Interested Parties

    State law will determine who are interested parties in addition 
to the claimant. Only employers who are interested parties must be 
afforded an opportunity to appear in predetermination proceedings. 
In most States, when an initial claim is filed, only the separating 
employer is an interested party. In some States, however, all base-
period employers (as well as the separating employer) are interested 
parties. Whether (and which) employers are interested parties in 
connection with issues arising during a claim series also depends 
upon provisions of State law.

IV. Promptness of the Determination Process

    Determinations on issues arising in connection with new claims 
may be considered on time within the meaning of the Court's 
requirement for promptness if accomplished no later than the second 
week after the week in which the claim is effective.
    The proposed time limit provides for completion of the 
determination process on normal claims (nonretroactive) by the end 
of the week in which the claimant would be certifying to his first 
compensable week, regardless of the type of ``week'' used by the 
State.
    These are examples of how this time limit for promptness would 
work out with a claim filed on August 12 (Thursday) in three 
different types of State ``weeks'':

[[Page 70944]]



------------------------------------------------------------------------
                                Effective date of      Time limit for
   Type of State ``week''             claim             determination
------------------------------------------------------------------------
1. Calendar week (claims      August 8 (Sunday)...  August 27 (last
 predated to preceding                               working day of the
 Sunday).                                            second week after
                                                     week for which the
                                                     claim was
                                                     effective).
2. Calendar week (claim post- August 15 (Sunday)..  September 3 (last
 dated to following Sunday).                         working day of
                                                     second week after
                                                     week for which the
                                                     claim was
                                                     effective.
3. Flexible week (claim       August 12 (Thursday)  September 1 (last
 effective on date of                                working day of
 filing).                                            second (flexible)
                                                     week after week for
                                                     which the claim was
                                                     effective).
------------------------------------------------------------------------

    Prompt mailing of notices is critical to prompt completion of 
the process. Mailing times involved will often make it difficult or 
perhaps impossible to achieve the promptness contemplated when 
notices to employers are prepared and mailed centrally. For this 
reason the procedures proposed here envision mailing of such notices 
from local offices. An employer's failure to respond on time to 
notices should not be permitted to delay proceedings.

V. Scheduling and Notification Process

    An opportunity to appear requires that the parties be informed 
of the time, place and nature of the proceeding so that the parties 
can know and protect their rights.

A. Notification of Parties (See subsection B as to mass separations.)

    The procedures for providing notice to claimants and employers 
include new elements designed to inform the parties of their 
opportunity to appear.

1. Notice to Employer

a. Notice of Claim Filed and Request for Separation Information

    Informing employers of their right to appear should be tied in 
with the current practices, in most State agencies, of mailing 
notices of claims filed.\5\
---------------------------------------------------------------------------

    \5\ A State agency which requires employers to submit separation 
notices to the agency automatically upon the separation of a worker 
will also need to use notices of claim filed or other appropriate 
notice to the employer of his right to appear and be heard.
---------------------------------------------------------------------------

    The notice of claim filed should contain the following 
information:
    (1) The claimant's stated reason for separation;
    (2) That the employer must post his return of the notice within 
5 calendar days of its mailing by the agency with any information he 
has concerning the circumstances of separation or any reason he has 
to question the claimant's eligibility; \6\
---------------------------------------------------------------------------

    \6\ If the fifth day is a Saturday, Sunday, or holiday, then the 
period runs to the next day which is not a Saturday, Sunday, or 
holiday. The five-day requirement is suggested to State agencies as 
appropriate to meet the promptness limit provided in section IV. 
States may wish to vary the requirement for areas where mail 
delivery problems require it.
---------------------------------------------------------------------------

    (3) The consequence under State law of his failure to respond to 
the notice;
    (4) That the claim will be determined on the basis of available 
information in the absence of a reply from him;
    (5) That in cases where issues \7\ are raised by the information 
obtained from him or the claimant he may attend a predetermination 
factfinding proceeding;
---------------------------------------------------------------------------

    \7\ An explanation to employers of what is an ``issue'' in the 
case of a benefit claim appropriately is included in an employer 
handbook or other general informational material that is given to 
all registered employers. If such an explanation has not been 
supplied to all employers, it should accompany the notice of claim 
filed.
---------------------------------------------------------------------------

    (6) That he is not required to attend such a proceeding and, if 
he chooses to rely on written information rather than appear in 
person, it will be given full consideration in the making of the 
determination;
    (7) That he should reply as to whether or not he wishes to 
attend such a proceeding in the case, and that if he replies that he 
wishes to attend, he will be notified of the time and place; and
    (8) That benefits will be paid immediately if allowed, even 
though an appeal is taken.

b. Notice to Employer of Proceeding

    There are at least two methods for notifying the employer of the 
actual place and time of the proceeding. One method is to schedule 
the proceeding automatically after discovery of an issue, and to 
provide information concerning the time and place of the proceeding 
in the notice mailed to the employer. The proceeding would most 
likely be set for the time that the claimant is scheduled to report 
to the local office.\8\ This method would have the advantage of 
providing earlier advice to the employer, thus giving him a better 
opportunity to decide whether he can, or wishes to, attend the 
proceeding. A major disadvantage would be that such a procedure 
would require an advance allocation of space and claims examiners' 
time for such proceeding before it is known whether the employer 
will appear.
---------------------------------------------------------------------------

    \8\ Not applicable if the State uses separate interview type of 
proceeding.
---------------------------------------------------------------------------

    The second method, which appears to be preferable, is to 
schedule the proceeding after an employer has indicated on his 
response to the notice of claim filed that he intends to appear. 
Better estimates can then be made of the time required for a 
particular proceeding and the time required, in the aggregate, for 
all proceedings scheduled on a particular day. It also makes 
possible more flexibility in scheduling predetermination proceedings 
for cases in which the employer elected not to appear. The 
disadvantage of this procedure is that it requires two contacts with 
employers who indicate a desire to appear--the notice of claim filed 
and the notice of time and place of the proceeding.
    When an employer has signified his intention to appear at the 
proceeding, a notice of the time and place should be mailed to him 
at least three calendar days before the scheduled date of the 
proceeding.\9\ If, for example, the proceeding is to be held on 
Tuesday, the notice should be mailed no later than the preceding 
Friday. The next three calendar days, the days of notice, would be 
Saturday, Sunday, and Monday. (Note that the mailing date has not 
been counted and the date of the proceeding is the day following the 
specified number of calendar days of notice.)
---------------------------------------------------------------------------

    \9\ Where experience demonstrates that more time is needed to 
provide reasonable notice, this period may be modified.
---------------------------------------------------------------------------

    When circumstances require that such notification be given by 
telephone (as is likely to be the case in separate interview 
proceedings), an appropriate record should be made of the exact 
information given the employer, the name of the person to whom the 
information was given, and the date and hour of the telephone call.

c. Content of Notice to Employer of Proceeding

    If the employer who has requested an opportunity to appear is to 
be given an effective opportunity, he must be given certain basic 
information concerning the proceeding.
    This should include, at least:
    (1) The time, place and purpose of the proceeding; and
    (2) His right of representation and that any person designated 
to appear at the proceeding to present information on the employer's 
behalf should either have direct knowledge of the circumstances 
surrounding the issue or be able to present the written statement of 
a person who has such knowledge and/or the employer's pertinent, 
written records.

2. Notice to Claimant of Proceeding

    Claimant must be informed of the predetermination proceeding but 
the method employed for notification will vary according to whether 
advance notice is required and whether other interested parties are 
involved in the determination.
    When no other interested parties are involved, in most instances 
it will be possible to hold the proceeding immediately and no 
written notice will be required. The claimant should be informed of 
the purpose and nature of the proceeding.
    If the proceeding is scheduled for a later date, the notice to 
the claimant should be in writing. This may be given by entry on the

[[Page 70945]]

claimant's reporting booklet or on a separate notification form. The 
following information should be provided in the notice: \10\
---------------------------------------------------------------------------

    \10\ The detail that needs to be included in the individualized 
portions of such notices to claimants can be reduced by attaching an 
adequate printed explanation to each notice or by including 
appropriate explanatory detail in claimant handbooks or pamphlets.
---------------------------------------------------------------------------

    a. The time, place and purpose of the proceeding;
    b. Advice that the employer might attend; \11\
---------------------------------------------------------------------------

    \11\ Not applicable if the State uses separate interview type of 
proceeding.
---------------------------------------------------------------------------

    c. The need for particular evidence (doctor's statement, etc.) 
and the claimant's right to bring witnesses;
    d. His right of representation; and
    e. That he notify the local office if he cannot attend the 
proceeding at the scheduled time and the reason, so that the office 
may reschedule the proceeding or take whatever other action is 
appropriate.

3. Time and Place of Proceeding

    The time and place of the proceeding must neither burden the 
claimant nor delay payment of benefits to which the claimant may be 
found entitled. It is recommended that the proceeding be scheduled 
for the day and hour on which the claimant is scheduled to report at 
the local office.\12\ By so scheduling the proceeding, the local 
office procedures for equalizing workloads by spreading claimant 
reporting periods throughout the days of the week would better be 
maintained.
---------------------------------------------------------------------------

    \12\ Not applicable if the State uses separate interview type of 
proceeding.
---------------------------------------------------------------------------

4. Requests for Postponement or Continuance

    Since requests for postponement or continuance of a proceeding 
may, if granted, delay the payment of benefits that may be due, they 
should not be granted except in compelling circumstances. Such a 
request by an employer, however, can often be satisfied by asking 
him to appear separately from the claimant or inviting him to submit 
his information in writing or by telephone.
    Since the claimant is the initiating party who seeks prompt 
payment of benefits and is moreover required as a condition of 
getting benefits to report when requested by the agency, his 
presence at the proceeding is generally assured. On the infrequent 
occasions when he requests a postponement it should be granted where 
information from him is necessary to make the determination and it 
would be difficult to obtain from him in writing.

B. Notice Requirements in Mass Separations

    In the case of mass lay-offs where employers furnish lists of 
laid-off workers to the agency there is no need for notice to the 
employer and opportunity to be heard in person because lack of work 
is the cause of separation.
    In mass cases involving issues, such as labor disputes, special 
procedures may be necessary, and as recommended in UIPL Nos. 1126 
and 1136, consideration should be given to referral of the claims to 
the appeal tribunal or board of review for the initial 
determination.

VI. Requirements for Notice When Issues Arise After the Initial 
Determination

    In general, the preceding section applies also to issues that 
arise during a claim series or to an additional claim. Insofar as 
such issues involve special consideration, however, they are 
discussed in this section.
    The Java case did not involve an issue arising after the initial 
determination. The reasoning of the Court, however, requires that 
interested employers be given notice and opportunity to be heard 
with respect to such issues.

A. Issues Arising During a Claim Series

    When an issue arises during a claim series and the claimant is 
the only interested party, no substantive changes from existing 
procedures are required. A typical situation would involve a 
claimant who, during his regular interview, reports an illness 
during the week being claimed that might warrant denial of benefits 
for the week. All necessary actions can be taken on the spot, and 
the claimant may be informed of the issues and of his right to 
hearing. Factfinding can then take place, and a determination can be 
made.
    When an issue arising during the claim series involves any 
interested party in addition to the claimant, notice and an 
opportunity to be heard must be given to such other party. The 
determination of the issues may not be made until such notice and 
opportunity has been provided. Such determinations will be 
considered on time within the meaning of the Court's requirement for 
promptness if issued no later than the end of the week following the 
week in which the issue arises.

B. Additional Claims

    An additional claim begins a new claim series and involves a new 
reason for unemployment. Unlike a claim that may begin a benefit 
year, however, such a claim does not require a monetary 
determination.
    It follows that payment of benefits cannot commence until a 
determination of entitlement is made after notice to the parties and 
opportunity to be heard. When an issue arises in connection with an 
additional claim, and notice must be afforded to parties other than 
the claimant, a proceeding must be scheduled for a date after the 
filing of the claim. As in the case of new claims, employers should 
be given notice of the claim and five calendar days in which to 
respond--and to state whether they wish to appear in person. 
Employers who wish to attend should be afforded at least three 
calendar days' advance notice of time and place of the proceeding. 
If the employer elects to appear, a determination issued in the 
second week after the additional claim is effective will be 
considered on time within the meaning of the Court's requirement for 
promptness. In other cases it should be possible to issue the 
determination by the end of the week after the additional claim is 
effective.

VII. Conduct of the Predetermination Proceeding

A. Investigatory Proceeding

    Although the appearance of an employer or his representative 
adds a new element, it need not materially change the content of the 
factfinding interview from that conducted by interviewers prior to 
the Java decision. While each State must determine how its 
proceedings will be conducted, it is our recommendation that: the 
proceeding should not be recorded, the parties should not be 
required to testify under oath, and the subpoena procedure should 
not be used. Each party, however, may have witnesses appear in his 
behalf, and where necessary the party or the witness may avail 
himself of the services of an interpreter whom either he or the 
agency may provide.
    The interviewer should tactfully but firmly control the 
proceedings. Each party should be given an opportunity to present 
his view of the facts, and should be given rebuttal opportunity. The 
interviewer may and should ask questions to elicit from the parties 
and their witnesses information he deems relevant to the issues in 
the case at hand. He should have the parties' questions and answers 
directed to him rather than permit questions, discussion or argument 
between the parties.
    In some instances a party may wish to record the proceeding. 
While the agency cannot prohibit such recordings, the practice 
should be discouraged, as it may disrupt the conduct of the 
proceeding. Both parties must be informed in such cases that the 
agency record will be the only official record to be used in making 
the determination or in any subsequent appeals.

1. Preparation of Factfinding Report

    State practice in the preparation of factfinding reports may be 
used at a predetermination factfinding proceeding. The common 
practice of taking notes which can be used in preparing factfinding 
reports will suffice. Since the factfinding report, essentially, is 
a report of the interviewer, it is not necessary that the individual 
parties sign the report. However, some State agencies may wish to 
have parties sign certain statements which appear to be vital to the 
proceedings, and this may be done.

2. Separate Appearances of Claimant and Employer

    The investigatory type of predetermination proceeding is 
intended to afford the employer an opportunity to appear at the 
factfinding interview at the same time as the claimant. Provision 
for employer appearance should not be made for any place other than 
the local office where the claimant is filing and the proceeding is 
scheduled. If an employer requests an opportunity to make his 
appearance elsewhere, he should be asked to submit his information 
in writing instead, since only the claim-filing office has records 
and knowledge of the case.
    If an employer wishes to appear at the claim-filing office 
before the scheduled time for the proceeding, he should be permitted 
to do so if at all possible, but he should be informed that the 
claimants appearance will not be rescheduled to conform to his. 
(This in effect changes the proceeding to the separate interview 
type explained in VII. B. below.)
    In responding to a request by an employer for separate 
appearance, he should also be informed again that information may be

[[Page 70946]]

submitted in writing and it will be given full consideration in the 
making of the determination.

3. Representation of Parties

    Each party has the right to be represented by a person of his 
choice, but this right has been seldom exercised at the 
determination level. In view of the Java decision, representation at 
the factfinding proceeding may increase. The handling of the 
representative adds a new dimension to the interviewer's task. The 
interviewer should ascertain at the outset the status of the 
representative and he should inform him that his participation will 
be limited to the presentation of information necessary to decide 
the issues, and as to which he has direct knowledge or is able to 
present the written statement of a person who has such knowledge 
and/or the employer's pertinent written records.

B. Separate Interview

    This type of proceeding consists essentially of providing for a 
personal interview on the determination issues with an employer who 
has requested it in addition to the predetermination factfinding 
interview with the claimant. Accordingly, the considerations that 
make recordings, oaths, and subpoenas inappropriate in the 
investigatory proceedings apply with equal or greater force in the 
separate-interview proceeding. No change from pre-Java practices 
would appear necessary in the claimant-interview portion of the 
proceeding.
    The employer-interview part of the proceeding would differ from 
any other factfinding interview conducted by the interviewer only in 
the need for the interviewer to take into account the fact that the 
interview takes place as the result of the employer's request and 
that it usually supplements written information already provided by 
the employer. Presumably, the employer in such an interview has 
additional information and the interviewer should permit him to 
present that additional information before any questions designed to 
get other information are directed to the employer. The employer may 
wish to raise questions that he believes should be put to the 
claimant. These should be accepted when they are pertinent to 
claimant's benefit eligibility and the employer should be assured 
that they will be taken up in the claimant interview.
    Subparagraphs A. 1 and 3 would appear to be generally applicable 
also to separate interviews.

C. Referral of Cases to the Appeals Authority

    Certain types of cases are not suited to the predetermination 
proceeding contemplated for the great majority of determination 
issues. These are cases involving difficult questions of fact or law 
and multiple claimants. It is recommended that State agencies use 
their authority to transfer such cases to appeal tribunals or boards 
of review for determination. If a State agency now lacks legislative 
authority for transferring such cases to an appeals body, it should 
seek such authority.\13\ As in other types of predetermination 
proceedings, promptness is crucial.
---------------------------------------------------------------------------

    \13\ Appropriate legislative language for this purpose was 
transmitted to State agencies with UIPL No. 1136, July 19, 1971.
---------------------------------------------------------------------------

D. Notice of Determination

    Present State practices with respect to the preparation and 
distribution of Notices of Determination are not affected by the 
changes in procedures required to insure that both claimant and 
employer(s) are given reasonable notice and opportunity to be heard. 
Any needed adaptations would present no problem so long as they do 
not interfere with the prompt completion of the determination 
process. In any event, the claimant is entitled to a written Notice 
of Determination as provided in section 6013, Standard for Claim 
Determinations-Separation Information, Part V of the ES Manual.

VIII. Payment of Benefits During Investigation, Determination, 
Redetermination and Appeals (Including Higher Authority) \14\
---------------------------------------------------------------------------

    \14\ Some increase in overpayments will result from the new 
requirements for immediate payment of benefits. If State law 
requires recovery, claimants should, of course, be informed that 
benefits being paid under such circumstances may (according to 
requirements of State law) be subject to recovery or future offset 
as the case may be. This information may be included in general 
informational material furnished to all claimants. In any event, it 
should not be presented in such a manner as to discourage claimants 
from accepting the benefits due them.
---------------------------------------------------------------------------

    A. Under the Java decision benefits allowed in an initial 
determination may not be withheld by reason of the pendency of the 
appeal period or of an appeal.
    B. In addition, the reasoning of the Court in the Java decision 
supports the payment of benefits as indicated below.\15\
---------------------------------------------------------------------------

    \15\ For additional discussion see Explanatory Statement, 
Attachment No. 1 to UIPL No. 1136, July 19, 1971.
---------------------------------------------------------------------------

1. Redeterminations

    Since practices vary so widely among the States, the following 
covers only the most common kinds of redeterminations: (a) When a 
claimant was initially found ineligible and another interested party 
is involved, notice and opportunity to be heard in a 
predetermination proceeding must be offered both parties before a 
redetermination can be made. No benefits may be paid until the 
redetermination is completed and then benefits are to be paid 
immediately or denied, according to the redetermination. (b) When a 
claimant was initially found eligible, notice and opportunity to be 
heard must be afforded to the claimant and any other interested 
party before a redetermination can be made that could modify or 
reverse that initial determination. In the meantime benefits may not 
be withheld. Benefits will be paid or denied upon the issuance of 
the redetermination and in accordance therewith.

2. Appeals

    Except as it may be precluded by a ``double affirmance'' 
provision in the State law, an appeal decision should be given 
immediate effect when it is issued and benefits should be paid or 
denied in accordance with it regardless of the issue involved or 
previous determinations and decisions and regardless of the fact 
that a further appeal may be taken.

3. Payment of Benefits for Weeks Not in Dispute

    In the case of an appeal, it has been the practice to pay 
benefits only for weeks ``not in dispute.'' For example, in a 
voluntary-quit case where State law provides a variable 1-to-6 week 
disqualification, and a 3-week disqualification has been assessed, 
benefits would be withheld for 6 weeks, because the appeal decision 
could result in increasing the disqualification. The reasoning of 
the Court in the Java case leads to the conclusion that benefits 
after the 3-week disqualification initially imposed are due and are 
to be paid if the claimant is eligible for such later weeks.

4. Suspension of Benefit Payments During a Claim Series

    In the Case of any week claimed during a claim series as to 
which a question arises, such as a question of work refusal, a 
determination must be made as to whether benefits are payable. 
Before such a determination, benefits will not be withheld.
    When the determination has been made following appropriate 
predetermination procedures, benefits must then be paid or denied in 
accordance with that determination. When the question relates to 
eligibility or possible fraud for past weeks only, benefits claimed 
for current weeks may not be suspended while an investigation is 
conducted. They may be denied in appropriate cases, however, for 
weeks claimed after a determination or redetermination has been made 
of the issue(s) with respect to such prior weeks, following notice 
to the interested parties and opportunity to be heard. In order to 
minimize overpayments this process should be completed as quickly as 
possible.

IX. Interstate Claims, Federal Claims and Monetary Determination 
Issues

A. Interstate Claims

    Although the procedural concepts outlined in this document have 
been stated in terms of intrastate claims, they apply as well to 
interstate claims. The interested employer in a determination issue 
arising in an interstate claim must be given an opportunity not only 
to submit information concerning the claim in written form but also, 
if he wishes, to appear either in person or by representative and 
submit any additional information he has to offer that bears upon 
the issue. Since it is not necessary that an employer who wishes to 
make such an appearance be interviewed in the claimant's presence, 
his opportunity to appear and be interviewed on the claim may be 
provided to him in the office of the liable State where the 
determination will be made rather than in the agent-State local 
office where the claimant is to be interviewed. Obviously, such an 
interview on an interstate claim with an employer who is located in 
the liable State and wishes to make an appearance would need to be 
held at a time when any information he may present can be taken into

[[Page 70947]]

account in making the determination. If the interested employer is 
located in the agent State, the latter will have the responsibility 
to notify the employer of the opportunity to appear at the local 
office, and if he elects to make an appearance, to schedule it at an 
appropriate time.

B. Application of Java Decision to Federal Unemployment Insurance, 
Training Allowances and Related Payments

    The requirements for paying benefits promptly after a 
determination has been made in the claimant's favor, regardless of 
the pendency of the appeal period or of any appeal that has been 
taken from the determination, are applicable to Federal claims. The 
requirement of notice to an interested employer and opoprtunity to 
be heard will, however, have no effect on those programs which do 
not involve employers as interested parties.
    Following are specifics on application of the requirement for 
notice and opportunity to be heard relating to the various kinds of 
Federal claims.

UCFE: (Unemployment Compensation for Federal Employees)

    When a private employer is an interested party to a UCFE claim, 
the procedures for notice and opportunity to be heard with respect 
to State UI claims are applicable.
    When a Federal agency is an interested party to a UCFE claim, 
the Java decision does not change present methods of processing so 
long as findings of the Federal agency, in writing, which are final 
and conclusive, are applicable in determining the claim.

UCX: (Unemployment Compensation for Ex-Servicemen)

    When a private employer is an interested party to a UCX claim, 
the procedures for notice and opportunity to be heard with respect 
to State UI claims are applicable.
    When a Federal agency which employed the claimant as a civilian 
employee is an interested party, the procedures applicable to UCFE 
claims apply. For the purpose of the Java procedure, a branch of the 
Armed Forces for which a UCX claimant served on active military duty 
is never considered to be an interested party with respect to 
reasons for separation or for not reenlisting or for not continuing 
on active duty, since the State agency does not apply the 
eligibility or disqualification provisions of the State unemployment 
insurance law to any of these. Thus in such cases the notice-and-
opportunity-to-be-heard requirement of the Java decision is not 
applicable.

TRA: (Trade Readjustment Allowances)

    The procedures for implementing the Java decision for State UI 
claims, with respect to notice and opportunity to be heard, are 
applicable to TRA claims with respect to employers who are 
interested parties to an issue.

Training Allowances, Disaster Unemployment Assistance and Other Similar 
Federal Payments

    The procedures implementing the Java decision, with respect to 
notice and opportunity to be heard, have no effect on factfinding 
procedures for determination of issues arising under the Manpower 
Development and Training Act (MDTA), the Work Incentive Program (WIN 
), or the Disaster Unemployment Assistance provisions of the 
Disaster Relief Act of 1970. There is no employer or other 
interested party involved in such cases. Established procedures for 
the factfinding claimant interview and notice of determination 
satisfy the requirements for predetermination proceedings.

C. Monetary Determinations

    It should not be assumed that, because the facts in the Java 
case presented a nonmonetary determination issue, the Court's 
requirements do not also apply to monetary determinations and 
redeterminations. The principles are equally applicable when 
monetary determinations or redeterminations involve issues of fact 
although the manner in which they must be applied necessarily is 
affected by the nature of the issues and the processes required to 
resolve them. Some monetary ``issues,'' for example, are simply 
questions of computation or other operational matters that relate 
entirely to the processing of data already contained in the agency's 
records. To settle such questions, the State agency need not seek 
information from either the employer or the claimant and there is no 
occasion for appearance by either at an interview.
    Some monetary issues, however, present questions which cannot be 
resolved from a review of the agency's records. For example, a 
claimant may question the correctness of an employer's wage report 
underlying the agency record on which the claimant's monetary 
determination was based. Yet another claimant may contend that his 
monetary determination has not taken into account wages he earned 
during his base period that an employer omitted from his report 
because, in his view, there was no employment relationship. Common 
agency practice in such cases is to make a field investigation 
including a visit to the employer's place of business, a review of 
his records and an interview with the employer or the appropriate 
members of his staff who have the necessary pertinent information. 
The facts thus obtained, together with the information submitted by 
the claimant, are then used in resolving the issue and as the basis 
for the necessary monetary redetermination. When this is the case, 
the process used has itself provided an appearance by the employer 
in the factfinding proceeding in addition to his written submittal. 
There would ordinarily appear to be no need to provide the employer 
in such cases with yet a further opportunity to appear in the 
factfinding proceeding that precedes the monetary determination or 
redetermination in question. The common agency practice of 
reinterviewing the claimant after the results of the field 
investigation are available assures claimant of his opportunity to 
appear and be heard before the determination is made.
[FR Doc. 00-30266 Filed 11-27-00; 8:45 am]
BILLING CODE 4510-30-P