II 116th CONGRESS 2d Session S. 4378 IN THE SENATE OF THE UNITED STATES July 30, 2020 Mr. Romney (for himself, Ms. Collins , and Ms. McSally ) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To provide for a short-term extension of the Federal Pandemic Unemployment Compensation program, and for other purposes.

1. Short title; table of contents (a) Short title This Act may be cited as the Federal Pandemic Unemployment Compensation Extension Act of 2020 . (b) Table of contents The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Improvements to Federal Pandemic Unemployment Compensation to better match lost wages. Sec. 3. Supplemental emergency unemployment relief for governmental entities and nonprofit organizations. Sec. 4. Conforming eligibility for Pandemic Unemployment Assistance to disaster unemployment assistance and accelerating appeal review. Sec. 5. Improvements to State unemployment systems and strengthening program integrity. Sec. 6. Emergency designation. 2. Improvements to Federal Pandemic Unemployment Compensation to better match lost wages (a) Extension Section 2104(e)(2) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended by striking July 31, 2020 and inserting November 1, 2020 . (b) Improvements to accuracy of payments (1) Federal Pandemic Unemployment Compensation (A) In general Section 2104(b) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended— (i) in paragraph (1)(B), by striking of $600 and inserting equal to the amount specified in paragraph (3) ; and (ii) by adding at the end the following new paragraph: (3) Amount of Federal Pandemic Unemployment Compensation (A) In general The amount specified in this paragraph is the following amount with respect to an individual: (i) For weeks of unemployment beginning after the date on which an agreement is entered into under this section and ending on or before July 31, 2020, $600. (ii) For weeks of unemployment beginning after the last week under clause (i) and ending on or before August 31, 2020, an amount equal to one of the following, as determined by the State for all individuals: (I) $500. (II) An amount (not to exceed $500) equal to— (aa) 80 percent of the individual’s average weekly wages; minus (bb) the individual's base amount (determined prior to any reductions or offsets). (iii) For weeks of unemployment beginning after the last week under clause (ii) and ending on or before September 28, 2020, an amount equal to one of the following, as determined by the State for all individuals: (I) $400. (II) The amount determined under clause (ii)(II). (iv) For weeks of unemployment beginning after the last week under clause (iii) and ending on or before November 2, 2020, an amount equal to one of the following, as determined by the State for all individuals: (I) $300. (II) The amount determined under clause (ii)(II). (B) Base amount For purposes of this paragraph, the term base amount means, with respect to an individual, an amount equal to— (i) for weeks of unemployment under the pandemic unemployment assistance program under section 2102, the amount determined under subsection (d)(1)(A)(i) or (d)(2) of such section 2102, as applicable; or (ii) for all other weeks of unemployment, the amount determined under paragraph (1)(A) of this subsection. (C) Average weekly wages (i) In general Subject to clause (ii), for purposes of this paragraph, the term average weekly wages means, with respect to an individual, the following: (I) If the State computes the individual weekly unemployment compensation benefit amount based on an individual’s average weekly wages in a base period, an amount equal to the individual’s average weekly wages used in such computation. (II) If the State computes the individual weekly unemployment compensation benefit amount based on high quarter wages or a formula using wages across some but not all quarters in a base period, an amount equal to 1/13 of such high quarter wages or average wages of the applicable quarters used in the computation for the individual. (III) If the State uses computations other than the computations under subclause (I) or (II) for the individual weekly unemployment compensation benefit amount, or for computations of the weekly benefit amount under the pandemic unemployment assistance program under section 2102, as described in subsection (d)(1)(A)(i) or (d)(2) of such section 2102, for which subclause (I) or (II) do not apply, an amount equal to 1/52 of the sum of all base period wages. (ii) Special rule If more than one of the methods of computation under subclauses (I), (II), and (III) of clause (i) are applicable to a State, then such term shall mean the amount determined under the applicable subclause of clause (i) that results in the highest amount of average weekly wages. . (B) Technical amendment regarding application to short-time compensation programs and agreements Section 2104(i)(2) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended— (i) in subparagraph (C), by striking and at the end; (ii) in subparagraph (D), by striking the period at the end and inserting ; and ; and (iii) by adding at the end the following: (E) short-time compensation under section 2108 or 2109. . (2) Conforming amendments (A) Pandemic Unemployment Assistance Section 2102(d) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended by inserting with respect to the individual after section 2104 in each of paragraphs (1)(A)(ii) and (2). (B) Pandemic emergency unemployment compensation Section 2107 of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended— (i) in subsection (a)(4)(A)(ii), by inserting with respect to the individual after section 2104 ; and (ii) in subsection (b)(2), by inserting with respect to the individual after section 2104 . (c) Consistent treatment of earnings and unemployment compensation Section 2104(h) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended by adding at the end the following new sentence: The preceding sentence shall not apply to any Federal Pandemic Unemployment Compensation paid to an individual with respect to a week of unemployment ending on or after October 5, 2020. . (d) Requirement for return to work notification and reporting Section 2104(b) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended by adding at the end the following new paragraph: (3) Beginning 30 days after the date of enactment of this paragraph, any agreement under this section shall require that the State has in place a process to address refusal to return to work or refusal of suitable work that includes the following: (A) Providing a plain-language notice to individuals at the time of applying for benefits regarding State law provisions relating to each of the following: (i) Return to work requirements. (ii) Rights to refuse to return to work or to refuse suitable work. (iii) How to contest the denial of a claim that has been denied due to a claim by an employer that the individual refused to return to work or refused suitable work. (B) Providing a plain-language notice to employers through any system used by employers or any regular correspondence sent to employers regarding how to notify the State if an individual refuses to return to work. (C) Other items determined appropriate by the Secretary of Labor. . (e) Effective date The amendments made by this section (other than the amendment made by subsection (d)) shall take effect as if included in the enactment of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )). 3. Supplemental emergency unemployment relief for governmental entities and nonprofit organizations (a) In general Section 903(i)(1)(B) of the Social Security Act ( 42 U.S.C. 1103(i)(1)(B) ) is amended by striking one-half and inserting 75 percent . (b) Effective date The amendment made by subsection (a) shall take effect as if included in the enactment of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )). 4. Conforming eligibility for Pandemic Unemployment Assistance to disaster unemployment assistance and accelerating appeal review (a) Confirmation of eligibility for Pandemic Unemployment Assistance Section 2102(a) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended— (1) in paragraph (3)— (A) in subparagraph (A)— (i) in clause (i), by striking and at the end; and (ii) by inserting after clause (ii) the following: (iii) provides documentation substantiating employment or self-employment or the planned commencement of employment or self-employment not later than 21 days after the date on which the individual submits an application for assistance under this section or is directed by the State Agency to submit such documentation or has shown good cause under the applicable State law for failing to submit such documentation by the deadline, in accordance with section 625.6(e) of title 20, Code of Federal Regulations, or any successor thereto, except that such documentation shall not be required if the individual previously submitted such information to the State agency for the purpose of obtaining regular or other unemployment compensation; and ; and (B) in subparagraph (B)— (i) in clause (i), by striking or at the end; (ii) in clause (ii), by striking the period at the end and inserting ; or ; and (iii) by adding at the end the following: (iii) in accordance with section 625.6(e)(2) of title 20, Code of Federal Regulations, or any successor thereto, an individual who does not provide documentation substantiating employment or self-employment or the planned commencement of employment or self-employment under subparagraph (A)(iii). ; (2) by redesignating paragraphs (4) and (5) as paragraphs (5) and (6), respectively; and (3) by inserting after paragraph (3) the following: (4) Documentation substantiating employment or self-employment or the planned commencement of employment or self-employment The term documentation substantiating employment or self-employment or the planned commencement of employment or self-employment means documentation provided by the individual substantiating employment or self-employment and wages earned or paid for such employment or self-employment, or such information related to the planned commencement of employment or self-employment. . (b) Applicability (1) In general Beginning not later than 30 days after the date of enactment of this Act, each State shall require that documentation substantiating employment or self-employment or the planned commencement of employment or self-employment (as defined in section 2102 of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 ))) be submitted by any individual who applies for pandemic unemployment assistance under section 2102 of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) on or after the date of enactment of this Act. (2) Prior applicants Any individual who applied for pandemic unemployment assistance under section 2102 of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) before the date of enactment of this Act and receives such assistance on or after the date of enactment of this Act shall submit documentation substantiating employment or self-employment or the planned commencement of employment or self-employment (as defined in such section 2102) not later than 90 days after the date of enactment of this Act or the individual will be ineligible to receive pandemic unemployment assistance under such section 2102. (c) Conforming eligibility for Pandemic Unemployment Assistance to Disaster Unemployment Assistance Section 2102(a)(3)(A) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )), as amended by subsection (a), is amended— (1) in clause (ii)— (A) in subclause (I), in the matter preceding item (aa), by inserting in the employment or service described in clause (iv) after unavailable to work ; and (B) in subclause (II), by striking and at the end; and (2) by inserting after clause (iii), as added by subsection (a), the following: (iv) provides self-certification that the principal source of income and livelihood of the individual are dependent upon the individual’s employment for wages or the individual’s performance of service in self-employment; and . (d) Pandemic Unemployment Assistance appeals (1) Amendment Section 2102 of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended by adding at the end the following: (i) Appeals by an individual filed in the 50 States, District of Columbia, Commonwealth of Puerto Rico, and Virgin Islands (1) In general An individual may appeal any determination or redetermination regarding the rights to pandemic unemployment assistance under this section made by the State agency of a State, the District of Columbia, the Commonwealth of Puerto Rico, or the Virgin Islands (referred to in this subsection as applicable States ). Such an appeal shall be made in accordance with the applicable State law. (2) Requirements All levels of an appeal under paragraph (1) shall be— (A) carried out by the applicable State that made the determination or redetermination; and (B) conducted in the same manner and to the same extent as the applicable State would conduct appeals of determinations or redeterminations regarding rights to compensation under State law. . (2) Effective date The amendment made by paragraph (1) shall take effect as if included in the enactment of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )). (3) Applicability The amendment made by paragraph (1) shall not affect any decision regarding the rights to pandemic unemployment assistance under section 2102 of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) issued on appeal or review before the date of enactment of this Act. (e) Technical correction Section 2102(h) of the Relief for Workers Affected by Coronavirus Act (contained in subtitle A of title II of division A of the CARES Act ( Public Law 116–136 )) is amended by striking section 625 each place it appears and inserting part 625 . 5. Improvements to State unemployment systems and strengthening program integrity (a) Unemployment compensation systems (1) In general Section 303(a) of the Social Security Act ( 42 U.S.C. 503(a) ) is amended— (A) in the matter preceding paragraph (1), by striking provision for— and inserting provision for each of the following: ; (B) at the end of each of paragraphs (1) through (10) and paragraph (11)(B), by striking ; and and inserting a period; and (C) by adding at the end the following new paragraph: (13) The State system shall, in addition to meeting the requirements under section 1137, meet the following requirements: (A) The system shall be capable of handling a surge of claims that would represent a twentyfold increase in claims from January 2020 levels, occurring over a one-month period. (B) The system shall be capable of— (i) adjusting wage replacement levels for individuals receiving unemployment compensation; (ii) adjusting weekly earnings disregards, including the ability to adjust such disregards in relation to an individual’s earnings or weekly benefit amount; and (iii) providing for wage replacement levels that vary based on the duration of benefit receipt. (C) The system shall have in place an automated process for receiving and processing claims for disaster unemployment assistance under section 410(a) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act ( 42 U.S.C. 5177(a) ), with flexibility to adapt rules regarding individuals eligible for assistance and the amount payable. (D) In the case of a State that makes payments of short-time compensation under a short-time compensation program (as defined in section 3306(v) of the Internal Revenue Code of 1986), the system shall have in place an automated process of receiving and processing claims for short-time compensation. (E) The system shall have in place an automated process for receiving and processing claims for— (i) unemployment compensation for Federal civilian employees under subchapter I of chapter 85 of title 5, United States Code; (ii) unemployment compensation for ex-servicemembers under subchapter II of chapter 85 of title 5, United States Code; and (iii) trade readjustment allowances under sections 231 through 233 of the Trade Act of 1974 ( 19 U.S.C. 2291–2293 ). . (2) Effective date The amendment made by paragraph (1) shall apply to weeks of unemployment beginning on or after the earlier of— (A) the date the State changes its statutes, regulations, or policies in order to comply with such amendment; or (B) October 1, 2023. (b) Electronic transmission of unemployment compensation information Section 303 of the Social Security Act ( 42 U.S.C. 503 ) is amended by adding at the end the following new subsection: (n) Electronic transmission of unemployment compensation information (1) In general Not later than October 1, 2022, the State agency charged with administration of the State law shall use a system developed (in consultation with stakeholders) and designated by the Secretary of Labor for automated electronic transmission of requests for information relating to unemployment compensation and the provision of such information between such agency and employers or their agents. (2) Use of appropriated funds The Secretary of Labor may use funds appropriated for grants to States under this title to make payments on behalf of States as the Secretary determines is appropriate for the use of the system described in paragraph (1). (3) Employer participation The Secretary of Labor shall work with the State agency charged with administration of the State law to increase the number of employers using this system and to resolve any technical challenges with the system. (4) Reports on use of electronic system After the end of each fiscal year, on a date determined by the Secretary, each State shall report to the Secretary information on— (A) the proportion of employers using the designated system described in paragraph (1); (B) the reasons employers are not using such system; and (C) the efforts the State is undertaking to increase employer’s use of such system. (5) Enforcement Whenever the Secretary of Labor, after reasonable notice and opportunity for hearing to the State agency charged with the administration of the State law, finds that there is a failure to comply substantially with the requirements of paragraph (1), the Secretary of Labor shall notify such State agency that further payments will not be made to the State until the Secretary of Labor is satisfied that there is no longer any such failure. Until the Secretary of Labor is so satisfied, such Secretary shall make no future certification to the Secretary of the Treasury with respect to the State. . (c) Unemployment compensation integrity data hub (1) In general Section 303(a) of the Social Security Act ( 42 U.S.C. 503(a) ), as amended by subsection (a), is amended by adding at the end the following new paragraph: (14) The State agency charged with administration of the State law shall use the system designated by the Secretary of Labor for cross-matching claimants of unemployment compensation under State law against any databases in the system to prevent and detect fraud and improper payments. . (2) Effective date The amendment made by paragraph (1) shall apply to weeks of unemployment beginning on or after the earlier of— (A) the date the State changes its statutes, regulations, or policies in order to comply with such amendment; or (B) October 1, 2022. (d) Reducing State burden in providing data To prevent and detect fraud Section 303 of the Social Security Act ( 42 U.S.C. 503 ), as amended by subsection (b), is amended by adding at the end the following new subsection: (o) Use of unemployment claims data To prevent and detect fraud The Inspector General of the Department of Labor shall, for the purpose of identifying and investigating fraud in unemployment compensation programs, have direct access to each of the following systems: (1) The system designated by the Secretary of Labor for the electronic transmission of requests for information relating to interstate claims for unemployment compensation. (2) The system designated by the Secretary of Labor for cross-matching claimants of unemployment compensation under State law against databases to prevent and detect fraud and improper payments (as referred to in subsection (a)(14)). . (e) Use of National directory of new hires in administration of unemployment compensation programs and penalties on noncomplying employers (1) In general Section 303 of the Social Security Act ( 42 U.S.C. 503 ), as amended by subsections (b) and (d), is amended by adding at the end the following new subsection: (p) Use of National directory of new hires (1) In general Not later than October 1, 2022, the State agency charged with administration of the State law shall— (A) compare information in the National Directory of New Hires established under section 453(i) against information about individuals claiming unemployment compensation to identify any such individuals who may have become employed, in accordance with any regulations or guidance that the Secretary of Health and Human Services may issue and consistent with the computer matching provisions of the Privacy Act of 1974; (B) take timely action to verify whether the individuals identified pursuant to subparagraph (A) are employed; and (C) upon verification pursuant to subparagraph (B), take appropriate action to suspend or modify unemployment compensation payments, and to initiate recovery of any improper unemployment compensation payments that have been made. (2) Enforcement Whenever the Secretary of Labor, after reasonable notice and opportunity for hearing to the State agency charged with the administration of the State law, finds that there is a failure to comply substantially with the requirements of paragraph (1), the Secretary of Labor shall notify such State agency that further payments will not be made to the State until the Secretary of Labor is satisfied that there is no longer any such failure. Until the Secretary of Labor is so satisfied, such Secretary shall make no future certification to the Secretary of the Treasury with respect to the State. . (2) Penalties (A) In general Section 453A(d) of the Social Security Act ( 42 U.S.C. 653a(d) ), in the matter preceding paragraph (1), is amended by striking have the option to set a State civil money penalty which shall not exceed and inserting set a State civil money penalty which shall be no less than . (B) Effective date The amendment made by subparagraph (A) shall apply to penalties assessed on or after October 1, 2022. (f) State performance (1) In general Section 303 of the Social Security Act ( 42 U.S.C. 503 ), as amended by subsections (b), (d), and (e), is amended by adding at the end the following new subsection: (q) State performance (1) In general For purposes of assisting States in meeting the requirements of this title, title IX, title XII, or chapter 23 of the Internal Revenue Code of 1986 (commonly referred to as the Federal Unemployment Tax Act ), the Secretary of Labor may— (A) consistent with subsection (a)(1), establish measures of State performance, including criteria for acceptable levels of performance, performance goals, and performance measurement programs; (B) consistent with subsection (a)(6), require States to provide to the Secretary of Labor data or other relevant information from time to time concerning the operations of the State or State performance, including the measures, criteria, goals, or programs established under paragraph (1); (C) require States with sustained failure to meet acceptable levels of performance or with performance that is substantially below acceptable standards, as determined based on the measures, criteria, goals, or programs established under subparagraph (A), to implement specific corrective actions and use specified amounts of the administrative grants under this title provided to such States to improve performance; and (D) based on the data and other information provided under subparagraph (B)— (i) to the extent the Secretary of Labor determines funds are available after providing grants to States under this title for the administration of State laws, recognize and make awards to States for performance improvement, or performance exceeding the criteria or meeting the goals established under subparagraph (A); or (ii) to the extent the Secretary of Labor determines funds are available after providing grants to States under this title for the administration of State laws, provide incentive funds to high-performing States based on the measures, criteria, goals, or programs established under subparagraph (A). (2) Enforcement Whenever the Secretary of Labor, after reasonable notice and opportunity for hearing to the State agency charged with the administration of the State law, finds that there is a failure to comply substantially with the requirements of paragraph (1), the Secretary of Labor shall notify such State agency that further payments will not be made to the State until the Secretary of Labor is satisfied that there is no longer any such failure. Until the Secretary of Labor is so satisfied, such Secretary shall make no future certification to the Secretary of the Treasury with respect to the State. . (2) Effective date The amendments made by this subsection shall take effect on the date of enactment of this Act. (g) Funding Out of any money in the Treasury of the United States not otherwise appropriated, there are appropriated to the Secretary of Labor $2,000,000,000 to assist States in carrying out the amendments made by this section, which may include regional or multi-State efforts. Amounts appropriated under the preceding sentence shall remain available until expended. 6. Emergency designation (a) In general The amounts provided by this Act and the amendments made by this Act are designated as an emergency requirement pursuant to section 4(g) of the Statutory Pay-As-You-Go Act of 2010 ( 2 U.S.C. 933(g) ). (b) Designation in Senate In the Senate, this Act and the amendments made by this Act are designated as an emergency requirement pursuant to section 4112(a) of H. Con. Res. 71 (115th Congress), the concurrent resolution on the budget for fiscal year 2018.