Worker benefit denials are keeping Oklahoma’s unemployment rate artificially low (Guest post: Jimmy Curry)

Jimmy Curry is President of the Oklahoma AFL-CIO (www.okaflcio.org).

Believe it or not, sometimes the State of Oklahoma gets it right.  The Oklahoma Unemployment Insurance Trust Fund is one of the healthiest funds in the Country with over $1 billion in it. This didn’t happen by accident. Many years ago the Oklahoma Legislature developed a formula that would raise employers’ unemployment insurance rate and lower the unemployed workers’ weekly benefit if the Trust Fund’s monies were low.  The opposite is true when the trust fund monies were high — employers’ unemployment insurance rate would drop and unemployed workers’ weekly benefit would increase.

This formula has worked so well that Oklahoma was one of only a handful of states that did not have to borrow money from the federal government to shore up their Unemployment Insurance Trust Funds during the years after the Great Recession. This is great news since the Oklahoma economy has been taking it on the chin with the falling oil prices, layoffs in the energy sector, state hiring freezes, and severe budget cuts.

With over $1 billion in the Trust Fund, you would think Oklahoma would be poised to offer some help with the monthly bills for Oklahomans who were laid off until they could find a new job. Keep in mind the current average weekly unemployment insurance benefit is about a third of what you are currently making, up to a weekly maximum of $490 per week. So we should ask the question: how can just 4.2 percent of Oklahomans be receiving unemployment benefits as of February, when the energy sector alone has shed 13,800 jobs?

There may be a couple of explanations. In 2012, the Oklahoma Legislature enacted into law the requirement for Oklahomans claiming unemployment insurance to register for work within 7 days after filing their initial claim. After realizing that not all claimants were complying with the Legislative mandate, the Oklahoma Employment Security Commission (OESC) decided to add an automated system to verify work registration in July 2014.

In the first quarter that this new system was active, total denials more than doubled from 5,560 in Q3 2014 to 11,118 in Q4 2014. Nearly all of that increase was due to a huge spike in denials for not meeting the deadline, and these denials have remained elevated for every quarter since the change. This is happening to workers who were laid off for no fault of their own. In September 2015 alone, 1,921 unemployed workers were denied benefits over this technicality.

Besides the spike in denials, another recent change by lawmakers is making fewer workers eligible for unemployment benefits. HB 2505, signed into law by Governor Fallin in 2014, changed the definition of misconduct as it applies to unemployment benefits. The law now reads “any misconduct violation as defined in subsection B of this section shall not require a prior warning from the employer, as long as the employee knew, or should have reasonably known that a rule or policy of the employer was violated, the employee shall not be eligible for benefits.” That means workers who were fired for violating any policy, according to the employer, can be denied benefits even if they never received a prior warning about the policy.

The average working Oklahoman probably does not know any of this is going on at the State Capitol.  This is no way to treat your workforce. As someone who was born, raised, and lived my whole life in Oklahoma, I know we, as a State, can do better than this.

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