Gov. Mike Pence’s administration quickly scrapped its plans to stop 32,000 Hoosiers’ unemployment payments as a result of looming federal spending cuts – a move Indiana looked like it would be alone in making.
The reversal occurred just hours after Pence’s Indiana Department of Workforce Development had initially announced it would put all benefits on hold rather than guess at how much federally-extended unemployment payments should be reduced.
A two-sentence email from Gay Gilbert, the U.S. Department of Labor’s unemployment insurance administrator, said the “sequester” would not affect benefits in early March and that more information would come on a Friday conference call.
That was enough to satisfy state officials, who quickly said they would continue payments that average $275 a week and go to those who have been out of work at least 26 weeks.
“In response to the state of Indiana’s request for additional guidance, late this afternoon the U.S. Department of Labor confirmed that unemployment benefits will not be impacted by sequestration through the week ending March 9, and additional guidance will be forthcoming,” said DWD Commissioner Scott Sanders.
“As such, the Indiana Department of Workforce Development will proceed with full payment of extended unemployment compensation until further notice.”
Indiana provides state unemployment benefits for the first 26 weeks that Hoosiers are out of work, but then federal funding kicks in to extend the program through 63 weeks. Federal officials had warned that benefits would be cut by 9.4 percent, but DWD spokesman Joe Frank said the agency also needed to know how and when to implement those changes.
The email from Gilbert that prompted the DWD to reverse course said: “Yes – I can definitely confirm that the weeks ending 3/2 and 3/9 for EUC will not be impacted by sequestration. We are working to get you more information as soon as feasible and anticipate holding a state call on Friday, March 1st.”
The Pence administration’s initial move – which the governor did not mention earlier Wednesday during a news conference in which he discussed how the sequester would affect Indiana – was quickly criticized by the U.S. Department of Labor, which called it premature, and by labor lawyers who said Indiana might run afoul of federal law.