- The U.S. Department of Labor (DOL) has adopted a new interpretation of the existing federal unemployment compensation law so that states can now provide unemployment compensation to parents who take approved leave or who "otherwise leave employment" to be with their newborns or newly-adopted children. This program is called Birth and Adoption Unemployment Compensation (BAUC) and the new DOL interpretation is contained in the Birth and Adoption Unemployment Compensation Final Rule, which became effective on August 14, 2000. The rule will allow, but does not require, that individual states provide unemployment compensation to new parents. If states wish to provide unemployment compensation under BAUC, those states must amend their unemployment compensation statutes.
- In the past, DOL has consistently required that applicants for unemployment compensation be "able to work and available for work." DOL is now making an exception for new parents. This is an experimental program, with the goal of ascertaining whether the provision of unemployment compensation to new parents will promote the parents' continued connection to the workforce. Under this voluntary and experimental program, states can set eligibility criteria, duration of eligibility, compensation amounts and may also define under what circumstances, if any, employees "otherwise leaving employment" are eligible for compensation.
- While there are many other aspects of this experimental program described in the rule, it is clear that Michigan will not participate in providing BAUC in the immediate future. No legislation has been sponsored in the Michigan legislature, which is in recess until mid-September. While we cannot predict whether Michigan will amend its statute to participate in this experimental program, Jack Wheatley, Director of the Michigan Unemployment Agency, is opposed to the BAUC program. On March 9, 2000, Mr. Wheatley testified before the Ways and Means Committee of the U.S. House of Representatives that the BAUC program could undermine the integrity of the unemployment compensation program in Michigan. For example, if only 25% of new parents in Michigan received BAUC benefits, the cost would exceed $190 million, which is 22% of the total expenditures for benefits in 1999.
- Across the country, fifteen states have introduced legislation to implement the BAUC program. In neighboring states, bills have been introduced in Illinois, Indiana and Minnesota, but none has passed.
States Now May Provide Unemployment Compensation To New Parents
This article was edited and reviewed by FindLaw Attorney Writers | Last reviewed March 26, 2008
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