Labor Department says Trump’s delays on coronavirus relief won’t impact unemployment aid

Despite federal unemployment assistance expiring on 26 December, before Donald Trump signed a $900bn coronavirus relief package after nearly a week of delays, millions of out-of-work Americans who relied on two critical programmes will not lose benefits, according to the Labor Department.

Roughly 14 million people have relied on the Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation programmes, and a lapse in their extension prompted fears that millions of jobless Americans would lose at least a week of benefits, which were extended into March, as states re-enroll benefit recipients.

But because states administer unemployment claims, it’s unclear how uniform those benefits will be paid out, and when.

Following the 11th-hour chaos over the latest Covid-19 relief legislation, people across the US reported lapses in state systems delaying their payments, received notice that their claims have ended, received payments short of the $300 from the federal programmes, or general confusion about next steps for critically needed assistance as the public health crisis and its economic fallout stretch into the new year.

The legislation includes direct payments to most Americans and extends unemployment benefits to self-employed workers and people who have exhausted state benefits up to 11 weeks, through mid-March, and adds on $300 in weekly federal aid to benefits.

A statement from the Department of Labor says that the agency “does not anticipate that eligible claimants will miss a week of benefits due to the timing of the law’s enactment” as states begin implementing provisions in the latest bill.

Democratic Senator Ron Wyden, ranking member on the Senate Finance Committee, said that the Labor Department has told states that they will pay all benefits for the week of 27 December.

"Millions of jobless workers will be able to breathe a sigh of relief, knowing that they will not lose a week’s worth of income," he said in a statement. “Now, Donald Trump’s needless delay in signing the relief bill still means unnecessary administrative headaches and late payments, but workers will not lose income.”

While labour departments in several states have reported that claimants will continue to receive benefits without a gap in coverage, other have warned that there will be a lapse, though payments will come through eventually.

Those delays could mean some recipients will receive backpay, though it’s unclear whether those gaps in benefits will be covered in future payments.

Iowa’s Workforce Development agency, for example, warned that “there will be a gap in payments for these programs of an unknown period of time."

A two-thirds majority vote in the House of Representatives on Monday night approved raising one-time direct payments to most Americans from $600 to $2,000, though its fate in the Senate is unclear, as GOP leader Mitch McConnell has blocked efforts by Bernie Sanders and Senate Democrats to bring it to a vote. The Vermont senator has pledged to block a crucial vote on overriding the president’s veto of the the National Defense Authorization Act unless a vote on $2,000 payments is brought to the floor.