As the state plans to begin rolling back its measures intended to fight the spread of COVID-19 on Friday, it is urging employers to report workers who refuse to return to work to the state’s unemployment agency to terminate their benefits, the head of the state’s secretary of commerce said.
Oklahoma Secretary of Commerce and Workforce Development Sean Kouplen said during a series of video meetings with businesses on Wednesday that workers who are receiving unemployment benefits can lose those funds if they refuse a job offer from their former employer as the state begins to reopen.
“Obviously, if somebody turns down employment, then what will happen is, if the company chooses to call OESC (the Oklahoma Employment Security Commission) and let them know, then that individual’s unemployment benefits will stop,” Kouplen said. “The individual has a right to appeal that based on, for example, a health concern.”
As long as the job offered has the same or greater pay and the business is taking steps to mitigate the spread of the disease at the workplace, and if the person is not considered part of a vulnerable population to the disease, then it’s likely the person would have to return to work or lose their unemployment benefits, Kouplen said. There is still a lot of “grey” area in adjudicating those decisions, Kouplen said, and the OESC is seeking guidance from the U.S. Department of Labor.
Part of the issue, Kouplen said, is the level of unemployment benefits individuals are receiving. In addition to regular unemployment benefits, which in Oklahoma ranges from $188 to $539 per-week, unemployed workers can also receive an extra $600 per week until July 31 under the federal Coronavirus Aid, Relief and Economic Security Act.
“We are seeing some businesses around the state who are offering individuals their jobs back at the same pay they had before, and the individuals are turning them down because maybe they’re making the same or more with this elevated unemployment payment that we’re seeing,” Kouplen said. “I don’t blame the employees for doing that, and we’re glad they’re getting good unemployment, but the problem is we cannot relaunch the economy without workers.”
Nearly a quarter-million Oklahomans have applied to OESC for unemployment since late March, though OESC has yet to provide numbers on how many claims have been processed or approved. Unemployment claims by workers who would not otherwise qualify for traditional unemployment benefits but do qualify for the Pandemic Unemployment Assistance Program — part of the CARES Act that provides relief to gig workers, independent contractors and others — had yet to be fully processed by OESC as of Wednesday.
On Tuesday, The Frontier reported on comments made at a recent meeting by members of the Governor’s Council for Workforce and Economic Development, some of whom were eyeing ways to end the extra $600-per-week unemployment payments as a way to incentivize workers to return to their jobs.
Oklahoma’s minimum wage of $7.25 an hour is one of the lowest minimum pay rates in the nation. Cities in the state are not allowed to establish their own higher minimum wages for workers after the Legislature and former Gov. Mary Fallin passed a law in 2014 prohibiting them from doing so. The last increase came more than a decade ago, when the federal minimum wage was increased.
During Wednesday’s meetings, Kouplen said the state will not seek to reduce unemployment benefits to Oklahoma workers affected by the COVID-19 pandemic.
“Those dollars are not going to be taken away,” Kouplen said. “We had a conversation that occurred in our Governor’s Workforce Council meeting that made it into the media, and that is fine, but I just want everybody to know that we would never take unemployment benefits away from anybody.”
However, Kouplen said, those higher benefits are still making it difficult for employers to begin reopening. Kouplen said one barbershop owner emailed him Wednesday saying that only 20 percent of the company’s workers agreed to return when it reopened, while the rest refused because they can draw more money from unemployment.
So rather than reduce payments to the unemployed, the state is asking that employers who offer an employee their job back report to OESC if the employee refuses, Kouplen said.
“OESC has asked if you had this experience — if you are out there and offer someone a job and they turn the job down — please let them know,” Kouplen said. “And frankly, that worker will become ineligible for unemployment benefits. Now, if they have a legitimate reason — a health concern or something like that — that’s a different ballgame. But if it’s just a matter of ‘I’m making the same money, I’d rather stay at home’ — that is clearly not what unemployment is designed to do.”
Kouplen said the practice is a longstanding one at OESC, and that workers may file administrative appeals in those cases.
The state’s economy and unemployment system will not be able to handle prolonged unemployment claims at the level it is currently at and it will be difficult to get the state’s economy up and running again without an adequate number of workers, Kouplen said, which necessitates making sure people return to their jobs.
“I know that can seem a little bit harsh, but the challenge becomes we’re trying to balance our unemployment insurance fund, we’re trying to balance getting businesses back up and going, and we’re trying to balance the welfare of that unemployed individual, all three,” Kouplen said. “So if everyone stays on unemployment extensively, we cannot reopen the economy and we’re going to see businesses go under en masse.”
Last week, Gov. Kevin Stitt rolled out a three-phase plan to begin removing restrictions on individuals and businesses that were implemented as a result of COVID-19. The first phase, which begins Friday, will allow the reopening of theaters, restaurants, entertainment venues, gyms and other businesses that have mostly been closed since late March.
Critics have argued the state is reopening too early, which could put workers forced back into jobs because their unemployment ended in a tough spot. Though many business leaders praised the move, others, such as the Oklahoma Medical Association, said it is too soon to reopen.
“No business has to open until they’re ready,” Kouplen said. “So these are just guidances, these are not requirements. You don’t have to open up until you’re ready. If a business wants to be more strict than what are on these guidances, that’s fine. That is up to that business. We think that customers will go to businesses that are more careful than others because they will feel more safer.”
There are three reasons to move forward with reopening, Kouplen said. First, because of the mental health issues caused by the measures. Second, Kouplen said, is the federal money for businesses affected by COVID-19, such as the Payroll Protection Program, runs out in 8 weeks.
“If at the end of 8 weeks, if our businesses are not up and going and generating cash flow, we have a real problem as a state,” Kouplen said. “That’s the urgency we have in getting this going. We want to be safe, but we want to open our economy back up.”
As the restrictions and measures are rolled back, Kouplen said, state officials will be monitoring hospitalization, infection and other data related to COVID-19. If things begin trending downward, Kouplen said, the other phases, which are spaced in two week intervals, will be halted.
Once the state begins reopening, Kouplen said, it’s likely that customers will trend toward businesses that keep protections in place. However, it is up to each individual city whether restrictions on businesses there continue, he said.
“Gov. Stitt really, really believes in personal choice and the value of the market. So our goal as a state is to give guidance,” Kouplen said. “It’s not the Governor’s desire to be heavy-handed. We’re going to leave that to each individual city. Our goal is just to lay out guidances and we believe that our businesses will do the right thing and make the right decisions.”