New Maximum Rates for Unemployment Insurance and Temporary Disability Insurance
June 27, 2012
The RI Department of Labor and Training has announced the 2012 maximum weekly benefit rates for Unemployment Insurance and Temporary Disability Insurance for claimants who begin their benefit year on or after July 1, 2012.
Director of the RI Department of Labor and Training Charles J. Fogarty says, “This is the first time in more than 40 years of the Unemployment Insurance program that a new maximum benefit rate has not exceeded the previous year’s maximum.” This change in calculation is anticipated to save the state Unemployment Insurance Trust Fund $2.2 million in the first year and $12.3 million every year when fully implemented.
Another change in Unemployment Insurance benefits to take effect July 1st is a reduction in the percentage of replaced wages from 60 percent of an individual’s average weekly wage to 57 percent. This percentage will be reduced to 54 percent in July 2013 and 50 percent in July 2014, at which time Rhode Island’s Unemployment Insurance benefit structure will fall in line with its neighboring states. This change in the percentage of replaced wages will save the trust fund $5.4 million in the first year and $24.9 million when fully implemented.
Other changes legislated to begin July 1st include allocating severance over time prior to paying out Unemployment Insurance benefits, calculating weekly benefit rates using the average of a claimant’s two highest quarters of work rather than using the highest quarter only, and extending the number of weeks a claimant must have worked in order to receive the maximum weeks of benefits. Together, these three changes are expected to save the state more than $8 million each year.
Fogarty stresses that the new changes will only affect new claims begun in July 2012 or later. “Existing claims will not be affected by the changes in benefit rate calculation,” Fogarty says.
The Unemployment Insurance program provides benefits to insured and eligible persons who are out of work through no fault of their own. Benefits are financed by employer contributions.
New legislation enacted this year (Public Laws 12-033 & 12-042) will eliminate the one-week waiting period before TDI claimants can receive benefits for all new claims with benefit years beginning on or after July 1, 2012.
ABOUT DLT: The RI Department of Labor and Training offers employment services, educational services and economic opportunity to both individuals and employers. DLT protects Rhode Island’s workforce by enforcing labor laws, prevailing wage rates and workplace health and safety standards. The department also provides temporary income support to unemployed and temporarily disabled workers. For more information on the programs and services available to all Rhode Islanders, please call the RI Department of Labor and Training at (401) 462-8000 or visit the web site at www.dlt.ri.gov.