On May 4, 2021, Montana Gov. Greg Gianforte announced that the state would end its participation in federal COVID-19 unemployment benefits related to the pandemic and transition to pre-pandemic unemployment insurance (UI) eligibility and benefits by the end of June.
During the pandemic, unemployment benefits were extended beyond the traditional 13 weeks, via the federal Pandemic Emergency Unemployment Compensation (PEUC), and provided an additional $300 per week under Federal Pandemic Unemployment Compensation (FPUC).
The decision was one of two measures announced to “address the state’s severe workforce shortage and incentivize Montanans to reenter the labor force.” In addition to ending federal UI related to the pandemic, the state will also launch a return-to-work bonus program that will leverage federal funds authorized by the American Rescue Plan Act, a $1.9 trillion stimulus package signed by U.S. President Joe Biden in March 2021 to provide relief to Americans who have been struggling during the pandemic.
Under the new measure, Montanans who were previously unemployed will receive a $1,200 return-to-work bonus if they rejoin the labor force and maintain steady employment for at least one month.
“Montana is open for business again, but I hear from too many employers throughout our state who can’t find workers. Nearly every sector in our economy faces a labor shortage,” said Gianforte.
“Incentives matter,” Gianforte continued, “and the vast expansion of federal unemployment benefits is now doing more harm than good. We need to incentivize Montanans to reenter the workforce. Our return-to-work bonus and the return to pre-pandemic unemployment programs will help get more Montanans back to work.”
Montana will be the first state to fully opt out of the federal unemployment benefit programs enacted at the start of the pandemic in March 2020, paving the way for states like South Carolina that have also similar measures. Gianforte said returning to pre-pandemic unemployment eligibility will incentivize workers to return to work and ease a “critical labor shortage.” It will also require unemployment claimants to be “able and available” for work.
“Montana’s unemployment rate is at just 3.8% – near pre-pandemic lows – and statewide there are record numbers of new job postings each week. But today, despite an influx of new residents into Montana over the last year, our labor force is some 10,000 workers smaller than it was before the pandemic,” Commissioner of Labor and Industry Laurie Esau said. “Our labor shortage doesn’t just affect employers and business owners. Employees who are forced to work longer shifts, serve more customers or clients, and take on more duties have been paying the price.”
A closer look at the announced changes revealed that as of June 27, claimants who have exhausted their traditional UI would no longer receive federal benefits under the PEUC and would lose the added $300 benefit granted under the FPUC. Additionally, Montana will no longer participate in the federal pandemic unemployment assistance program that awarded benefits to people who were self-employed or underemployed, as well as those who were unable to work due to health or COVID-19 affected reasons. Montana also will no longer participate in the Mixed Earner Unemployment Compensation (MEUC) program, which offers supplemental payments to individuals who had both traditional W-2 income as well as self-employment income.
Claimants with questions about their future eligibility can contact the Department of Labor and Industry at 406-444-2545. Claimants receiving Pandemic Unemployment Assistance (PUA) should contact 406-444-3382.