PA Labor & Industry Announces Launch Date for Modern Unemployment Benefits System

During a Pennsylvania Senate budget hearing April 8th and in a subsequent news release, Department of Labor & Industry Acting Secretary Jennifer Berrier announced that the Department will launch its new, much-anticipated unemployment compensation (UC) system June 8th.

The new system will replace the 40-year-old, obsolete mainframe legacy system the Department now uses to process traditional unemployment claims. The new system will also process claims for Pandemic Emergency Unemployment Compensation (PEUC), Extended Benefits (EB), Shared Work or Short-Time Compensation, and Trade Readjustment Allowances.

Pandemic Unemployment Assistance (PUA) will not be affected by the transition to the new UC system.

“The new system will be easy to use, provide access to important information, and streamline the unemployment claim filing process for workers, employers, unemployment program staff, and third-party administrators,” Secretary Berrier said. “The pandemic stressed an already-antiquated IT platform and we look forward to improving the process so that out-of-work Pennsylvanians can focus their time and attention on finding a new job.”

The Department planned to launch the system last October but postponed the transition due to factors related to the COVID-19 pandemic. L&I staff members who had been working on the project, known as Benefits Modernization or BenMod, were diverted to assist with the unprecedented volume of new unemployment claims. The Department also sought to minimize the impact of any benefits disruptions on claimants.

During the transition, the claims system will be taken offline for about two weeks when users will be unable to file claims. L&I will provide regular updates and information about the disruption period.

L&I will provide user guides and hold live workshops with UC experts to assist individuals with learning how to use the new system before its implementation. Announcements will be made in the coming weeks regarding the dates of the workshops and how to access them. L&I is also in the process of hiring and training an additional 500 to 1,000 customer service representatives and 180 interviewers to help Pennsylvanians with their questions and claims.

Claimants, businesses, and other users can view tutorials and instruction guides for the new system at www.uc.pa.gov, and should follow L&I on Facebook or Twitter to stay up-to-date.

PA Attorney General Charges State College Contractor with Prevailing Wage Violations

Attorney General Josh Shapiro announced that Glenn O. Hawbaker, Inc., of State College, has been charged with four counts of theft relating to violations of the Pennsylvania Prevailing Wage Act and the federal Davis-Bacon Act. Hawbaker is one of the largest contractors to complete projects on behalf of the Commonwealth, receiving an estimated $1.7 billion in funding as of 2021.

“This is the largest prevailing wage criminal case on record — under Pennsylvania prevailing wage law and across the United States under federal law,” said AG Shapiro. “My focus now is on holding Hawbaker accountable for breaking the law and getting these workers their money back.”

While Hawbaker boasted that it provided great employee benefits, the company was actually stealing its workers’ retirement, health, and welfare money, the AG alleged. As a result of Hawbaker’s conduct, individual workers lost tens of thousands of dollars from their retirement. Hawbaker used its workers’ fringe benefit funds to lower their costs, and thereby increase profits for the Hawbaker family.

These charges conclude a three-year investigation into the company’s practices for calculating and claiming fringe benefit credits. Investigators discovered that the company stole wages from its workers by using money intended for prevailing wage workers’ retirement funds to contribute to retirement accounts for all Hawbaker employees – including the owners and executives. As a result, workers received less money in their retirement accounts than what was owed.

Hawbaker also stole funds intended for prevailing wage workers’ health and welfare benefits and used them to subsidize the cost of the self-funded health insurance plan that covers all employees. The company disguised its scheme by artificially inflating its records of benefit spending by millions of dollars each year and claiming credit for prohibited costs. Those measures created the appearance that it provided employees with benefits that far exceeded the cost of those that it actually did.

Although investigators determined that the complex and well-disguised sleight of hand had gone on for decades, Hawbaker could only be charged for the last five years due to the statute of limitations.

Union Organizers Lose Alabama Amazon Vote But Vow to Challenge Results

Union advocates have lost their bid to form a new bargaining unit for 5,800 workers at an Amazon fulfillment center in Alabama, but organizers of the unionization effort aren’t going down without a fight.

Stuart Appelbaum, president of the Retail, Wholesale and Department Store Union (RWDSU), said they are planning to challenge the election results, which stood at 1,798 votes against the union and 738 in favor, as of early April 9th.

“Our system is broken – Amazon took full advantage of that – and we will be calling on the labor board to hold Amazon accountable for its illegal and egregious behavior during the campaign,” Appelbaum said according to Vox.com.

An RWDSU spokesperson stated that the union believes Amazon acted inappropriately by installing a USPS mailbox on the grounds of the Bessemer warehouse and advising employees to use it to cast their mail-in votes. The placement allowed the company to monitor and intimidate voters, the union claims.

“The Washington Post reported … that Amazon officials pressed the USPS to install the mailbox after the National Labor Relations Board denied the company’s request to place a ballot drop box on the property,” Vox.com reported.

Amazon had previously claimed that the mail-in format was likely to reduce voter turnout and defended the mailbox placement as a “simple, secure, and completely optional” way for employees to vote.

The seven-week window for voting ended on March 29th, according to NBC News. 3,041 ballots were cast, but 505 were set aside by the NLRB after one of the parties – Amazon in most cases – contested their validity.

“Labor experts said the results are not a surprise, given the resources Amazon has invested in countering organizing,” NBC News reported.

Amazon is the second-largest private employer in the United States. Bessemer would have become the company’s first unionized workplace had the organizing campaign succeeded. The facility opened in March 2020. Organizing efforts began last August with employees seeking to improve working conditions.

Despite Collecting PPP Loans, Dozens of PA Companies Laid Off Thousands of Workers

More than 40 companies laid off or furloughed at least 4,200 Pennsylvania workers despite collecting nearly $70 million in forgivable loans during the first round of the federal Paycheck Protection Program (PPP) last year, according to recent analysis of public records by The Philadelphia Inquirer and The Center for Public Integrity.

“The PPP loans, part of the first $2.2 trillion federal coronavirus bailout, were touted by then-Senate Majority Leader Mitch McConnell as a ‘job-saving program’ for small businesses crushed by the pandemic,” the Inquirer reported. “The money was primarily supposed to help companies pay their employees’ salaries and benefits.”

Two businesses received the largest loan amounts cited by the newspaper. Cameron Mitchell Restaurants of Philadelphia, operator of Ocean Prime, laid off 90 workers and collected $10 million. Eat N Park Hospitality Group also collected $10 million and laid off 335 employees statewide.

Other big borrowers in Philadelphia included the Phelan Hallinan Diamond & Jones law firm with about $4 million in loans and 48 layoffs, Kimmel Center ($3.8 million, layoffs undisclosed), The Franklin Institute ($2.9 million, 21 layoffs), and Doubletree Hotel Center City ($2.7 million, 126 layoffs). Prime EFS of Langhorne borrowed $2.9 million and laid off 114.

“It’s not clear if these companies broke the rules of the program or if the layoffs make them ineligible for loan forgiveness,” the Inquirer reported. “Companies that did not rehire all their laid-off workers by the end of 2020 may have to pay back the loan with 1% interest unless they can prove their business did not return to pre-pandemic levels because it was following federal COVID-19 safety guidelines. Companies found to have spent the money on expenses other than payroll, utilities, rent, mortgage payments, or PPE could be charged with fraud.”

In December, The Center for Public Integrity reported on more than 900 companies from across the nation that took $1.8 billion from the same federal aid program but laid off 90,000 workers just before or soon after collecting the money. Overall, more than 5 million businesses borrowed $525 billion under the program last year.

The Small Business Administration is administering the program. The SBA offered a Second Draw loan period earlier this year and is now accepting applications for a third round of loans. The current window closes on May 31st.