Return to Work Bonus Legislation

Washington, D.C. – The top Republican on the House Ways and Means Committee Kevin Brady (R-TX), with 14 original Republican cosponsors, introduced the Reopening America by Supporting Workers and Businesses Act of 2021. This bill will help local businesses rebuild their workforce quickly by turning enhanced unemployment benefits into a back-to-work bonus that will provide a bump to workers and help accelerate our economic recovery.

Upon introduction of the legislation, Rep. Brady released the following statement:

“As more Americans get vaccinated and states roll back restrictions on businesses, now is the time to reconnect workers with jobs. The pandemic has hit Main Street businesses hard. Now businesses are competing with enhanced unemployment benefits for workers.

“A Return to Work Bonus, which would allow states to provide a bonus to unemployed workers if they accept a job offer, can make sure temporary job losses don’t turn into permanent ones.”

Background:

The so-called American Rescue Plan Act provided an extension of $300/week in supplemental unemployment benefits through September 6. As states begin to reopen, the expansion of benefits has presented serious challenges for businesses trying to hire or recall workers, especially employers in the Paycheck Protection Program.

Main Street businesses are seeking relief from hiring challenges caused by enhanced unemployment benefits. The additional $300/week in benefits means as many as 37% of workers receive more on unemployment than their paycheck, creating a disincentive to return to work. The National Federation of Independent Businesses Research Center said that job openings in February reached an all-time record high as 40% of small firms have an open position that they aren’t able to currently fill.

Last year, Rep. Brady introduced a similar bill intended to offset the negative impacts of the $600/week unemployment benefits. Idaho was the first state to implement a return to work bonus system. Governor Brad Little announced their return to work bonus system last July and saw over 10,000 Idahoans seeking the bonus.

Bill Summary: Nobody should have to choose between earning a steady paycheck and making even more by not working at all. The Reopening America by Supporting Workers and Businesses Act of 2021 would help connect unemployed workers with jobs to get the economy going again. The bill includes:

• Time limited back-to-work bonuses: Makes work pay by providing a one-time payment of either $1,200 (full-time) or $600 (part-time) to unemployed workers that obtain employment, comparable to a hiring bonus. The bonus requires verification from an individual’s employer of their hours and earnings and would be available through July 1, 2021.
• Reemployment services: In recognition of the increased need for support to laid off workers, the bill accelerates a scheduled increase in funding for Reemployment Services and Eligibility Assessments (RESEA) and expands the pool of eligible workers to include those receiving benefits through CARES Act unemployment programs, including Pandemic Unemployment Assistance.
• Reinstate job search requirement: The bill reinstates the federal work search requirement for individuals receiving unemployment. Last March, when businesses were closed, Congress provided flexibility for states to waive this requirement. Thirty-two states continue to have a waiver in place. Reopening the economy will require connecting all available workers to job openings.

A section-by-section summary of the bill is available here.

“Job openings are at a record high, yet businesses are struggling to recruit employees. I know this is the case in the 7th District. Businesses shouldn’t be competing with unemployment benefits in order to get employees working again,” said Congressman Tom Rice (R-SC). “I’m proud to cosponsor this legislation which will allow a bonus to be provided to unemployed workers upon accepting a job offer. This will encourage Americans to get back to work quickly, help businesses recover, and get the economy moving again.”

Main Street businesses want to hire, but enhanced unemployment benefits are discouraging potential applicants from seeking work. The additional $300/week in benefits, provided by the American Rescue Plan Act, means as many as 37% of workers receive more on unemployment than their paycheck, creating a disincentive to return to work. The National Federation of Independent Businesses Research Center said that job openings in February reached an all-time record high as 40% of small firms have an open position that they aren’t able to currently fill.