Unemployment Benefits for Furloughed Federal Employees

Navigating the Safety Net: Unemployment Benefits for Furloughed Federal Employees

When a government shutdown occurs, one of the most immediate and pressing concerns for federal employees in a non-pay status is how to cover essential expenses. The good news is that federal workers furloughed due to a lapse in appropriations are generally eligible to apply for state unemployment benefits through the Unemployment Compensation for Federal Employees (UCFE) program. However, employees who are forced to work without pay (excepted or exempted status) are typically ineligible, although they are also not receiving pay or benefits.

The Furlough and Filing for UCFE

The UCFE program is essentially the federal version of unemployment insurance, but it is administered by individual state unemployment insurance (UI) agencies acting as agents of the federal government. This means that while the benefit is for federal employees, the eligibility rules, benefit amounts, and duration are determined by the laws of the state in which the employee's last official duty station was located.

• Filing a Claim: Furloughed employees should file a claim with the state UI agency where their last federal duty station was located, typically as soon as they are placed in a non-pay status.

• Key Information Needed: You'll generally need documents like your agency name, work location, dates of employment, and proof of earnings, such as your Leave and Earnings Statement (LES) or an SF-50 (Notice of Personnel Action), though an affidavit may suffice if official forms are unavailable during a shutdown.

• Waiting Week: Be aware that many states require an unpaid "waiting week" before benefits can begin.

The Status of "Excepted" or "Exempted" Employees

The eligibility picture changes for "excepted" or "essential" federal employees. These are workers who are required to continue working during a shutdown, though without pay, because their duties relate to national security or other deemed critical functions.

• Generally Ineligible: In most states, full-time excepted employees who are working are not considered unemployed and are therefore not eligible for unemployment benefits. Unemployment insurance is designed for those who are out of work or working severely reduced hours through no fault of their own.

• Partial Eligibility: However, excepted intermittent employees or those whose hours are significantly reduced may still be eligible for partial benefits, depending on state law. This can become complicated.

Repayment of Benefits

There's a significant detail all federal employees claiming unemployment benefits must

understand. Under the Government Employee Fair Treatment Act of 2019 (GEFTA), both furloughed and excepted employees are, by law, guaranteed retroactive back pay once the government shutdown ends and funding is restored. This backpay was histroically the practice of Congress, but is now codified in statutory law. HOWEVER, even though the law was signed by Donald Trump, Trump is now threatening to not pay furloughed or even excepted federal employees backpay for lost wages.

Generally, because back pay covers the same time period for which unemployment benefits were received, those benefits are considered an overpayment and must be repaid to the state if furloughed or excepted federal employees receive backpay. Not a big issue really, given the gravity of the situation created by trump.

• A Temporary Bridge: In essence, the unemployment benefits act as a temporary interest-free loan to help cover expenses during the non-pay period.

• The Repayment Process: State UI agencies will issue a notice for repayment. In some cases, federal agencies may facilitate the repayment by directly deducting the UI amount from the back pay and reimbursing the state, but this is not universal. Employees should be prepared to handle the repayment themselves if their agency doesn't process the deduction.

Final Takeaway

For a federal employee in a non-pay status due to a government shutdown, applying for UCFE can provide a vital financial cushion. Furloughed employees are typically eligible, while excepted employees working full-time without pay are generally not. Crucially, any benefits received will need to be repaid upon receiving retroactive back pay.

If you are a federal employee affected by a non-pay status, the best course of action is to file a claim immediately with your state's UI office to get a formal determination of your eligibility.