May 27, 2020

COVID-19: Employees who Refuse Offer of Suitable Work Rendered Ineligible for Ongoing UC Benefits

In late March, when Congress passed, and the President signed the “Coronavirus Aid, Relief, and Economic Security Act,” commonly referred to as the “CARES,” many observers touted the expansion of Unemployment Compensation eligibility. The addition of newly created qualifying categories, increased weekly benefit amounts, and extended time periods over which benefits could be paid, were all welcomed provisions of CARES, as the nation braced for massive and unprecedented furloughs and layoffs.

However, even before the ink was dry on the new law, employers recognized the higher level of benefits payable under CARES could provide a disincentive for employees to return to work. As the lock-down orders are slowly lifted and business begins to replenish its workforce, those predictions of hesitation to relinquish attractive Unemployment Compensation benefits are coming to fruition in certain instances.

Treasury Secretary Steven Mnuchin confirmed earlier this week that individuals who reject an offer from their company to return to work after being laid off due to Coronavirus are no longer considered eligible to receive federal unemployment benefits. Mnuchin said that companies receiving benefits under the Payroll Protection Program who are inviting employees who had been laid off or furloughed due to the Coronavirus crisis to return to work should plan to notify state unemployment offices of their job offers. However, this directive may be easier said than done, as anyone can attest who has attempted to contact their state’s unemployment compensation authorities.

Some states do have a specific mechanism for eliminating Unemployment Compensation benefits for individuals who have rejected an offer of work. In Pennsylvania, for example, Section 402(a) of Pennsylvania Unemployment Compensation Law provides, in part, that an employee shall be ineligible for compensation for any week in which their unemployment is due to failure, without good cause, to accept suitable work; provided that the employer who offers the work notifies the department of the refusal within seven days from when the offer is made.

The Pennsylvania Department of Labor and Industry has created a new form, found here, so employers can provide notification that suitable work was refused. The form can be saved, printed, and submitted directly to the Department online, it can be emailed to, or it can be faxed to 717-772-0378.

If you have any questions or concerns, please feel free to contact one of the attorneys in our Employment Law Group at 1-888-488-2638.