Democrats Outline Unemployment Insurance Technology Priorities for American Rescue Plan Funds

Letter to Labor Department details how Democrats’ legislation provides framework for unemployment insurance technology overhaul

Washington, D.C. – Senate Finance Committee Chair Ron Wyden, D-Ore., and Representative Steven Horsford, D-Nev., today led a bicameral letter to Labor Secretary Marty Walsh outlining priorities for $2 billion in American Rescue Plan funding to overhaul unemployment insurance administration and technology.

The 30 senators and members of Congress are requesting the administration use their legislation, the Unemployment Insurance Technology Modernization Act, as a guide for a technology overhaul. The bill would establish one set of technology and security capabilities for state unemployment offices, and pave the way for one website to apply for unemployment benefits, not 53.

The letter was signed by Senators Mark Warner, D-Va., Catherine Cortez Masto, D-Nev., Sherrod Brown, D-Ohio, Richard Blumenthal, D-Conn., Dianne Feinstein, D-Calif., Kyrsten Sinema, D-Ariz., Chris Van Hollen, D-Md., Mazie Hirono, D-Hawaii, Bob Menendez, D-N.J., Cory Booker, D-N.J., Dick Durbin, D-Ill., Michael Bennet, D-Colo., Jacky Rosen, D-Nev., Bernie Sanders, I-Vt., Edward J. Markey, D-Mass., Amy Klobuchar, D-Minn., Kirsten Gillibrand, D-N.Y., and Tim Kaine, D-Va.,

The letter was also signed by Representatives Pramila Jayapal, D-Wash., Don Beyer, D-Va., Dwight Evans, D-Pa., Suzanne Bonamici, D-Ore., Sharice L. Davids, D-Kans., Gerald E. Connolly, D-Va., Carolyn Bourdeaux, D-Ga., Eleanor Holmes Norton, D-District of Columbia, Bill Pascrell Jr., D-N.J, Susie Lee, D-Nev., Kweisi Mfume, D-Md., Hank Johnson, Jr., D-Ga., and Terri A. Sewell, D-Ala.

In the letter to Secretary Walsh, the senators and members of Congress wrote, “We strongly urge the Department to use the Unemployment Insurance Technology Modernization Act as a guide for any modernization efforts. The past year has proven that individual states attempting to modernize their system in isolation hasn’t yielded results, and that failure has contributed to unconscionable delays for millions of workers. A cohesive federal approach would not only ensure that every state has access to modern, efficient technology to meet their needs, but would also be far more cost effective than investing in 53 separate systems.”

Full text of the letter follows:

We are writing to request that as the Department of Labor (the Department) considers how to use the $2 billion appropriated for fraud prevention, equitable access, and timely payment in the American Rescue Plan, the Department should focus any technology and infrastructure modernization efforts on developing federal technology capabilities for unemployment insurance administration. The Unemployment Insurance Technology Modernization Act (S.490/H.R.1458), recently introduced by Senator Wyden in the Senate and Representative Horsford in the House of Representatives with 47 cosponsors between the Senate and House bills, can be used as a guide for this kind of robust modernization effort.

The Unemployment Insurance Technology Modernization Act calls for the Department to work with technology experts to develop, operate, and maintain a modular set of technology capabilities to modernize unemployment compensation technology. This type of system would allow the federal government to take on a role in ensuring smooth administration of unemployment programs while still allowing states to adapt the technology to meet their unique programmatic needs. The bill would require the Department to establish a Department of Labor Digital Services Team to assist states in implementation and to support federal technology needs. The updated system would help states ensure timely and accurate delivery of payments, make the program more accessible, and better identify fraudulent claims.

Importantly, the Unemployment Insurance Technology Modernization Act prioritizes user experience by requiring consultation and testing with claimants, employers, state workforce agency staff, and other users. It also requires the use of best practices in cybersecurity, procurement, and transparency, and includes several requirements for online claim filing systems to ensure that technology does not impede the ability of workers to access benefits. Finally, the legislation includes several provisions to ensure that automated decision systems or algorithms used as part of the technology do not result in systemic bias.

We strongly urge the Department to use the Unemployment Insurance Technology Modernization Act as a guide for any modernization efforts. The past year has proven that individual states attempting to modernize their system in isolation hasn’t yielded results, and that failure has contributed to unconscionable delays for millions of workers. A cohesive federal approach would not only ensure that every state has access to modern, efficient technology to meet their needs, but would also be far more cost effective than investing in 53 separate systems.

Thank you for your attention to this important matter. We request that you keep us updated on any technology modernization efforts that the Department undertakes.

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