Employment and Training Administration
Washington, D. C. 20210






January 24, 1996




January 31, 1997











Unemployment Insurance Service




Unemployment Compensation for Federal Employees (UCFE)--Federal Employees Excepted from Furlough (UCFE-Excepted Employees Program)

  1. Purpose. To advise State Employment Security Agencies (SESAs) of the provisions of Section 312 of Title III of P.L. 102-94 (Continuing Resolution) concerning eligibility for UCFE for Federal civilian employees excepted from furlough and to provide instructions for implementing the legislation to ensure the timely and accurate payment of benefits under the UCFE-Excepted Employee Program (UCFE-EEP) and to provide fiscal and reporting instructions.

  2. References. Title III of P.L. 102-94 (H.R. 1643) enacted January 6, 1996; Subchapter I of chapter 85, title 5 of the United States Code (5 U.S.C. 8501 et seq.) (UCFE law); 20 CFR Part 609 (UCFE regulations); Secretary of Labor's Agreement with States to administer the UCFE and Unemployment Compensation for Ex-servicemembers (UCX) Programs.

  3. Background. Generally, whenever there is a lapse in appropriations to fund a Federal government agency, the agency must shut down activities and furlough its employees. However, there are exceptions that permit certain employees to remain working to continue selected functions. This includes those functions which the failure to perform would result in an imminent threat to the safety of human life or the protection of property, or where there is an implied authority by statute that the function should continue.

    Unless there are special provisions enacted after the furlough which retroactively provide a different outcome, furloughed employees may be eligible for UCFE under subchapter I of chapter 85 of title 5 of the United States Code. However, employees excepted from such furloughs would neither be compensated (because of the lapse in appropriations) nor eligible for UCFE because they perform services during the furlough period and would not be considered unemployed or otherwise eligible for benefits in accordance with State and Federal laws governing the payment of unemployment compensation.

    Section 312 of P.L. 102-94 changes and suspends some UCFE eligibility requirements, through September 30, 1996, to convey UCFE eligibility to employees excepted from furlough who are not being paid due to a lapse in appropriations. These changes have, in effect, created a sub-program of the regular UCFE program which will be known as the UCFE-Excepted Employees Program (UCFE-EEP).

    The purpose of the UCFE-EEP is to provide a weekly payment to unpaid workers who are excepted from furlough through September 30, 1996, similar to that paid under the UCFE program to furloughed individuals. To the extent possible these instructions so provide; however, in certain instances provisions have had to be changed or new provisions added in order to provide a weekly benefit amount to individuals not otherwise eligible for UCFE in the absence of Section 312.

    This document provides the Department's interpretation of the requirements of Section 312 and sets forth operating instructions prescribed by the Department to guide the States in implementing the provisions of the UCFE-EEP.

  4. Legal Requirements of Section 312 of P.L. 102-94.

    Section 312 provides--

    ELIGIBILITY FOR UNEMPLOYMENT COMPENSATION.--Notwithstanding any other provisions of law, beginning on January 2, 1996, any Federal employee who is excepted from furlough and is not being paid due to a lapse in appropriations shall be deemed to be totally separated from Federal service and eligible for unemployment compensation benefits under subchapter I of chapter 85 of title 5 of the United States Code with no waiting period for such eligibility to accrue.

    Section 8502(b) of 5 U.S.C. 8501 et seq., as implemented by 20 CFR 609.9(a) of the Secretary's regulations implementing the UCFE program, relative to State law applicability, provides that--

    Except where the result would be inconsistent with the provisions of the Act or this part or the procedures thereunder prescribed by the Department, the terms and conditions of the applicable State law which apply to claims for, and the payment of, State unemployment compensation shall apply to claims for, and the payment of, UCFE and claims for waiting period credit.

    To effectuate the provisions of Section 312 of P.L. 102-94, it is necessary to differ, in part, from the State and Federal laws normally governing the payment of UCFE. The exceptions to the laws and regulations necessitated by this section are described in section 7. below.

  5. Effective Dates. Section 312, the UCFE-EEP provisions, are effective beginning January 2, 1996 and remain in effect through the end of Federal Fiscal Year (FY) 1996 (September 30, 1996). However, it has been determined that only weeks of unemployment beginning on or after January 27, 1996 are compensable under the provisions of Section 312 as the Continuing Resolution provided for retroactive pay for excepted employees from December 16, 1995 through January 6, 1996.

    The Continuing Resolution which provided funding for Federal agencies that are without FY 1996 appropriations expires on January 26, 1996. In the absence of another Continuing Resolution or FY 1996 appropriations for Federal agencies not funded, the UCFE-EEP will become operational for UCFE-EEP claims filed for a week beginning on or after January 27, 1996 and thereafter as long as such conditions exist, through a week ending on or before September 30, 1996.

  6. Policy. The instructions in this document are issued to the States and the cooperating State agencies and constitute controlling guidance provided by the Department of Labor in its role as the principal in the UCFE program. As agents of the United States, the States and the cooperating State agencies may not vary from the operating instructions in this directive (or any subsequent or supplemental operating instructions) without the prior approval of the Department of Labor.

  7. The Department's Interpretation of the Requirements of Section 312 of P.L. 102-94 and Controlling Implementation Guidance.

    The Department's interpretation is that all State and Federal laws and regulations applicable to UCFE claims are applicable to UCFE-EEP claims, except where the result of such application would be inconsistent with the provisions of Section 312 of P.L. 102-94, as described below.

    Section 312 deems all excepted employees to be totally unemployed with respect to Federal service and eligible for unemployment compensation "under" the UCFE law for as long as such excepted status continues (but not beyond September 30, 1996) without having to serve any waiting week. Thus, even excepted employees having insufficient wages under the State law base period must be determined eligible, as well as excepted employees outside the United States (i.e., outside the States of the United States, District of Columbia, Puerto Rico and the Virgin Islands).

    1. Notwithstanding the requirements governing the determination of entitlement under the UCFE/State UI laws, a weekly benefit amount for UCFE-EEP claimants must be established for all Federal employees excepted from furlough who are not being paid due to a lapse in appropriations and who file such claims. (This includes excepted employees who would otherwise have insufficient base period employment and wages to establish monetary entitlement and excepted employees performing excepted services outside the United States). The weekly benefit amount so determined could potentially be paid through a week ending on or before September 30 1996. Therefore, the State law or Federal law maximum total benefit amount does not apply, since, potentially, an individual could receive UCFE-EEP for a number of weeks that exceed any State's maximum.

    2. Monetary entitlement for UCFE-EEP claims must be determined under the qualifying requirements for regular UCFE claims by the State in which the excepted employee's official duty station is located or deemed located for purposes of UCFE-EEP. To effect this requirement, all base period wages covered under any State or Federal law will be used in computing UCFE-EEP entitlement under the State law.

    3. The official duty station of an excepted employee who is performing services outside of the United States is deemed to be the State in which the headquarters of the Federal agency is located.

    4. Charges resulting from the payment of UCFE-EEP benefits must be charged to the Federal agency that designated the individual filing such claim as a Federal excepted employee.

    5. Section 312 of P.L. 102-94 does not apply to weeks of unemployment during which an individual is not in excepted employee status. Therefore, UCFE-EEP benefits are not payable for weeks during which the individual is not in excepted employee status. In order to receive benefits for such weeks, an individual must establish or have a separate claim in existence with a remaining balance under any of the other unemployment programs and meet all the eligibility conditions for the receipt of regular benefits.

    6. Section 312 prohibits the application of any State or Federal law requiring availability for work or active work search to UCFE-EEP claims, including weeks claimed during which the excepted employee performed no excepted services because of annual or sick leave.

    7. UCFE-EEP benefit eligibility will be determined in accordance with UCFE/UI requirements defining total unemployment and deductible earnings with respect to any services other than excepted Federal service performed by an excepted employee during a week claimed since Section 312 provides only that excepted service is treated as being totally unemployed.

    8. The pension deduction provisions of State law applies to benefits payable under the UCFE-EEP.

    9. Section 312 prohibits the application of any State or Federal law requiring an unpaid waiting week or period as a condition to receiving compensation for a week claimed by an excepted employee.

  8. UCFE-EEP Implementation Instructions Based on the Department's Interpretation of Section 312 of P.L. 102-94. Operating procedures to implement the requirements of Section 312 of P.L. 102-94 as prescribed by the Department are set forth below.

    1. UCFE-EEP Claims Filing Procedures. Most excepted employees will be performing full-time excepted services, during the weeks involved in the furlough period. Since most excepted employees will be working during the normal workday, SESAs should utilize methods for filing claims that will allow an excepted employee to remain at his/her job site.

      If a State agency waives regular reporting provisions with respect to excepted employees, no issue will arise with respect to 20 CFR 609.9.

    2. Initial Claims.

      (1) New. When a UCFE-EEP claim is filed, the State agency will issue a UCFE-EEP monetary determination based on all employment and wages during the base period applicable to the claim, without regard to separate monetary entitlement under any State or Federal law, including UCFE.

    3. Monetary Entitlement.

      (1) Excepted Employee has Sufficient Base Period Wages to Qualify. Monetary entitlement for UCFE-EEP claims will be determined by the State in which the excepted employee's official duty station is located or deemed located, based on all base period employment covered under any State or Federal law to establish the weekly benefit applicable to the UCFE-EEP claim.

      The Federal agency that designates the individual as an excepted employee has been instructed to furnish the State agency, of the State in which the excepted employee's official duty Station is located or deemed located, with the excepted employee's name, social security number, annual Federal salary, base period employment and wage information, home address, and effective date of excepted designation, within the first week of the Federal agency furlough, in accordance with the format and procedures established with the State agency prior to the beginning of such furlough. In the event of a delay of submittal of required information by such Federal agency or if it is deemed to be more expeditious, the SESA may utilize an affidavit to determine entitlement as outlined in ET Handbook 391, Chapter XIII, page XIII-2.

      To obtain information pertaining to employment and wages covered under another State's law, the State agency should follow its regular procedures to obtain information pertaining to such wages, including using the Request for Wage Transfer procedures (TC-IB4) (or the Interstate Inquiry, IBIQ, via the ICON). However, if the TC-IB4 is used, such use must not interfere with the processing of a regular claim and the employment and wages must be returned as unused.

      (2) Excepted Employee has Insufficient Base Period Wages to Qualify. If the excepted employee has insufficient employment and wages in the base period to qualify, the State agency will prorate the individual's annual salary, as reported by the Federal agency that designated the individual as a Federal excepted employee, in terms of quarters or weeks of wages in the base period, as appropriate, and issue a monetary determination, accordingly. In addition, the excepted worker's most recent earnings and leave statement will reflect the excepted employee's annual and weekly salary and may be utilized for the projection utilizing the affidavit procedure.

    4. UCFE-EEP Weeks Claimed. When an employee is designated as an excepted employee, even for a portion of a week, such individual shall be determined eligible for UCFE-EEP for the entire week. This includes excepted employees who may be on leave during an entire week or portion thereof.

    5. Overpayments. Should an appropriation or continuing resolution occur that retroactively provides for the payment of salary to excepted employees, State and Federal laws governing overpayments will need to be applied to weeks paid under the UCFE-EEP program (20 CFR 609.11).

    6. Relationship to Other Programs. Eligibility for UCFE-EEP has no effect on unemployment compensation payable under any other State or Federal law. Benefits under this program are payable only to an excepted employee. If an excepted employee's status changes for any week during the furlough period, UCFE-EEP benefits are not payable and the individual must establish eligibility under the regular requirements for such week.

  9. Instructions for Reporting UCFE-EEP Transactions on Form ETA 2112. Advances and expenditures under the Excepted Employee Program are to be reported on the ETA 2112 in the same manner as transactions for the regular UCFE program.

    Drawdowns: On line 23, include in columns C and E, amounts which have been received as advances or reimbursements from the Federal Employees Compensation Account (FECA) for payment of benefits to Federal civilians under provisions of the UCFE-EEP. Disbursements: On line 43, include in columns C and F, net benefit payments made to Federal civilians under the UCFE-EEP with funds received from the FECA.

  10. Fiscal Requirements. All UCFE-EEP paid to an excepted employee during the furlough period will be billed to the Federal agency placing the individual in excepted employee status. Administrative costs for the workload associated with UCFE-EEP claims will be paid from contingency funds at the Fiscal Year 1996 allocated MPU level.

  11. Reporting Instructions. While counts of UCFE-EEP claims will be incorporated in the existing UCFE reporting, separate counts for three items of data are required to track the UCFE-EEP claimants. Separate counts should be reported weekly on: (a) the number of individuals who file new and additional initial claims for UCFE-EEP benefits; (b) the number of weeks of UCFE-EEP benefits that were compensated during the report week; and (c) the amount of UCFE-EEP benefits paid for those weeks.

    Because this should be a temporary situation, this data is to be reported electronically on the Quick Response Report. The Quick Response Report is a blank report found in the UI Required Reports (UIRR) electronic entry system. Once in the UIRR system, "Access Reports" should be chosen, followed by "Special Programs" and then "arQuick Response Report". This is a blank report where 12 unlabeled items may be reported. Items 1 through 3 are already being used for Self Employment data reporting in those few States which have that program. Therefore, items 6, 7 and 8 will be used for UCFE-Excepted Employee claimant data reporting.

    Fill in the report date item using the Saturday week ending date of the week in which the activity occurred. Report in item 6 the total number of initial claims, both new and additional, filed by UCFE-EEP claimants during the report week. Report in item 7 the total number of weeks compensated for UCFE-EEP claimants during the report week. Report in item 8 the total amount of benefits paid for the weeks reported in item 7. Please note in comments that the data is for UCFE-EEP claimants. No edits are available on the Quick Response Report.

    This report will be due the Friday following the week in which the activity took place. Reporting will continue as long as there is activity. These reporting requirements have been submitted to the Office of Management and Budget (OMB) for approval under the Paperwork Reduction Act of 1995. States are not required to report until that approval is received. When the approval is received, States will be notified and provided the OMB approval number and expiration date.

  12. Action Required.

    1. Department of Labor. The Department of Labor has instructed affected Federal agencies, directly and through the Office of Personnel Management (OPM), to furnish SESAs with the list of each agency's excepted employees, including the employee's home address, Social Security Number, annual Federal salary rate, effective date of designation, and base period qualifying wage and employment information. Also, Federal agencies are being instructed to furnish an on-going list of employee changes to and from excepted employee status if applicable. Once the State agency has been provided with all of the information pertaining to an excepted employee, the Federal agency will furnish only the pertinent information for changes.

      In addition, Federal agencies are being advised to establish a liaison person(s) to work with each SESA in administering the UCFE program for excepted workers. This may be the same person already assigned UCFE program liaison responsibilities.

      To the extent possible, the Department of Labor National Office and Regional Offices will work with the affected Federal agencies to provide information to the SESAs that will expedite and administratively ease the establishment of UCFE-EEP by the SESAs.

    2. State Agencies. SESA Administrators shall:

      (1) Provide the above guidance in this UIPL to appropriate staff.

      (2) Ensure that appropriate staff perform all actions necessary to provide for the proper payment of UCFE-EEP to excepted employees for a program that could begin as early as January 27, 1996. This will include--

      (A) When contacted by the Federal agency liaison, coordinating with such individual(s) actions necessary to receive the information, described in section a. above and any other actions determined necessary by the State agency, that will enable UCFE-EEP claims to be processed. The claims filing procedures that excepted employees are to follow should also be explained to the Federal agency;

      (B) Establishing UCFE-EEP claims for excepted employees in a prompt manner, minimizing any in-person reporting by such employees. For example, the State could send appropriate claims forms to individuals identified by the Federal agency as excepted employees in order for such individuals to file claims;

      (C) Promptly determining monetary eligibility for UCFE-EEP claims based on base period qualifying employment and earnings or the annual salary figure supplied by the Federal agency and/or the earnings and leave statement furnished by the applicant through the use of the ES-935 affidavit process in the absence of base period wages reported by the Federal agency;

      (D) Making prompt payment of UCFE-EEP benefits to excepted employees including payment for what would otherwise be a waiting period;

      (E) Developing any other procedures with Federal agencies that will ease administration of this special program;

      (F) Adhering to the fiscal guidelines set forth in this document and furnishing required reports in a timely manner.

  13. Inquiries. Questions should be directed to the appropriate Regional Office.