System Punishes Strong Work Ethic

[Chicopee John]

Long-Term Unemployed Finding It Sometimes Pays Better Not To Work

 

Dominic Caciopoli of Naugatuck is a victim of a quirk in a federal law covering unemployment benefits — because he found temp work after being on unemployment, his benefits were recalculated based on that temporary income, leaving him with less than half of his original benefit.

 

By MARA LEE The Hartford Courant March 10, 2010

 

 

 

Ten months after Mark Krawiec lost his road construction job, he eagerly took a six-week assignment on Route 2 that paid just over $1,000 a week.

 

Big mistake.

 

"By working and knowing it wasn't steady, and it wasn't going to last long, I cut my own throat," said Krawiec, 60, of Plainville.

 

That's because in January 2010, the state Department of Labor reset his benefits based on the work he did in 2009. His weekly check dropped from $544 to $254.

 

Krawiec had no idea that accepting work would slash his unemployment pay this way. Hardly anyone does.

 

It's a quirk in the federal rules that's most likely hurting thousands of Connecticut residents who have been searching for work for more than a year, many from the hard-hit construction trades.

 

In the first year of unemployment, the size of the benefit check is based on your old salary. You can go right back on unemployment after a temp job, and nothing changes. But federal law requires states to recalculate benefits for the second year. If you worked a few days or a few months, the second year's checks will be based on that lower earnings total.

 

People who went to work would have been have been better off staying at home if their unemployment continues for months in the new year. Some people have had their benefits cut by more than $400 a week.

 

If Krawiec had not gone back to work, his benefits would have stayed at $544 through July of this year.

 

Construction workers are especially likely to face the cuts, because that sector was hit early, and trades workers are accustomed to taking project-based work if they can't find a regular opening.

 

In Connecticut, 25 percent of construction jobs have disappeared since June 2007.

 

 

Thankful For Work

 

Dominic Caciopoli typically had two months of unemployment in the winter during a lifetime of working in construction.

 

In November 2008, his job driving a grading truck was eliminated. He was unemployed until July 2009, when he had a month of work helping build a salt shed along the Merritt Parkway. He worked seven days a week, and made a little over $8,000.

 

"I was thankful just to get back to work," said Caciopoli, 46. Being unemployed for more than six months "works on your self-esteem. It affects your relationships. Your self-worth. You feel like you're not contributing to society."

 

In January, he learned that his unemployment would be cut because of his temporary work. It wasn't dramatic — $85 a week, to $474 — but it was the final straw.

 

"We're not just trying to ride the system. Then to punish us because we did that?" Caciopoli drew his hand across his throat. "I've had it."

 

Caciopoli's wife, Barbara, has a rare neurological disease that left her bedridden for a year before spinal surgery. She can't work full time, and earns less than $20,000 a year as an office temp. Even with help from his son Stephen, 23, who also works in construction, Caciopoli had to liquidate $39,000 in retirement savings — losing $10,000 to taxes and penalties — just to stay current on his $1,100 monthly mortgage and other bills.

 

"I've tried so hard to stay and make this happen," he said, his voice breaking.

 

When he saw that the state was not putting out bids for road construction projects in 2010 as early in the year as it used to, he decided to sell his 1,100-square-foot house in Naugatuck before his credit was ruined by missing payments. He and his wife are moving this weekend, to live with friends in Edinburg, N.Y. His son will live with a friend's family for a while.

 

"To have to separate from your family is very hard, emotionally," Caciopoli said, tears welling in his eyes.

 

Doing The Right Thing

 

The labor department doesn't track how many people's benefits have been cut because of this rule. In the early '90s recession, a study for the U.S. Department of Labor estimated that 5 percent to 7 percent of benefits were at risk. Congress changed the law to eliminate the penalty in 1992.

 

Based on that study, it's probable that several thousand Connecticut residents have been affected — especially because this recession has been marked by long-term unemployment, and most temp jobs have not yet turned into permanent positions. There are about 170,000 unemployed workers in the state, although not all receive benefits.

 

Frank Laviero, 49, worked on the same paving job as Krawiec last year, and had intermittent work from August to December, earning $11,000.

 

He had been on unemployment from January 2009 until that job began in August.

 

This January, when the state recalculated his benefits, his weekly check dropped from more than $500 to just $122.

 

"How am I supposed to live? It's not right what they're doing," he said.

 

Laviero rents an apartment on the first floor of a Cape Cod-style house in Plainville for $800 a month. He hasn't been able to pay for the past two months, but his landlord has allowed him to stay and says he can catch up on back rent when he gets work again.

 

If it wasn't for that kindness, "I'd be out on the street," he said.

 

He said the labor department worker who gave him the news said he'd get "a little decrease." When he protested in shock that a cut of $400 a week was not a little decrease, she admitted: "You're better off not going to work."

 

He said: "That's so stupid! Why are you penalizing people that are trying to help themselves?"

 

Caciopoli said that Congress needs to change the unemployment benefits law so that people who take temporary work aren't penalized.

 

Both of Connecticut's senators have signed on to an effort by Rhode Island Sen. Jack Reed to fix the rule. Reed, a Democrat, has been trying to make the fix since the beginning of the year, but he needs Republican support to get it passed.

 

U.S. Sen. Christopher Dodd, D-Conn., in a prepared statement, called for a fix to the "glitch in our current employment laws," and said the penalty is a serious disincentive for people to take part-time or temporary work if they think it's possible that it could be more than a year before they get full-time, steady work. "This needs to be fixed so that workers in Connecticut and across the country can collect the benefits they've earned and so desperately need," he said.

 

Attorney General Richard Blumenthal, who is running for Dodd's seat, said the policy is penny-wise and pound-foolish, as well as unfair to people who are trying "to do the right thing." He said at the very least, Connecticut should be mobilizing with other states to lobby Congress to make the fix.

 

"These issues have real-life consequences," he said.

 

Caciopoli is angry that Republicans and Democrats can't seem to cooperate to address the recession. "Congress needs to start working together and really starting thinking about the American people. I suggest a couple of them go live with a family that's going through this for two weeks, and then see if we have the bickering. Take off your suit and tie, put on your sweat pants and live this."

 

Copyright © 2010, The Hartford Courant

 

[calfoxwc]

Well, he should be far more angry at the Dems - they control the wh and congress.

 

And they are doing the opposite of what would have worked, and has worked in the past.

 

Penalized for working a short temp job.

 

Typical gov red tape - counter productive, ...

[Mr. T]

Has anyone calculated the amount of losses in revenue through income taxes lost due to so many people who are unemployed?

 

The government has the ideal business, they get paid for producing social programs and creating laws to strap those who pay them their hard earned dollars.

[calfoxwc]

Well, Heck has no comment. He's got nothin but flimsy doofus replies, no substance.

[Pumpkin Eater]

Well, Heck has no comment. He's got nothin but flimsy doofus replies, no substance.

 

What is he supposed to say? Clearly this is a fcuked up glitch in the system that needs to be fixed. It's been this way for a long time. It's now coming to the forefront because the economy is the worst it's been since the '30's, typically people found work with much shorter period between jobs in other recessions.

 

This glitch doesn't really have anything to do with anything else, it's a glitch and that's it.

[calfoxwc]

Well, You commented fine ! GGG

 

The trouble is, years ago, people could get jobs in factories,

 

the railroads, bakeries, mom and pop stores. etc....

 

Now, there are far, far fewer of those jobs, and far far more people looking.

 

When my Dad got out of the Navy, he was going to electronics school..

 

at one point, he worked at a railroad roundhouse.

 

Yes, it is a glitch, but it's been a glitch for a long, long time.

 

Just wait til gov run health care has glitches, and they can't possibly afford

 

to resolve them.

[Mr. T]

My biggest gripe about temporary unemployment benefits are ....

 

example; a man gets temporary layed off here in NC while losing pay for 3 days (he works 2 days)the state kicks in $101. per day(max), meanwhile the same man is still losing $405. per week but is only allowed to earn another $115. per week to make up the difference or they will lose their benefits.

 

He is still out $290 bucks per week if he can find part time work elsewhere.