Unemployment payments are safe, Labor says

The Labor Department found out this month that the nation’s unemployment insurance
systems, overseen by the federal government but run by states, are year 2000-ready.

People filing claims for unemployment benefits are assigned a benefit year, which means
that as of Jan. 4 unemployment insurance systems began handling dates and calculations
that extend into 2000, Clinton administration officials said late last month.

Labor Department Secretary Kitty Higgins and John Koskinen, chairman of the
President’s Council on Year 2000 Conversion, said at a briefing that there will be no
interruption in service.

Many systems, which process claims and collect taxes from employers, are more than 30
years old, Higgins said. “This is a case of the New Deal meeting the new
millennium,” she said.

Washington, D.C., the Virgin Islands and many states—Arizona, Connecticut,
Delaware, Hawaii, Illinois, Kansas, Louisiana, Maine, Massachusetts, Missouri, Montana,
New Hampshire, New Mexico and Vermont—were still finishing work on their systems as
late as November. Delaware, for example, does not expect to have its systems ready until
Jan. 1, 2000, Labor officials said.

Despite the last-minute work, Koskinen said, the benefits will be paid. “As a
general matter, the states are doing a good job,” he said. “The bottom-line
issue is that each state is able to run the system.”

Labor, however, reviewed states’ contingency plans to ensure payments can be made
if problems arise. The Virgin Islands’ contingency plan includes a provision that
staff members would write out checks by hand, said Grace Kilbane, director of the
Unemployment Insurance Service Program.

Three states have implemented a stopgap measure by hard coding the benefit year-end
date in applicants’ files. That is a short-term fix, Kilbane said, but those states
will have to recode the data for specific people’s records.

Koskinen said the unemployment program is a good example of federal-state cooperation
on readiness efforts. 

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