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H.R. 5572: Help Federal Employees During Shutdowns Act

This bill, known as the Help Federal Employees During Shutdowns Act, proposes amendments to the Social Security Act regarding unemployment compensation for federal employees during government shutdowns. Here’s a summary of its main provisions:

Unemployment Compensation for Federal Employees

The bill mandates that states must provide unemployment benefits to certain federal employees during periods of government shutdowns. Specifically, it outlines the requirements that states must follow:

States must allow excepted federal employees—those who are still required to work during a shutdown—to apply for and receive unemployment compensation.
If an excepted employee receives a different pay during their unemployment period, they must repay the unemployment benefits to the state.
Any benefits not repaid will be considered an overpayment, and states will have the authority to recover those amounts.
Funds collected from repayments will go to the state's unemployment fund.

Federal Funding for State Compensation

The bill also stipulates a mechanism for federal support to states for these unemployment payments:

The Secretary of the Treasury is required to pay each state an amount equal to 100% of the unemployment compensation granted to excepted federal employees and any extra administrative costs incurred by the states in handling these payments.
Payments to states will be financed through the Unemployment Trust Fund established under federal law.

Definition of Excepted Federal Employee

According to the bill, an “excepted federal employee” refers to federal employees who are not receiving pay due to the government shutdown but are still performing essential work as categorized under the relevant federal provisions.

Implementation Timeline

This law is proposed to be applicable during fiscal years 2026 and 2027, focusing on situations where there is a lapse in appropriations.

Impact and Administration

The implementation of this bill will require states to adjust their unemployment compensation systems to comply with the new requirements regarding federal employees, and they will receive federal funds to support this adjustment.