Article: Ohio slices seniors’ jobless benefits

"Ohio is the only state that reduces jobless benefits by 100 percent against Social Security. As a result, unemployment compensation for Social Security recipients often is cut to nothing."

Social Security checks cut by value of unemployment

Sunday, January 22, 2006

Catherine Candisky

THE COLUMBUS DISPATCH

At 77, Donald A. Hyatt Sr. is still working because he likes to keep busy and needs the money to supplement his Social Security check.

Last year, when his company announced it would lay off workers, Hyatt was stunned to learn he was not eligible for unemployment benefits.

It turns out that thousands of older Ohioans do not qualify for benefits if they lose their job.

Ohio is the only state that reduces jobless benefits by 100 percent against Social Security. As a result, unemployment compensation for Social Security recipients often is cut to nothing.

"I’ve been working here 25 years," said Hyatt, a machinist at L.B. Heating and Cooling in Mount Vernon.

"Why can’t an elderly person collect unemployment if his company is paying into it? I think it’s a scam."

With more older Ohioans in the work force out of necessity, the issue has become a top concern of advocates for seniors and the jobless, including AARP Ohio and Policy Matters Ohio, a Clevelandbased nonprofit research organization.

Ohio’s Unemployment Compensation Advisory Council is reviewing the matter, and a Republican state lawmaker is pushing to end Ohio’s "offset" of Social Security.

Rep. William J. Seitz, Cincinnati, hopes "to help our senior citizens who are rudely awakened to find their Social Security benefits are offset against their unemployment comp benefits when they have to get a second job merely because Social Security isn’t enough."

The way it works in Ohio:

• If you’re entitled to $100 a week in unemployment benefits and $200 a week in Social Security, you get no unemployment benefits.

• If you’re entitled to $200 a week in unemployment benefits and $150 a week in Social Security, your unemployment benefits are reduced to $50.

Zach Schiller of Policy Matters says the practice is unfair because the workers paid into the Social Security system and their employers paid into the state’s unemployment fund.

"A lot of retirees are working because they need to supplement their retirement income," said AARP Ohio spokeswoman Kathy Keller.

Anita Wilhelm, a widow from Miamitown, had been working 30 years for a wholesale distributor when she was let go in 2003 at age 70.

"I was continuing to work because my husband passed away, and Social Security is fine, but it’s not enough," said Wilhelm, now 72.

"I realize I didn’t pay, but the company paid and that’s what it’s for. The gentleman from unemployment told me they needed to take care of the younger workers."

Keller said many others being denied benefits took early retirement — usually at 62 — and have started new careers as they receive lower retirement and Social Security benefits.

The Ohio Department of Job and Family Services estimates 2,360 unemployment claims are made each year by those collecting Social Security. To extend jobless benefits to them would cost about $12 million annually.

The money would come from Ohio’s unemployment trust fund. The balance, currently at $446 million, is expected to dip to about $300 million in April before rebuilding.

Agency spokesman Jon Allen said the department does not oppose eliminating the offset.

But opinions differ among the co-chairmen of Ohio’s Unemployment Compensation Advisory Council, which makes recommendations to the General Assembly. The council is expected to discuss the issue at its next meeting, Feb. 8.

"We understand that it’s a problem, and what we’re trying to do is determine what amount of an offset we should have," said council co-chairman William A. Burga, president of the Ohio AFL-CIO.

But co-chairman Andrew E. Doehrel, president of the Ohio Chamber of Commerce, opposes extending unemployment benefits to Social Security recipients.

"If you’re going to start draining the system," he said, "you will put benefits at risk for everyone."

Unemployment benefits, Doehrel said, "were designed to be a bridge to help someone when they don’t have other resources. . . . It’s not meant to cure anything other than that."

He also cautioned that reducing or eliminating the Social Security offset would make it impossible to implement other proposals, such as one to reduce the earnings requirement. In Ohio, workers must have earned at least $193 a week to be eligible for unemployment benefits. Some argue it should be lower so more workers can qualify.

Policy Matters says that Ohio is the only state that offsets 100 percent of Social Security benefits against unemployment benefits. Eight states offset 50 percent.