This bill, introduced by Senator Lankford, aims to reduce fraud in the unemployment insurance system by changing when benefits are paid to people whose eligibility is being challenged. Currently, states must continue paying unemployment benefits while a claimant appeals an ineligibility determination. Under this bill, states would be required to withhold those payments until the appeal is resolved and the person is deemed eligible, then pay any owed benefits within five business days. States have up to two years to implement this change. The bill also directs the Department of Labor and its Inspector General to develop guidance within 270 days on best practices for denying unemployment benefits to initial applicants and declaring existing claimants ineligible, with particular focus on identifying fraud, nonresponse, and other risk factors. This guidance must be updated at least every three years to help states more effectively screen out fraudulent claims.
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