Will the $600 unemployment benefit be extended? Here is what may happen

The $600-a-week federal unemployment benefit is scheduled to end this week, but for those who are depending on the money to make ends meet during the fourth month of the COVID-19 pandemic, there may be a glimmer of hope.

Senate Republicans and the White House are signaling that there could be a short-term extension of the Pandemic Unemployment Assistance legislation and it could be passed this week, keeping benefits uninterrupted for the time being, Bloomberg News is reporting.

The money, which has been distributed over and above state unemployment benefits to help those who lost their jobs due to the COVID-19 pandemic, was part of a stimulus package passed by Congress in March and signed into law by President Donald Trump.

An extension of the $600 benefit, or something that would take its place, is being considered by the Senate as the virus has caused some states to pull back on plans to open up businesses.

To prevent a lapse in benefits while a potential fourth stimulus bill debate ensues, the White House and Senate Republican leaders suggested Wednesday that a short-term extension of the Pandemic Unemployment Assistance be passed this week, according to Bloomberg. It's unclear if a short-term extension would be of the full $600 weekly benefit, or how long benefits would be paid out.

Sen. Rob Portman, R-Ohio, confirmed to reporters Wednesday that an extension of federal unemployment benefits was being considered, saying he was not sure what that would entail as many Republicans were not in favor of a $600 payment from the start.

“Most of us agree that there needs to be something in its place and most of us also agree that the $600 flat amount for every worker is not a good idea going forward because it’s a disincentive to get back to work,” Portman said in a Bloomberg Television interview on Wednesday. “The better solution would be to get our act together and get something by the end of next week.”

Portman is one of several senators who have proposed bills aimed at getting Americans back to work. His plan would see a back-to-work bonus of $450 a week for Americans who return to their jobs.

Many Republicans have said that the $600 payment has disincentivized workers from returning to their jobs. It’s estimated that the $600 supplement gave two-thirds of laid-off workers more money from their unemployment benefits than they made from their jobs.

Those who want to extend the $600-a-week payment until after the first of 2021 could face stiff opposition in the GOP-led Senate, where there has been little support for continuing the benefit at that level.

Senate Democrats have voiced support for the House bill that would extend unemployment benefits into 2021 and have proposed other measures to keep the federal money flowing to the program.

Sen. Ron Wyden, D-Oregon, said he wants to see unemployment benefits expanded and included in a fourth stimulus bill.

“We’re not going to go for some sort of let’s-duck-this-some-more strategy,” Wyden, the top Democrat on the Senate Finance Committee, said Wednesday about a possible Republican plan for a short-term extension.

A proposal, introduced by Wyden and Senate Minority Leader Chuck Schumer, D-New York, would extend the $600 unemployment benefit “until a state’s three-month average total unemployment level falls below 11%.”

“Once the unemployment rate falls below 11%, the benefit amount reduces by $100 for each percentage point decrease in a state’s unemployment rate,” according to the proposed bill.

If an extension or a stimulus bill isn’t passed by Friday, 17.3 million Americans currently receiving unemployment benefits will see the $600-per-week federal unemployment benefits end.

Those who are getting the federal money may be in for a disappointing surprise as payments of the federal funds will be ending this week instead of the next week as many thought.

The benefits, which were set to end on July 31, will be cut off at the end of this week due to how states have set up their unemployment payment systems.

States use a system of “benefit weeks” to disperse unemployment payments, meaning benefit checks are paid for full weeks ending on a Saturday or Sunday. Checks are for a set amount and are paid for a week’s period. They are not prorated for a partial week.

The federal unemployment benefits plan is set to end on July 31, which falls on a Friday.

While an extension is being debated, other options to continue some form of aid are being considered.

Two proposals being floated now would include a continuation of payments, though it may not be a $600-per-week check.

Another proposal, supported by Treasury Secretary Steven Mnuchin and Trump would cap benefits at the amount equal to the unemployed person’s prior wages.

“Enhanced unemployment is intended for people who don’t have jobs, particularly in industries that are harder to rebound, so we will not be doing it in the same way,” Mnuchin said on CNBC on Thursday

While House Democrats point to the Health and Economic Recovery Omnibus Emergency Solutions (HEROS) Act that puts forward calls for additional federal benefits that are tied to state unemployment rates, Senate Majority Leader Mitch McConnell, R-Kentucky, says the bill is just a “wish-list,” and its chances of passing the Senate as-is are nil.