Summer unemployment benefits for hourly school workers bring opportunities, costs

School cafeterias don’t staff themselves — they need nutrition workers to run them. Buses need reliable, experienced drivers to take kids safely to school. Students and teachers depend on support from paraprofessionals to aid learning in essential ways.

These workers all fall into an employment category of non-licensed hourly paid workers known as education support professionals (ESP). School districts nationwide rely heavily on them and other ESPs, such as custodians and clerical staff, for daily operations.

Despite them being indispensable to schools, until recently, non-salaried ESPs were usually not eligible to receive full or partial unemployment benefits from the state when school was out of session, even if they were unable to find other equivalent paid work.

However, a recent change in law means that eligible ESPs can now apply for and receive unemployment benefits in the same way that other workers can.

Starting May 28, 2023, Minnesota became the first state to offer between-term unemployment benefits to non-licensed hourly school workers whose jobs ended with the school year and who expect that a position will be available for them at the start of the next school year.

This new law is bringing both opportunities and costs to Eden Prairie Schools.

Being able to receive summer unemployment benefits could help provide an economic cushion to Eden Prairie’s eligible ESPs during summer breaks, said Thomas May, EP Schools’ executive director of human resources.

May said EP Schools has about 500 ESPs who fit into this category, including paraprofessionals, clerical, nutrition services, transportation, custodial, and other non-instructional staff.

He said he hopes that whether taken in full or in part, these benefits will “provide a great benefit to our staff who do not receive compensation in the summer.”

Even those who still work for the district in the summer might not be able to get the same hours or days as they do when school is in session, May said. These benefits could help bridge the gap for workers on a reduced schedule.

Giving hourly school workers access to this economic support is also hoped to aid the district’s ability to ensure their return in the fall of the next school year, May added.

How funding will work

While there are many positives for both employees and districts, this new law does come with a cost. While the state is providing initial funding, the district will eventually have to pay extra for unemployment insurance (UI) to fund this benefit.

When the Minnesota Legislature passed the law last May, school districts across the state asked for help covering their tax contributions to fund between term UI.

The state agreed to provide a one-time, $135 million pool of capped unemployment reimbursement aid to be shared between eligible local education agencies, including public school districts, charter schools, cooperative units, and intermediates.

This funding will be available to schools until June 20, 2027, or until the funding runs out. Perpich Center for Arts Education and Minnesota State Academies will receive separate funding.

The fund was sufficient to cover eligible summer 2023 UI costs. In November, the Minnesota School Boards Association (MSBA) said a survey of districts indicated that about $40 million of the $135 million had been spent so far.

Matt Hippen, EP Schools’ director of finance, said the district reported to the state that it spent $466,000 to cover benefits claims made by 174 EP Schools employees last summer.

It is expected that there will still be money in the state’s fund to help ease between term UI contributions in the summer of 2024 and potentially beyond. However, Hippen said it was still unclear how and when the money would be allocated and distributed, and the district was not assuming it would be fully reimbursed in future summers.

Once the state money is depleted, school districts still must continue to allow and fund between UI costs themselves. These costs will not be eligible for levy reimbursement.

Hippen said that the potential impact of this new, upcoming expense on the district’s finances is still unclear. However, May said MSBA advised him to expect the total cost to rise as more employees learn about these benefits and apply to receive them.

Hippen said EP Schools has added summer UI cost projections to its financial forecast model, and the model will be continuously adjusted as more becomes known. As with other state mandates, May said, “We will navigate that, and we will get that figured out.”

How to apply

Eligible staff can apply for the between-term Unemployment Insurance Program through Minnesota’s Department of Education and Economic Development.

In order to be eligible, applicants must:

• Have sufficient earnings in their base period (the most recent one-year period — four completed calendar quarters — the government uses to calculate weekly benefits).
• Be legally authorized to work in the U.S.
• Be unemployed or working substantially reduced hours through no fault of their own.
• Actively seek suitable employment each week.
• Be able and willing to begin suitable work without delay when offered.

Education Minnesota’s website has a step-by-step tutorial and Q&A that explain how between-term unemployment benefits work and how to apply for them. A recording of a virtual town hall explaining the benefits can be accessed here.