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Letter to Labor Secretary Walsh - Democrats Outline Unemployment Insurance Technology Priorities for American Rescue Plan Funds


Dear Secretary Walsh:

We are writing to request that as the Department of Labor (the Department) considers how to use the $2 billion appropriated for fraud prevention, equitable access, and timely payment in the American Rescue Plan, the Department should focus any technology and infrastructure modernization efforts on developing federal technology capabilities for unemployment insurance administration. The Unemployment Insurance Technology Modernization Act (S.490/H.R.1458), recently introduced by Senator Wyden in the Senate and Representative Horsford in the House of Representatives with 47 cosponsors between the Senate and House bills, can be used as a guide for this kind of robust modernization effort.
The Unemployment Insurance Technology Modernization Act calls for the Department to work with technology experts to develop, operate, and maintain a modular set of technology capabilities to modernize unemployment compensation technology. This type of system would allow the federal government to take on a role in ensuring smooth administration of unemployment programs while still allowing states to adapt the technology to meet their unique programmatic needs. The bill would require the Department to establish a Department of Labor Digital Services Team to assist states in implementation and to support federal technology needs. The updated system would help states ensure timely and accurate delivery of payments, make the program more accessible, and better identify fraudulent claims.
Importantly, the Unemployment Insurance Technology Modernization Act prioritizes user experience by requiring consultation and testing with claimants, employers, state workforce agency staff, and other users. It also requires the use of best practices in cybersecurity, procurement, and transparency, and includes several requirements for online claim filing systems to ensure that technology does not impede the ability of workers to access benefits. Finally, the legislation includes several provisions to ensure that automated decision systems or algorithms used as part of the technology do not result in systemic bias.
We strongly urge the Department to use the Unemployment Insurance Technology Modernization Act as a guide for any modernization efforts. The past year has proven that individual states attempting to modernize their system in isolation hasn't yielded results, and that failure has contributed to unconscionable delays for millions of workers. A cohesive federal approach would not only ensure that every state has access to modern, efficient technology to meet their needs, but would also be far more cost effective than investing in 53 separate systems.
Thank you for your attention to this important matter. We request that you keep us updated on any technology modernization efforts that the Department undertakes.