May FEMA administrative funds provided to states, territories and the District of Columbia to administer the supplemental lost wages assistance program be used to cover all staff costs?

Unemployment Insurance (UI) employees are federally funded by the Department of Labor (DOL). The DOL’s funding may not be used to administer supplemental lost wages assistance.

As such, the state, territory and the District of Columbia may utilize the funding provided by FEMA for administrative costs under the supplemental lost wages assistance grant for employees’ regular and overtime hours to deliver supplemental lost wages assistance. Example: 40 hours per week is normally paid with 100% UI funding. The employee is now spending 50% of her time on supplemental lost wages assistance. So long as the state, territory and the District of Columbia does not charge 50% of the employee’s cost to the UI administrative grant for the period of time that the employee is supporting supplemental lost wages assistance, the state/territory can use FEMA funding for administrative costs to pay the employee’s costs for administering supplemental lost wages payments.

States, territories and the District of Columbia must account for the time charged and demonstrate a proportional allocation of staff costs to facilitate the delivery of the program so as to avoid any improper duplication of charging. As a general rule, the state, territory and the District of Columbia may submit charges to administer supplemental lost wages assistance for all employee overtime and any portion of the employee’s regular time costs not also paid for with other federal funds.