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States accidentally overpaid thousands of workers over the spring and summer during a rush to get relief to unemployed and idled Americans. Now they want the money back, the Wall Street Journal reported. Even though the funds have long since been spent and many of those workers continue to struggle with the coronavirus pandemic’s economic fallout, people across multiple states are being asked to repay thousands of dollars or are having their current benefits cut to make up the difference. Individuals themselves often have no idea they are being overpaid, in part because formulas for unemployment checks can be hard to decipher. Many also waited weeks to start receiving benefits, and say they believed that large checks were simply the back payments they were owed because of delays. For many people, the repayment obligations hinge on a fine-print detail in the March CARES Act, which authorized the new programs. States can waive recovery of overpayments for most unemployment insurance when there is no fraud involved, but the Pandemic Unemployment Assistance program follows a different set of rules. It is administered as a form of disaster relief, and the statute that guides it blocks states from forgiving the debts. Adding to the complexity, the PUA program gave new categories of workers—including gig workers and the self-employed—access to unemployment checks. But state unemployment systems were designed to calculate benefits based on traditional jobs, employer records, W-2 tax documents and verifying income with pay stubs. Re-engineering the systems to account for far more complicated self-employment income was bound to create problems, experts say.

House Speaker Nancy Pelosi (D-Calif.) said yesterday that there is no deal yet on a new coronavirus relief package as Democrats wait to see whether the Trump administration will agree to terms, the Washington Post reported. Pelosi spoke a day after President Trump, hospitalized with covid-19, tweeted his support for more stimulus legislation, writing, “WORK TOGETHER AND GET IT DONE.” Pelosi was asked if the president’s comment suggested that a deal was in hand or close. “No, it means that we want to see that they will agree on what we need to do to crush the virus so that we can open the economy and open our schools safely,” Pelosi said. She did not elaborate, but had said on Friday that agreeing on language on how to spend new testing and tracing money remained a sticking point. Democrats have pushed for months for a national testing strategy that the administration never produced. Pelosi also suggested Friday that Trump’s positive diagnosis could change the dynamic and help speed an agreement in the new round of economic relief talks that restarted about a week ago between her and Treasury Secretary Steven Mnuchin. Negotiations continued over the weekend, but there was little sign a breakthrough would be imminent. Pelosi asked airlines on Friday to hold off on impending furloughs of tens of thousands of workers pending a deal. United and American, the major carriers that have threatened furloughs, have said they can reverse them if there is a deal to extend payroll support for the industry that just expired, but Congress must act fast.

House Democrats passed a $2.2 trillion coronavirus relief bill Thursday over intense GOP opposition, even as bipartisan talks between House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued, the Washington Post, reported. The legislation, which passed 214 to 207, has no chance of advancing in the Republican-led Senate and is opposed by the White House. But it’s been nearly five months since the House passed the $3.4 trillion HEROES Act, which also went nowhere in the Senate. So with the House set to recess Friday through the election, Pelosi (D-Calif.) acceded to demands from moderate Democrats who wanted to take new action to address the toll of the coronavirus pandemic before heading home to campaign for reelection. But even as the highly partisan debate was underway on the House floor, behind the scenes Pelosi was, in fact, working to try to strike a bipartisan deal with Mnuchin. The two spent the day trading phone calls and offers, and although Pelosi said they remained far apart on some issues, the negotiations were continuing and appeared to be getting into some granular details, such as specific language on a coronavirus testing plan, and whether and at what level Republicans could agree to a refundable child tax credit sought by Democrats. Read more. 

In related news, the latest White House coronavirus relief offer, with a $1.6 trillion price tag, received a cool reception yesterday from congressional Republicans, The Hill reported. The new offer from Treasury Secretary Steven Mnuchin, which exceeds the original $1.1 trillion Senate GOP package and the $1.5 trillion the White House signaled it could support last month, was made as part of renewed talks this week with Democratic leaders. But Republicans, including influential chairmen and members of leadership, are warning they can't support it, creating another potential obstacle for negotiators trying to strike a deal on emergency COVID-19 aid after nearly two months of stalemate. Asked about the prospect of supporting a $1.6 trillion measure, Senate Finance Committee Chairman Chuck Grassley (R-Iowa) was direct: "No." Rep. Kevin Brady of Texas, the top Republican on the House Ways and Means Committee, also appeared unsure he could back a bill with that dollar amount by criticizing the inclusion of a $400 per week federal unemployment benefit. Read more.

Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi (D-Calif.) failed to strike a deal for a new stimulus package during a 90-minute meeting Wednesday but said they will continue negotiating, with time running out until the election, Bloomberg News reported. “We still don’t have an agreement, we still have more work to do,” Mnuchin told reporters, adding, “We’ve made progress in a lot of areas.” Pelosi said that she and Mnuchin were seeking some “further clarification” on each others’ positions and that “our conversations will continue.” The speaker said that the House will go forward with a vote Wednesday night on a $2.2 trillion Democratic stimulus plan she described as “our proffer” in negotiations with the White House. That legislation is less than the $3.4 trillion bill Democrats passed in May, but still more than Republicans have said they could accept. Senate Majority Leader Mitch McConnell (R-Ky.) said earlier that it was rife with “poison pills” that have nothing to do with pandemic relief. Read more.

In related news, The Trump administration has proposed including a $20 billion extension in aid for the battered airline industry in a new stimulus proposal to House Democrats worth over $1.5 trillion, White House chief of staff Mark Meadows said yesterday. “There’s $20 billion in the most recent proposal for the airlines that would give them a six month extension,” said Meadows. Meadows declined to provide the total value of the White House’s latest proposal but said the figure is “certainly above the $1.5 trillion that has been articulated to date.” “As you get above $1.5 trillion, it gets extremely difficult to justify based on the facts,” he cautioned, explicitly stating that $2 trillion was too much. “If it starts with a 2, it’s going to be a real problem,” he added. Read more.

U.S. airlines said that they will begin furloughing tens of thousands of employees today after congressional leaders and the Trump administration failed to reach a deal on a coronavirus relief package, the Washington Post reported. In making the announcements yesterday, the carriers left open the possibility that workers could be called back if a deal is reached in the next few days. American Airlines was the first to announce its plans, saying that it would begin furloughing 19,000 employees. Chief executive Doug Parker said in a letter to employees that he spoke with Treasury Secretary Steven Mnuchin late Wednesday about the status of his negotiations with House Speaker Nancy Pelosi (D-Calif.) but came away with no guarantee a deal would be reached. Parker wrote that the airline had to begin the furloughs but that he committed to Mnuchin he would recall employees if a deal is reached. A similar message came from United, which said it will be forced to furlough roughly 13,000 employees starting today.

Workers dismissed by bankrupt Art Van Furniture Inc. are demanding that private equity owner Thomas H. Lee Partners pay back money they contributed to their own flexible spending benefits accounts that was lost in the chain’s liquidation, Bloomberg News reported. The workers forfeited as much $525 each when they lost access to cash in their flexible savings accounts and health care savings accounts as part of the retailer’s liquidation, according to a copy of a letter to T.H. Lee reviewed by Bloomberg News. It’s the latest instance of workers pushing for better treatment in retail bankruptcies, which has been forcing lenders and private equity owners to rethink their assumptions about the costs of dismantling a company. Art Van went bankrupt in March, putting about 4,500 people out of work. T. H. Lee created a $1 million hardship fund following worker protests over the earnings and benefits they lost, but the workers group said the payment amounts to about $400 per person and is “woefully inadequate.” The employees asked for $1,500 each to cover three months of out-of-pocket health insurance coverage so they could weather the coronavirus pandemic, plus the return of any unused funds in their flexible spending accounts and the removal of a cap that excludes anyone who earned more than $99,000 a year.

Walt Disney Co. said yesterday that it will lay off roughly 28,000 employees, mostly at its U.S. theme parks, where attendance has been crushed by the coronavirus pandemic, especially in California where Disneyland remains closed, Reuters reported. About two-thirds of the laid-off employees will be part-time workers, the company said in a statement. Disney shut its theme parks worldwide when the novel coronavirus began spreading this year. All but Disneyland — nicknamed the Happiest Place on Earth — reopened, though the company was forced to limit the number of visitors to allow for physical distancing. “We have made the very difficult decision to begin the process of reducing our workforce at our Parks, Experiences and Products segment at all levels,” Josh D’Amaro, chairman of the parks unit, said in a statement. He cited the parks’ limited capacity and uncertainty about the pandemic’s duration, which he said was “exacerbated in California by the state’s unwillingness to lift restrictions that would allow Disneyland to reopen.”

House Democrats released a scaled back $2.2 trillion proposal to extend support to the U.S. economy in face of the continuing damage from the coronavirus pandemic, Bloomberg News reported. The plan follows through on discussions last week to prompt a last-ditch attempt at negotiations with the White House and break an impasse on COVID-19 relief that’s lasted since early August. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin talked yesterday after the Democratic plan was released and plan to speak again today, Pelosi’s spokesman said. While the details of the legislative text adds clarity to the talks, the top-line spending level is no closer to that so far supported by Republicans. President Donald Trump has indicated he could support as much as $1.5 trillion in aid — still higher than the $650 billion put forth in a “skinny” aid package by Senate Republicans earlier this month. Should no deal be forthcoming, House Democrats have said they aim to proceed on their own in voting on the new plan, allowing the party’s candidates in the Nov. 3 elections to highlight a recent vote on coronavirus relief. The last vote was on the bigger, $3.4 trillion HEROES Act back in May. A key source of division has been Democrats’ push for large-scale aid to state and local authorities. The plan released yesterday has $436 billion for one year of assistance, less than a previous demand for $915 billion, which had triggered scorn among Trump administration officials who called it a bailout for poorly run states. The Democratic plan includes new aid for airlines, restaurants and small businesses that wasn’t in in the original package passed by the House in May, and it has more than double the amount for schools.