Extended Unemployment Compensation Act of 1985

Extended Unemployment Compensation Act of 1985 - Amends the Federal-State Extended Unemployment Compensation Act of 1970 (the Act), and repeals the Federal Supplemental Compensation Act of 1982, to provide for a consolidated program of extended unemployment compensation to replace the current extended compensation and Federal supplemental compensation programs.

Sets forth provisions for the number of weeks of extended compensation under the consolidated program. Provides for an increasing number of weeks of such benefits as the level of a State's unemployment increases in terms of specified types of unemployment periods.

Sets forth provisions for extended benefit periods and benefit tiers. Provides that an extended benefit period for a State shall begin with the third week after the first week for which there is a State "on" indicator, and end with the third week after the first week for which there is a State "off" indicator.

Provides that there is a State "on" indicator for a week if: (1) the State's insured unemployment rate (IUR) is four percent or greater during the two preceding 13-week periods, or five percent or greater during the one preceding 13-week period, and such preceding 13-week period equals or exceeds a certain average IUR for comparable periods in the prior six years in order to qualify for a benefit tier; or (2) the average of the State's unadjusted total civilian unemployment rate (TUR) is nine percent or greater for the most recent two months immediately preceding such week for which such rate is available from the Bureau of Labor Statistics (BLS).

Provides for a State "off" indicator for a week if: (1) there is not a State "on" indicator for such week; (2) such week is a redetermination week; and (3) the State's IUR is less than four percent for the two preceding 13-week periods or fails to qualify for any tier.

Provides for initial tier periods for the first six weeks of any extended benefit period, with the State's initial tier to be determined on the basis of the third week preceding the tier period and to remain the same for the six weeks of the initial tier period.

Provides for redeterminations and continuing periods. Requires that, three weeks after the beginning of any tier period, a redetermination be made of whether there is a State "on" or "off" indicator for such week, and whether the State's tier for such week has changed. Provides that, if there is not an "off" indicator, a new six-week period shall begin with the third week following such week, and the tier shall be determined for such new period. Provides that, if there is an "off" indicator, the extended benefit period shall end with the third week following such redetermination.

Sets benefit tier levels, for which a State can qualify on the basis of its IUR over the 13-week period ending with the week of determination or redetermination or its TUR over the most recent two months immediately preceding such week for which BLS statistics are available. (Sets forth a special rule under which, under certain conditions, a State not qualifying for such tiers shall be deemed to be at tier I.) Requires, in order to qualify for such tiers, that a State's IUR for the 13-week period also equal or exceed the average of such rate for comparable 13-week periods in the prior six years. Provides for qualification for lower tiers if the State's IUR equals or exceeds specified percentages of such average, as follows: (1) the next lower tier if 90 percent or greater; (2) the second lower tier if 80 percent or greater; and (3) the third lower tier if 70 percent or greater.

Sets forth provisions for an individual's eligibility period for any benefit year. Makes such period consist of the first week in such benefit year for which the individual meets specified current requirements of the Act and which is in an extended benefits period, and all weeks thereafter in such benefit year for which the individual continues to be unemployed and meets the requirements of the Act. Provides that, if at the end of such benefit year, the individual is receiving extended compensation and has not exhausted such compensation, the individual's eligibility period shall continue for any subsequent consecutive weeks of unemployment in which the individual meets the requirements of the Act until the individual has exhausted the individual's extended compensation.

Defines the "rate of insured unemployment" (IUR) as the percentage arrived at by dividing: (1) the average weekly number of individuals filing claims for regular compensation for weeks of unemployment with respect to a specified period, based on State agency reports, by (2) the average monthly covered employment for the specified period. Provides that the IUR for any 13-week period shall be determined by reference to the average monthly covered employment under the State law for the first four of the most recent six calendar quarters ending before the close of such period.

Revises provisions for payments to States under the Act. Provides for an increasing Federal share of the State's costs for regular and extended compensation as the State's level of unemployment increases. Requires such Federal payments to States in an amount equal to the applicable percentage of the sum of the sharable extended compensation and the sharable regular compensation paid to individuals under the State law. Sets forth such applicable percentages. Defines "sharable regular compensation," for purposes of such payments to States, as regular compensation paid to an individual for a week of unemployment in such individual's eligibility period: (1) to the extent that such amount exceeds 26 times the weekly benefit amount (including dependents' allowances) for weeks of total unemployment payable to such individual under the State law in the benefit year in which such eligibility period begins; and (2) which would qualify as "sharable extended compensation" under specified provisions if it were extended compensation.

Amends title IX (Employment Security) of the Social Security Act to authorize appropriations for additional amounts to be transferred into the extended unemployment compensation account. Sets such amounts at the total of: (1) 80 percent of the amount of Federal payments required to be made to States under this Act with respect to compensation paid during a tier IV period; (2) 60 percent of such amount for tier III; (3) 40 percent of such amount for tier II; and (4) 20 percent of such amount for tier I. Provides that such appropriations shall not be required to be repaid.

Revises the Act to permit the State to modify the requirement that an individual must actively engage in seeking work during each week of unemployment in order to qualify for extended compensation. Permits States to take into account any State determination that labor market conditions in the labor market area in which such individual last worked and in the labor market area in which such individual resides are so depressed that actively seeking work likely will not result in employment.

Prohibits payment of extended unemployment compensation to an individual unless the individual participates in an intensive one-week job search program administered by the Employment Service if requested to so participate.

Repeals the Federal Supplemental Compensation Act of 1982.

Permits States to choose to delay the applicability of the amendments and repeals made by this Act. Sets forth transition provisions for such States.

Directs the Secretary of Labor to study and report to the Congress, within one year after enactment of this Act, on alternatives to the insured unemployment rate (IUR) which would be available with respect to all States and which might provide a more accurate measurement of the employment and labor market situation in each State.

Provides that actions taken by a State to meet any requirement of this Act, or the amendments made by this Act, shall not be considered a State action which results or will result in a net decrease in the solvency of the State unemployment compensation system, for purposes of specified provisions of the Internal Revenue Code and the Social Security Act.