An emergency rule adopted by the Iowa Workforce Development agency [“IWD”] now requires Iowa employers to “ensure workers are aware of the benefits they may be eligible for if they become unemployed or experience a reduction in hours”.

The agency’s move imposes a new obligation on employers during the separation process, and may generate the potential for liability for employers who fail to comply with the state rule.

On July 14, 2020, IWD appeared before the legislative Administrative Rules Review Committee, requesting authorization to adopt an emergency administrative rule without the public notice and comment requirements that would otherwise be required in the Iowa Administrative Procedure Act, Iowa Code Chapter 17A.

IWD noted that a U.S. Department of Labor interpretation of Unemployment Insurance Program Letter No. 13-30 requires states who receive federal pandemic relief funds to ensure that employers within the state provide notice on the availability of unemployment insurance. The emergency rule reflected IWD’s attempt to comply with what it perceived to be a federal mandate.

During its July 14th meeting, the Administrative Rules Review Committee approved adoption of the IWD emergency rule. Though the emergency administrative rule contains a July 14th effective date, Iowa Legislative Services Agency staff have confirmed that due to the timing of the agency’s actual submission of the rule for publication, the IWD rule will be deemed to have an effective date of July 23rd.

Neither the federal guideline nor the Iowa administrative rule contained a definition of “workers” or “employees”. As a result, Iowa employers are advised to provide notice of the availability of unemployment insurance to each and every departing worker, regardless of the circumstances of the separation from employment.

It is advisable for employers to treat this new state UI disclosure form like a COBRA or Iowa 509B notification. Employers should provide the state unemployment insurance disclosure form to any employee who resigns, retires, is discharged, is laid off or has been subject to a reduction in force. When making scheduling decisions that may result in an employee receiving substantially reduced hours, employers should also consider providing this unemployment insurance disclosure form. More information can be obtained at the IWD website.