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Employment Development Department
Employment Development Department

Total and Partial Unemployment TPU 460.85

Welfare Payments

A. Workforce

Welfare recipients are sometimes required to work for their payments. Such work is generally aimed at maintaining the individual’s work habits and the amount of payment is based on the need of the recipient rather than on the amount of work done. Although the claimant may be assigned specific days and hours to work, as a rule this will be less than full-time ant the claimant would be excused to accept regular employment or to participate in job interviews. The claimant, in such instance, is not employed by the Welfare Agency and the payments received, whether in the form of money, credit or goods, are not wages.

Example:

In Ghent v. CUIAB, 1986, the California Court of Appeal addressed "Workfare" as wages for the purpose of purging a disqualification under UI Code Section 1256.

The claimant quit his job without good cause and moved to Humboldt County. He was disqualified from benefits under Section 1256, and had to earn $380 or more in bona fide employment after a specified date to purge the disqualification. The court summarized his history:

"Thereafter, Ghent applied for, and was granted, general relief assistance by the County. As a condition for receiving this aid, he was required to, and did, perform work assigned by the County. Ghent's monthly relief was $199, and his assigned work each month was credited against his grant at the hourly rate of $3.35. If Ghent had not performed the assigned services, he would not have received the aid. Ghent received one-half of his monthly aid at the beginning of the month, and the balance at the end, after his services were completed."

Two months after starting work, the claimant asked the Department to purge his prior disqualification because he had then received over $380 in relief from the county. The department denied the purge on the basis that the work which he had performed did not constitute "bona fide employment." In affirming the department, the ALJ, and the Board, the appellate court stated:

"The issue on appeal is whether such work performed by Ghent as a condition of receiving general relief under a County-operated work relief program constituted 'bona fide employment' . . . If so, the amount of Ghent's grant constituted 'remuneration' under Section 1260, which purges a disqualification . . . . Work relief is not employment under the Unemployment Insurance Code.

Under . . . the Rules and Regulations Governing General Relief Program for Humboldt County, all recipients must reimburse the County for aid given in cash 'subject to any credits for work performed on a work-for-relief project'. . . . In addition to the recipient’s obligation to repay County aid, a consideration of other relevant facts leads inescapably to the conclusion that no contract of hire existed between the County ant Ghent, and that Ghent did not perform services for "wages" As . . . County correctly observes: 'Claimant was not put to work through the same processes as are required for regular County employees. He made no contact with personnel; he filled out no application for a particular position; he was not screened by the Department head . . . no pay scale was established, nor were the jobs funded. . . . His aid grant was measured by his need, not by the type of work hedid'."

The Court also commented that the county could not hire or fire their workfare participants ". . . in the traditional meaning of those terms." The claimant’s case was built upon case law from Workers' Compensation, which has held that". . . (an indigent person) is an employee within the meaning of the Workers' Compensation Act." In denying a similarity between Workers' Compensation and unemployment insurance, the court found:

"This definition of employment should NOT be extended to claims arising outside the Workers' Compensation Act. . . Public policy encourages participation in work relief as a way of transferring employable persons from the welfare dole to the employment role . . . If, on the other hand, remaining on work relief were to purge unemployment insurance benefit disqualifications, an undesirable effect would result: able-bodies workers would be encourages to hop from county-to-county, munch from one public treasury to another and thereby multiply the ranks of the unemployment. . . . We hold that Ghent's participation in the County’s work relief program and receipt of aid therefrom did not establish either a statutory or common law employment relationship between County and Ghent. Since workfare is not employment, it does not satisfy the requirement of 'bona fide employment' . . . necessary to purge . . . a disqualification resulting from voluntary unemployment without good cause."

Finally, the court held that:

"Ghent's participation in the County’s work relief program and receipt of aid therefrom did not establish either a statutory or common law employment relationship between the County and Ghent."

B. Foster Parent Compensation

Under the provisions of Sections 11250 and 11251 of the Welfare and Institutions Code, aid and services to a child under foster care are provided when the child is deprived of parental support and care. Aid is defined as financial assistance to or on behalf of needy persons.

Since payments to foster parents for the care of foster children are paid on behalf of the child, they do not constitute remuneration for personal services rendered by the foster parent. Therefore, such payments are not wages for UI purposes.