Bonus Pay for Essential Workers Varied Widely Across States

Jul 11, 2021, 9:35 AM



JEFFERSON CITY, Mo. — For putting their health on the line during the coronavirus pandemic, prison guards in Missouri got an extra $250 per paycheck. Teachers in Georgia received $1,000 bonuses. And in Vermont, nurses, janitors, retail workers and many others got as much as $2,000.

Over the past year, about one-third of U.S. states have used federal COVID-19 relief aid to reward workers considered essential who dutifully reported to jobs during the pandemic. But who qualified for those bonuses — and how much they received — varied widely, according to an Associated Press review. While some were paid thousands of dollars, others with similar jobs elsewhere received nothing.

As society reopens, momentum to provide pandemic hazard pay appears to be fading — even though the federal government has broadened the ability of state and local governments to provide retroactive pay under a $350 billion aid package enacted by President Joe Biden in March.

So far, only a few states have committed to paying workers extra with money from the American Rescue Plan.

Florida is giving $1,000 bonuses to teachers and first-responders. Minnesota plans to distribute $250 million in bonuses to essential workers, though a special panel won’t determine who qualifies until later this year.

This past week, Hawaii Gov. David Ige vetoed a budget provision to pay teachers $2,200 bonuses. The Democratic governor said lawmakers didn’t have the authority to tell the state Department of Education how to use the federal money.

Some states remain reluctant to enact bonus programs.

An Oregon proposal to use federal pandemic aid to provide bonuses of up to $2,000 for essential workers failed to make it into the budget that took effect July 1, despite a union lobbying campaign that included thousands of emails and hundreds of phone calls to lawmakers. The proposal would have covered workers in numerous fields, including education, health care, public safety and transportation.

“I don’t think anyone was opposed to it,” said Melissa Unger, executive director of Service Employees International Union Local 503. But “no one prioritized it.”

Although states have until the end of 2024 to decide how to spend the latest federal aid, some advocates worry the realistic window for providing worker bonuses may be closing as more parts of society re-open.

“Unfortunately, the longer you delay doing it, the less it’s going to be on the top of minds of voters and those policymakers,” said Molly Kinder, a fellow at the nonprofit Brookings Institution who tracks pandemic hazard pay policies.

Premium pay is one of just several options provided to states under Biden’s aid package. States also can use the money to backfill budget holes, help businesses and households affected by the economic downturn, fund certain infrastructure projects and pay for public health programs such as COVID-19 testing and vaccinations.

Illinois lawmakers used the federal money for dozens of initiatives in the budget that took effect July 1 — from $75,000 for a high school mentoring and violence prevention program to $200 million for hospitals. Nothing was earmarked for extra pandemic pay, even though Illinois had paid it in the past.

Democratic Gov. J.B. Pritzker’s administration provided a temporary 12% pay boost last year to nearly 24,000 state workers whose jobs put them at risk of contracting COVID-19. Most of the $62 million cost was covered with federal funds.

“Morale-wise, that was a critical thing for my co-workers and I,” said Crosby Smith, a care provider at a state home for the developmentally disabled near Chicago. “Because at that time, when COVID hit our facility … we felt kind of abandoned.”

Smith and his fiancee were among numerous staff and residents at the Ludeman Developmental Center who contracted the virus last year. He said the hazard money helped pay down credit cards and avoid further debt when buying clothing and shoes.

Most states that have provided COVID-19 hazard pay used money from the Coronavirus Aid, Relief and Economic Security Act signed by then-President Donald Trump in March 2020. While some states limited payments to particular public employees, others passed out money to a wide range of private-sector workers deemed to be doing important jobs.

Louisiana spent more than $38 million last year providing $250 payments to more than 152,000 “frontline workers” earning less than $50,000 annually, according to state data provided to the AP. Health care workers received the largest share of the money, followed by grocery store workers and law enforcement personnel. But payments also went to gas station workers, child-care providers, janitors, bus drivers and others.

Pennsylvania Gov. Tom Wolf, a Democrat, used $50 million in federal aid for grants to over 600 businesses to provide a temporary $3 hourly boost to employees earning less than $20 an hour. Health care providers got most of the money, followed by the food industry, according to state data provided to the AP. But millions of dollars also went to cleaning companies and private security firms.

By contrast, South Dakota limited hazard pay to state workers and only for the time they were potentially exposed to COVID-19. One therapy assistant got an extra 40 cents, a pharmacist received $1.80 and a maintenance supervisor got $4, according to state data provided to the AP.

In some states, the cost of hazard pay programs far exceeded initial expectations.

Missouri originally budgeted about $24 million in federal aid to provide an extra $250 per two-week paycheck for state employees working in close-contact institutions such as prisons, mental health facilities and veterans nursing homes. The stipend applied to anyone without unscheduled absences at any facility with at least one COVID-19 case — ultimately covering a lot more people for a much longer period than policymakers had anticipated at the onset of the pandemic.

Missouri ended up paying more than $73 million in hazard stipends to more than 18,000 employees, trigging an additional $24 million in fringe costs such as pension payments and federal taxes, according to state data provided to the AP. The payments ended June 30, and the state has no immediate plans to resume them.

“Without a doubt, it was worth it,” said Missouri Gov. Mike Parson, a Republican. “Some people did some incredible jobs in this state to stay the course and to stay in the line of duty.”

Vermont’s hazard pay program also swelled in cost. Last August, the state allotted $28 million of federal funds to pay up to $2,000 to health care employees who worked during the early stages of the pandemic. It later added $22 million to expand the program to retail and grocery workers, child care providers, janitors, trash collectors and others. When those funds were depleted, the state added $10 million more to cover all eligible applicants.

Employees in Vermont’s retail and grocery industries received nearly a third of the total money, almost matching the amount that went to health care fields, according to data provided to the AP.

Demand was high, in part, because Republican Gov. Phil Scott encouraged hesitant big businesses, such as Walmart, to apply on behalf of their employees, said Mike Pieciak, commissioner of the Vermont Department of Financial Regulation. He said consumer spending spiked around the time the payments were distributed.

“The primary goal was to say thank you to those frontline workers, but it had that nice benefit as well of getting the money into the economy,” Pieciak said.

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Bonus Pay for Essential Workers Varied Widely Across States