Rule2026-18978
Federal-State Unemployment Compensation (UC) Program; Data Availability
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 16, 2026
Effective
November 16, 2026
Issuing agencies
Labor DepartmentEmployment and Training Administration
Abstract
The Department of Labor (DOL or the Department) is issuing this final rule to require the disclosure of confidential unemployment compensation (UC) information to Federal officials for purposes of UC program oversight and audits. This rule will ensure that Federal officials, including the Department's Office of Inspector General (DOL- OIG), are able to obtain the information needed from State UC agencies to ensure proper oversight of the UC programs and to hold State UC agencies accountable for identifying and addressing fraud in UC programs.
Full Text
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<title>Federal Register, Volume 91 Issue 178 (Wednesday, September 16, 2026)</title>
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[Federal Register Volume 91, Number 178 (Wednesday, September 16, 2026)]
[Rules and Regulations]
[Pages 58593-58610]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-18978]
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DEPARTMENT OF LABOR
Employment and Training Administration
20 CFR Part 603
[Docket ETA-2025-0004]
RIN 1205-AC11
Federal-State Unemployment Compensation (UC) Program; Data
Availability
AGENCY: Employment and Training Administration, Labor.
ACTION: Final rule.
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SUMMARY: The Department of Labor (DOL or the Department) is issuing
this final rule to require the disclosure of confidential unemployment
compensation (UC) information to Federal officials for purposes of UC
program oversight and audits. This rule will ensure that Federal
officials, including the Department's Office of Inspector General (DOL-
OIG), are able to obtain the information needed from State UC agencies
to ensure proper oversight of the UC programs and to hold State UC
agencies accountable for identifying and addressing fraud in UC
programs.
DATES:
Effective date: This final rule is effective November 16, 2026.
Compliance date: States that need to amend their laws to conform
and comply with the requirements of this rule must do so as quickly as
possible, but no later than September 16, 2027.
FOR FURTHER INFORMATION CONTACT: Michelle E. Beebe, Administrator,
Office of Unemployment Insurance, Employment and Training
Administration (ETA), Department of Labor, 200 Constitution Avenue NW,
Room S-4524, Washington, DC 20210, Email: <a href="/cdn-cgi/l/email-protection#6200070700074c0f0b010a070e0e074c0722060d0e4c050d14"><span class="__cf_email__" data-cfemail="7517101017105b181c161d101919105b1035111a195b121a03">[email protected]</span></a>,
Telephone: (202) 693-3029 (voice) (this is not a toll-free number). For
persons with a hearing or speech disability who need assistance to use
the telephone system, please dial 711 to access telecommunications
relay services.
SUPPLEMENTARY INFORMATION:
Preamble Table of Contents
I. Acronyms and Abbreviations
II. Background
A. Regulatory History
B. Supplemental NPRM Planned for National UC Claims Database
C. Comments on Public Involvement and the Rulemaking Process
III. Discussion
A. Overview of the Final Rule
B. Need for Rulemaking
C. Statutory and Legal Background
D. Comments Regarding Requiring Rather Than Permitting
Disclosures of Confidential UC Data to Federal Officials for
Purposes of UC Program Oversight and Audits
IV. Rulemaking Analyses and Notices
A. Executive Orders 12866 (Regulatory Planning and Review),
13563 (Improving Regulation and Regulatory Review), and 14192
(Unleashing Prosperity Through Deregulation), and Subtitle E of the
Small Business Regulatory Enforcement Fairness Act of 1996
B. Regulatory Flexibility Act
C. Paperwork Reduction Act of 1995
D. Executive Order 13132 (Federalism)
E. Unfunded Mandates Reform Act
F. Executive Order 13175 (Indian Tribal Governments)
I. Acronyms and Abbreviations
2006 Final Rule Federal-State Unemployment Compensation Program (UC);
Confidentiality and Disclosure of State UC Information; Final Rule, 71
FR 56830 (Sept. 27, 2006)
2023 RFI Federal-State Unemployment Compensation (UC) Program;
Confidentiality and Disclosure of State UC Information; Request for
Information, 88 FR 47829 (July 25, 2023)
APA Administrative Procedure Act
August 2025 NPRM Federal-State Unemployment Compensation (UC) Program;
Data Availability; Proposed Rule, 90 FR 42143 (Aug. 29, 2025)
BLS Bureau of Labor Statistics
CARES Act Coronavirus Aid, Relief, and Economic Security (CARES) Act
CFR Code of Federal Regulations
COVID-19 coronavirus disease 2019
Department or DOL Department of Labor
DOL-OIG DOL Office of Inspector General
E.O. Executive Order
ETA Employment and Training Administration
FR Federal Register
GAO Government Accountability Office
NPRM Notice of Proposed Rulemaking
OEWS Occupational Employment and Wage Statistics
OIRA Office of Information and Regulatory Affairs
OMB Office of Management and Budget
[[Page 58594]]
PRA Paperwork Reduction Act of 1995
Pub. L. Public Law
RFA Regulatory Flexibility Act
RFI Request for Information
RIN Regulation Identifier Number
sec. section
Secretary Secretary of Labor
SNPRM Supplemental Notice of Proposed Rulemaking
SOC Standard Occupational Classification
SORN System of Records Notice
SSA Social Security Act
UC Unemployment Compensation
UIPL Unemployment Insurance Program Letter
UMRA Unfunded Mandates Reform Act of 1995
U.S.C. United States Code
II. Background
A. Regulatory History
The authority for this amendment is derived from the ``methods of
administration'' provision in sec. 303(a)(1) of the Social Security Act
(SSA), which requires States to provide in their laws, as a condition
to be certified to receive administrative grants, such ``methods of
administration'' as the Secretary determines to be ``reasonably
calculated to insure full payment of unemployment compensation when
due.'' Title 20 CFR part 603 establishes requirements for maintaining
the confidentiality of UC information along with standards for required
and permissible disclosures of such information. The existing
regulation at Sec. 603.5(i), last updated in 2006 by the Department's
Federal-State Unemployment Compensation Program (UC); Confidentiality
and Disclosure of State UC Information; Final Rule (hereinafter, the
2006 Final Rule), provides that State UC agency disclosures of
confidential UC information to Federal officials for purposes of UC
program oversight and audits are permissible and excepted from the
confidentiality requirement set forth in part 603. 71 FR 56830, 56837
(Sept. 27, 2006). Preceding the 2006 Final Rule, the Department
proposed an exception to part 603 specifically for disclosures required
by Federal law.\1\ The 2006 Final Rule changed the provision proposed
at Sec. 603.5(i) to limit it to disclosures for UC program oversight
and audits because disclosures to Federal officials as ``required by
Federal Law'' was already covered by other provisions in part 603,
including the provision allowing disclosure to public officials at
Sec. 603.5(e). The Department explained in the 2006 Final Rule that it
included the provision regarding permissible disclosures for purposes
of Federal oversight and audits because ``the Department believe[d] it
[was] necessary to explicitly address the inapplicability of the
confidentiality requirement to any disclosure to the Federal Government
for purposes of UC program oversight and audits.'' See 2006 Final Rule.
The Department now revises part 603 to make these disclosures required.
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\1\ See 69 FR 50022 (Aug. 12, 2004) (proposing Sec. 603.5(i)).
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Amending the regulation to require these disclosures allows the
Department to continue the important work of holding State UC agencies
accountable for identifying and preventing fraud in the UC program. As
State UC operations have evolved since this regulation was first
promulgated, States have faced increased fraud incidents, including
sophisticated multistate fraud schemes by organized criminals. The
CARES Act created a number of new UC programs in response to the
coronavirus disease 2019 (COVID-19) pandemic and during this period the
program was exposed to increased fraudulent activity, costing the UC
system billions of dollars according to estimates by DOL-OIG. DOL-OIG
identified $45.6 billion in potentially fraudulent benefits paid in six
high-risk areas under UC programs,\2\ and an estimated $191 billion in
benefits under UC programs during the pandemic period may have been
paid improperly, with a significant portion attributable to fraud.\3\
Since 2020, DOL-OIG has repeatedly expressed its concern to the
Department that its access to confidential UC information for purposes
of UC program oversight and audits could end at any time and
recommended a change to the regulations to make clear that such
disclosures are required.\4\ The Secretary of Labor (Secretary) must
have the tools necessary to ensure that UC programs are administered
consistently with the requirements of Federal law. Oversight and audits
of UC programs by the Department, DOL-OIG, and other Federal officials
help detect fraud vulnerabilities and identify possible solutions,
which is necessary to hold State UC agencies accountable for
administering UC programs consistent with Federal law requirements.
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\2\ DOL-OIG Alert Memorandum: Potentially Fraudulent
Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion Report Number: 19-22-005-03-315, Sept. 21, 2022,
<a href="https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf">https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf</a>.
\3\ ``The Greatest Theft of American Tax Dollars: Unchecked
Unemployment Fraud,'' Hearing, Statement for the Record of Larry D.
Turner, Inspector General, U.S. Department of Labor; House Committee
on Ways and Means, Feb. 8, 2023, <a href="https://www.oig.dol.gov/public/testimony/02082023.pdf">https://www.oig.dol.gov/public/testimony/02082023.pdf</a>.
\4\ See, e.g., DOL-OIG Alert Memorandum: ``COVID-19: More Can Be
Done to Mitigate Risk to Unemployment Compensation Under the CARES
Act'', Report No. 19-20-008-03-315, Aug. 7, 2020, <a href="https://www.oig.dol.gov/public/reports/oa/2021/19-21-005-03-315.pdf">https://www.oig.dol.gov/public/reports/oa/2021/19-21-005-03-315.pdf</a>.
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On August 29, 2025, the Department published a notice of proposed
rulemaking (NPRM), Federal-State Unemployment Compensation (UC)
Program; Data Availability; Proposed Rule (90 FR 42143) (hereinafter
referred to as the August 2025 NPRM), that proposed requiring the
disclosure of confidential UC information to Federal officials for
purposes of UC program oversight and audits. In total, 40 commenters
responded, representing State UC agencies, advocacy organizations,
individual and anonymous commenters, unions, a professional
association, and a think tank. See section III of this preamble for
discussion of the comments.
The August 2025 NPRM referenced a Request for Information (RFI)
entitled Federal-State Unemployment Compensation (UC) Program;
Confidentiality and Disclosure of State UC Information that was
published on July 25, 2023 (88 FR 47829) (hereinafter referred to as
the 2023 RFI), considering comprehensive updates to part 603. In the
August 2025 NPRM, the Department acknowledged that the most critical
step needed at this time was to address fraud in UC programs by
ensuring the Department, including DOL-OIG, has access to data to
conduct oversight and combat fraud.
The August 2025 NPRM also sought comment on a potential amendment
to part 603 that would require States to submit all UC claims data on a
regular basis to the ETA as part of a national UC claims database for
purposes of UC program oversight and audits, including comments about
appropriate safeguards and security measures to protect individual data
under such a requirement.
B. Supplemental NPRM Planned for National UC Claims Database
The Department has determined it is appropriate to solicit further
input on the topic of a national UC claims database. Therefore, if such
a database is to be pursued, the Department will issue a Supplemental
Notice of Proposed Rulemaking (SNPRM) on this topic. The Department
will consider the comments received regarding a national UC claims
database in response to the August 2025 NPRM when drafting the future
SNPRM on this topic. This final rule does not address the creation of a
national UC claims database.
[[Page 58595]]
C. Comments on Public Involvement and the Rulemaking Process
The August 2025 NPRM included a 30-day comment period for the
public to provide input on the NPRM, which ended on September 29, 2025.
Several commenters requested that the comment period be extended at
least 30 days to allow for more time to analyze the potential impacts
of the NPRM and prepare comments accordingly. An advocacy organization
argued that Executive Order (E.O.) 13563, Improving Regulation and
Regulatory Review, generally requires a 60-day comment period.
Some commenters also offered additional suggestions for the
Department to solicit further input from the public to inform the
rulemaking process. An advocacy organization identified only two
responses to the 2023 RFI on the subject of reducing fraudulent
payment, and therefore argued for the August 2025 NPRM to have ``more
robust, current, and timely feedback from experts and advocates.'' The
commenter also critiqued the Department for setting aside the other
concerns identified in public comments on the 2023 RFI. An advocacy
organization asserted that the NPRM was styled as a final rule, and
another asserted that the Department failed to and should consult with
impacted parties, such as States, local governments, or Tribal
governments. Another advocacy organization suggested the Department
engage with impacted immigrant populations, provide transparency about
data collection and use, and commit to privacy and accountability.
The Department declined to extend the comment period and posted a
letter to the docket to inform stakeholders of this decision.\5\ As
explained in the August 2025 NPRM and in the letter denying the comment
period extension requests posted to the docket, the Department
previously engaged with the regulated community on the topics covered
in the August 2025 NPRM, including through the 2023 RFI. The Department
also announced at that time that it was considering comprehensive
updates to the UC confidentiality regulations and that information
received in response to the 2023 RFI would inform and be considered by
the Department as part of that potential rulemaking. The August 2025
NPRM was more limited in scope than the 2023 RFI and included a 30-day
comment period for stakeholders to further provide comment on the
changes the Department proposed to make to the part 603 regulation.
Therefore, the Department declined to extend the August 2025 NPRM's 30-
day comment period because it determined that it had provided the
public with sufficient notice, time to review, and opportunity to
comment on the NPRM. To the commenter's concern that this rulemaking
sets aside the other concerns identified in public comments on the 2023
RFI, the Department considered the feedback it received and determined
that codifying the required disclosure of confidential UC information
to Federal officials, including DOL-OIG, for purposes of UC program
oversight and audits was the most critical step needed at this time.
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\5\ See Deny Comment Period Extension for Unemployment
Compensation NPRM, published to the rulemaking docket at <a href="https://www.regulations.gov/search?filter=ETA-2025-0004">https://www.regulations.gov/search?filter=ETA-2025-0004</a>.
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III. Discussion
A. Overview of Final Rule
The Department is removing Sec. 603.5(i), which permits State UC
agencies to disclose confidential UC information to Federal officials
for purposes of UC program oversight and audits, and adding a provision
requiring the disclosure of confidential UC information for purposes of
UC program oversight and audits to Sec. 603.6, which contains required
disclosures. Moving the disclosure to Federal officials for purposes of
UC program oversight and audits to Sec. 603.6 makes these disclosures
a requirement under 20 CFR part 603. This final rule effectuates this
change by redesignating paragraph (c) of Sec. 603.6 as paragraph (d)
and inserting a new paragraph (c) in Sec. 603.6. Additionally, in
response to comments, the Department is adding a new provision to Sec.
603.10 that will require certain requestors to provide additional
information to States as part of their request for confidential UC
information within the scope of UC program oversight and audits. This
final rule also makes conforming amendments to the introductory matter
of Sec. 603.5 and to paragraph (b) of Sec. 603.8. Finally, this final
rule updates the authority citation to more accurately reflect the
Department's statutory authority for part 603.
Based on comments received in response to the August 2025 NPRM, the
Department made two changes to the NPRM that are reflected below.
First, if a national UC claims database is pursued, the Department will
publish an SNPRM to provide a greater opportunity for input on the
national UC claims database referenced in the August 2025 NPRM. This
change allows for further input and policy refinement in consideration
of comments received about the proposal.
Second, the Department added a new provision to Sec. 603.10 that
requires Federal officials (other than the Department, DOL-OIG, and the
Government Accountability Office (GAO)) who are requesting information
pursuant to Sec. 603.6(c) to state how the information will be used
and how that use is for purposes of UC program oversight and audits,
and to cite to the Federal official's authority for UC program
oversight and audits. This was in response to concerns from commenters
over transparency, data use, and potential overreach. The Department,
DOL-OIG, and GAO already have separate authority to receive
confidential UC information and routinely request information for
purposes of UC program oversights and audits based on their duties and
statutory authority, thus a justification is not needed. The Department
believes that requiring a written justification for requests from other
Federal officials will address the concerns raised by commenters
because it increases transparency as to the scope and use of the data
requested by Federal officials. Paragraph 603.10(e) of this final rule
requires that other Federal officials requesting confidential UC
information must limit their use of the information to the uses stated
in the written request submitted to the State UC agency, except as
otherwise required by Federal law.
This change balances accountability and transparency with the
important oversight facilitated by the newly required disclosures. The
Department believes that the prescribed scope of these disclosures, for
purposes of UC program oversight and audits, provides an important
limitation on the disclosures and that such a limitation aligns these
new required disclosures with those States currently make to DOL-OIG,
as one example. Federal officials that seek to obtain confidential UC
information for purposes other than UC program oversight and audits are
outside the scope of this final rule. Public officials, as defined in
Sec. 603.2(d), may request such information pursuant to Sec.
603.5(e), which governs disclosure of confidential UC information to
public officials. Other officials may request confidential UC
information for non-oversight and audit purposes based on other
applicable authority that is available for that purpose. This rule is
only concerned with Federal officials requesting confidential UC
information for purposes of UC program oversight and audits.
[[Page 58596]]
The authority for this amendment is derived from the ``methods of
administration'' requirement of sec. 303(a)(1), SSA, which requires
States to provide in their laws, as a condition to be certified to
receive administrative grants, such ``methods of administration'' as
the Secretary determines to be ``reasonably calculated to insure full
payment of unemployment compensation when due.'' The Department
interprets the phrase ``when due'' in this requirement to mean accurate
payments are made to eligible individuals in addition to ensuring that
the payments are timely. It also requires that a State not make
payments when payments are not due, i.e., to individuals not eligible
due to fraud or otherwise. This final rule is also consistent with the
objectives of E.O. 14243, Stopping Waste, Fraud, and Abuse by
Eliminating Information Silos, because it requires, rather than
permits, the disclosure of confidential UC information to Federal
officials for purposes of UC program oversight and audits.
The Department notes that part of its responsibilities under the
SSA include certifying State UC programs. This responsibility can only
be upheld if the Department has the ability to access certain
information. The Department is not seeking to supplement its
information collections at this time; however, the capacity for the
Department to do so in the future is guaranteed by this rulemaking.
B. Need for Rulemaking
Pursuant to sec. 303(a)(1), SSA, the Department has long required
States to disclose all information that is necessary for the proper
administration of UC programs (Sec. 603.6(a)). The Department has also
specifically recognized the critical role that oversight and audits
play in the proper administration of UC programs, particularly in
ensuring payments are not made when they are not due. The Department
has recognized this critical role by explicitly making disclosures to
Federal officials for purposes of UC program oversight and audits
permissible and excepting such disclosures from the confidentiality
requirement under Sec. 603.5(i).
For years, the Department has interpreted sec. 303(a)(1) as
requiring the disclosure of confidential UC information to certain
Federal agencies because disclosure of such data is authorized under
statutes administered by those agencies, including, for example, the
Internal Revenue Service for purposes of UC tax administration. See
Federal-State Unemployment Compensation Program (UC); Confidentiality
and Disclosure of State UC Information; Proposed Rule, 69 FR 50022,
50027 (Aug. 12, 2004); 2006 Final Rule, 71 FR 56830, 56838 (Sept. 27,
2006). Similarly, the Department has long recognized that disclosures
of confidential UC information to DOL-OIG for fraud investigations are
necessary for the proper administration of the program. See 20 CFR
603.6(a); see, e.g., Unemployment Insurance Program Letter (UIPL) Nos.
04-17 (Dec. 16, 2016) (``OIG investigations of fraud are necessary for
the proper administration of the program'') and 04-17, Change 1 (Aug.
3, 2021). DOL-OIG's collections pursuant to Sec. 603.6(a) occur under
a System of Records Notice (SORN) that covers such collections. See
DOL-OIG 12, ``Office of Inspector General Warehouse and Learning System
(OWLS),'' 85 FR 60833 (Sept. 28, 2020). Additionally, during the
pandemic, the Department required the regular disclosure of
confidential UC information related to the Coronavirus Aid, Relief, and
Economic Security (CARES) Act UC programs to DOL-OIG for purposes of UC
program oversight and audits under its authority under the CARES Act
and as a condition of UC administrative grants. See, e.g., UIPL No. 04-
17, Change 1 (Aug. 3, 2021) (``Within the context of administering PUA,
FPUC, PEUC, MEUC, and full federal funding of the first week of regular
UC for States with no waiting week that is reimbursed in accordance
with Section 2105 of the CARES Act, as amended, states must disclose
all information to DOL-OIG for the purposes of investigating UC fraud
and for audits of UC programs.'') and UIPL No. 22-21 (Aug. 11, 2021)
(``as a condition of receiving a grant under this UIPL, states must
agree to information disclosure with [DOL-OIG]'').
State cooperation with these requests has become critical to the
effective administration of UC programs. State UC operations have
evolved since the confidentiality regulation was first promulgated in
2006, as States have faced a large increase in online claims filing, as
well as a stark increase in fraud incidents, particularly those
involving sophisticated multistate fraud schemes by organized
criminals. The CARES Act created a number of new UC programs in
response to the coronavirus disease 2019 (COVID-19) pandemic and during
this period the program was exposed to increased fraudulent activity,
costing the UC system billions of dollars according to estimates by
DOL-OIG. DOL-OIG identified $45.6 billion in potentially fraudulent UC
benefits paid in six high-risk areas,\6\ and estimated $191 billion in
UC benefits during the pandemic period could have been paid improperly,
with a significant portion attributable to fraud.\7\ The Secretary must
have the tools necessary to ensure that the UC programs are
administered consistently with the requirements of Federal law.
Oversight and audits are necessary to hold State UC agencies
accountable for reducing improper payments and for ensuring that State
UC agencies provide proper and efficient administration of the UC
program. As discussed above, DOL-OIG has reinforced this point through
repeated recommendations to the Department to amend this rule to make
disclosures for purposes of UC program oversight and audits required
rather than permissive. Accordingly, in recognition of the growing
urgency of the need for fraud identification and prevention within the
program, DOL interprets sec. 303(a)(1) as requiring the disclosure of
confidential UC information to Federal officials, including DOL-OIG,
for purposes of UC program oversight and audits.
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\6\ DOL-OIG Alert Memorandum: Potentially Fraudulent
Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion Report Number: 19-22-005-03-315, Sept. 21, 2022,
<a href="https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf">https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf</a>.
\7\ ``The Greatest Theft of American Tax Dollars: Unchecked
Unemployment Fraud,'' Hearing, Statement for the Record of Larry D.
Turner, Inspector General, U.S. Department of Labor; House Committee
on Ways and Means, Feb. 8, 2023, <a href="https://www.oig.dol.gov/public/testimony/02082023.pdf">https://www.oig.dol.gov/public/testimony/02082023.pdf</a>.
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In the sections that follow, the Department summarizes and responds
to the comments received about the August 2025 NPRM's proposed
requirement--finalized in this rule--that State UC agencies must
disclose confidential UC information to Federal officials for purposes
of UC program oversight and audits.
C. Statutory and Legal Background
1. Statutory Background
a. DOL Has Statutory Authority Under Section 303(a)(1), SSA, for This
Rule
Comments: A number of commenters objected to the Department using
the ``methods of administration'' requirement of sec. 303(a)(1), SSA,
as a statutory basis for the rulemaking. A State and an individual
commenter expressed opposition to the Department's reliance on the
language in sec. 303(a)(1), SSA, for authority to recast Sec. 603.5(i)
from a ``permissive data-sharing provision'' into a mandatory
requirement under Sec. 603.6(c). The individual commenter
[[Page 58597]]
stated that without congressional authority it would be beyond the
Department's statutory authority to convert something permissible into
a binding mandate. Similarly, a few commenters argued that because
disclosures to Federal officials for purposes of UC program oversight
and audits were included in the existing regulation as permissible
disclosures, such disclosures were not intended to be required and the
Department may not now assert that these same disclosures are
mandatory. Further, a commenter argued the methods of administration
provision is meant to only address timeliness of payments and
eligibility. One advocacy organization stated that the August 2025
NPRM's claim that sec. 303(a)(1), SSA, requires disclosure to DOL-OIG
reverses the Department's previous acknowledgement that it lacked the
authority to require access to confidential information because the
permissible framework in the regulation was a recognition of statutory
constraints.
Response: The Department has considered these positions and does
not agree with them. The Department did not take the position that it
does not have the authority to require this type of disclosure when it
issued the 2006 Final Rule. The current regulation implemented a
permissible disclosure in this instance, and the Department issued that
rule without opining on its authority to require those same
disclosures. Since the promulgation of the current regulation, State UC
operations have been increasingly subjected to fraud schemes, and
access to confidential UC information has increasingly become critical
for supporting Federal officials in their oversight responsibilities to
hold State UC agencies accountable for ensuring the integrity of the UC
programs. As a result, this final rule conforms the regulation to
reflect both the oversight responsibility of Federal officials and that
disclosures to Federal officials for purposes of UC program oversight
and audits are necessary for the proper administration of the program.
Agencies are free to change their existing policies as long as they
provide a reasoned explanation for the change. Encino Motorcars, LLC v.
Navarro, 579 U.S. 211, 221 (2016). The Department has provided a
reasoned explanation for amending the permissible disclosure at Sec.
603.5(i) to be a mandatory one at Sec. 603.6(c), pursuant to its
discretionary authority to determine what methods of administration are
necessary under sec. 303(a)(1), SSA. Accordingly, this rule is a
reasonable exercise of the agency's statutory authority to determine
what methods of administration are reasonably calculated to ensure
payment of benefits when due.
b. Executive Order No 14243 Is Not the Basis for This Regulation
Comments: A number of commenters asserted that there is a conflict
between the language of sec. 303(a)(1), SSA, and E.O. 14243, and argued
that the E.O. cannot be the basis for this regulation. An advocacy
organization questioned the legality of E.O. 14243 but also noted that
even the E.O. acknowledges that the authority for unfettered access is
only to the extent it is allowed under the SSA.
Response: The Department does not rely on E.O. 14243 for authority
to promulgate the regulation. As explained above, the Department
properly derives authority for this final rule from sec. 303(a)(1),
SSA.
c. This Rule Does Not Present a Major Questions Doctrine Issue and Does
Not Lack Congressional Authorization
Comments: A few commenters disagreed with the Department's reliance
on sec. 303(a)(1), SSA, for authority, arguing that this rule
constitutes a ``major question'' and lacks clear congressional
authorization. An advocacy organization asserted that the Department's
interpretation of sec. 303(a)(1) is overbroad and stated that
``[c]ourts have repeatedly held that general administrative provisions
do not authorize sweeping new mandates absent clear congressional
authorization.'' Further, the commenter argues that this rule
implicates the major questions doctrine, stating that ``[t]he United
States Supreme Court emphasized that in cases involving `major
questions' of `vast economic and political significance,' agencies
require `clear congressional authorization.''' According to the
commenter, this rule presents a major question without clear
congressional authorization.
Response: The Department does not agree. The major questions
doctrine provides that if on review a court finds that an agency action
has vast political and economic significance and involves a shift in
policy regarding a major issue, a reviewing court will critically
assess whether Congress meant to confer authority on the agency to take
such an extraordinary action. West Virginia v. EPA, 597 U.S. 697, 700
(2022) (citing FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,
159-60 (2000)). In such cases, the agency action will only be upheld if
it is supported by ``clear congressional authorization'' in the
statutory language. Id. (citing Utility Air Regulatory Grp. v. EPA, 573
U.S. 302, 324 (2014)).
This final rule is not an instance of extraordinary agency action.
As described in detail above, the Department has long interpreted the
disclosure of confidential UC information to be required when necessary
for proper and efficient administration of the program (see, e.g.,
Sec. 603.6(a)). Due to the growing need to address fraud in UC
programs, as explained previously in the Regulatory History section of
this preamble, and the responsibility of Federal officials to hold
States accountable for doing so, the Department has determined that
requiring disclosures for purposes of UC program oversight and audits
is necessary for the proper administration of the program under sec.
303(a)(1), SSA, and, therefore, a condition of certification for UC
administrative funding. The Department has determined that this
oversight is necessary in part because program performance metrics have
not sufficiently improved. This rule, which merely makes certain
disclosures States are generally already making a required rather than
a permissible disclosure, is not a major policy change, nor is it
economically or politically significant. Accordingly, it does not
constitute an extraordinary agency action or major question for the
purpose of the major questions doctrine.
d. This Rule Is Not an Improper Shift of Power to the Federal
Government
Comments: An advocacy organization wrote that this rule is a shift
of power toward the Federal Government, that it is a new interpretation
of sec. 303(a)(1), SSA, and that although the provision allows the
Secretary to require States to implement methods of administration
necessary for the proper and efficient administration of the UC
program, it has not been interpreted to require mandatory sharing of
confidential UC data with the Department. The commenter stated the
Department must point to clear congressional authorization for its
claimed authority, particularly when it imposes a significant shift of
power from the States to the Federal Government. And another advocacy
organization argued that nothing in the statute authorizes the
Department to ``compel States to provide wholesale access to wage
records, Social Security numbers or employer data.'' Instead, the
advocacy organization argues ``[t]he statutory purpose is to ensure
workers receive their benefits `when due,' not to build a national
surveillance system.'' Emphasizing that the UC system is intended to be
a cooperative federalism system, the commenter argues that the
[[Page 58598]]
Department, in promulgating this rule, asserts authority that is much
broader than the authority granted in the authorizing statute. Another
commenter concluded that the August 2025 NPRM would place new
obligations on States that would alter the Federal-State partnership
governing UC and exceed the Department's authority under the statute.
Response: As stated above in detail, this final rule is the
codification of current Department expectation and State practice.
Under sec. 303(a)(1), SSA, the Department has clear congressional
authority to determine such disclosure is a method of administration
necessary for the proper and efficient administration of the UC
program. States are already providing information to the Department and
DOL-OIG regularly for purposes of UC program oversight and audits under
the existing regulation set forth at Sec. 603.5(i). Furthermore, fraud
detrimentally impacts a State's ability to pay benefits ``when due,''
because it drains government resources that would otherwise serve the
State's administration of benefits to other workers.
e. Statutory Authority Comes From 303(a)(1), Not 303(a)(6), SSA
Comments: Commenters asserted that sec. 303(a)(6), SSA, which
relates to the requirement that States, as a condition for receiving
administrative grants, provide reports to the Secretary, should be used
as the statutory basis for this rule.
Response: The Department disagrees with comments that argue the
authority for this final rule should come from sec. 303(a)(6), SSA,
instead of 303(a)(1), SSA. This final rule requires disclosure of
confidential UC information to Federal officials for purposes of UC
program oversight and audits. Section 303(a)(6) requires that State UC
laws include provisions for ``[t]he making of such reports, in such
form and containing such information, as the Secretary of Labor may
from time to time require.'' The word ``reports'' in 303(a)(6) has
historically been interpreted as distinct from raw data and both
reports and the provision of raw data support UC program oversight and
audits. In this final rule, the Department does not opine on the
Department's authority to collect UC program information in the form of
``reports'' under sec. 303(a)(6).
The provision of disclosing confidential UC data to Federal
officials for purposes of UC program oversight and audits facilitates
critical efforts in holding State UC agencies accountable for
identifying and preventing fraud activities in UC programs, which in
turn reduces improper payments of benefits. Therefore, sec. 303(a)(1)
stands as the basis for requiring disclosures to Federal officials for
purposes of UC program oversight and audits.
2. Legal Background
a. Privacy Act of 1974
Comments: Commenters expressed several concerns regarding
compliance with the Privacy Act, including that the Department risks
improperly disclosing federally held personal records without consent,
exceeding the scope of its published SORN, exceeding the ``routine
use'' exception, and violating the minimization principle. An advocacy
organization was concerned that the proposed rule would not follow the
Privacy Act's agency obligation to provide clear notice to individuals
regarding how their information would be collected, maintained, and
disclosed, nor would it contain a required provision requiring notice
to UC claimants that their personal data would be shared with Federal
officials. The advocacy organization argued that UC claimant data is
collected under the SSA for the limited purpose of administering
unemployment benefits, not for Federal investigations or potential law
enforcement purposes. Therefore, the commenter reasoned, mandating
disclosure for use beyond that purpose risks violating the Privacy
Act's requirement that agencies collect and maintain only that data
that is ``necessary'' to accomplish their statutory mission.
Response: The Department does not intend this final rule to
supersede or conflict with the requirements of any Federal law,
including the Privacy Act of 1974, 5 U.S.C. 552a, as amended. The
Department must protect the confidential UC information it collects and
maintains pursuant to this final rule in accordance with all
requirements under the Privacy Act of 1974, 5 U.S.C. 552a, as amended,
as well as all other applicable Federal laws. Federal officials,
including those within the Department and DOL-OIG, have long collected
and maintained confidential UC information for purposes of UC program
oversight and audits to ensure the integrity of the UC program and that
benefits are paid when due as required by sec. 303(a)(1), SSA. Any
Federal official outside the Department that obtains confidential UC
information under this rule for purposes of UC program oversight and
audits will also be required to comply with all applicable Federal
laws, including the Privacy Act.
b. Constitutional Questions
Comments: A commenter wrote that allowing unemployment data to be
repurposed would deny individuals notice of the information disclosure,
remove their ability to contest data use, and violate due process under
the Fifth Amendment. An advocacy organization similarly argued that
allowing unfettered access to confidential unemployment data without
regard for the right to privacy would violate the Fourth Amendment.
An advocacy organization argued that the Department's rule lacks
the ``clear notice'' required by the Spending Clause and constitutes an
unlawful ``retroactive'' grant condition. The commenter further
asserted that ``the proposal's undefined requirement for States to
share data for unspecified `oversight and audits''' would be a
``fundamental shift in the program'' that the States could not
anticipate and would exceed the limitations imposed by the
Constitution's Spending Clause. In making this argument, the commenter
referenced UC program confidentiality rules that, according to the
commenter ``have included only limited provisions for sharing [data]
with Federal agencies,'' including the original regulations from 1986
that permitted States to share information with DOL only for the
purpose of determining eligibility or benefit amounts and the existing
regulations, which ``require disclosure only as `necessary for the
proper administration of the UC program' or to specific agencies for
specific purposes.'' The same advocacy organization further asserted
that retroactive conditioning of Federal funds would ``violate anti-
commandeering principles of the Tenth Amendment'' because it commands
States to share data as well as to build the infrastructure to do so.
Response: The Department disagrees with the assertion that the
Department's rule fails to provide the ``clear notice'' required by the
Spending Clause. In South Dakota v. Dole, the Supreme Court outlined
the framework governing Congress's authority under the Spending Clause
to attach funding conditions to Federal award programs. 483 U.S. 203
(1987). In relevant part the framework requires that ``if Congress
desires to condition the States' receipt of federal funds, it must do
so unambiguously, enabling the States to exercise their choice
knowingly, cognizant of the consequences of their participation.'' See
id.
[[Page 58599]]
This final rule meets this standard. It is clear and unambiguous.
It plainly describes the disclosure in the regulatory text of 20 CFR
part 603 that was permissible but is now a required condition upon
which State receipt of UC administrative funding depends. Accordingly,
contrary to the commenter's claim, this rule satisfies the requirement
that a funding condition attached to a Federal grant program allow
recipients to ``knowingly'' accept the provisions.
The same commenter also argues that the Department's rule is
impermissibly ``retroactive'' under the Spending Clause and the anti-
commandeering doctrine. However, counter to the commenter's assertion,
this rule will not apply retroactively; administrative funding already
provided to States will not be impacted by the new condition it
establishes. Even after the effective date of this rule, which is 60
days after publication, the compliance date gives States 1 year to
amend their State laws, if needed, to ensure they receive certification
for receipt of administrative funding. Accordingly, this rule does not
impose a retroactive condition and, consistent with Spending Clause
jurisprudence, the publication of this rule puts States on notice of a
new requirement upon which future certification for administrative
funding will depend so that they may knowingly choose to accept the
term going forward.
Finally, for the reasons set out above, the required disclosure
imposed by this rule does not commandeer the States. Indeed, Federal
grant conditions are lawful so long as the States have a genuine choice
whether to accept them. Nat'l Fed'n of Indep. Bus. v. Sebelius, 567
U.S. 519, 579 (2012). States may knowingly choose to accept the terms,
going forward.
Moreover, the Department does not agree with the commenter's claim
that this rule is a significant shift in the program as it currently
exists. All States already provide UC information to Federal officials
as requested for purposes of UC program oversight and audits under
Sec. 603.5(i), which made the disclosure permissible and excepted such
disclosure from the confidentiality requirement set forth in part 603.
Due to the growing need to address fraud in the UC program, the
Department has determined that requiring disclosures for purposes of UC
program oversight and audits is necessary for the proper administration
of the program under sec. 303(a)(1), SSA, and, therefore, a condition
of certification for administrative funding for the UC program. This
rule is a reasonable exercise of the agency's statutory authority to
determine what methods of administration are required in order for a
State to be certified to receive funding to administer the UC program
and does not constitute an unlawful commandeering of the States.
D. Comments Regarding Requiring Rather Than Permitting Disclosures of
Confidential UC Data to Federal Officials for Purposes of UC Program
Oversight and Audits
1. Written Agreements
Comments: A State UC agency noted that absent a written agreement
outlining the terms of the disclosures, States may be unable to track
the movement of disclosed UC information. The agency further noted that
in the event of a data breach, the lack of a written agreement will
make it more difficult to determine who is responsible for the data
breach, and potentially expose data requestors who have written
agreements to legal and information technology expenses because the
State will be unable to identify the source itself.
Another State UC agency expressed concern that the August 2025 NPRM
would eliminate data-sharing agreements and safeguards that current
Federal law at Sec. Sec. 603.9 and 603.10 require for the disclosure
of confidential UC information. The commenter asked for clarity
regarding what sections of the confidentiality regulation apply to the
mandated disclosure created by this rule, citing concerns about data
breaches, leaks, and a loss of trust in the safety net system.
Response: The change to Sec. 603.10 sets forth in this final rule
is in response to these comments as well as others. The Department and
DOL-OIG have an established working relationship with respect to UC
program oversight and audits, and no written agreement is required for
these disclosures under the current regulation. In response to the
comments discussed above, among others, the Department added a new
provision to Sec. 603.10 that requires Federal officials other than
the Department, DOL-OIG, and GAO, who are requesting information
pursuant to Sec. 603.6(c) to provide a request in writing to the State
UC agency stating how the information will be used and how that use is
for purposes of UC program oversight and audits. Additionally, this
final rule requires requestors to limit their use of the information to
the uses stated in the request, except as required by Federal law, and
to cite to their authority for UC program oversight and audits. These
justifications will increase transparency and are meant to provide
context and accountability in data requests.
2. State UC Agency Impacts
a. Administrative Burdens and Possible Negative Impact on Services
Comments: A few commenters, including unions and legal services
providers, argued that the August 2025 NPRM would impose burdens on
State UC agencies, which already face difficulty in executing their
missions under their current funding levels. Some of these commenters
reasoned that the additional burdens would require agencies to divert
IT, staff, and legal resources away from current functions,
exacerbating the agencies' existing operational challenges. A union
added that this would increase the risk of data breaches. An individual
and an advocacy organization asserted that the August 2025 NPRM could
create unnecessary or duplicative processes and waste Federal and State
funding and tax dollars.
Some commenters raised concerns that the August 2025 NPRM could
slow the delivery of payments under UC programs, noting that benefit
processing is already slower than before the pandemic. Some pointed to
recent funding disruptions and broader budget cuts as creating
uncertainty about future administrative resources. Some unions and
advocacy groups argued that this rule could divert critical staff and
technology resources away from claims processing, potentially impacting
timely payment of benefits.
Some advocacy organizations argued that the August 2025 NPRM lacked
clarity regarding the data collected, preventing States from providing
feedback on that collection. Similarly, some legal services providers
asserted that DOL should not put burdens on State UC agencies during a
time of greater workloads without sufficient clarification of the data
requested and its purpose.
Commenters also highlighted confusion about how States would fund
the costs associated with implementing this rule. Some noted
understaffing, ongoing technology modernization, and reduced Federal
support, such as through the rescission of one-time grants, as
significant barriers. Commenters asked the Department to consider
phased implementation, provide Federal funding or cost-sharing, and to
require transparency measures to minimize administrative strain and
ensure States can effectively comply.
Response: The Department notes that the scope of disclosure largely
remains the same as the existing regulation and
[[Page 58600]]
the Department believes the cost of changes will be minimal. States
have been making disclosures for purposes of UC program oversight and
audits to the Department and to Federal officials, including DOL-OIG,
for several years now.
The Department clarifies that this final rule does not alter the
existing regulation on the allowable scope of such a disclosure and
does not modify protections or limitations on use of data that is
applicable to these disclosures. The Department does not believe there
will be a significant increase in UC data disclosures and therefore
does not foresee a significant increase in legal, information
technology, or human capital expenditures to divert resources away from
current staff functions. The Department disagrees that this final rule
increases the risk of data breaches or does not provide sufficient
information to States regarding data to be collected. This final rule
takes what States are permitted to do currently, and all States have
been doing, and makes it a requirement. States' previous disclosures
have provided sufficient experience to be able to comment effectively
on this rule.
The Department's addition to Sec. 603.10(e) requires certain
Federal officials, other than the Department, DOL-OIG, and GAO, to
provide requests in writing to the State UC agency stating how the
information will be used and how that use is for purposes of UC program
oversight and audits; to limit their use of the information to the uses
stated in the request, except as required by Federal law; and to cite
the Federal official's authority for UC program oversight and audits
under Sec. 603.6(c). This addition provides clarity to States
responsible for disclosing confidential UC information to Federal
officials other than the Department, DOL-OIG, and GAO.
Additionally, the Department's amendment to Sec. 603.8 makes clear
that disclosures for purposes of UC program oversight and audits are
chargeable to a State's UC administrative grant.
b. Interaction With State Laws
Comments: A union, a few advocacy organizations, and an individual
commenter expressed concern that this rule lacked sufficient clarity
such that State UC agencies would not be able to understand how the
August 2025 NPRM would interact with existing State laws, would
potentially duplicate existing processes, or both.
Response: The Department clarifies that this final rule does not
alter the existing regulation on the allowable scope of such a
disclosure and does not modify protections or limitations on use of
data that is applicable to these disclosures. This final rule takes
what States are permitted to do currently and all States have been
doing and codifies this as a requirement.
c. Inappropriate Burdens on Smaller States
Comments: A few commenters warned that agencies in smaller States
might face heavy burdens, including significant IT and compliance costs
that could disrupt legitimate service delivery instead of decreasing
fraudulent benefit payments.
Response: This final rule does not alter the scope of disclosures
under the existing regulation. This final rule takes what States are
permitted to do currently and all States have been doing, including
smaller States, and makes it a requirement.
3. UC Claimant Impacts
a. Risk to Privacy
Comments: A few commenters, including advocacy organizations,
critiqued the August 2025 NPRM for insufficiently demonstrating that
the problem this rule is solving warrants the high risk to the privacy
of individuals. An advocacy organization called the August 2025 NPRM
``overly broad'' for authorizing the sharing of sensitive data without
a clearly identified purpose or reasonable suspicion of fraud and
argued that such access must be balanced with the need for privacy.
Another advocacy organization argued that DOL failed to establish a
nexus between the required data and the purposes of this rule, noting
the high risk to individual privacy.
Response: With respect to the purpose of this final rule, the
August 2025 NPRM described the rise of fraud in the UC program and
especially called out the increase in sophisticated multistate schemes
as necessitating this final rule. The existing regulation does not
address the realities of the ever-increasing sophistication of fraud
schemes, and in particular organized multistate schemes. Increased data
availability for Federal officials to perform UC program oversight and
audits will allow the Federal Government to hold State UC agencies
accountable for and further assist States in identifying and preventing
fraud. This final rule adds Sec. 603.10(e) to address some of the
concerns commenters expressed with respect to the purpose of such
disclosures. Further, the Department notes that the purpose of
disclosures under Sec. 603.6(c), UC program oversight and audits, is
explicit in the provision.
b. Past Failures of Federal Data Control
Comments: Some commenters, including advocacy organizations,
individual commenters, and a professional association, identified
examples of recent actions by the Administration that the commenters
claim eroded public confidence and where the commenters claim the
Administration failed to safeguard sensitive data, including
cybersecurity failures and mishandling of data by the Department of
Government Efficiency. An individual commenter reasoned that it would
be ``reckless'' for States to allow Federal control of confidential
data without trust in Federal processes to protect that data. An
individual commenter compared it unfavorably to examples of government
practices that prioritize the protection of confidential personal data,
describing U.S. Bureau of Labor Statistics (BLS) procedures that limit
access to employer survey responses and monitor research projects.
Response: This final rule does not alter the existing regulation,
as amended in 2006, regarding the allowable scope for disclosures of
confidential UC information for purposes of UC program oversight and
audits. Additionally, this final rule does not modify the protections
or limitations on use of data that is applicable to required
disclosures. This final rule takes what States are permitted to do
currently, and which all States have been doing, and makes it a
requirement. Any Federal official that obtains confidential UC
information under this rule for purposes of UC program oversight and
audits is required to comply with all applicable Federal laws,
including those concerning security and privacy.
c. Concerns About Increased Oversight
Comments: A professional association, a union, and an individual
commenter warned that the August 2025 NPRM could lead to increased and
inappropriate oversight of private citizens, risking civil liberties
violations. Similarly, some commenters expressed particular concerns
that collected data would be shared with immigration enforcement
agencies and used in enforcement targeting, unfairly impacting
immigrants.
Response: The existing regulation at Sec. 603.5(i) limits the
scope of disclosures to those made for purposes of UC program oversight
and audits. The August 2025 NPRM did not propose to alter the existing
regulation on the allowable scope of such a disclosure, and this rule
also does not modify the current protections or limitations on use
[[Page 58601]]
of data that are applicable to required disclosures, including those
that apply across the Federal Government.
d. Claimants Deterred From Interaction With UC System
Comments: Some commenters, including State UC agencies and an
advocacy organization, asserted that the August 2025 NPRM could
undermine confidence in the UC system, such that individuals may
believe that their confidential information would not be adequately
protected or would be used for broader purposes than UC oversight. Some
commenters elaborated that this could deter legitimate claimants from
accessing benefits under UC programs.
Response: This final rule does not alter the existing regulation on
the allowable scope of such a disclosure, and this rule also does not
modify protections or limitations on use of data that is applicable to
required disclosures. This final rule takes what States are permitted
to do currently and all States have been doing and makes it a
requirement.
Any Federal official inside or outside the Department that obtains
confidential UC information under this rule for purposes of UC program
oversight and audits will be required to comply with all applicable
Federal laws, including those concerning data security and privacy.
Therefore, the Department believes this rule does not dissuade
individuals from filing claims for benefits or otherwise present a
realistic barrier to access.
e. Increased Safety Risk for Certain Communities
Comments: Some commenters, including advocacy organizations and
individual commenters, criticized the August 2025 NPRM for lacking
clarity on how the disclosed data would be secured and used, and
furthermore expressed concern about the disproportionate harms that
certain communities face when their private information is improperly
disclosed or handled without sufficient care.
Response: This final rule continues disclosures of confidential UC
information that have been permissible and occurring since 2006. This
final rule does not alter the existing regulation on the allowable
scope of such a disclosure, and this rule also does not modify
protections or limitations on use of data that is applicable to
required disclosures. This final rule takes what States are permitted
to do currently and all States have been doing and makes it a
requirement. Therefore, the Department believes this rule does not
cause or create any new or increased safety risk for certain
communities due to unauthorized disclosure nor dissuade individuals
from filing claims for benefits or otherwise present a realistic
barrier to access.
f. Recommendations To Limit Negative Impacts on UC Claimants
Comments: Several commenters, including advocacy organizations, a
professional association, and a State UC agency, advocated for
modifications to the August 2025 NPRM that would provide greater
protections for UC claimants, such as improving transparency about data
collection and use practices, prohibiting the use of UC information in
immigration enforcement, and generally protecting against inappropriate
use of confidential UC information. Another advocacy organization urged
the Department to clarify who would have data access, limit that access
to a small group of civil servant DOL employees, and limit the extent
of their access to specific fraud investigations. Similarly, a few
commenters requested that the Department clarify limitations on data
use and sharing and specify disposal requirements.
Response: The existing regulation at Sec. 603.5(i) limits the
scope of disclosures to those that are for purposes of UC program
oversight and audits. This rule does not alter the existing regulation
on the allowable scope of such a disclosure, and this rule also does
not modify the current protections or limitations on use of data that
are applicable to required disclosures, and those that apply across the
Federal Government.
Further, the Department's addition of Sec. 603.10(e), requires
certain Federal officials other than the Department, DOL-OIG, and GAO,
to provide requests in writing to the State UC agency stating how the
information will be used and how that use is for purposes of UC program
oversight and audits under Sec. 603.6(c); to limit their use of the
information to the uses stated in the request, except as required by
Federal law; and to cite the Federal official's authority for UC
program oversight and audits. This addition provides clarity to States
responsible for disclosing confidential UC information to Federal
officials.
g. Call for Specific Data Elements To Be Enumerated
Comments: An advocacy organization and some individual commenters
requested that the Department withdraw the August 2025 NPRM until it
can clarify which information would be disclosed under the NPRM, such
as whether it would extend beyond claims data to wage data, payment
records, or other information beyond what is required for claims
processing. Some of these commenters expressed particular concern about
expanding the disclosure to include wage data, reasoning that such
information is especially sensitive and its disclosure would have
heightened implications for both individuals and States.
Response: The Department declines to enumerate an exhaustive list
of specific data elements required to be disclosed as this can vary in
accordance with the specific UC program oversight or audit activity
taking place. This rule does not change what UC information is subject
to disclosure under Sec. 603.5(i) for purposes of UC program oversight
and audits, but rather, makes such disclosures a requirement. This
final rule does not expand the categories of information that may be
disclosed, nor does it authorize new uses of such information; rather,
it takes what States are permitted to do currently and all States have
been doing and makes it a requirement. Nor does the existing regulation
specify specific data elements for other disclosures. Codifying a rigid
list of data elements would unnecessarily constrain the oversight and
audit function of Federal officials, as well as the UC system's ability
to respond in a timely and effective manner to emerging fraud schemes
and other risks that often evolve rapidly. Maintaining flexibility
within established confidentiality protections allows the Federal-State
partnership to adapt oversight activities as needed while continuing to
safeguard claim information. The Department notes that Federal
officials requesting data may do so, where applicable, in accordance
with the Privacy Act, and issue SORNs, which identify the information
being collected and are publicly available.
4. Employer Impacts
a. Concerns Regarding Sensitive or Confidential Information
Comments: A State UC agency, a coalition of advocacy organizations,
and an individual commenter expressed concern about releasing
confidential or sensitive UC data to DOL. Likewise, State UC agencies
critiqued the August 2025 NPRM for not defining a ``Federal official''
or which Federal entities or officials would gain access to the
disclosed data for what purposes or oversight. A State UC agency
articulated that while current practice allows States the discretion to
determine if an information request aligns with State
[[Page 58602]]
interest, the NPRM would remove State discretion and data control.
Response: This final rule does not alter the existing regulation,
as amended in 2006, regarding the allowable scope of disclosures of
confidential UC information for purposes of UC program oversight and
audits. Additionally, this final rule does not modify the protections
or limitations on use of data that are applicable to required
disclosures. This final rule takes what States are permitted to do
currently, and which all States have been doing, and makes it a
requirement. Any Federal official that obtains confidential UC
information under this rule for purposes of UC program oversight and
audits is required to comply with all applicable Federal laws,
including those concerning security and privacy. With respect to
concerns about defining ``Federal official'' or identifying specific
Federal entities, the definition of ``Federal official'' has not been
altered and retains the same meaning as in the existing regulation. The
Department notes that access to confidential UC information is limited
to authorized personnel acting within the scope of their official
duties related to UC program oversight and audits.
Regarding deference to State discretion over whether to provide
requested information, the Department emphasizes that the UC program is
a Federal-State partnership in which Federal oversight is a core
statutory responsibility. Effective program integrity in the UC system
increasingly depends on the ability to identify risks and fraud
schemes. Responding to requests from Federal officials seeking
confidential UC information for purposes of UC program oversight and
audits enables nationwide analysis, coordination, and oversight that
individual States, acting alone, are not positioned to perform. Federal
access to this information for purposes of UC program oversight and
audits supports the detection of multistate fraud patterns, the
assessment of systemic vulnerabilities, and the development of targeted
guidance and corrective actions that strengthen the integrity of the UC
system as a whole. Requiring disclosure of this information removes any
barriers to access that might arise: (1) when the requirement for such
disclosure is subject to time-limited conditions of individual grants;
or (2) States choosing not to disclose due to the disclosure being
permissive--thus streamlining access to data now and into the future.
Mandating disclosure strengthens overall program integrity by, among
other things, ensuring that oversight activities are informed by
complete and consistent data, thereby protecting public resources.
Further, the Department's addition to Sec. 603.10(e), requires
certain Federal officials other than the Department, DOL-OIG, and GAO
to provide requests in writing to the State UC agency stating how the
information will be used and how that use is for purposes of UC program
oversight and audits under Sec. 603.6(c); to limit their use of the
information to the uses stated in the request, except as required by
Federal law; and to cite the Federal official's authority for UC
program oversight and audits. This addition provides clarity to States
responsible for disclosing confidential UC information to Federal
officials.
b. Recommendations for Limits on Data Sharing
Comments: Some State UC agencies recommended that the Department
explicitly clarify limits on data sharing and usage to protect the
confidentiality of employer information, including by providing clear
and strict parameters for storing, maintaining, and securing data.
Response: This final rule does not expand the categories of
information that may be disclosed, nor does it authorize new uses of
such information; rather, it requires disclosure of information that
States are already disclosing to Federal officials for purposes of UC
program oversight and audits. Any Federal official that obtains
confidential UC information under this rule for purposes of UC program
oversight and audits will be required to comply with all applicable
Federal laws, including the Privacy Act. Further, in response to
concerns raised by commenters, Sec. 603.10(e) of this final rule now
specifies that other Federal officials who request confidential UC
information from State UC agencies must limit their use of the
confidential UC information to the uses stated in the written request,
except as required by Federal law.
5. Suggestions for Other Approaches the Department Could Take
a. Updating Rulemaking
Comments: An advocacy organization reasoned that the August 2025
NPRM would benefit from more feedback from experts and advocates, and
so recommended that DOL issue an updated RFI to solicit additional
information from the regulated community and stakeholders, and then
prepare an updated NPRM based on that feedback. Similarly, an
individual commenter urged DOL to consult with employers and payroll
departments to develop a new NPRM that would provide more information
to States and employers about the kinds of data that would be collected
and how it would be used.
Response: The Department declines the recommendation to issue an
additional RFI or to initiate a new NPRM for this change. As explained
in the August 2025 NPRM and in the letter denying the comment period
extension requests posted to the docket, the Department previously
engaged with the regulated community on the topics covered in the
August 2025 NPRM, including through the 2023 RFI. The Department also
announced at that time that it was considering comprehensive updates to
the UC confidentiality regulations and that information received in
response to the 2023 RFI would inform and be considered by the
Department as part of that potential rulemaking. The August 2025 NPRM
was more limited in scope than the 2023 RFI and included a 30-day
comment period for stakeholders to further provide comment on the
changes the Department proposed to make to the Part 603 regulation.
b. Consider Existing or Targeted Policy Approaches
Comments: Several commenters recommended alternative targeted
approaches to strengthen fraud prevention, such as increasing grants to
States, developing interstate data cooperation mechanisms, establishing
a limited-scope channel for IGs to collect specific records, and using
aggregated data to identify potential areas for fraud and target more
specific data requests. A union also emphasized the importance of
congressional action to prevent fraud in the UC system. Commenters also
discussed State efforts already underway, including using Department-
provided tools under the Unemployment Insurance Integrity Center. A
union identified declining improper payment rates as evidence current
State efforts are working, thus precluding the need for this rule. The
individual commenter went further, criticizing the Department for
declining to consider such alternative, targeted policy solutions in
the August 2025 NPRM. Some unions reasoned that because the emergency
programs established during the pandemic, which saw high rates of
fraud, have since expired, any fraud that resulted from those programs
also will have ceased, thus eliminating the need for the NPRM.
Response: The Department agrees that strengthening fraud prevention
in the UC system requires sustained attention and continued investment.
Although
[[Page 58603]]
fraud associated with pandemic-era programs has declined following the
expiration of those programs, fraud and improper payments in the UC
system remain a persistent concern. The UC program operates counter-
cyclically. Arguments that the type of fraud experienced during the
pandemic was unique to the now-expired CARES Act programs do not
address the realities of the ever-increasing sophistication and
national-scope of fraud schemes, or the need to ensure the resilience
of the UC system for future economic downturns. Longstanding structural
challenges, such as legacy information technology systems, staffing
constraints, and uneven fraud detection capabilities, continue to
create vulnerabilities. As documented by DOL-OIG, pandemic aside, the
UC program has experienced some of the highest improper payment rates
across Federal programs for many years, underscoring the ongoing need
for effective oversight and modernization.\8\
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\8\ DOL-OIG, ``U.S. Department of Labor's Top Management and
Performance Challenges,'' Jan. 2026, <a href="https://www.oig.dol.gov/public/DOL-OIG%202025%20Top%20Management%20and%20Performance%20Challenges.pdf">https://www.oig.dol.gov/public/DOL-OIG%202025%20Top%20Management%20and%20Performance%20Challenges.pdf</a>.
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The Department does not view this final rule as inconsistent with,
or a substitute for, the existing or targeted policy approaches
recommended by commenters. To the contrary, many of the strategies
cited, such as identity verification tools, IT modernization efforts,
interstate coordination mechanisms, and the use of aggregated data to
identify risk, are complementary to providing data access for purposes
of UC program oversight and audits. With respect to the improper
payment rate, while it has declined since the pandemic ended, the
decline resulted from significant joint efforts between the States and
the Federal Government, and yet the national average remains above the
ten percent target.
The Department considered alternatives such as reliance on
voluntary cooperation, existing policy tools, or targeted initiatives.
However, those approaches alone do not provide the level of consistency
and timeliness necessary for effective oversight of the UC system.
6. Other Comments About the Proposed Requirement
a. Unspecified Use of Disclosed Data
Comments: Some commenters, including State UC agencies and advocacy
organizations, expressed concern that the August 2025 NPRM did not
specify the purpose and use of the collected confidential UC
information, with a State UC agency and State elected official urging
the Department to describe and limit the uses of the collected
information. An advocacy organization similarly recommended that the
Department withdraw the August 2025 NPRM to address these concerns and
identify specific data points requested and the reasons for each.
Likewise, an anonymous commenter wrote that data usage should be
limited to program integrity audits and fraud detection and that
restricting eligibility for or reduction of benefits should be
prohibited. Finally, some commenters expressed concern that the
Department's statements about E.O. 14243 indicate that the Department
wants unfettered access to confidential UC information and that the
Department has been unclear about whether either the Department will
share confidential information beyond the needs of the UC program or
the States will be required to widely share confidential UC information
with Federal officials who may use the data for various non-UC
purposes.
Response: The Department reiterates that any Federal official that
obtains confidential UC information under this rule for purposes of UC
program oversight and audits will be required to comply with all
applicable Federal laws, including the Privacy Act. These purposes are
consistent with existing statutory and regulatory authority and do not
extend to Department actions on eligibility determinations or benefit
reductions. Furthermore, the Department added a new provision to Sec.
603.10 that requires Federal officials other than the Department, DOL-
OIG, and GAO who are requesting information pursuant to Sec. 603.6(c)
to provide requests in writing to the State UC agency stating how the
information will be used and how that use is for purposes of UC program
oversight and audits; to limit their use of the information to the uses
stated in the request, except as required by Federal law; and to cite
to the Federal official's authority for UC program oversight and
audits.
b. Lack of Privacy Protection for Disclosed Data
Comments: State UC agencies and an anonymous commenter expressed
concern that the August 2025 NPRM did not include provisions detailing,
nor did the NPRM provide any assurances regarding how the Department
will protect and secure the confidential UC information it will collect
and store under this rule. A State UC agency elaborated that the threat
of data breaches continually increases as data hacking grows more
sophisticated. Similarly, a different State UC agency questioned what
data transfer methodology would be used, expressing concern that data
technologies in their State might have insufficient firewall
protections despite ongoing modernization efforts. The commenter
further remarked that without data-sharing agreements, States might be
vulnerable to legal liability for data breaches. An anonymous commenter
urged the Department to mandate protections such as encryption, data
minimization, and destruction timelines for data that is no longer
needed. Another State UC agency wrote that the August 2025 NPRM would
``undoubtedly'' put confidential UC information at risk.
Response: This final rule does not alter the existing regulation,
as amended in 2006, regarding the allowable scope of such disclosures
of confidential UC information for purposes of UC program oversight and
audits. Additionally, this final rule does not modify the protections
or limitations on use of data that is applicable to required
disclosures. This final rule takes what States are permitted to do
currently, and which all States have been doing, and makes it a
requirement. Any Federal official that obtains confidential UC
information under this rule for purposes of UC program oversight and
audits is required to comply with all applicable federal laws,
including those concerning security and privacy.
c. Undefined Terms
Comments: Some commenters, including State UC agencies and an
advocacy organization, described issues that could arise from terms
being left undefined in the August 2025 NPRM, including whether the
data could be used for other purposes and who could request this data.
Commenters particularly identified ``Federal official,'' ``oversight,''
and ``UC program oversight and audits'' as terms they recommend be
defined.
Response: Under this final rule a State UC agency must disclose
confidential UC information to Federal officials for purposes of UC
program oversight and audits. In requiring disclosure of information
that is already permissible to disclose under existing confidentiality
regulations, the terms ``Federal official'' and ``UC program oversight
and audits'' retain the same meaning as in the existing regulation.
Thus, the Department is not defining those terms in this final rule.
[[Page 58604]]
d. Requests To Retain Regulatory Language
Comments: A few State UC agencies specified a preference for the
Department to retain the current regulatory language of Sec. 603.5(i)
without adding any regulatory text to Sec. 603.6.
Response: The Department considered retaining the current
regulatory language in Sec. 603.5(i) without adding a required
disclosure to Federal officials for purposes of UC program oversight
and audits to Sec. 603.6. However, this proposed change provides for
the Secretary and other Federal officials to be able to obtain the
information needed from State UC agencies by removing barriers that
might arise: (1) when the requirement for such disclosure is subject to
time-limited conditions of individual grants; or (2) States choosing
not to disclose due to the disclosure being permissive. This regulatory
change streamlines access to the data now and into the future, thereby
strengthening overall program integrity and ensuring proper oversight
of the UC program. Audits and oversight of the UC program by the
Department, DOL-OIG, and other Federal officials are essential for
detecting fraud vulnerabilities and identifying possible solutions, and
are necessary to hold State UC agencies accountable for administering
the UC program consistent with Federal law requirements. The rise of
fraud incidents and sophisticated multistate fraud schemes demand
action by the Department to strengthen program integrity and safeguard
the UC program from fraudulent activity.
7. Implementation, Compliance, and Enforcement
Comments: A few commenters provided suggestions to improve
implementation of the August 2025 NPRM. A couple State UC agencies
asserted that implementation would require rule and legislative changes
in their State, with one warning that such changes could not be made
immediately. An individual commenter recommended that the Department
consider time-limited pilots with sunset clauses as a possible
moderated policy approach.
Another individual commenter noted that States vary widely in terms
of their privacy laws, data storage capabilities, and technical
capacities, and warned that assuming uniform readiness among the States
to implement the August 2025 NPRM would lead to unattainable compliance
standards and result in many agencies potentially facing penalties for
circumstances beyond their control.
Response: The Department notes that the scope of disclosure largely
remains the same as the existing regulation and the Department believes
the cost of changes will be minimal. States have been making
disclosures for purposes of UC program oversight and audits to the
Department and DOL-OIG for several years now. Even after the effective
date of this rule, which is 60 days after publication, the compliance
date gives States 1 year to amend their State laws, if needed.
8. Administrative Procedure Act Arguments
Comments: Some commenters argued the August 2025 NPRM did not meet
the requirements of the Administrative Procedure Act (APA). The
commenters raised concerns that the NPRM lacked sufficient detail for
commenters to meaningfully respond and that the Department did not
provide adequate notice and period to respond. Additionally, commenters
concluded that the NPRM fell short of the APA's requirements on several
fronts, namely by failing to offer adequate justification, ignoring
States' reliance interests under existing confidentiality laws, and not
considering less intrusive alternatives (e.g., aggregate or de-
identified data).
Response: The Department disagrees with the commenters' assertions
that the August 2025 NPRM did not meet the requirements of the APA. The
Department notes that in addition to discussing the proposed changes to
the regulatory text, the August 2025 NPRM provided specific regulatory
text. The Department is adopting that text with changes that, as
discussed above, stem directly from the comments received. The
Department provided adequate notice and opportunity for comment through
the publication of the August 2025 NPRM and the 2023 RFI, and their
accompanying comment periods, as explained in section II of this
preamble.
As explained in the August 2025 NPRM and throughout this preamble,
the Department is amending part 603 to require disclosure of
confidential UC information to Federal officials, including DOL-OIG,
for purposes of UC program oversight and audits to ensure the UC
program is being administered consistent with Federal law and to
identify and prevent fraud. The Department did not identify reliance
interest concerns under existing confidentiality laws as the purpose
and scope of the subject disclosures have not changed. The disclosures
required by this final rule, which are already permissible and
occurring under existing confidentiality regulations for purposes of
Federal oversight and audits, remain subject to existing
confidentiality, privacy, and data-security requirements.
The statement that the Department failed to consider less intrusive
alternatives is incorrect. The Department analyzed reasonable
regulatory alternatives, including making no change to part 603
concerning disclosure of confidential UC information to Federal
officials. Ultimately, the Department determined this final rule was
necessary to ensure the UC program is being administered consistent
with Federal law and to identify and prevent fraud. The Department's
analysis is detailed in section IV.A.2 of this preamble.
IV. Rulemaking Analyses and Notices
A. Executive Orders 12866 (Regulatory Planning and Review), 13563
(Improving Regulation and Regulatory Review), and 14192 (Unleashing
Prosperity Through Deregulation), and Subtitle E of the Small Business
Regulatory Enforcement Fairness Act of 1996
E.O. 12866, ``Regulatory Planning and Review'' (58 FR 51735 (Oct.
4, 1993)), requires agencies, to the extent permitted by law, to: (1)
propose or adopt a regulation only upon a reasoned determination that
its benefits justify its costs (recognizing that some benefits and
costs are difficult to quantify); (2) tailor regulations to impose the
least burden on society, consistent with obtaining regulatory
objectives, taking into account, among other things, and to the extent
practicable, the costs of cumulative regulations; (3) select, in
choosing among alternative regulatory approaches, those approaches that
maximize net benefits; (4) to the extent feasible, specify performance
objectives, rather than specifying the behavior or manner of compliance
that regulated entities must adopt; and (5) identify and assess
available alternatives to direct regulation, including providing
economic incentives to encourage the desired behavior, such as user
fees or marketable permits, or providing information upon which choices
can be made by the public.
Section 6(a) of E.O. 12866 also requires agencies to submit
``significant regulatory actions,'' as defined by section 3(f) of that
order, to the Office of Information and Regulatory Affairs (OIRA),
which is part of the Office of Management and Budget (OMB). OIRA has
determined that this final rule is a ``significant regulatory action''
under section 3(f) of E.O. 12866. Accordingly, this final rule was
submitted to OIRA for review. E.O. 13563 directs agencies
[[Page 58605]]
to propose or adopt a regulation only upon a reasoned determination
that its benefits justify its costs; it is tailored to impose the least
burden on society, consistent with achieving the regulatory objectives;
and in choosing among alternative regulatory approaches, the agency has
selected those approaches that maximize net benefits.
E.O. 14192, titled ``Unleashing Prosperity Through Deregulation,''
was issued on January 31, 2025. This final rule is exempt from E.O.
14192 pursuant to section (5)(c) of the E.O.
Pursuant to Subtitle E of the Small Business Regulatory Enforcement
Fairness Act of 1996, also known as the Congressional Review Act (5
U.S.C. 801 et seq.), OIRA has designated this rule as not a ``major
rule,'' as defined by 5 U.S.C. 804(2).
1. Statement of Need
The Department amends 20 CFR part 603 to require, rather than
permit, the disclosure of confidential UC information to Federal
officials for purposes of UC program oversight and audits. Since this
regulation was first promulgated, and as State UC operations have
evolved, States have faced increased fraud incidents, including
sophisticated multistate fraud schemes by organized criminals. During
the COVID-19 pandemic, there was a sizable increase in fraudulent
activity costing UC programs billions of dollars according to estimates
by DOL-OIG. DOL-OIG identified $45.6 billion in potentially fraudulent
benefits under UC programs in six high-risk areas,\9\ and it estimated
$191 billion in benefits under UC programs during the pandemic period
could have been paid improperly, with a significant portion
attributable to fraud.\10\
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\9\ DOL-OIG Alert Memorandum: Potentially Fraudulent
Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion Report Number: 19-22-005-03-315, issued Sept. 21,
2022, <a href="https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf">https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf</a>.
\10\ ``The Greatest Theft of American Tax Dollars: Unchecked
Unemployment Fraud,'' Hearing, Statement for the Record of Larry D.
Turner, Inspector General, U.S. Department of Labor; House Committee
on Ways and Means, Feb. 8, 2023, <a href="https://www.oig.dol.gov/public/testimony/02082023.pdf">https://www.oig.dol.gov/public/testimony/02082023.pdf</a>.
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The Secretary must have the tools necessary to ensure that UC
programs are administered consistent with the requirements of Federal
law. Mandatory disclosure of confidential UC information to Federal
officials, including DOL-OIG, for purposes of UC program oversight and
audits is essential to ensure the UC program is being administered
consistent with Federal law and to identify and prevent fraud.
Codifying the requirement for such disclosures allows Federal officials
to fully utilize UC program oversight and audits to hold State UC
agencies accountable in identifying and preventing fraud in UC
programs.
2. Alternatives Considered
OMB Circular A-4, which outlines best practices in regulatory
analysis, directs agencies to analyze reasonable regulatory
alternatives to the proposed regulatory action. Accordingly, the
Department considered two alternatives regarding disclosure of
confidential UC information to Federal officials for purposes of UC
program oversight and audits.
The first alternative was to make comprehensive updates to part
603, including to require States to disclose confidential UC
information to DOL-OIG for purposes of UC program oversight and audits.
The comprehensive updates the Department considered and that were
described in the Fall 2024 Unified Agenda of Regulatory and
Deregulatory Actions would have included additional amendments
regarding issues raised by stakeholders over the years, including
addressing questions around sharing information across the workforce
system, the permissibility and use cases of sharing information with
agencies within the Department for analysis and evaluation, the
permissibility of disclosing confidential UC information to federally
recognized Indian Tribes, data warehousing, and the use of contractors
and subcontractors. While the Department gained valuable information
from the engagement with stakeholders and the 2023 RFI, the Department
ultimately decided that the most critical step needed at this time was
to address fraud in UC programs by ensuring that Federal officials,
including DOL-OIG, have access to data to conduct oversight and combat
fraud.
Another option considered was to make no change to part 603
concerning disclosure of confidential UC information to Federal
officials, including to DOL-OIG. The Department decided against
maintaining the status quo because the rise of fraud incidents and
sophisticated multistate fraud schemes demand immediate action by the
Department to ensure that Federal officials continue to have the access
now and into the future to confidential UC information for purposes of
UC program oversight and audits by removing any barriers that might
arise: (1) when the requirement for such disclosure is subject to time-
limited conditions of individual grants; or (2) States choosing not to
disclose due to the disclosure being permissive. Proceeding with this
regulatory change, thus, will strengthen the overall program integrity
for Federal officials to hold States accountable for ensuring benefits
are paid only to eligible individuals and withheld from those who are
ineligible, thus assisting with the statutory requirement for accurate
and timely payments under sec. 303(a)(1), SSA.
3. Economic Analysis
The Department conducted an economic analysis to determine the
costs of this final rule and to consider the benefits and the impact of
transfers under this rule. The Department recognizes potential costs of
this rule for required one-time technological upgrades, compliance
costs, and recurring costs related to data submission. However, data
availability prevents the Department from estimating these costs.
Despite its efforts to gather information through a survey of nine
States, the 2023 RFI, and the August 2025 NPRM, the Department did not
receive enough data that would allow for the quantification of
realistic cost estimates. State UC agencies are largely already
disclosing the information that this final rule codifies to the
Department and DOL-OIG, minimizing any new costs.
Additionally, this final rule imposes a one-time regulatory
familiarization cost on the 53 State UC agencies. These costs are
associated with State UC agency staff reviewing the new regulation and
conducting internal discussions and are determined using BLS
Occupational Employment and Wage Statistics (OEWS) data and estimates
of the time required to become familiar with this rule.
The Department considers the benefits of this final rule to be
substantial, including ensuring program integrity and building and
maintaining public trust in the UC system. Specific benefits include
enhancement of fraud prevention, identification, and investigation and
providing strong oversight and accountability through timely audits and
evaluations. Data availability and uncertainty limit the Department's
ability to quantify the benefits of this rule.
Comments: Some commenters, including an advocacy organization, a
union, and individual commenters, expressed concern that the August
2025 NPRM's economic analysis was insufficient because it did not
quantify the NPRM's costs or adequately demonstrate that its benefits
outweigh its costs. An anonymous commenter suggested that the
Department publish a
[[Page 58606]]
quantitative cost-benefit analysis and sector-specific prevalence data
to justify the need for this rule. An advocacy organization
specifically criticized the Department for not quantifying additional
workloads on State UC agencies associated with broad, mandatory data-
sharing requirements. The commenter furthermore warned that this rule
would place increased strain on State UC agency budgets already
stretched due to decreasing Federal funding, a strain that could
interfere with State UC agencies' ability to fulfill their statutory
obligations for prompt payment, risking material impacts on UC
recipients.
Response: The Department does not anticipate that the costs
associated with this final rule will be economically significant.
States are currently processing permissible disclosure requests from
Federal officials. Any additional costs would arise from the change to
these being required disclosures. The Department does not expect a
significant increase in the number of disclosures under this rule
compared to the number of disclosures States provide to Federal
officials for UC program oversight and audits under the existing
regulation.
Despite its efforts to gather information through the 2023 RFI and
the 2024 survey of nine States, the Department did not receive enough
data to provide reasonable cost estimates. Moreover, the Department did
not receive public comments or input in response to the August 2025
NPRM that would make quantification of the compliance costs feasible.
Comments: A few commenters critiqued the August 2025 NPRM as
lacking evidence that it would add value to existing State UC integrity
efforts. A few State UC agencies and a State elected official asserted
that the NPRM likely would be duplicative of States' efforts to combat
UC fraud and would not add value while introducing fiscal inefficiency
and data security risks into the UC system. Further, the commenters
cautioned that the Department would incur staffing and infrastructure
costs to accommodate increased data storage, maintenance, and security.
Response: The Department recognizes that significant efforts have
been made across the UC system to combat UC fraud. While the Department
acknowledges commenters' concerns about potential overlap with State
initiatives, the Department's primary goal is to enhance existing fraud
prevention measures, thereby complementing State efforts rather than
duplicating them, and informing efforts to hold States accountable for
continuing such efforts.
Although the implementation of new requirements may incur staffing
and infrastructure costs to the Department, these investments are
crucial for strengthening the integrity of the UC system. The
Department anticipates that this rulemaking will provide important
benefits, particularly in terms of fraud prevention and program
integrity.
a. Rule Familiarization Costs
Regulatory familiarization costs represent direct costs to the 53
State UC agencies with UC programs that will need to review the new
regulation in order to implement it. Consequently, this final rule will
impose a one-time familiarization cost to those entities in the first
year after promulgation. The Department anticipates that the changes
introduced by this rule will be reviewed by General and Operations
Managers (SOC code 11-1021), Lawyers (SOC code 23-1011), and Computer
Systems Analysts (SOC code 15-1211) employed by State UC agencies
within the State government.\11\ The Department anticipates that it
will take one State UC Manager, one Lawyer, and one Computer Systems
Analyst an average of 1 hour each to review this rule and hold a
meeting concerning this rule.
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\11\ This analysis uses codes from the Standard Occupational
Classification (SOC) system and the North American Industry
Classification System.
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The BLS OEWS data shows that the mean hourly wage of a State
government General and Operations Manager is $63.12.\12\ The Department
assumes a 62-percent benefits rate \13\ and a 17-percent overhead
rate,\14\ so the fully loaded wage rate is $112.98 [= $63.12 + ($63.12
x 62%) + ($63.12 x 17%)]. The BLS OEWS data show that the mean hourly
wage of a State government Lawyer is $58.24.\15\ The fully loaded wage
rate is $104.25 [= $58.24 + ($58.24 x 62%) + ($58.24 x 17%)]. The BLS
OEWS data show that the mean hourly wage of a State government Computer
Systems Analyst is $44.97.\16\ The fully loaded wage rate is $80.50 [=
$44.97 + ($44.97 x 62%) + ($44.97 x 17%)].
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\12\ General and Operations Managers (11-1021), for industry
type ``State Government, excluding Schools and Hospitals,'' period
May 2025. Data extracted on July 16, 2026, from <a href="https://www.bls.gov/oes/">https://www.bls.gov/oes/</a>.
\13\ BLS, ``National Compensation Survey, Employer Costs for
Employee Compensation,'' <a href="https://www.bls.gov/ecec/data.htm">https://www.bls.gov/ecec/data.htm</a> (last
visited July 16, 2026). For State and local government workers,
wages and salaries averaged $39.87 per hour worked in 2025, while
benefit costs averaged $24.86, which is a benefits rate of 62
percent.
\14\ Cody Rice, U.S. Environmental Protection Agency, ``Wage
Rates for Economic Analyses of the Toxics Release Inventory
Program,'' June 10, 2002, <a href="https://www.regulations.gov/document?D=EPA-HQ-OPPT-2014-0650-0005">https://www.regulations.gov/document?D=EPA-HQ-OPPT-2014-0650-0005</a>.
\15\ Lawyers (23-1011) for industry type ``State Government,
excluding Schools and Hospitals,'' period May 2025. Data extracted
on July 16, 2026, from <a href="https://www.bls.gov/oes">https://www.bls.gov/oes</a>.
\16\ Computer Systems Analysts (15-1211) for industry type
``State Government, excluding Schools and Hospitals,'' period May
2025. Data extracted on July 16, 2026, from <a href="https://www.bls.gov/oes">https://www.bls.gov/oes</a>.
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The time burden of 1 hour was multiplied by the estimated number of
entities (53) and the total of the loaded hourly wage rate of the
readers ($112.98 + $104.25 + $80.50 = $297.73). This calculation
results in a one-time undiscounted cost of $15,780 in the first year
after this rule takes effect.
b. Technology Costs for State UC Agencies
This final rule may require States to update computer systems and
security protocols in order to comply with Federal and State laws
concerning safeguarding confidential UC information. State UC agencies
already have processes and systems in place for providing information
to Federal officials, including the Department and DOL-OIG. The
Department is unable to quantify the number of States that may need to
perform additional IT updates to accommodate the changes from this rule
and determine whether updates will require upgrades to existing
technology or the purchasing of new components.
Comments: Some individual commenters remarked that if States are
required only to submit information they have already been providing in
recent years, then updates to their IT systems would not be necessary.
In the same vein, a union noted that the August 2025 NPRM stated that
the NPRM could impose compliance costs for new technologies or upgrades
to manage data submissions, but questioned what these potential costs
might be if the NPRM would only continue current fraud prevention
efforts. A State UC agency asserted it would face minimal impacts
because it already provides this data to DOL on a quarterly basis.
Conversely, some unions expressed concern about potential costs to
States to develop and maintain new IT systems or to reconfigure
existing ones under this rule, especially amid Federal funding cuts.
A State UC agency said that they are currently undergoing
modernization efforts and would need to consult with their vendor to
determine the extent of changes and costs required to be compliant with
the August 2025 NPRM.
Response: Regarding the absence of responses regarding cost
estimates to the August 2025 NPRM, this gap in data is
[[Page 58607]]
primarily due to insufficient information gathered. Stakeholders did
not provide the Department with enough input to generate realistic cost
projections from the 2023 RFI or the 2024 survey. Furthermore, the
Department did not obtain any public comments or feedback based on the
August 2025 NPRM that would enable the quantification of compliance
costs.
As discussed in section II of this preamble, this final rule does
not address the creation of a national UC claims database. Based on the
changes in this final rule, many States will not face significant IT
investment requirements, or require new IT systems, since many State UC
agencies are already providing this information to Federal officials,
including DOL-OIG, through permissible disclosures.
c. Costs for States To Make Changes to State Law
The requirements for disclosures under State law vary from State to
State. This final rule establishes required disclosures for purposes of
UC program oversight and audits where those disclosures were
permissible under the existing regulation. All States already provide
UC information to Federal officials on a regular basis for purposes of
UC program oversight and audits under the existing regulation. The
Department is unable to identify those State law requirements that
would need to change to conform to this final rule and therefore cannot
quantify any associated costs.
Comments: A State UC agency said no change in State laws would be
required since its current State law permits sharing UC information
with DOL, the Census Bureau, or their agents if required by law or as a
condition of receiving Federal funding. Conversely, an individual
commenter reasoned that because the August 2025 NPRM did not explain
what data are implicated, States cannot estimate how their laws would
be affected. A union asserted that the NPRM conflicted with State-level
privacy protections in dozens of States.
Response: There are several States that enumerate in their State
laws each of the Federally required disclosures of confidential UC
information. These States will need to change their State laws to
include the required disclosures to Federal officials for purposes of
UC program oversight and audits. Due to differences between State laws,
the Department is unable to quantify the costs associated with changing
State laws.
d. Costs for Data Request Fulfillment
Grant funds may be used to cover the costs of providing required
data under this rule to Federal officials for purposes of UC program
oversight and audits. It is not clear whether the data requests
received will be the same requests for data that States already
fulfill, or whether the amended rule will result in new requests.
Generally speaking, the Department does not expect the number of
requests for disclosures to increase significantly because the purpose
of the required disclosure remains narrow; however, there is a
possibility that disclosure requests may increase. Because of this
ambiguity, the Department cannot quantify the magnitude of the
potential increased costs to the States of responding to the data
requests. Further, State UC administrative grant funds may be used by
the States, where available, to offset possible increases in costs.
Comments: An individual commenter said the August 2025 NPRM did not
clarify how costs to States to comply with this rule would be paid.
Response: The Department's amendment to Sec. 603.8 makes clear
that disclosures for purposes of UC program oversight and audits are
chargeable to a State's UC administrative grant.
e. Non-Quantifiable Benefits
This final rule is expected to generate several important
unquantified benefits that support the integrity and effectiveness of
the UC program. Chief among these is the enhancement of fraud
prevention and detection capabilities. By requiring the disclosure of
confidential UC information to Federal officials for purposes of UC
program oversight and audits, this final rule removes any barriers that
might arise: (1) when the requirement for such disclosure is subject to
time-limited conditions of individual grants; or (2) States choosing
not to disclose due to the disclosure being permissive. This regulatory
change streamlines access to the data now and into the future, thereby
strengthening overall program integrity for Federal officials to hold
States accountable for ensuring that benefits are paid only to eligible
individuals and withheld from those who are ineligible, thus assisting
with the statutory requirement for accurate and timely payments under
sec. 303(a)(1), SSA. This regulatory change also enables nationwide
analysis, coordination, and oversight that individual States, acting
alone, are not positioned to perform.
In addition, this final rule promotes stronger oversight and
accountability by facilitating consistent and timely audits by Federal
officials. This oversight helps the Federal Government to ensure that
State UC programs are administered in compliance with Federal law and
best practices. Federal access to this information helps identify
multistate fraud patterns,\17\ assess systemic vulnerabilities, and
inform targeted guidance and corrective actions to strengthen the
integrity of the UC system as a whole. As noted earlier in this
preamble, this final rule merely aligns the part 603 regulations with
longstanding practice, and States already have processes and systems in
place for sharing UC information with Federal officials; accordingly,
the Department expects this final rule to have minimal impacts and
limited incremental costs and benefits. This final rule formalizes that
practice and closes an oversight gap by requiring States to disclose
such information upon request to the Department and other Federal
officials for purposes of UC program oversight and audits.
---------------------------------------------------------------------------
\17\ OIG Audit Report, COVID-19: ETA Needs to Improve its
Oversight of States' Efforts to Identify Multistate UI Fraud, August
2, 2025; <a href="https://oig.dol.gov/public/reports/oa/2025/19-25-004-03-315.pdf">https://oig.dol.gov/public/reports/oa/2025/19-25-004-03-315.pdf</a>.
---------------------------------------------------------------------------
Moreover, because this rule requires disclosure of confidential UC
information to Federal officials for purposes of UC program oversight
and audits, this final rule supports program integrity and performance.
This approach enhances the efficiency and responsiveness of the UC
program. This final rule also aligns with recent executive orders aimed
at reducing information silos and improving interagency collaboration
to combat waste, fraud, and abuse.
Finally, by reinforcing transparency and accountability in the
administration of the UC program, this final rule helps to build and
maintain public trust in the system. Although these potential benefits
are not readily quantifiable, they represent significant improvements
in the administration, oversight, and public perception of the UC
program.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA), 5 U.S.C. chapter 6, requires
the Department to evaluate the economic impact of this rule on small
entities. The RFA defines small entities to include small businesses,
small organizations (including not-for-profit organizations), and small
governmental jurisdictions. The Department must determine whether this
rule imposes a significant economic impact on a substantial number of
such small entities. The Department concludes that this rule
[[Page 58608]]
does not regulate any small entities directly, so any regulatory effect
on small entities will be indirect. Accordingly, the Department has
determined this rule will not have a significant economic impact on a
substantial number of small entities within the meaning of the RFA.
C. Paperwork Reduction Act of 1995
The purposes of the Paperwork Reduction Act of 1995 (PRA), 44
U.S.C. 3501 et seq., include minimizing the paperwork burden on
affected entities. The PRA requires certain actions before an agency
can adopt or revise a collection of information, including publishing
for public comment a summary of the collection of information and a
brief description of the need for and proposed use of the information.
As part of its continuing effort to reduce paperwork and respondent
burden, the Department conducts a preclearance consultation program to
provide the public and Federal agencies with an opportunity to comment
on proposed and continuing collections of information in accordance
with the PRA. See 44 U.S.C. 3506(c)(2)(A). This activity helps to
ensure that the public understands the Department's collection
instructions, respondents can provide the requested data in the desired
format, reporting burden (time and financial resources) is minimized,
collection instruments are clearly understood, and the Department can
properly assess the impact of collection requirements on respondents.
A Federal agency may not conduct or sponsor a collection of
information unless it is approved by OMB under the PRA and it displays
a currently valid OMB control number. The public is also not required
to respond to a collection of information unless it displays a
currently valid OMB control number. In addition, notwithstanding any
other provisions of law, no person will be subject to penalty for
failing to comply with a collection of information if the collection of
information does not display a currently valid OMB control number (44
U.S.C. 3512).
Comments: An individual commenter said that the lack of a cost-
benefit analysis has implications for the PRA.
Response: This final rule does not require any specific data
collection subject to the PRA. If any information is to be collected
under this authority, it would be subject to the PRA and must meet any
applicable requirements.
D. Executive Order 13132 (Federalism)
E.O. 13132, ``Federalism,'' 64 FR 43255 (Aug. 10, 1999), imposes
certain requirements on Federal agencies formulating and implementing
policies or regulations that preempt State law or that have Federalism
implications. E.O. 13132 requires agencies to examine the
constitutional and statutory authority supporting any action that would
limit the policymaking discretion of the States and to carefully assess
the necessity for such actions. E.O. 13132 also requires agencies to
have an accountable process to ensure meaningful and timely input by
State and local officials in the development of regulatory policies
that have Federalism implications. The Department has reviewed this
final rule in light of these requirements and has concluded that it
meets the requirements of E.O. 13132.
Accordingly, the Department has reviewed this final rule and has
concluded that the rulemaking has no substantial direct effects on
States, the relationship between the Federal Government and the States,
or the distribution of power and responsibilities among the various
levels of government as described by E.O. 13132. Therefore, the
Department has concluded that this final rule does not have a
sufficient federalism implication to require further agency action or
analysis.
Comments: An advocacy organization stated that the August 2025 NPRM
did not comply with E.O. 13132 because it did not limit the preemption
of State law to the minimum level necessary, has no evidence of
consultation with State and local officials while providing only a 30-
day comment period, and provides no indication that funds necessary to
pay the direct costs incurred in complying with the regulation would be
provided to States by the Federal Government (as required by section
6(b)(1) of E.O. 13132).
An advocacy organization and a union argued that by imposing
uniform, required disclosure requirements, the August 2025 NPRM would
undermine the balance of Federal-State authority. Further, the union
asserted that the NPRM was unconstitutional, conflicted with State
privacy laws, and federalism requires these conflicts to be resolved by
Congress.
Response: This final rule does not alter the allowable scope of
disclosures of confidential UC data to Federal officials. The
disclosures required by this final rule are already permissible
disclosures under the existing regulations. Since this final rule does
not substantially alter the scope of the disclosures, E.O. 13132 does
not require further consultation with State and local officials beyond
the normal comment period within the rulemaking process. Such
disclosures are part of the normal business of the administration of UC
programs and would be allowable uses of UC administrative funding.
This final rule also does not modify the protections or limitations
on use of data that are applicable to required disclosures. This rule
merely changes the disclosure from one that a State is permitted to
make to one that the State is required to make. As discussed above, the
Department has the statutory authority to change these disclosures from
permissive disclosures to mandatory disclosures
Although this rule does not have Federalism implications and does
not require further consultation with State and local officials beyond
the normal comment period within the rulemaking process, the Department
has nevertheless pursued such consultation. The Department published
the 2023 RFI, which said ``[t]he Department is considering a regulatory
update to 20 CFR part 603 that would incorporate a requirement for
States to disclose confidential UC information to [DOL-OIG] for
oversight and audits.'' See 88 FR 47829 (July 25, 2023). The 2023 RFI
included questions on the topic and afforded the regulated community an
opportunity to comment. Additionally, the Department's unique
relationship with the States requires regular consultation and
collaboration with State partners, including on matters pertaining to
disclosures of confidential UC information under part 603.
E. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub.
L. 104-4) requires each Federal agency to assess the effects of Federal
regulatory actions on State, local, and Tribal governments and the
private sector. 2 U.S.C. 1531. For a regulatory action likely to result
in a rule that includes any Federal mandate that may cause the
expenditure by State, local, and Tribal governments, in the aggregate,
or by the private sector of $100 million or more in any one year
(adjusted annually for inflation), UMRA requires a Federal agency to
publish a written statement that estimates the resulting costs,
benefits, and other effects on the national economy. (2 U.S.C. 1532(a),
(b)). Relating to small governments, UMRA requires an agency plan for
giving notice and opportunity for timely input to potentially affected
small governments before establishing any requirements that might
significantly or uniquely affect them. Such plan must include an
effective process to permit timely input by elected officers of State,
local, and Tribal governments on
[[Page 58609]]
significant Federal intergovernmental mandates.
The Department examined this final rule according to UMRA and its
statement of policy and determined that this final rule does not
contain a Federal intergovernmental mandate, nor is it expected to
require expenditures of $100 million or more in any one year by State,
local, and Tribal governments, in the aggregate, or by the private
sector. Furthermore, because this rule does not impose a Federal
intergovernmental mandate, this rule does not significantly or uniquely
affect small governments. As a result, the requirements of UMRA do not
apply.
Comments: Some unions, an advocacy organization, an individual
commenter, and an anonymous commenter stated the August 2025 NPRM would
be an unfunded mandate. A union critiqued the Department's reasoning
that the August 2025 NPRM would not trigger UMRA's requirements due to
impact of less than $100 million annually when it also states that it
cannot quantify the State costs. The commenter further asserted that
unfunded mandates in the NPRM would force States to fund Federal
surveillance infrastructure out of their own administrative budgets.
Challenging the adequacy of the NPRM's UMRA analysis, a union cautioned
that ``[c]ertifying compliance without quantification is arbitrary and
capricious under the APA.''
Response: As described in section IV.A.3 of this preamble, the
Department believes that compliance with this rule should impose
minimal costs on States. The Department expects that many States will
not encounter the need for significant technology updates, as States
are already providing the data to Federal officials, including the
Department and DOL-OIG, for purposes of UC program oversight and audits
under the permissible disclosure in the existing regulations. Although
commenters took issue with the Department's position that this rule
does not trigger UMRA's analytical requirements due to its impact of
less than $100 million in any one year by State, local, and Tribal
governments, in the aggregate, or by the private sector, they did not
provide alternate analysis or data to support the position that this
rule would require expenditures of $100 million or more in any one
year. The Department maintains its position that this rule does not
contain a Federal intergovernmental mandate, nor is it expected to
require expenditures of $100 million or more in any one year by State,
local, and Tribal governments, in the aggregate, or by the private
sector.
Additionally, this rule amends Sec. 603.8 to clarify that
disclosures for purposes of UC program oversight and audit are
chargeable to a State's UC administrative grant.
To the commenter's concern that ``[c]ertifying compliance without
quantification is arbitrary and capricious under the APA,'' the
Department notes that the scope of this final rule is limited. All
State UC agencies already provide confidential UC information for
purposes of UC program oversight and audits to Federal officials,
including the Department and DOL-OIG, through permissible disclosures.
Regarding certification under UMRA, the Department conducted an
economic analysis to determine the costs of this final rule as provided
in section IV.A.3 of this preamble. Although data availability prevents
the Department from fully estimating these costs, the Department does
not expect this final rule to require expenditures of $100 million or
more in any one year by State, local, and Tribal governments, in the
aggregate, or by the private sector. States are currently processing
permissible disclosure requests from Federal officials, so any
additional costs would arise from the change to these being required
disclosures, which are expected to be roughly equivalent to the current
number of permissible disclosures for purposes of UC program oversight
and audits.
For these reasons, the requirements of title II of UMRA do not
apply. Therefore, DOL has not prepared a statement under UMRA.
F. Executive Order 13175 (Indian Tribal Governments)
The Department has reviewed this final rule under the terms of E.O.
13175 and the Department's Tribal Consultation Policy and has concluded
that the changes to regulatory text do not have Tribal implications.
These changes do not have substantial direct effects on one or more
federally recognized Indian Tribes, the relationship between the
Federal Government and Indian Tribes, nor the distribution of power and
responsibilities between the Federal Government and Tribal governments.
Comments: An advocacy organization asserted that the August 2025
NPRM did not indicate input was solicited from Tribal officials and
thus did not comply with E.O. 13175. Additionally, the commenter said
the Department's conclusion that there would be no direct effect on
Indian Tribes is incorrect because they employ 355,000 workers and are
part of the Federal-State UC system.
Response: The Department maintains its position that the changes to
regulatory text do not have Tribal implications. This rule requires the
disclosure of information that is currently disclosed by States to
Federal officials on a permissive basis for purposes of UC program
oversight and audits. This rule does not change the scope of
disclosures under the existing regulation, nor does it modify the
current protections or limitations on the use of the data subject to
the required disclosures. This rule therefore does not have substantial
direct effects on one or more federally recognized Indian Tribes, the
relationship between the Federal Government and Indian Tribes, nor the
distribution of power and responsibilities between the Federal
Government and Tribal governments. The Department notes that it
conducted a Tribal consultation in 2023 related to the broadly scoped
2023 RFI (88 FR 53928, July 25, 2023).
List of Subjects in 20 CFR Part 603
Unemployment compensation, Wages.
For the reasons set forth in the preamble, the Department of Labor
amends 20 CFR part 603 as follows:
PART 603--FEDERAL-STATE UNEMPLOYMENT COMPENSATION (UC) PROGRAM;
CONFIDENTIALITY AND DISCLOSURE OF STATE UC INFORMATION
0
1. The authority citation for part 603 is revised to read as follows:
Authority: 42 U.S.C. 503(a)(1); 42 U.S.C. 1302; 29 U.S.C. 3141;
29 U.S.C. 3249; 29 U.S.C. 3343; 20 U.S.C. 1232g.
0
2. Amend Sec. 603.5 by:
0
a. Revising the introductory text; and
0
b. Removing paragraph (i).
The revision reads as follows:
Sec. 603.5 What are the exceptions to the confidentiality
requirement?
The following are exceptions to the confidentiality requirement.
Disclosure of confidential UC information is permissible under the
exceptions in paragraphs (a) through (g) of this section only if
authorized by State law and if such disclosure does not interfere with
the efficient administration of the State UC law. Disclosure of
confidential UC information is permissible under the exception in
paragraph (h) of this section without such restrictions.
* * * * *
0
3. Amend Sec. 603.6 by:
0
a. Redesignating paragraph (c) as paragraph (d); and
[[Page 58610]]
0
b. Adding a new paragraph (c).
The addition reads as follows:
Sec. 603.6 What disclosures are required by this subpart?
* * * * *
(c) The Department of Labor interprets section 303(a)(1), SSA, as
requiring each State UC agency to disclose confidential UC information
upon request to a Federal official for purposes of UC program oversight
and audits.
* * * * *
0
4. Amend Sec. 603.8 by revising paragraph (b) to read as follows:
Sec. 603.8 What are the requirements for payment of costs and
program income?
* * * * *
(b) Use of grant funds permitted. Grant funds paid to a State under
section 302(a), SSA, may be used to pay the costs of only those
disclosures necessary for proper administration of the UC program.
(This may include some disclosures under Sec. 603.5(a) (concerning
public domain information), Sec. 603.5(c) (to an individual or
employer), and Sec. 603.5(d)(1) (to an agent).) In addition, grant
funds may be used to pay costs of disclosures under Sec. 603.6(a) (for
the proper administration of the UC program) and Sec. 603.6(c) (for UC
Program Oversight and Audits). Grant funds may also be used to pay
costs associated with disclosures under Sec. 603.7(b)(1) (concerning
court-ordered compliance with subpoenas) if a court has denied recovery
of costs, or to pay costs associated with disclosures under Sec.
603.7(b)(2) (to officials with subpoena authority) if the State UC
agency has attempted but not been successful in obtaining reimbursement
of costs. Finally, grant funds may be used to pay costs associated with
any disclosure of UC information if not more than an incidental amount
of staff time and no more than nominal processing costs are involved in
making the disclosure.
* * * * *
0
5. Amend Sec. 603.10 by adding paragraph (e) to read as follows:
Sec. 603.10 What are the requirements for agreements?
* * * * *
(e) Request requirements for required disclosures to certain
Federal officials. Federal officials, other than the Department of
Labor, the Department of Labor--Office of Inspector General, and the
Government Accountability Office, making a request for information from
the State UC agency pursuant to Sec. 603.6(c) must do so in writing to
the State UC agency stating how the information will be used and how
that use is for purposes of UC program oversight and audits; stating
that the Federal official will limit their use of the information to
those uses stated in the request, except as required by Federal law;
and citing the Federal official's authority for UC program oversight
and audits.
Marek Laco,
Acting Assistant Secretary for Employment and Training, Labor.
[FR Doc. 2026-18978 Filed 9-15-26; 8:45 am]
BILLING CODE 4510-FW-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.