The bill amends the Unemployment Compensation Law of Pennsylvania by changing the calculation of unemployment benefits for eligible employees. It replaces the term "highest quarterly wage" with "average quarterly wage" to determine the weekly benefit rate, which will now be the greater of the amount specified in a benefits table or fifty percent of the employee's full-time weekly wage. Additionally, if the calculated weekly benefit rate is less than $68, the employee will be ineligible for compensation. The average quarterly wage will be calculated by dividing the total wages paid during the highest earning calendar quarter of the base year by four, and the benefits table will be updated accordingly.

For calendar years 2026 and beyond, the bill further modifies the definition of "highest quarterly wages" to be the average of the total wages from the highest and second-highest earning quarters in the base year. It also sets a cap on the weekly benefit rate at 63% of total base year wages, with certain exceptions. A provision is included that allows for a reversion to the previous method of determining "highest quarterly wages" if the trigger percentage reaches 250% on July 1, 2026, or in subsequent years. These changes aim to create a more equitable and accurate system for determining unemployment benefits in Pennsylvania, with the act taking effect six months after passage.