Covid-19: Expanded Unemployment Assistance for Non-traditional Workers

April 8, 2020

The impact of COVID-19 continues to be felt across the globe, including by the millions of workers who have been laid off in the United States. The CARES Act (the “Act”) has established a temporary, federally funded Pandemic Unemployment Assistance (“PUA”) program for individuals who are otherwise ineligible to receive unemployment benefits, such as gig workers, freelancers, and independent contractors. Note: The Act also establishes a separate Federal Pandemic Unemployment Compensation (“FPUC”) program, which provides supplemental weekly payments for workers who are entitled to traditional unemployment compensation. Though there are many similarities between the programs, this Law Alert is limited to the PUA program.

WHO CAN OBTAIN UNEMPLOYMENT ASSISTANCE UNDER SECTION 2102 OF THE CARES ACT?

Unlike many states’ unemployment laws, the PUA program does not require a covered individual to be actively seeking work to receive unemployment benefits under the program. 

In order to obtain unemployment assistance, an individual will have to provide self-certification that they have the ability to work, except that they are partially unemployed, unemployed or are not available to work as a result of one of the reasons listed below. Additionally, the coverage is extended to those who do not have sufficient work history, are self-employed, or seeking part-time employment, so long as they provide self-certification that they meet one of the following:

  1. they are experiencing symptoms of COVID-19 (for which they are seeking a confirmed diagnosis) or have been diagnosed;
  2. an individual in their household has been diagnosed with COVID-19;
  3. they are providing care for a family member or a member in their household who was diagnosed with COVID-19;
  4. the head of their household has passed away from COVID-19, and the certifying individual has become the breadwinner or major support of their household;
  5. they have primary caregiving responsibilities for a child who is unable to attend school (or another similar facility), because it is closed due to COVID-19;
  6. they do not have the ability to go to their place of employment due to the imposition of a quarantine caused by COVID-19;
  7. their place of employment is closed due to COVID-19;
  8. they have to quit their job because of COVID-19;
  9. they no longer have a job or are unable to reach their job because of COVID-19;
  10. they have received orders from a health care provider to self-quarantine attributable to concerns that are connected to COVID-19; or
  11. they meet additional criteria that the Secretary of Labor for unemployment assistance establishes.

The coverage does not apply to any individual who is currently receiving paid sick leave or other paid leave benefits or individuals who are teleworking with pay.

WHEN AND HOW LONG WILL THE ASSISTANCE BE AVAILABLE?

If a State waives the standard one-week waiting period requirement, allowing recipients to be paid as soon as they become unemployed, the Federal Government will fund the cost of that first week of a benefit.

Generally, the assistance for the covered individuals will be available for weeks of partial  unemployment, unemployment, or an inability to work beginning on or after January 27, 2020 and ending on or before December 31, 2020, so long as the covered individual’s partial or full unemployment, or inability to work as related to COVID-19 persist.

Individuals who remain unemployed after their state employment benefits are exhausted, will receive up to 13 weeks of additional unemployment benefits—thereby increasing the 26-week maximum under most states’ unemployment laws to 39 weeks—at the weekly federal rate of $600.00 during that 13-week period as discussed below.

HOW MUCH WILL AN INDIVIDUAL RECEIVE?

An individual who qualifies for unemployment assistance under Section 2102 will be compensated with a weekly benefit amount equaling 100% of the covered individual’s regular weekly compensation, but not less than $600.00 per week. For covered individuals who are self-employed, their employment assistance amount will be calculated in accordance with section 625.6 of title 20, Code of Federal Regulations.

SHORT-TIME COMPENSATION (“STC”) PROGRAM (certain states).

The Act also provided funding to states that currently have or choose to implement a STC program for employers that reduce their employees’ hours in lieu of a lay-off. Under the STC program, employees will receive a pro-rated unemployment benefit. The federal government will fund 100% of the costs for states that currently have a STC program and 50% for those states that choose to implement one.

WHAT SHOULD YOU DO?

On March 28, 2020, the Georgia Department of Labor (the “GDOL”) signed the documents necessary for the state to access funding for the program. At the direction of the US Department of Labor (“USDOL”), prior to the distribution of the funds, states are to wait for guidance on the implementation of the program. The GDOL is therefore currently awaiting approval from the USDOL in order to implement the program and make the funding available. Instructions on how to apply for the federal program for independent contractors, self-employed individuals, and gig workers, will be available by April 10, 2020, subject to the USDOL approval.

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