Since the announcement of a national emergency in mid-March, the COVID-19 pandemic has swept through the U.S., not only creating a national health crisis, but causing economic turmoil and mass-unemployment as businesses have been forced to close, either temporarily or permanently. Although millions of individuals across the country have already lost their jobs, the crisis could become worse before it improves. In fact, according to estimates released by the Economic Policy Institute, the unemployment rate may continue to climb into July, where they predict the unemployment rate will hit 16%.
We know this is a challenging time for most of our clients, and we want to help wherever we can. As a start, we are posting this rather lengthy blog to assist persons struggling with these new regulations to better understand them.
New Legislation to Ensure Unemployment Pay
With so many individuals out of work, furloughed, or experiencing reduced hours, unemployment benefits have become more important than ever in helping individuals and families financially survive this crisis. In order to combat rising unemployment rates due to COVID-19, two pieces of legislation were signed into law in March: The Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The FFCRA provides flexibility for state unemployment insurance agencies to respond to the COVID-19 pandemic. The CARES Act created three new unemployment insurance programs: Pandemic Unemployment Compensation (PUC), Pandemic Emergency Unemployment Compensation (PEUC), and Pandemic Unemployment Assistance (PUA).
Through these programs, the CARES Act expands a state’s ability, and gives them the option, to provide unemployment insurance for many workers impacted by the COVID-19 pandemic, including for workers who are not ordinarily eligible for unemployment benefits.
The first two programs, PUC and PEUC, operate to boost unemployment benefits, both in the amount of compensation provided and the length of time you can receive benefits. PUC is federally funded and provides an additional $600 a week for workers collecting unemployment benefits, including regular state unemployment, and through programs such as PEUC and PUA.
This benefit is available for weeks of unemployment beginning after the date on which your state entered into an agreement with the U.S. Department of Labor (DOL) and ending with weeks of unemployment ending on or before July 31, 2020. As of March 28, 2020, all states have executed agreements with the DOL. However, eligible individuals will receive retroactive payments back to whenever they became eligible or the date of the agreement between the state and the DOL, whichever is later.
Extended Unemployment Insurance Benefits
According to guidance provided by the DOL, the PEUC program permits states to provide up to an additional 13 weeks of 100% federally funded unemployment benefits to qualified individuals who:
- Have exhausted all rights to regular compensation under state law or Federal law with respect to a benefit year that ended on or after July 1, 2019;
- Have no rights to regular compensation with respect to a week under any other state unemployment law or Federal unemployment law, or to compensation under any other Federal law;
- Are not receiving compensation with respect to a week under the unemployment law of Canada; and
- Are able to work, available to work, and actively seeking work, although states must offer flexibility on “actively seeking work” where there are COVID-19 impacts and constraints.
The additional weeks of unemployment benefits are available to workers who have exhausted all unemployment compensation rights and who are able and available to work, and actively seeking work as defined by state law. However, the CARES Act gives states flexibility in defining “actively seeking work” if you are unable to work because of COVID-19. PEUC benefits are available for weeks of unemployment beginning after your state implements the new program and ending with weeks of unemployment ending on or before December 31, 2020.
The CARES Act, through the PUA program, and the FFCRA greatly expanded the availability of unemployment insurance by providing unemployment benefits to workers that are generally ineligible for regular state unemployment benefits or who have exhausted their state unemployment benefits. In fact, in order to be eligible for PUA assistance, you must not be eligible for state unemployment benefits or extended benefits under state, federal law or PEUC.
Fewer Restrictions for Unemployment Eligibility
The PUA, which is retroactive to January 27, 2020 and expires on December 31, 2020, loosens eligibility requirements allowing self-employed individuals, independent contractors, those that do not have a long-enough work history to qualify for state unemployment benefits and those whose hours have been reduced to receive unemployment compensation to receive benefits.
The PUA provides up to 39 weeks, depending on your state, of unemployment benefits to qualified individuals who otherwise are able and available to work, except that they are unemployed, partially or fully, or unable or unavailable to work due to COVID-19. In order to be eligible, applicants must be partially or fully unemployed, or unable or unavailable to work for any of the following:
- They have been diagnosed with COVID-19 or have symptoms of it and are seeking diagnosis;
- A member of their household has been diagnosed with COVID-19;
- They are providing care for someone diagnosed with COVID-19;
- They are providing care for a child or other household member who can’t attend school or work because it is closed due to COVID-19;
- They are quarantined or have been advised by a health care provider to self-quarantine;
- They were scheduled to start employment and do not have a job or cannot reach their place of employment as a result of a COVID-19 outbreak;
- They have become the breadwinner for a household because the head of household has died as a direct result of COVID-19;
- They had to quit their job as a direct result of COVID-19;
- Their place of employment is closed as a direct result of COVID-19; or
- They meet other criteria established by the Secretary of Labor.
Benefit payments under PUA are retroactive, for weeks of unemployment, partial employment, or inability to work due to COVID-19 reasons starting on or after January 27, 2020. Workers are not eligible for PUA if they can either telework with pay or are receiving paid sick days or paid leave.
Although these laws have been passed by the federal government, because benefits are provided by state unemployment offices, it is important to review your state’s unemployment agency website for details about changes to your state’s unemployment benefit rules and requirements due to COVID-19.
Changes to Unemployment Benefits in Kentucky
In response to the FFCRA and CARES Act, Kentucky has announced a number of changes to the state’s unemployment system. First, pursuant to Executive Order 2020-235 issued on March 16, 2020, the standard waiting period of seven days to obtain unemployment benefits has been waived, and workers who become unemployed during the state of emergency are now immediately eligible for unemployment insurance benefits. In addition, the work search requirement has been waived while the state of emergency is in effect.
In an effort to maintain and strengthen access to unemployment benefits, Kentucky also announced that unemployment eligibility has been expanded to individuals who are usually not eligible. Individuals who are self-employed, independent contractors, freelance workers, substitute teachers, childcare workers employed by religious affiliated organizations and non-profits are now eligible to received unemployment benefit. Access has also been expanded to include individuals who left their job for “good cause” because of reasonable risk of exposure, such as self-quarantining, or due to caring for a family member affected by the virus.
Lastly, due to the high volume of unemployment claims due to eligibility changes and increased unemployment, Kentucky has adopted a system where individuals should file their unemployment claim only on a specific day of the week, which is determined by the first letter of the applicant’s last name. For more information about Kentucky unemployment or to file your claim in Kentucky, please visit the Kentucky Career Center’s website.
Changes to Unemployment Assistance in Ohio
For Ohio’s response, Governor DeWine issue an Executive Order which expands eligibility for individuals to receive unemployment benefits during Ohio’s emergency declaration period. Unemployment benefits are now available for eligible individuals who are requested by a medical professional, local health authority, or employer to be isolated or quarantined as a consequence of COVID-19. This applies even if the individual is not actually diagnosed with COVID-19. In addition, the typical one-week waiting period for eligible individuals to receive unemployment benefits has been waived.
Unlike Kentucky, self-employed individuals and independent contractors are not eligible for Ohio unemployment benefits. However, the new federal PUA program will provide benefits to self-employed workers, 1099 tax filers, and some other individuals who previously were not eligible for unemployment benefits.
Similar to Kentucky, due to the high volume of unemployment claims due to eligibility changes and increased unemployment, Ohio is now asking individuals to file their unemployment claim on a specific day of the week, which is determined by the first letter of the applicant’s last name.
Ohio is currently awaiting further guidance from the DOL on implementing the PUA program. Once the system is in place, retroactive benefits will be provided. For more information about Ohio unemployment or to file your claim in Ohio, please visit the Ohio Department of Job and Family Services website. They have also created a step-by-step guide with quick tips for filing for unemployment.
At this time, both Kentucky and especially Ohio’s unemployment systems have been overwhelmed with this unprecedented rise in unemployment benefits claims. Due to the over-burdening of the unemployment offices, you may experience significant delays in filing your claim or being able to reach anyone who can assist you.
At Gatlin Voelker, we understand that most of our clients have questions during these challenging and uncertain times. Our attorneys want to help however and wherever we can. If you have specific questions or concerns about your unemployment claim or how these new regulations may affect your claim, please contact our office at 859-781-9100 for a free consultation.