Coronavirus Aid, Relief, and Economic Security (Cares) Act
On March 27, 2020, President Trump signed, specifically in response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security (CARES) Act. In the section known as Relief for Workers Affected by Coronavirus Act, the CARES Act creates three new unemployment programs: Pandemic Unemployment Compensation, Pandemic Emergency Unemployment Compensation, and Pandemic Unemployment Assistance. It is estimated that these programs will provide an additional $260 billion in unemployment insurance benefits to workers affected by COVID-19 or our country’s response to coronavirus.Pandemic Unemployment Compensation (PUC)
From execution of the CARES Act until July 31, 2020, all unemployment insurance benefit recipients, including Pandemic Unemployment Assistance claimants, will receive an additional $600/week in compensation. This is in addition to their usual benefits. This additional benefit will be paid on a weekly basis.Pandemic Emergency Unemployment Compensation (PEUC)
The CARES Act provides an additional 13 weeks of state unemployment insurance benefits after an individual exhausts all of their regular state unemployment insurance benefits. In Illinois, unemployment recipients are eligible for 26 weeks of unemployment insurance benefits. Employees must still meet other unemployment benefits eligibility requirements, such as be actively searching for work. The CARES Act specifically provides, however, that “a State shall provide flexibility in meeting such [work search] search requirements in the case of individuals unable to search for work because of COVID-19, including because of illness, quarantine, or movement restriction.” This language likely eases the burden on Illinois benefit recipients during the pendency of Governor Pritzker’s shelter in place executive order.Pandemic Unemployment Assistance (PUA)
For employees not traditionally covered by state unemployment insurance benefits, the CARES Act institutes Pandemic Unemployment Assistance. These benefits are for individuals not covered by state unemployment or who have exhausted their state unemployment benefits. Up to 39 weeks of Pandemic Unemployment Assistance is available for workers who are eligible to receive PUA. The program runs from January 27, 2020 until December 31, 2020. Workers are eligible for retroactive benefits as the legislation was not in effect on January 27, 2020.
Individuals eligible for PUA include self-employed workers, independent contractors, freelancers, workers seeking part-time work, and workers who do not have qualifying history for state unemployment benefits. Of note, workers who are eligible for benefits through state unemployment insurance are not eligible under PUA.
Applicants will need to provide certification that they are partially or fully unemployed or unable and unavailable to work because of one of the following:
- the individual has been diagnosed with COVID-19 and is experiencing symptoms of COVID-19 and are seeking diagnosis;
- a household member has been diagnosed with COVID-19;
- the individual is a caregiver to a family member or a member of the individual’s household has had been diagnosed with COVID-19;
- a child or other person for whom the individual the primary caregiver is unable to attend school or another facility that is closed as a direct result of the COVID-19 public health emergency and such school or facility is required for the individual to work;
- the individual is unable to reach their place of employment because of a quarantine imposed as a direct result of COVID-19;
- the individual is unable to reach their place of employment because the individual has been advised by a health care provider to self-quarantine;
- the individual was scheduled to commence employment and does not have a job or is unable to reach the job because of COVID-19;
- the individual has become the breadwinner or major supporter for a household because the head of the household has died as a direct result of COVID-19;
- the individual has to quit his or her job as a direct result of COVID-19;
- the individual’s place of employment is closed as a direct result of the COVID-19 public health emergency.
Individuals are eligible for benefits for unemployment or partial unemployment as long as the inability to work related to COVID-19 continues.
Most significantly, workers who can work remotely with compensation are not eligible for unemployment benefits. In addition, workers receiving paid sick days or other paid leave are not eligible for unemployment benefits under PUA. Workers must be authorized to work in the United States, meaning undocumented workers will not qualify.Short-Time Compensation
Also known as work-sharing, this program is designed for employers to avoid layoffs by putting workers on part-time schedules with partial unemployment benefits to supplement lost income. These unemployment benefits will be temporarily financed by the federal government. Here, state unemployment offices and private employers reach an agreement to avoid layoff of employees by supplementing retained employee’s lost income with unemployment benefits. Consequently, employees avoid termination and retain benefits.Considerations When Applying
Across the nation, government agencies are experiencing record-setting applications for unemployment benefits. Illinois is no different. While this is certainly a stressful time for all, please exercise and use patience when dealing with the Illinois Department of Employment Security. This is an unprecedented situation for all and the laws are continuously being modified placing an additional burden, besides sheet work volume, on government employees.
That being said, there are things you can do as an applicant to assist in getting benefits:
- Document all attempts to file your claim including dates and times of telephone calls or website access, your waiting period, and any individuals that you have spoken with. This evidence will be useful in dating back when your benefits should begin.
- Understand why you are eligible so you can succinctly and efficiently provide the necessary information to IDES
- Follow IDES guidelines on filing. Note that online filing and claims applications are closed between 8:00pm and 10:00pm daily. Also note that the IDES has issued filing guidelines in order to assist with the high volume of claims related to COVID-19. Under these guidelines, individuals with last names beginning with letters A-M should file their claims on Sundays, Tuesdays, or Thursdays; individuals with last names beginning with letters N-Z should file their claims on Mondays, Wednesdays, and Fridays; and Saturday will be available to accommodate those who cannot file during their allotted period.
- If your claim is denied, consider your appeal rights
- Unique Situations
- Tipped Workers: whether tips will be included as part of your unemployment benefits will depend on whether your employer has been reporting those tips as income. Workers should review their income, including tips, and benefits to make sure they are receiving their full benefits.
- Self-employed Workers: while gig and self-employed workers will be unemployment eligible, their eligibility is dependent on their work and pay documentation. The Department of Labor is still providing regulations on proper documents, but these workers should be prepared to provide documentation that taxes have been paid on their wages and documentation what amounts they have been paid. Employees who have been paid cash, without proper documentation, will not be eligible for these benefits.
In addition to the expansion of unemployment benefits, the CARES Act has created a loan program. The forgiveness of this loan is designed to incentivize employee retention. Over the eight weeks following the loan, any amounts used towards payment of rent, mortgage, utilities, and payroll will be forgiven. In addition, the employer must retain their employees for a certain duration and cannot reduce their compensation by more than 25%. These incentives are significant as they may impact an employer’s decision with regards to retaining, furloughing, or terminating employees.
At DeSanto Morgan & Taylor, we offer employment consultations to help apply these new regulations to your employment situation. These consultations focus on the uniqueness of your situation. We look forward to speaking with you today.