Recent COVID-19 Legislation – Guidance on the $600 Federal Weekly Benefit and Other Unemployment Benefits
Monday, April 13, 2020
By Sue Peirce, CPA
The Act expands eligibility for unemployment benefits by:
- Expanding the types of workers eligible for unemployment benefits(
- including sole proprietors, independent contractors, the self-employed,
- individuals with limited work histories
- individuals who have exhausted their unemployment benefits
- Adding an additional $600 weekly payment to unemployment benefits (FPUC);
- Extending unemployment benefits by 13 weeks (PEUC);
- Providing funding to cover half the cost of unemployment claims incurred by nonprofit organizations and government entities.
Late last week, the Department of Labor (DOL) clarified some of the details of the benefits available under the CARES Act. The federal provisions requires Ohio to sign an agreement with DOL and issue its own guidance on unemployment benefits as the federal program runs through the respective state programs. As of this writing, OH has not issued additional guidance.
Pandemic Unemployment Assistance (PUA)
PUA establishes payment of unemployment benefits through December 31, 2020 for individuals who are not traditionally eligible for those benefits – sole proprietors, independent contractors, self-employed; workers with limited work histories and those who have exhausted benefits.
Individuals are eligible to receive PUA when unavailable for work because:
- Diagnosed with COVID-19 or is experiencing the symptoms of COVID-19 and is seeking a medical diagnosis;
- A household member has been diagnosed with COVID-19, or the head of the individual’s household has died as a direct result of COVID-19;
- Caring for a family or household member who has been diagnosed with COVID-19;
- Is the primary caregiver for a child or other person whose school or other facility has closed due to COVID-19 (Note – does not extend beyond the date the school was to close for summer break);
- Under quarantine as a result of a public health emergency related to COVID-19 or pursuant to the advice of a healthcare provider due to concerns related to COVID-19;
- Scheduled to commence employment but does not have a job or is unable to reach his or her job due to a public health emergency related to COVID-19;
- His or her place of employment has closed as a direct result of a COVID-19 public health emergency;
- “Has to quit his or her job as a direct result of COVID-19,” (refers to individuals who were diagnosed with COVID-19 and who have recovered, but who are unable to work due to health complications caused by the virus); or
- Meets “any additional criteria” for eligibility established by the DOL; an example per the guidance allows independent contractor drivers (like Uber and Lyft drivers) – to qualify for unemployment benefits if operations were suspended due to the pandemic. This includes an emergency state or municipal order restricting movement makes continued operation unsustainable.
PUA benefits are not available to individuals who have the ability to telework with pay or those who are receiving paid leave benefits (including sick leave). However, if an individual is receiving paid leave benefits for less than the customary workweek, or is teleworking with pay for fewer hours than the individual worked prior to the pandemic, he or she may still be eligible for a reduced PUA benefit amount, subject to Ohio’s calculations for determining the amount of its unemployment benefits.
Federal Pandemic Unemployment Compensation (FPUC)
Once Ohio signs an agreement with the DOL to administer the program, individuals receiving unemployment benefits will receive an additional $600 weekly benefit payment, regardless of how much they were paid while working. The additional payment will be made for weeks of unemployment ending on or before July 31, 2020.
FPUC also expands those eligible to receive this additional benefit including those eligible under PUE, federal employees and ex-service members.
Other important considerations regarding the $600 benefit:
- An individual need only receive “at least $1 of underlying benefits” to receive the full $600 additional amount. There are no partial benefits even if the state pays only a partial benefit payment.
- Child support – Child support obligations must be deducted from FPUC payments in the same manner and to the same extent as these obligations are deducted from regular UC.
- Intercepted benefits – 100% of this benefit may be intercepted to pay debts, including child support. Intercepted payments are considered compensation for the week.
- Taxable income – Amount received is to be included on the 1099G issued by Ohio.
Pandemic Emergency Unemployment Compensation (PEUC)
Ohio limits unemployment benefits to 26 weeks. Under PEUC, those on unemployment are eligible to receive benefits for up to 13 additional weeks. Those receiving these extended benefits remain eligible to receive the $600 additional payment through July 31, 2020.
Assistance to Governmental Entities and Nonprofits
Through December 31, 2020, CARES includes payments to states to cover half the costs of unemployment claims incurred by reimbursing employers; typically nonprofit organizations and government entities which do not pay into the state unemployment fund but directly reimburse the state for unemployment claims.
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