Unemployment Insurance Benefits in the Age of COVID-19
Apr 23, 2020 11:30AM
By David Dykes
By Reggie Belcher and Hannah Stetson
As a result of the coronavirus/COVID-19 pandemic, unemployment claims are at record levels throughout the United States, and South Carolina is no exception.
The South Carolina Department of Employment and Workforce (SCDEW), the state agency tasked with administering unemployment claims, released information that it had processed 268,614 claims in the four weeks since the pandemic began — a nearly 4,300 percent increase from the claim week ending March 14, 2020.
Due to the scope of this impact, it is critical for both employers and employees to understand the unemployment insurance claims process.
Unemployment Insurance Background
Unemployment insurance generally provides financial benefits for eligible workers who are unemployed through no fault of their own and able, available, and actively seeking work. Prior to the pandemic, South Carolina provided eligible workers up to 20 weeks of benefits, with maximum weekly benefits capped at $326.
New Laws Impacting Unemployment Insurance Claims
In response to the current unprecedented unemployment figures, Congress enacted two laws directly affecting unemployment insurance claims — the Families First Coronavirus Response Act (FFCRA) and the Coronavirus, Aid, Relief, and Economic Security Act (CARES). SCDEW will work in conjunction with the United States Department of Labor to implement these laws.
The FFCRA provides $1 billion in emergency unemployment insurance relief to states. In exchange for this funding, states are required to relax certain unemployment eligibility requirements, such as waiting periods and job search requirements.
The CARES Act provides more than $2 trillion in federal disaster financial assistance.
Components of this relief include providing an extra $600 a week in unemployment benefits for a set time period to eligible persons under the Federal Pandemic Unemployment Compensation (FPCU) Program as well as extending eligibility for unemployment benefits up to an additional 13 weeks under the Pandemic Emergency Unemployment Compensation (PEUC) Program. These benefits are funded by the federal government but implemented by the states.
Expansion of Benefits for Typically Excluded Workers
Notably, the CARES Act also provides benefits to certain independent contractors, gig-workers, self-employed workers, non-profit workers and freelance workers not typically entitled to state unemployment benefits under the Pandemic Unemployment Assistance (PUA) Program. This PUA provides support for these non-traditional workers who oftentimes receive compensation via an IRS Form 1099 as opposed to a W-2 Form. PUA compensation will apply to claims filed for the week ending in April 4, 2020 to December 26, 2020, and SCDEW anticipates beginning to accept PUA claims no later than April 25, 2020.
Tips for Applying for Unemployment Benefits
Non-Traditional Workers Need Apply: Non-traditional workers, including self-employed individuals and business owners, should attempt to take advantage of newly offered assistance. A worker may be eligible for PUA benefits even if the same worker has been previously deemed ineligible for South Carolina state unemployment benefits. These expanded benefits allow for situations like a decline in work or revenue as a result of the pandemic to potentially qualify as a “termination” without cause, even for a self-employed individual.
Patience and Persistence: SCDEW’s system for handling unemployment claims was not built for the volume and type of claims being filed in the wake of the pandemic. Applicants should utilize all available resources provided by SCDEW, including online and telephonic assistance, in attempting to secure benefits. There are workarounds for many of the limitations in the application process for non-traditional workers. For example, a self-employed individual whose earnings are taken from his or her personal income tax each year technically has gross earnings of $0 for any given week. However, in order to trigger benefits in the application process, the worker must enter $1.00 for weekly earnings.
Reginald W. Belcher is a shareholder and certified specialist in labor and employment law with the law firm of Turner Padget Graham & Laney PA. Hannah D. Stetson is an associate with Turner Padget Graham & Laney PA. Both work in the firm's Columbia office.
You can reach them at 803-254-2200 or by email at email@example.com and firstname.lastname@example.org.