Massachusetts Gig Workers, Independent Contractors, and Self-Employed Individuals Can Now Apply for Unemployment Benefits

On Monday, April 20, 2020, Massachusetts became one of the first states to begin providing unemployment benefits to gig workers, self-employed individuals, independent contractors, freelancers, and others not traditionally covered by unemployment compensation laws.  

As we have discussed, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), established the Pandemic Unemployment Assistance (PUA) program, under which states are responsible for administering benefits and for establishing eligibility criteria and benefit amounts.  (A full summary of the CARES Act is available here and a summary of the unemployment benefits under the CARES Act is available here.)

The PUA benefits provide up to 39 weeks of unemployment benefits to individuals who are unable to work because of a COVID-19-related reason and are not otherwise eligible for other types of unemployment benefits.  

The Massachusetts Department of Unemployment Assistance (DUA) has advised that those newly eligible to apply in the commonwealth include individuals who: 

• Are self-employed, including gig workers, freelancers, and independent contractors;
• Are seeking part-time employment;
• Have an insufficient work history to qualify for benefits;
• Have exhausted all rights to regular or extended benefits under state or federal law;
• Have been laid off from churches and religious institutions and are not eligible for benefits under state law; or
• Are otherwise not qualified for regular or extended benefits.

Individuals must provide a “self-certification” that they are otherwise able and available to work, but are prevented from doing so because of a COVID-19 reason.  A list of COVID-19 reasons can be found here.  Individuals that can telework with pay and those who are receiving paid sick leave or other paid benefits are not eligible to apply.  However, individuals receiving paid sick leave or other paid leave benefits for less than their customary work week may still be eligible for PUA benefits in Massachusetts.  For a list of required documents, click here.  Online applications are available here.  

All applicants who are accepted will receive their weekly benefit amount (approximately 50% of their average weekly wage – up to a maximum of $823), plus an additional $600 as part of the Pandemic Unemployment Compensation (PUC) program established by the CARES Act.  In Massachusetts, the $600 weekly benefit increase applies to weekly unemployment payments made for weeks ending April 4, 2020, to July 25, 2020.

DUA has advised that once a worker’s weekly wages are verified, the weekly benefit amount may increase.  Further, the DUA has advised that accepted applicants will initially only receive benefits retroactive to the week ending on March 14, 2020.  However, in the future, applicants will be able to receive benefits retroactive to an earlier date.  

The current processing time for an application is between 21 and 28 days.  Accepted applicants should expect to receive payment within four to seven days if they select direct deposit as their payment method and within 10 to 14 days for all other payment methods.  For more information, the Massachusetts DUA PUA Guidebook is available here.

Over the past five weeks, Massachusetts has received more than 650,000 claims for unemployment, which puts the state’s current unemployment rate at around 20%.  The DUA reported that during the first couple of days that the PUA program was live, it had already received approximately 200,000 PUA claims.  These recent PUA claims will be reflected in the data released on Thursday, April 30, 2020.  Expect to see a substantial increase in the number of unemployment claims filed this week compared to the previous two weeks, where the approximate number of claims filed in Massachusetts were 100,000 and 80,000, respectively.

Finally, Massachusetts is not the only state providing these expanded benefits.  Other states, such as Colorado, Iowa, Kentucky, Louisiana, Rhode Island, Texas, Utah and Washington, have also started to provide gig workers and other newly eligible workers with PUA benefits.  In the coming days and weeks, more states will join this list as they get their programs up and running.  We will continue to keep readers apprised of developments in this area.

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