The 99.5 Percent Act has been proposed in the Senate, which could result in the most extensive changes to the federal estate and gift tax in decades.
Including An Analysis of the Impact on Gig Workers and Independent Contractors
The FAMILIES FIRST CORONA VIRUS RESPONSE ACT (FFCRA) and the CORONAVIRUS AID RELIEF AND ECONOMIC SECURITY ACT (CARES) provide expanded unemployment compensation for workers who become unemployed due to the Coronavirus COVID-19 Pandemic. These measures are timely in light of the unprecedented increase in applications for unemployment benefits in the United States linked to the ongoing Pandemic. The Acts provide increased funding, increased benefits and expanded benefits to gig workers (i.e. hospitality field), independent contractors, the self-employed, and for others whose work history might not otherwise qualify. Unfortunately, the number of unemployed is expected to continue to rise as new Coronavirus hot spots continue to emerge across the United States.
At this time, Pennsylvania is in the process of updating its website in order to process benefits for workers who would not otherwise have been eligible.
Families First Corona Virus Response Act:
The FFCRA is an amendment to the Social Security Act intended to give states access to emergency funds to provide unemployment compensation to impacted employees who either lose their jobs or have hours reduced due to COVID-19. The FFCRA added $1 billion for state unemployment programs.
The FFCRA requires employers to notify employees of the availability of Unemployment Benefits at the time of the termination or reduction in hours. FFCRA requires states to amend unemployment rules to allow impacted workers greater access and to quicken payment. In response, most states have waived the one week waiting period and have loosened or eliminated job search requirements for unemployment claims related to COVID-19.
Corona Virus Aid Relief and Economic Security Act:
The CARES Act also provides greater benefits to impacted workers including Pandemic Unemployment Insurance that covers individuals who would not be covered by traditional unemployment benefits. This includes business owners, self-employed individuals, independent contractors, gig workers and those with a limited work history and history of wages earned. As with traditional unemployment benefits, the individual must self-certify that he or she is otherwise able to work and available for work within the meaning of applicable state law and that he or is she is unemployed do to the fact that they:
- Have been diagnosed with COVID-19
- Have symptoms of COVID-19 and are in the process of seeking a medical diagnosis
- Have a household member who has COVID-19
- Are providing care to a household member with COVID-19
- Have a child or other person in the household, for which the individual is the primary caregiver, who is unable to attend school or daycare due to COVID-19
- Are unable to reach work due to a quarantine
- Are unable to attend work because a healthcare professional advised him or her to self-quarantine
- Are scheduled to commence employment and do not have a job or are unable to reach the job as a direct result of COVID-19
- Are the sole wage earner in his or her household due to death of the head of household as a result of COVID-19
- Were required to quit his or her job as a result of COVID-19
- His or her place of employment is closed due to COVID-1; and
- The individual is self-employed, is seeking part-time employment, does not have sufficient work history, or otherwise would not qualify for unemployment benefits under another state unemployment program.
Workers who are able to telework with pay or who are receiving sick leave or other paid leave benefits are not eligible.
The CARES Act further extends unemployment benefits to up to 39 weeks and an additional $600 per week for up to a total of four months of unemployment related to COVID-19. Payment of this additional benefit will be paid in the first four months of unemployment. Finally, the bill requires states to waive the one-week waiting period.
Many states, including Pennsylvania, are in the process of updating their websites and applications to adjust for the aforementioned changes in benefits and persons who are eligible to receive them.
States are also encouraged to expand workshare or short-time compensation (STC) programs. Short-time compensation or shared work programs allow workers who are employed for a portion of the week to collect unemployment benefits on top of regular pay. The intent is to avoid layoffs by reducing the number of regularly scheduled hours of work during disruptions caused by COVID-19. Employers must submit an STC/workshare to the state for approval. Further, the affected employees’ work weeks must be reduced by at least 10 percent, but no more than 60 percent and must maintain health benefits and retirement benefits for affected employees, despite the reduced hours.
The Acts are intended to protect the American worker and to stabilize the economy by assuring the consumer is able to return to normal activities and spending at the conclusion of this crisis. The ultimate goal being to avoid a recession by helping to stabilize the U.S. economy.
Gawthrop Greenwood and its team of lawyers will continue to review legislation and governmental decisions as they unfold, as we are committed to providing guidance to our clients. If you have any questions, please do not hesitate to call us at 484-412-0612.