Monday, June 10, 2024

Can Independent Contractors File For Unemployment

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Collecting Unemployment Benefits For Self

New federal program to help independent contractors apply for unemployment benefits

Can you collect unemployment if you work as a freelancer, independent contractor, gig worker, or self-employed individual running your own business?

Self-employed workers, independent contractors, and freelance workers who lose their income are traditionally not eligible for unemployment benefits.

Im Partially Employed Because Im A Student And Work Part Time Doing Ride

You may be eligible for PUA, depending on your personal circumstances. A gig economy worker, such as a driver for a ride-sharing service, is eligible for PUA provided that he or she is unemployed, partially employed, or unable or unavailable to work for one or more of the qualifying reasons provided for by the CARES Act. For example, a driver for a ride-sharing service may be forced to quit his or her job if he or she was diagnosed with COVID-19 by a qualified medical professional, and although the driver no longer has COVID-19, the illness caused health complications that render the driver objectively unable to perform his or her essential job functions, with or without a reasonable accommodation. Similarly, under an additional eligibility criterion established by the Secretary of Labor pursuant to 2102, a driver who receives an IRS Form 1099 from the ride-sharing service may qualify for PUA benefits if he or she has been forced to suspend operations as a direct result of the COVID-19 public health emergency, such as if an emergency state or municipal order restricting movement makes continued operations unsustainable. Relatedly, widespread social distancing undertaken in response to guidance from federal, state, or local governments may so severely reduce customer demand for a drivers services as to force him or her to suspend operations, and thus make the driver eligible for PUA.

Apply For Unemployment Benefits

If you believe that you meet eligibility requirements for unemployment benefits, including having been paid enough wages by an employer, the fastest way to apply is through UI OnlineSM. You can also apply by phone or by mailing or faxing the paper application form. If you do not apply through UI Online, allow extra time for processing.

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Unemployment Update: Expanded Coverage For Independent Contractors And Self

HOME> ARTICLES AND BLOGS> Unemployment Update: Expanded Coverage for Independent Contractors and Self-Employed

: In Ohio, unemployment benefits are designed to provide workers with temporary income when a worker loses his job through no fault of his own. Because these benefits are provided for by taxes paid by employers, only employees and not independent contractors were eligible. However, on March 27, 2020, the federal government passed the Coronavirus Aid, Relief, and Economic Security Act which expands a states ability to provide unemployment benefits for those who generally would not qualify by establishing the Pandemic Unemployment Assistance program. While the CARES Act was passed at the end of March, Ohio Department of Job and Family Service , the agency responsible for processing unemployment applications, only recently starting accepting PUA applications.

PUA is only available for those who do not qualify for traditional unemployment benefits. In addition, applicants must meet one of the following criteria:

To apply for PUA, applicants will need to provide the following information:

  • Social security number, date of birth and drivers license or state ID number
  • Name, address, telephone number, and valid email address
  • Name, address, telephone number and dates of employment for 2019
  • Reason for unemployment
  • Dependent information , including social security number and date of birth
  • Banking information for direct deposit

When Should I Submit My Application

Can an independent contractor collect unemployment ...

When submitting the application, select reduced hours as the reason for job separation. If the reduced hours are related to the pandemic, be sure to select COVID-19 under the disaster impact section. Complete each question provided after the appropriate selection, and then submit the application.

You will also need to provide the following information:

  • Last employer’s business name and address
  • First and last dates you worked for your last employer
  • Number of hours worked and pay rate if you worked this week
  • Information related to your normal wage
  • Alien Registration Number

If you need help applying, consult the Unemployment Application Guide.

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Do Most Gig Companies Put Workers On A W

Most major gig companies do not hire their workers as W-2 employees. This has become a contested area of how workers are classifiedor more realistically, are not. Because a lot of the gig economy players hire their workers as convenient 1099s, they arent required to provide benefits or safety nets.

If you receive a 1099 form, youre paid as an independent contractor, so youre not considered a standard employee by the government. Typically, that means you wouldnt be eligible for benefits if times were normal.

Employee Or Independent Contractor

Sometimes an employer will classify workers as contractors instead of employees. In these cases, contract workers are responsible for paying their own payroll taxes, including federal and state income taxes and both the employer and employee portion of Social Security taxes. In most cases, contractors are responsible for providing their own Workers Compensation Insurance and are not eligible for Unemployment Insurance if their services are no longer needed.

Generally, a worker who performs services for an employer is an employee if the employer can control both what will be done and how it will be done. The key factor is that the employer has the right to control the details of how the services are performed, even if the employee has substantial freedom of action.

By contrast, anindependent contractor performs services required by an employer but is not subject to the employers control about how the services are performed.

The Virginia Unemployment Compensation Act, § 60.2-212C provides that Services performed by an individual for remuneration shall be deemed to be employment subject to this title unless the Commission determines that such individual is not an employee for purposes of the Federal Insurance Contributions Act and the Federal Unemployment Tax Act, based upon application of the 20 factors set forth in Internal Revenue Service Ruling 87-41.

Generally speaking, a worker is an employee if his or her employer:

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How Long Will It Take To Receive Unemployment Benefits For Self

Even a month after the CARES Act was signed into law, its unclear how long it will take for self-employed or freelance workers in most states to get their first unemployment payments.

Once unemployment insurance applications are completed, OneCareerStop, a website run by the Labor Department, says payments typically take a couple weeks. But thats under normal circumstances within the existing state systems.

Those existing systems have struggled to keep up with demand, though they are beginning to catch up. Stettner estimates that about 70% of claims filed since the middle of March have been processed now.

The Labor Department announced Thursday that 10 states have begun making Pandemic Unemployment Assistance payments. They are: Alabama, Colorado, Iowa, Kentucky, Louisiana, New York, Rhode Island, Tennessee, Texas, and Utah. A spokesperson at the Texas Workforce Commission, which runs the states unemployment insurance program, confirmed the state has been sending out PUA payments but said it doesnt yet have statistics on the number of self-employed workers whove received benefits.

Several other states are nearly ready to begin processing claims and issuing payments. Heres the status of applications in the largest 10 states:

What Is An Offer Of Suitable Employment And How Is It Connected To Unemployment Insurance Eligibility

Independent Contractors And Gig Workers Are Eligible For Unemployment But Still Can’t File

Most state unemployment insurance laws include language defining suitable employment. Typically, suitable employment is connected to the previous jobs wage level, type of work, and the claimants skills.

Refusing an offer of suitable employment without good cause will often disqualify individuals from continued eligibility for unemployment compensation.

For example, if an individuals former employer calls the individual back to work after having temporarily laid the individual off for reasons related to COVID-19, the individual would very likely have to accept the offer to return to work, or jeopardize his or her eligibility for unemployment insurance benefits, absent some extenuating circumstance, such as if the individual tested positive for COVID-19. The job an individual held before the spread of COVID-19 will constitute, in the vast majority of cases, suitable employment for purposes of unemployment insurance eligibility.

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When You Are Considered An Employee

If you were hired as an independent contractor, you may still be considered an employee, and eligible for unemployment benefits, depending on the law in your state. For example, in New York, even if your employer hired you to work as an independent contractor, the law may still consider you an employee. This means you may qualify to receive unemployment insurance benefits.

Federal and state law determines whether an individual is an employee or an independent contractor.

My Regular Unemployment Compensation Benefits Do Not Provide Adequate Support Given The Unprecedented Economic Challenges Caused By The Covid

Yes, depending on how your state chooses to implement the CARES Act. The new law creates the Federal Pandemic Unemployment Compensation program , which provides an additional $600 per week to individuals who are collecting regular UC and Unemployment Compensation for Ex-Servicemembers , PEUC, PUA, Extended Benefits , Short Time Compensation , Trade Readjustment Allowances , Disaster Unemployment Assistance , and payments under the Self Employment Assistance program). This benefit is available for weeks of unemployment beginning after the date on which your state entered into an agreement with the U.S. Department of Labor and ending with weeks of unemployment ending on or before July 31, 2020.

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Unemployment Benefits For Self

Because employers contribute to a fund for unemployment benefits, their employees are eligible to receive benefits from the government if they qualify after losing their job. If you are operating as self-employed, you most likely didn’t pay into your state’s unemployment fund.

Other than in special circumstances, if you were paid as an independent contractor and received a 1099 form, you were not considered an employee and would not be eligible for unemployment benefits. That’s because eligibility for state unemployment benefits is based upon being employed by an organization that was paying into the unemployment insurance fund.

Affordable Care Act Coverage More Affordable

Can Independent Contractors Apply for Unemployment Benefits?

Many independent contractors obtain health insurance coverage through their state health insurance exchange established under the Affordable Care Act . However, ACA coverage can be expensive. Depending on your income, you can qualify for a premium tax credit to help pay for your coverage.

However, under the normal ACA rules the premium tax credits are only available to enrollees whose family income is less than 400% of the federal poverty level. This is only $51,040 for a single person and $104,800 for a family of four. If your income exceeds the threshold by even one dollar, you get no financial help to purchase ACA coverage.

You can find a link to your state health insurance exchange at

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Independent Contractors In Michigan Can Apply For Unemployment Benefits Today

MICHIGAN Self-employed workers in Michigan that have been affected by COVID-19 can apply for unemployment benefits.

Flipping the metaphorical switch at 8 this morning, independent contractors and gig employees struggling to find work during a statewide shelter-in-place order can now receive aid from the government. Funded by the federal Pandemic Unemployment Assistance , self-employed workers applying for aid can receive a $600 weekly stipend. The money should start coming in as early as April 20.

Ensuring Michiganders have access to state and federal benefits during this pandemic is a critical part in protecting everyones health and safety, Gov. Whitmer said in a statement. We will do everything we can to continue providing emergency financial assistance as quickly as possible to the Michigan working families who have lost income as a result of COVID-19.

The money comes as an addition to the benefits received for by the $2 trillion CARES act passed earlier this month.

As of Monday morning, Michigans website where workers apply for unemployment benefits was down.

If youd like to apply for funds, go to to apply. To receive funds, eligible workers will need to show their proof of income from a W-2 or 1099 tax form.

Customers are also encouraged to use off-peak times from 8 p.m. to 8 a.m. to file.

Unemployment Benefits For Independent Contractors

ATLANTA – In March, more than 10 million Americans applied for unemployment benefits. Georgia processed the highest number of claims ever processed in a week.

For many of you this is your first time dealing with this process. We are all just learning the new rules for applying for unemployment. Your number one question has been about how to get unemployment benefits if you are an independent contractor.

CARES Act and unemployment benefits for contractors

Your number one question has been about how to get unemployment benefits if you are an independent contractor.

If you are self-employed, a contractor, a gig worker you are waiting for the CARES ACT. Thats the $2 trillion package from the federal government. That was signed off on about a week ago. Georgias Labor Department on Saturday signed off on everything needed to get it moving. The Labor Commission has asked the governor to appeal to the White House to get this moving, but they are in a holding pattern.

Lets deep dive here. This is the part of the CARES ACT that will impact you: Pandemic Emergency Unemployment Compensation. If you are self-employed or an independent contractor, or what we call today a gig worker, this is what will capture you. But again, its not here yet .Be patient. There are record claims coming in and half the staff at the state level.

A labor attorney said to me: Its crazy, complicated, and confusing. And shes an expert. If youre feeling unsure of things, its normal. Hang in there.

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Working While Receiving Unemployment Benefits

Can you still pick up a part-time or a short-term gig and remain eligible for unemployment? Yes, but there are two important things to bear in mind, says Stettner.

The first thing to consider is how much youll earn in this part-time work. All states have a formula, whats called a partial benefit credit, that outlines how much you can earn while still receiving unemployment. In Pennsylvania, for example, you can earn up to 30% of your weekly unemployment payment before your part-time earnings affect your weekly unemployment payout. After that, your pay will be reduced dollar-for-dollar based on what you’re earning.

Typically, as long as youre earning less in that part-time work than youre receiving for your regular unemployment, then youll remain qualified for unemployment benefits, Stettner says. And as long as you qualify for any amount through your state’s partial benefit credit, then you’ll still qualify for the full $600 from the federal government .

But thats only the first of the two important criteria. The other is that you only want to take a short-term or part-time gig if you’re confident that you won’t quit it. If you quit, then that means you aren’t involuntarily out-of-work, and that’s a key requirement for any unemployment insurance, Stettner says. So if you take a position to make a little more money, but then you quit, you forfeit your unemployment insurance eligibility.

What Are The Rules In California

Kentucky’s self-employed, independent contractors apply for unemployment

California rules: Other states, however, have different rules in place. Some states look not to days worked, but to how much is earned. For instance, in California, in Benefit Decision 5903, the California unemployment insurance appeals board stated: An individual who is self-employed may nevertheless be unemployed However, if such an individual is in receipt of income for services performed in an independent business, such income constitutes wages This means that an individual who is self-employed may still collect unemployment income as long as he does not earn what the state considers excessive wages over the course of a week. California reduces your unemployment benefits dollar for dollar for all amounts you earned above a certain threshold while on unemployment .

In order to work as an independent contractor in California while maximizing regular unemployment benefits, the individual should either:

  • spread his earnings out over a longer period so he does not earn XE in a single week or
  • condense the work to be performed into a short time so there are fewer weeks when XE is earned and benefits affected .

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How To Apply For Unemployment Benefits In Pa If You Are Self


Pursuant to the Federal Pandemic Unemployment Compensation program, these individuals will also receive an additional $600 per week in benefits through July 31, 2020.

Those individuals who are eligible for benefits under PUA are the self-employed, independent contractors, and gig workers, who are not eligible under Pennsylvania state law, and individuals who lack sufficient work history or have previously exhausted their state benefits.

Moreover, those individuals will need to substantiate the COVID-19 reason for their inability to work by providing documentation, such as proof from a medical professional regarding diagnosis or isolation instructions, notices or emails from school or childcare providers, notices or emails from a county or state government regarding the closure of businesses or stay at home orders, notices or emails from customers stating that their services are not needed due to COVID-19 related shutdowns, or proof of a job being postponed or cancelled.

Applications can be made online here.

If you have a question about PUA or other unemployment benefits you may be eligible for, please feel free to contact us at and an attorney at Nochumson P.C. will immediately reach out to you to schedule a free consultation.

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