Unemployment Update: Federal Benefits Now Available Along With Answers To Other FAQs

April 10, 2020

The Coronavirus Aid, Relief, and Economic Security (CARES) Act extends an additional $600 in federal unemployment insurance (UI) benefits to displaced employees.  The state began issuing the extra payments on April 9, meaning the federal UI benefits (Pandemic Unemployment Compensation, or “PUC”) will be deposited alongside a claimant’s next scheduled state UI benefit deposit. 

Do you have other questions about the UI provisions in the CARES Act?  We have answers to some of our members’ most commonly asked questions here.  

Does everyone get the extra $600 in PUC, or just some claimants?  It’s our understanding that if a claimant qualifies for even $1 in state UI benefits, they qualify for the full $600 in federal PUC  benefits.  This includes people receiving checks because they are in the state’s Work Share Program and those who may have seen their hours reduced due to COVID-19 or otherwise. 

Do claims receive their PUC payment on top of their state weekly benefit amount?  Yes, claimants will receive their state weekly benefit amount (maximum of $362 per week) plus the additional $600 per week in federal UI benefits, for a maximum of $962 per week.  The two deposits (via bank deposit or debit card) should be issued together.    Since the President signed the CARES Act on March 27 but the state is just beginning to process these payments, $600 PUC will be paid retroactively for weeks of benefits beginning March 29.

When will payments be available to individuals who are self-employed, 1099-independent contractors, low wage workers and others who are not traditionally eligible for benefits?  We do not have a date at this time, but are told the state is working around the clock to get this portal open.  The state will release guidance regarding eligibility and the application process in the coming days. If you have already filed for unemployment benefits, you DO NOT need to reapply at this time because the state plans to re-process all claims that were denied during the COVID-19 period. 

Some of my employees will be able to make more on unemployment than they do working?  Isn’t this going to be a disincentive to getting people back to work when the time is right?

We share these concerns, which have been covered in recent days by media outlets.  (See:  “Finley:  Fat jobless checks a disincentive to work” [quotes a Chamber Executive Committee member] and “Paid to quit? Backlash builds against unemployment benefits on ‘steroids’”.)  Practically speaking, some employees could earn as much as $962 per week on employment, which is equivalent to $24/hour for a 40 hour week--and this could be more than they’d normally make working 40 hours per week.  This was discussed when the US Senate debated this bill but, despite these concerns, the bill moved forward anyway.  Under "normal circumstances" an employee cannot voluntarily quit, reject an offer of work or refuse to return work if called back from a layoff.  Under "normal circumstances," an employer would document this correspondence and use it to contest the UI claim.  However, these are not "normal circumstances" so we are unsure yet how the State will handle these disputes.  Employers can challenge these claims; we just can't make any promises about how it will play out down the road through the adjudication process.  We remain hopeful that there will be guidance issued by the US-DOL, especially as we move to restart/reopen the economy.  Language may be needed to clarify that an employee cannot refuse an offer to return to work or quit because they could make the same amount (or more) on UI.  We will continue to keep a close eye on this issue and advocate for changes if they become necessary.   

How soon will claimants start to get their first check after filing for unemployment?  Although circumstances may vary, individuals should expect their first payment about three weeks after they file their claim. Subsequent payments are released every two weeks after the individual certifies.  Claimants must certify (report) every two weeks that they are eligible for benefits. After the first certification (which is done during the third week of unemployment) they will receive their payment in about 3-5 days. Certification can be done online with MiWAM at www.michigan.gov/uia 24 hours a day, 7 days a week or by phone at 1-866-638-3993 (Monday - Saturday; 8:00 a.m. - 7:00 p.m.).

How many weeks can claimants collect UI?   Under Executive Order 2020-24, the maximum entitlement for weeks of benefits for existing claims as of March 15, 2020, and new claims filed between March 15, 2020 and April 18, 2020, is 26 weeks. In addition, the CARES Act adds 13 additional weeks of unemployment benefits in Pandemic Emergency Unemployment Compensation (PEUC) to the 26 weeks of benefit entitlement under E.O. 2020-24, for a total of 39 weeks of benefits payable. 

As an employer, will my account be charged for the extra $600 payment?  No, these benefits are 100 percent federally funded.  In fact, all benefits charged as a result of the Governor’s “Stay Home, Stay Safe” Executive Order (E.O.), will be charged to the “non-chargeable benefit account.”  The E.O.states:  “Effective immediately, and continuing until April 14, 2020 at 11:59 pm, an employer or employing unit must not be charged for unemployment benefits if their employees become unemployed because of an executive order requiring them to close or limit operations.”

If you are an employer and are looking for assistance on UI issues, please contact Wendy Block at wblock@michamber.com.  Please note:  We are not able to assist claimants or employees.  These inquiries should be directed to the State of Michigan’s Unemployment Insurance Agency.