It has been announced by the New Jersey Department of Labor and Workforce Development that recipients of the Federal Pandemic Unemployment Assistance (including self-employed individuals, independent contractors, and those who are not usually eligible for unemployment benefits), will start being notified of their PUA eligibility, and the Department is going to start making payments. 

The PUA is a new program that has been authorized by Congress and is a part of the Coronavirus Aid, Relief and Economic Security (CARES) Act to provide unemployment benefits to workers who are not eligible for regular unemployment. This also includes employees who don’t have enough recent earnings to receive regular unemployment benefits. 

Individuals who have applied for regular unemployment and have been denied, don’t need to do anything further.  They will automatically be evaluated for PUA eligibility.  New Jersey is waiting on more guidance from the Federal Government.  The Department is going to start reaching out and processing payments soon (if they haven’t done so already). It was stated by the Labor Commissioner, Robert Asaro-Angelo, that the Department had worked hard over the past month to get this program up and running despite facing the unprecedented challenges of COVID-19. It will take time to determine the eligibility of everyone who is seeking PUA benefits. The process has already started to get billions of additional dollars into the wallets of eligible self-employed workers. 

It’s only going to take a month for the NJ Department of Labor team to create the infrastructure to implement this new federal program, which will determine eligibility, protect confidential personal information, prevent fraud, and issue payments. All claimants must certify for these benefits online every week. The claimants will get their payments retroactive to when they filed their unemployment claim. 

However, they must also certify that their PUA claim for every week that they are claiming benefits, even if they have previously certified that their regular unemployment claims for the same week. It can be stated in other words that PUA claims are going to be processed separately from regular unemployment claims, which is why the certifying information needs to come separately. 

The first group of PUA-eligible claimants is going to be notified of their time slot to certify for benefits, after which they will receive their payments. The workers who certify for their benefits will also receive a separate $600 supplemental payment as part of the CARES Act for every week they were eligible for the PUA since March 29. Those who have certified will receive their supplemental payment within a few business days of certifying their benefits.

Workers who are eligible for the PUA, but for whom the available wage records are incomplete, will be issued weekly unemployment benefits for the minimum amount of $231, along with a separate $600 weekly supplemental benefit. These workers will be contacted separately to update their income information, and any necessary adjustment to their weekly benefit rate will be made based on the updated income information they have provided. 

Here’s what New Jersey’s self-employed workers, independent contractors, and others who may be eligible for PUA should know about it:

• The first step to getting PUA is to apply for state unemployment benefits and be denied
• If you’ve already applied for state unemployment, you don’t need to do anything else right now
• If you’ve not applied for state unemployment benefits yet, then you should follow the instructions for self-employed, independent contractors, and others not eligible for regular unemployment. 
• If you’ve already applied but didn’t follow the instructions, you don’t need to worry. Your application is going to be reviewed for PUA eligibility. 
• If you’ve not heard from them, there is no need to call or email.
• You should look for more information in your mail or email inbox. 
• PUA claims are going to be backdated to the date you first became eligible, so you won’t lose any benefits. The first week of potential eligibility is the week ending February 8, 2020. 
• You may be required to produce income records for 2018 and 2019. 

Hundreds of thousands of workers who are unemployed, furloughed or had their hours reduced have already filed for unemployment benefits since the COVID-19 pandemic hit New Jersey in the middle of March. Despite the rapid influx of claims, New Jersey has dispersed more than $1 billion in unemployment benefits to more than 550,000 people.

Overview of the PUA 

The PUA provides supplemental unemployment coverage to those not ordinarily covered by unemployment insurance laws. The intent is to provide income replacement to independent contractors, self-employed individuals, sole proprietors, ‘gig’ economy workers, and other ‘covered individuals’ who have been impacted by COVID-19 and would otherwise be without any income or unemployment benefits during the pandemic. The term ‘covered individuals’ also includes those ‘lacking sufficient work history’ or seeking part-time employment.

The implementation of the PUA program has been hindered by both numerous logistical issues and the sheer volume of applicants. The program is Federally financed, but is administered through individual states. The individual states have been able to streamline ‘clean’ unemployment applications, ( those resulting from terminations and furloughs) in a manner that allows the process to be online entirely and doesn’t require the intervention of an agent, but same isn’t true for PUA applicants. 

PUA is available to those independent contractors and sole proprietors who certify that they:

• Are diagnosed with COVID-19 or have experienced symptoms or are seeking a diagnosis
• Have a member of his/her household who has been diagnosed with COVID-19
• Are providing care for a family member or a member of that person’s household who has been diagnosed with COVID-19
• Have primary caregiving responsibility for a child that is unable to attend a school or another childcare facility due to COVID-19 
• Can’t reach his/her place of work due to a quarantine
• Have been advised by a health care provider to self-quarantine
• Have become a breadwinner after the head of household has died from COVID-19
• Have had to quit his/her work as a result of COVID 19
• Have a work location that is closed as a direct result of the COVID-19 public health emergency
• Meet any additional criteria established by the Secretary for Unemployment Assistance 

The new law covers individuals who haven’t been physically impacted by COVID-19, but whose ability to perform their customary work has been severely limited or suspended entirely due to the pandemic. 

It is important to note that to qualify for the PUA, an applicant needs to be otherwise ineligible for unemployment benefits. Therefore, the preliminary step in asserting a PUA claim is applying for regular Unemployment Insurance (UI) online and getting denied. Every state is obligated to review all UI denials for possible eligibility for PUA. Once an applicant’s UI denial is received, in the form of either an explicit denial or a determination that the claimant is entitled to $0, the claimant will then be placed in the pool for PUA benefits.

The PUA applicants need to provide self-certification, stating the reason why they can’t work. As has been provided in recent US Department of Labor (DOL) guidelines directed to states, the self-certification process must include an acknowledgment that the actual certification is made under the penalty of perjury and that intentional misrepresentation in self-certifying represents fraud. The self-certification must be submitted every week. If the certification is submitted on Friday, Saturday or Sunday, the payment will be received on Tuesday. Those who have certified on Monday, Tuesday, Wednesday, or Thursday will receive the payment two days after submitting the certification. 

In terms of the amount of PUA, those who qualify are eligible for unemployment assistance calculated in accordance with their existing state unemployment programs, along with an additional $600 per week of Federal Pandemic Unemployment Compensation (FPUC). The DOL has recently issued additional guidelines on calculating a weekly benefit amount, and the formula is the same as that used to determine regular UI (,60% of a claimant’s average weekly salary). In New Jersey, the weekly maximum is $731, and the minimum is $231. 

It should also be noted that the PUA is available retroactively to January 27, 2020 and will continue through December 31, 2020 as long as the individual’s unemployment, partial unemployment, or inability to work caused by COVID-19 continues, up to the maximum of 39 weeks. The supplemental $600 is available for every week of PUA eligibility starting on March 29, 2020 through the week of July 25, 2020, and all payment received through the PUA program are taxable as income. 

To receive the PUA for past periods of unemployment, the application should be backdated to the first week of the COVID-19 pandemic during which the applicant was unemployed, partially employed, or unable or unavailable to work due to one of the reasons that have been specified above. 

Significant challenges in calculating the PUA are that the amount of income for eligible PUA applicants fluctuates considerably, and this income is not reported in one form (W-2) easily accessible and verifiable by the unemployment agency.  Also, and that the deadline for submitting 2019 income tax returns has been deferred to July 15, 2020. Nonetheless, in order to facilitate the calculation of an average weekly benefit amount, the applicants will need to provide proof of income for the past two years. To this end, helpful documents would include schedule C forms, 1099s, and K-1 schedules.

It is important to note that the PUA is available to qualifying applicants, who are ‘partially unemployed,’ and individuals with a demonstrable decline in income. However, benefits aren’t available to individuals who are receiving paid sick leave or other paid leave benefits, including benefits available to independent contractors under the federal Families First Coronavirus Response Act (FFCRA) or under a state law providing such paid benefits to self-employed workers. The PUA is not available to individuals who are able to work from home or who have opted not to work for other reasons. 

For many individuals, the PUA benefits may provide their only source of income at this moment in time, and that’s the reason why it is essential that there are no missteps in the application process.

Conclusion

The Pandemic Unemployment Assistance has provided a welcome respite to people who are currently laid off or can’t go to work due to COVID-19.

The government has developed numerous programs, and the PUA is one of their most comprehensive forms of aid available. If you have questions regarding your eligibility for the PUA please don’t hesitate to reach out to me on my cell phone at (732)759-5114.  I am here to help guide you through the process.