Submitted by Richard Allen, EA, AFSP

In Illinois, over 1.3 million unemployment claims have been processed since March.

This includes many employees whose businesses have been curtailed under Illinois shelter in place orders. Section 2104 of the CARES ACT of March 2020 provides an additional, federally financed $600 benefit (Federal Pandemic Unemployment Compensation [FPUC]) that augments weekly UI benefits including regular, state Unemployment Compensation (UC), Extended Benefits (EB), and other benefits.

It also includes many self-employed businessmen and independent contractors who are now eligible under Section 2102 of the CARES ACT of March 2020. Section 2102 is a temporary federal program (PUA, for Pandemic Unemployment Assistance) for individuals not otherwise eligible for unemployment benefits.

How does $600 additional FPUC work? This FPUC is payable through agreements with states for weeks of unemployment ending on or before July 31, 2020. (During the period that this payment is authorized, states are prohibited from reducing their UC benefit amount or duration.) FPUC income is disregarded for the purposes of Medicaid and the Children’s Health Insurance Program (CHIP).

PEUC: Additional Weeks of Benefits Section 2107 creates PEUC, which authorizes up to 13 additional weeks of federally financed UI benefits for individuals who exhaust state and federal UI benefits and are able, available, and actively seeking work, subject to COVID-19-related flexibilities.

Further, these benefits are supplemented by Section 2107 Pandemic Emergency Unemployment Compensation (PEUC) benefits. PEUC authorizes up to 13 additional weeks of federally financed UI benefits for individuals who exhaust state and federal UI benefits and are able, available, and actively seeking work, subject to COVID-19-related flexibilities.

PEUC is administered by states and is authorized through the end of December 2020. The PEUC benefit amount is the Weekly Benefit Amount as calculated under state law. All PEUC benefits would be increased $600 a week by FPUC through July 2020. (During the period that PEUC is authorized, states are prohibited from reducing UC benefit amount or duration.)

How does PUA work? PUA is administered by states and provides up to 39 weeks of federally financed UI benefits to unemployed workers who (1) are ineligible for any other state or federal UI benefit; (2) meet conditions related to being unemployed, partially unemployed, or unable to work
due to COVID-19; and (3) are not able to telework and are not receiving any paid leave. The PUA maximum duration of 39 weeks is offset by any weeks of regular UC or EB.

The unemployment insurance benefit process under PUA for self-employed individuals and independent contractors begins with filing for unemployment. Former self-employed individuals and independent contractors will first receive a denial of basic unemployment benefits because they are not eligible employees. They will be told to appeal the denial and reapply for PUA benefits.

More information can be found at the Illinois Department of Employment Security (IDES) website (just Google “IDES”, then by searching for “Learn about PUA” in the search box above).

Under Section 500 of the Illinois Unemployment Insurance Act, an unemployed individual shall be eligible to receive benefits with respect to any week only if he/she is able to work, available for work and actively seeking work. These individuals must continue to certify that they are actively seeking work.

Applicants for the PUA benefit are required weekly to certify their eligibility for benefits (see attached example at the end of this article). There are 8 basic questions to answer. One of these questions asks if the individual during the week is receiving any “pension, subsidy, disability or holiday pay”. I believe this question relates to benefits only from the latest employer.

For example, a 66 year-old employee may have retired, started receiving social security, and also found employment with a different employer, or found self-employment as an independent contractor. Upon being laid off from that employer (or being unable to continue find work an independent contractor), that person should be eligible for unemployment benefits under the CARES Act. Such a person would answer “No” to the above question.

Reopening Businesses in Illinois. Currently, some businesses in Illinois are beginning a phased reopening of their business. These business owners may face difficulties rehiring employees. I personally know of a small business with several locations providing Personal Care Services (Barber Shops, Beauty and Nail Salons, and Diet and Weight Reduction centers, etc.).
The business owners have contacted employees originally laid off. These employees have refused to return to work because they are making more on current unemployment benefits including the extra $600 per week FPUC benefit which will run out at the end of July 2020. This issue was noted when the original CARES Act was enacted in March.

What can an employer due now? Because unemployment benefits are supposed to be payable only to those able, available, and actively seeking work, an employer should contact each of their laid off employees and make a verbal offer to return to work. Employees who refuse to return to work should have their conversation documented on the IDES Refusal of Work Reporting Form (search “Refusal of Work Reporting Form” on IDES website) and notify IDES by uploading the completed form. Over 25 employees can be listed on each uploaded form.