WASHINGTON – A week after Congress responded to the coronavirus pandemic with a $2.2 trillion package designed to provide economic relief to workers and businesses that for the first time provided unemployment benefits to gig workers and the self-employed, states are struggling to implement in its provisions and swiftly provide financial aid to Americans who are part of the “gig economy.” Sen. Mark R. Warner (D-VA), a longtime national leader on labor issues affecting contractors and the contingent workforce, today called on the U.S. Department of Labor (DOL) to issue better guidance to states allowing them to quickly implement the provisions in theCoronavirus Aid, Relief, and Economic Security (CARES) Act allowing these workers to access unemployment benefits in the midst of a growing economic emergency. Though DOL issued initial guidance on the CARES Act to states late yesterday, it failed to address several key issues, leaving many states flailing in their efforts to quickly make the new unemployment benefits accessible to Americans who need it, and ensuring that it may be weeks before some workers can access the financial relief as Congress intended.
“The CARES Act directs states to stand up a new program, the Pandemic Unemployment Assistance (PUA) Program, to disburse benefits to workers who would normally not be eligible for unemployment assistance, such as gig workers or freelancers. Unfortunately, we are already hearing reports from unemployment officials from around the country that it will likely take weeks to stand up a new program and disburse benefits to these newly eligible workers,” Sen. Warner wrote in a letter to Secretary of Labor Eugene Scalia. “In the middle of the COVID-19 pandemic, with unemployment claims overwhelming state systems, there is no time to waste. While I appreciate the initial round of guidance that was released yesterday, the Department of Labor should have already issued more comprehensive guidance to states this week.”
In order to enable the rapid implementation of the CARES Act, Sen. Warner urged DOL to issue guidance on several problems that were missing from its release yesterday. Sen. Warner called on DOL to: streamline the Pandemic Unemployment Assistance process by removing burdensome regulatory barriers limiting worker participation; require states to accept electronic documentation and allow them flexibility to make determinations on eligibility for the program on a case-by-case basis; take the lead on contracting innovative technologies to implement the program and avoid all 50 states having to each “reinvent the wheel”; and increase flexibility for states to calculate and disburse weekly benefits.
In early March, Sen. Warner successfully called on leading gig worker platform companies to commit that independent contractors who deliver their services will not be penalized for following recommended health procedures to protect the public from further spread of the coronavirus. For years, Sen. Warner has championed legislation to establish portable benefits systems that would allow gig workers, independent contractors, and the self-employed to access benefits and protections that are commonly provided to full-time employees, such as paid leave, workers’ compensation, skills training, unemployment insurance, tax withholding and tax-advantaged retirement savings.
Following the March 18 passage of the Families First Coronavirus Response Act, Sen. Warner also led several of his colleagues in urging state governors and workforce administrators to implement its provisions easing restrictions on emergency unemployment benefits as swiftly as possible.
April 3, 2020
The Honorable Eugene Scalia
Secretary of Labor
U.S. Department of Labor
200 Constitution Ave, NW
Washington, DC 20210
Dear Secretary Scalia,
Yesterday, the Department of Labor released the latest number of unemployment claims around the country. The numbers are unprecedented: 6.6 million new unemployment claims this past week in addition to the 3.3 million from the week before. In a span of two weeks, more workers filed unemployment claims than the entirety of the 8.7 million jobs lost during the Great Recession. In light of the record-breaking unemployment numbers and the tremendous pressure this places on state unemployment agencies, I write to urge the Department of Labor to issue additional, more comprehensive guidance to states on implementation of the unemployment provisions of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, Public Law No. 116-136, as quickly as possible.
The CARES Act directs states to stand up a new program, the Pandemic Unemployment Assistance (PUA) Program, to disburse benefits to workers who would normally not be eligible for unemployment assistance, such as gig workers or freelancers. Unfortunately, we are already hearing reports from unemployment officials from around the country that it will likely take weeks to stand up a new program and disburse benefits to these newly eligible workers. In the middle of the COVID-19 pandemic, with unemployment claims overwhelming state systems, there is no time to waste. While I appreciate the initial round of guidance that was released yesterday, the Department of Labor should have already issued more comprehensive guidance to states this week.
To enable the rapid implementation of the CARES Act, the Department of Labor should issue guidance on the following issues that were missing from DOL’s release yesterday:
- As others have stated, the Pandemic Unemployment Assistance process should be streamlined as much as possible. Streamlining could include the removal of burdensome regulatory barriers normally applicable under the Disaster Unemployment Assistance program that limit worker participation.
- Given the present Center for Disease Control and Prevention’s public health recommendation urging individuals to stay home, states should be required to accept electronic documentation submissions and have the flexibility to make determinations on eligibility for the program on a case by case basis.
- The Department of Labor should be taking the lead on innovative technological solutions that relieve the burden on states to recreate the wheel on their own. As others have noted, vendors with cloud-based solutions for PUA processing could streamline the process for state unemployment agencies.
- States should have increased flexibility to calculate weekly benefit calculation for part-time workers in a way that takes into consideration the expansion of part-time work in the gig economy. They should also be given the flexibility to determine wages using alternative forms of wage information other than state tax returns and be encouraged to disburse benefits while processing documentation.
Ensuring swift, and effective, implementation of section 2102 of the CARES Act will require that both the federal government and states to be nimble, and act swiftly, to shore up the critical social safety net for all American workers. It is paramount that people who normally would fall through the cracks of the current system, like gig workers and freelancers, get needed support as quickly as possible as the country weathers the economic downturn caused by the COVID-19 pandemic. I’m hopeful that, long-term, we will learn something from this about supporting worker benefits in ways that can improve our public health and make our economy more resilient.
Again, I urge you to issue more comprehensive guidance on the implementation of the CARES Act as quickly as possible. Thank you in advance for your prompt attention to this matter. I look forward to working with you on your next steps.