Eligibility for PUA benefits

On April 14th, the Department released some initial guidance on PUA benefits — the unemployment benefits available to those who do NOT qualify for regular unemployment benefits.

As already noted, the Department will begin accepting PUA claims the week of April 21st.

Note: Scammers have popped up relating to unemployment claims. While you are entitled to representation for any part of the unemployment filing process, you should be extremely cautious about anyone who wants money up front or wants you to turn over your confidential claim-filing information.

The Department has severe penalties for those who do NOT keep their claim-filing information confidential. Because the unemployment claim-filing process is specific to each state, no one should be claiming they can assist you with your unemployment claim across state borders.

What are PUA benefits?

California’s labor secretary says it best:

The CARES Act also created a special program for this crisis called Pandemic Unemployment Assistance, or PUA. PUA provides federally funded benefits distinct from the UI program for certain individuals out of work or partially unemployed due to the COVID-19 crisis, including the self-employed, individuals who lack sufficient work history, and independent contractors. Federal guidelines on how to administer PUA came out on April 5 and include gig workers as an example of those eligible for PUA.

Under PUA, individuals can receive weekly unemployment assistance that may be equivalent to what individuals would get under UI (depending on their earnings and whether earnings can be verified). Those who get PUA also get the $600/per week additional payment added to UI for weeks they are unemployed from March 29 until the end of July. PUA benefits can cover people unemployed or partially unemployed due to COVID-19 from January 27, 2020 through December 31, 2020 depending on date of actual impact. In other words, it is retroactive to the time before the federal stimulus bill was passed and before funding was made available. The retroactivity means more money in people’s pockets and we are anxious to get that out. When you apply and your application is approved, you will get PUA benefits going back to the first full week of February as long as you can show that your inability to work was COVID-19 related.

Who is eligible for PUA benefits?

Applicants will need to provide self-certification (a statement of some kind) that they are:

(1) partially or fully unemployed, OR

(2) unable and unavailable to work because of one of the following circumstances:

• They have been diagnosed with COVID-19 or have symptoms of it and are seeking diagnosis;
• A member of their household has been diagnosed with COVID-19;
• They are providing care for someone diagnosed with COVID-19;
• They are providing care for a child or other household member who can’t attend school or work because it is closed due to COVID-19;
• They are quarantined or have been advised by a health care provider to self-quarantine
• They were scheduled to start employment and do not have a job or cannot reach their place of employment as a result of a COVID-19 outbreak;
• They have become the breadwinner for a household because the head of the household has died as a direct result of COVID-19;
• They had to quit their job as a direct result of COVID-19;
• Their place of employment is closed as a direct result of COVID-19; or
• They meet other criteria established by the Secretary of Labor.

OR are (3) self-employed (and have lost work), OR

(4) seeking part-time employment (if state law allows for benefits for PT workers) [Wisconsin’s benefit formula encourages part-time work when receiving unemployment benefits, but requires claimants to be looking for full-time work or as much work as possible for that individual given that individual’s physical limitations], OR

(5) do not have sufficient work history to qualify for regular unemployment, or otherwise do not qualify for state unemployment.

The Department will most likely seek verification of this information. So, a claimant stating that there has been a loss of work will need to produce receipts or pay stubs verifying that loss of work, as starting on the date the claimant claims the loss of work started.

This certification will also be made in light of numerous warnings about being made under penalties of perjury, that misrepresentation constitutes fraud, and that claimants will be subject to criminal prosecution for that fraud.

And, please understand that all of these categories are inclusive. That is, eligibility can be based on ANY one of these categories. Failure to meet one category does not mean you are excluded from PUA eligibility if another category makes you eligible.

Note: But, no one should think that quitting a job to collect PUA benefits is acceptable. According to the Labor Department: quitting a job in order to gain access is unemployment benefits is NOT a valid reason. “Individuals who quit their jobs to access higher benefits, and are untruthful in their UI application about their reason for quitting, will be considered to have committed fraud.”

Per UIPL 16-20, the guidance document for PUA benefits, here is some specific information for various scenarios.

Partial loss of work (category 1)

Throughout this federal guidance, it is repeatedly stated that eligibility for PUA benefits exists for a partial loss of work connected to the pandemic.

So, an employee who can still tele-work (generally, a disqualification for being eligible for PUA benefits because the person still has work options) for three days a week but was previously working five days a week before the pandemic will be eligible for PUA benefits for the two days a week they now can NOT work because of the pandemic.

In other words, eligibility for PUA benefits does NOT turn on a complete loss of work. All that you need to demonstrate is that there has been some loss of work connected to the pandemic.

To be a “covered individual” under PUA, an individual must also self-certify that he or she is otherwise able to work and available for work, as provided under state law, except that the individual is unemployed, partially unemployed, unable to work or unavailable for work due to at least one of the following categories described below.

UIPL 16-20 at I-3 (emphasis supplied). What this provision means, in part, is that all of Wisconsin’s job search and eligibility requirements will also apply for recipients of PUA benefits.

And, ALL claimants should understand that the US Dep’t of Labor asserts that the PUA benefits are very temporary. Someone in quarantine, for instance, should only be out of work for two weeks, according to the Labor Department. And, employees who have to care for children who are not in school can only claim benefits until the school year ends in early June. See UIPL 16-20 at I-7.

In other words, for each week claimed, expect to have to demonstrate that the loss of work at issue in your claim is still occurring.

Lacking sufficient work history (category 5)

an individual “lacking sufficient work history” means an individual (1) with a recent attachment to the labor force (2) who does not have sufficient wages in covered employment during the last 18 months to establish a claim under regular UC, and (3) who became unemployed or partially unemployed because of one of the COVID-19 related reasons identified under Section 2102.

UIPL 16-20 at I-3.

So, under this guidance, all three of these conditions must be met for someone who lacks the wages to qualify for regular unemployment benefits to receive PUA benefits.

The self-employed (category 3)

as defined in 20 C.F.R 625.2(n) means individuals whose primary reliance for income is on the performance of services in the individual’s own business, or on the individual’s own farm. These individuals include independent contractors, gig economy workers, and workers for certain religious entities.

UIPL 16-20 at I-3.

This category is probably the largest number of people eligible for PUA benefits. Anyone who gets a 1099 form or runs his or her own business will be applying for PUA benefits as self-employed.

This category will probably also be the most difficult in which to file a claim. Besides the certification about your lack of work that you will need to provide and sustain for every week you claim PUA benefits, you will also need to provide detailed information about your earnings as described below under Earnings questions.

And, for each week of your claim, you will need to document how much work you have done that week. For many, you will need to document having no work by establishing what requests or contacts from potential customers have NOT occurred along with demonstrating your availability that for those potential customer contacts each week. How the Department will carry out these requirements remains to be seen.

Interestingly, the Department “must identify individuals who are potentially eligible for PUA and provide them with appropriate written notification of their potential entitlement to PUA, including filing instructions. This includes notifying claimants who were found ineligible for UC as far back as January 27, 2020.” The Department “must [also] notify all appropriate news media having coverage throughout the state of the beginning of the PUA program.” UIPL 16-20 at I-14.

So, anyone denied regular unemployment benefits should receive notice about applying for PUA benefits. Apparently, this press release was the required notice to media. In comparison, other states have instituted social media campaigns and other kinds of notices.

SSDI recipients (category 5)

Wisconsin (as well as North Carolina) makes anyone receiving SSDI benefits completely ineligible for regular unemployment benefits.

So, if these individuals have lost work because of the pandemic and are NOT eligible for regular unemployment benefits, they should be eligible for PUA benefits.

Update (15 May 2020): At some point this week, DWD added the following to its PUA FAQ:

How the Department reached this conclusion is unknown and unclear. Luckily, someone contacted the Department last week, and they exchanged these messages. As evident in these messages, the Department is claiming that the prohibition in state law on unemployment eligibility for SSDI recipients governs federal PUA eligibility because federal law did not explicitly indicate PUA eligibility for SSDI recipients.

Furthermore, the Department has apparently decided that because there is no PUA eligibility for SSDI recipients because of the state law prohibition, the Department will NOT be issuing any initial determinations to SSDI recipients regarding a denial of PUA benefits. So, if folks wait for a PUA initial determination that never arrives, they will miss the appeal deadline regarding their denial of regular unemployment benefits which, according to the Department, governs their PUA eligibility. Then, many weeks later, if they try to appeal that first denial of their eligibility, they will need to indicate why that now late appeal should be excused for reasons beyond their control. Good luck with convincing the Department that you did not realize you were never going to get an initial determination concerning your eligibility for PUA benefits, since the Department just posted that cryptic Q&A cited above on its PUA FAQ.

Yikes. As someone else commented on this blog, this kind of procedural nightmare is “weaponized bureaucracy at it’s finest.”

So, anyone getting denied for unemployment benefits because of SSDI benefits should appeal as soon as possible. That denial determination is the only determination you will likely receive. If you do not appeal, you likely will lose all eligibility for PUA benefits even though the determination says nothing about PUA benefits.

As for the Department’s legal reasoning on claiming that state law governs on this issue, federal law and guidance plainly indicate otherwise. See this appeal letter I am sending in on these cases. The Department is simply going out of its way to deny the disabled eligibility for PUA benefits.

Update (29 May 2020): Fox6 has the following report that details the problems Wisconsin is creating for the disabled on this issue.

Loss of work because of COVID-19 illness (category 2)

Unless your employer has indicated you should not work because of your suspected or confirmed COVID-19 illness, you will need a confirmed medical diagnosis or a positive test result (yes, despite testing still being extremely difficult and rare) to indicate you cannot work because of your COVID-19 illness or the pandemic-related illness of a family member for whom you are providing care. See UIPL 16-20 at I-4.

If your own physical health makes you susceptible to COVID-19, you will need specific medical advice to stay away from work in order to qualify for PUA benefits. Your own judgment about your health is insufficient. UIPL 16-20 at I-5.

Loss of work because of business closure or governmental order (category 2)

A governmental order restricting travel in a way that prevents you from getting to and from work does qualify you for PUA benefit eligibility. UIPL 16-20 at I-5. A governmental order closing the place of business where you work also qualifies you for PUA benefits. UIPL 16-20 at I-6.

Interaction with paid sick leave or PTO

The availability of paid sick leave or PTO makes a claimant ineligible for PUA benefits if this paid leave completely covers the loss of work.

But, if this leave only provides partial coverage for the loss of work (and that loss is connected to a pandemic-related illness as described above), then you may be eligible for partial PUA benefits. UIPL 16-20 at I-7.

Conflicts between Wisconsin and Federal guidance

Conflicts already exist between Wisconsin and federal guidance about PUA benefits. So, expect eligibility issues to be a major factor in your case. For instance, compare these two Q&As (as of 16 April 2020):

Wisconsin
Q: Am I eligible for PUA if my work allows me to telework for pay?

A: No, if you have the ability to telework and be paid the same as you have customarily worked prior to the COVID-19 pandemic, then you are not eligible for PUA.

Federal
Q: My employer will let me work from home with pay. However, because my children are out of school and my spouse is working, I need to care for them and it is too difficult to work from home. Under Section 2102(a)(3)(A)(ii)(I)(dd) of the CARES Act, I self-certify that I need my kids to be at school in order for me to be able to work. Do I qualify for PUA?

A: You may qualify. The CARES Act does provide PUA to an individual who is the “primary caregiver” of a child who is at home due to a forced school closure that directly results from the COVID-19 public health emergency. However, to qualify as a primary caregiver, your provision of care to the child must require such ongoing and constant attention that it is not possible for you to perform your customary work functions at home. For example, if your employer allows you to telework and you are caring for a more mature child who is able to care for him or herself for much of the day, you likely would not qualify for PUA because you are still able to work.

In addition, you should bear in mind that the CARES Act provides PUA only when a child is home because of a school closure that is a direct result of the COVID-19 public health emergency. A school is not closed as a direct result of the COVID-19 public health emergency, for purposes of 2102(a)(3)(A)(ii)(I)(dd), after the date the school year was originally scheduled to end. That means that, once the school year is over, parents should rely on their customary summer arrangements for caring for their children, and will not, absent some other qualifying circumstances, be eligible to receive PUA. If, however, the facility that they rely on to provide summer care for the child is also closed as a direct result of the COVID-19 public health emergency, they may continue to qualify for PUA. Similarly, if there is some other reason under which they qualify for PUA, they will continue to be eligible to receive benefits.

In light of these conflicts, expect Wisconsin to follow its own guidance until you point out the correct federal guidance on the issue.

Update (21 April 2020): From Politico’s morning shift (see also this piece from Bloomberg News):

The Labor Department on Friday clarified major pieces of its guidance for the new Pandemic Unemployment Assistance program and said it would issue further follow-up instructions, following criticism the guidelines could leave out workers who should be eligible. Democrats and labor groups have pressed for more details regarding guidance documents issued by DOL meant to help states implement the program, which extends unemployment payments to gig workers and others who ordinarily would be ineligible for unemployment insurance.

Specifically, Democrats requested that DOL clear up confusion surrounding the eligibility of gig workers. In guidance issued by DOL earlier this month, that agency said Uber and Lyft drivers “may not be eligible” for benefits if they claim they’re “unable to reach” their place of employment, because app-based drivers don’t have a place of employment. However, DOL Deputy Assistant Secretary Joe Wheeler affirmed in a letter to lawmakers Friday that independent contractors who experience a “significant diminution” of work are eligible for the aid.

When do PUA benefits start?

Regardless of when you file your initial application, PUA benefit eligibility will be back-dated to the week you can show a loss of work. That loss of work week can start as early as the week ending 8 February 2020.

PUA benefits will end for everyone as of the week ending 26 December 2020, regardless of how many weeks of eligibility remain for any particular claimant.

Earnings questions

Unlike regular unemployment benefits, PUA benefits will range from a minimum of $163 to a maximum of $370 (the range for regular unemployment in Wisconsin is from $50 to $370).

But, the Department will still need to calculate your PUA weekly benefit rate (“WBR”) for this range, and this calculation is based on your earnings in a set of four previous calendar quarters.

Unlike California and several other states which will start paying out PUA benefits within a few days the minimum WBR while gathering more information to determine the specific WBR for claimants, it appears that Wisconsin will want all earnings information up front before issuing any PUA benefits.

So, because all earnings must be presented on a quarterly basis and then verified, expect the application process for PUA benefits to take several weeks at a minimum before any benefit payments are made.

Repayment concerns

Wisconsin’s DWD is aggressive on finding situations for which claimants need to repay benefits. See the discussion about eligibility for PEUC benefits and broad concerns about how the Department charges intentional fraud for unintentional claim-filing mistakes.

So, some folks may already be repaying unemployment benefits when this pandemic started. Here is some good news for these folks: per D.4.a.iii, the $600 PUC benefit is still available to you even if your underlying benefit is being intercepted for recovering an over-payment.

Individuals whose underlying benefit payments are intercepted to pay debts (e.g., overpayments) are eligible for the $600 FPUC, even if 100% of their weekly benefit amount is intercepted. Benefits intercepted to pay debts are considered to be compensation for the week.

UIPL 15-20 at I-6.

A successful claim?

Data provided by the Department indicates that the state has already been failing to approve most of the unemployment claims it has received:

      Weekly claims ratio  Benefits paid   Avg WBR  Year
3/15-4/6    589,616  3.8   $68,759,104.00  $116.62  2020
3/15-4/6    155,148        $39,597,111.00  $255.22  2019

Source

Despite an increase of ~4x in claims being filed, benefits paid are less than 2x the amount. So, the WBR per claimant is also less than half what was being paid per claimant last year for the same time period.

There three possible explanations for this rapid decline in payment amounts. First, many, many more lower-paid workers could be applying (who would have a lower WBR) and higher-earning folks are NOT applying. Second, DWD could simply be denying many more of these claims. Third, DWD could be so overwhelmed with claims that it is failing to act on all of these claims in a timely way.

Given how low unemployment benefits already are in Wisconsin (folks need about $13,000 in income to qualify and they get the max of $370 at around $32,000), it seems that the first explanation is highly unlikely.

The answer most likely turns on a combination of the last two possibilities. The question is which of these is playing the larger role — are more claims being denied or is the Department unable to keep up with all of the claims.

The best advice at the moment is to keep calling the Department about the status of your claim at least once a week. Make sure to talk to someone about the status of your claim. Do NOT expect that leaving a message will lead to a return phone call.

Update (17 April 2020): one of my sources indicate that the backlog is enormous. Only now are they starting to process claims that were filed during the week ending March 28th. These claims were filed during week 13, the second week of the pandemic-caused escalation in claims. We are now in week 16, and claims are STILL running ~12x higher than normal.

Update (21 April 2020): added news item about the Labor Department planning to provide additional PUA guidance to states.

Update (15 May 2020): added information about DWD’s denial of all PUA eligibility for SSDI recipients.

Update (29 May 2020): added additional info regarding a story on the SSDI issue by Fox6.