Christina Pickens knew her situation as a part-time maid was only going to get worse when she lost over $5,000 in wages in the month of March.
Pickens, who cleans rental cabins in Sevierville, Tennessee, saw a sharp drop in orders from her usual clients as spring break customers began canceling reservations due to the COVID-19 outbreak.
With no relief in sight, Pickens had no choice but to file for unemployment.
“I depend on people heavily coming in for vacation,” Pickens says.
What Pickens did not expect, however, was how difficult it would be to collect unemployment as an independent contractor in Tennessee.
“I’m frustrated because I can’t find the answers as to where I can get some financial help,” she said.
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As Americans experience record layoffs, reduced hours and other employment issues amid the unprecedented coronavirus pandemic, gig workers, independent contractors, freelancers and temporary workers all over the country are finding themselves in a precarious situation.
Numbering 57 million and representing one-third of the workforce, these part-time and self-employed workers are struggling to obtain relief promised them under The Coronavirus Aid, Relief and Economic Security, or CARES Act.
But what they're finding is that government employees in many states aren’t trained to handle their unique situations. The rules governing when a part-time worker can collect unemployment insurance can be confusing. The technology is antiquated, and some states like Arizona have such onerous eligibility restrictions that part-time workers can't get benefits at all – at least for the time being.
“Most states have specific rules regarding part-time availability that add barriers to Unemployment Insurance eligibility,” said a report by the National Employment Law Project. “Limitations on overall work hours, times of day, or days of the week imposed by health, disabilities, caregiving responsibilities, or other factors can prevent claimants from receiving UI benefits in any state.”
Some of these limitations will become less relevant once new Pandemic Unemployment Assistance benefits are fully implemented across the country. That's just not the case at the moment.
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In Tennessee, Pickens said it was difficult to navigate the Labor and Workforce Development website, and she’s not confident her efforts will result in a penny of unemployment benefits.
Even when the state implements changes under the CARES Act, Pickens is not expecting much. Tennessee ranks near the bottom of U.S. states in terms of unemployment benefits – offering $275 per week – just a fraction of what Pickens earned from her cleaning business.
"They are way behind on what’s really going on in terms of trying to apply for any kind of benefit," Pickens told USA TODAY.
Snags in federal assistance
When Congress passed its $2.2 trillion relief package last month, benefits were supposed to be extended to everyone impacted by the order to stay at home.
Not only would full-time workers receive unemployment checks, but under the Pandemic Unemployment Assistance program, freelancers and gig workers would receive half the average unemployment benefit in their states and an extra $600 per week through July 31.
Even the self-employed and part-time employees would get benefits under the law, regardless of whether states allowed those classifications of workers to receive benefits prior to the onset of the coronavirus pandemic.
But many of these workers have run into roadblocks.
“Intake is swamping the system right now,” said Wayne Vroman, a labor economist and associate with the Urban Institute, a Washington D.C. think tank that carries out economic and social policy research. “Claims with substantial work history are much easier to service and those workers will be able to collect their benefits much sooner.”
Part-time and self-employed workers, who can’t present pay stubs are much harder to service, Vroman said. State computer systems simply aren’t set up to handle their requests because they don’t meet the current criteria.
Olivia Wertheimer, for example, kept getting her hours reduced in the middle of March until she was eventually out of a job at the Hot Table Panini restaurant in Worcester, Massachusetts.
But bad news compounded when the 22-year-old student at Becker College tried to file an unemployment claim. The state’s Department of Unemployment Assistance told her she couldn’t proceed because she did not meet the state's minimum wage requirements.
In Massachusetts, workers must earn at least $5,100 during the previous four quarters, which comes to $425 per month.
Wertheimer had only worked for a little over three months and earned around $1,500.
Without assistance from the government, she was forced to dip into savings. She feels grateful to be splitting the rent with roommates, alleviating some of the financial pressure.
Misty Schuler, a waitress in Prescott, Arizona, had a similar experience. After losing her job at a Golden Corral restaurant, the state Department of Economic Security turned her down for unemployment insurance because she didn’t make “at least $7,000 in total wages in at least two quarters of her base period, with wages in one quarter equal to $5,987.50 or more.”
Schuler told ABC 15 News in Arizona that she was “really surprised” because she thought all Arizonans were supposed to get help.
"I don’t know what I’m gonna do,” she told a broadcast journalist. “I’m scared. I’m afraid.”
Waiting for help: assistance for part-time, self-employed workers delayed
That’s not the way the CARES Act passed by Congress a month ago is supposed to work. All workers knocked out of a job because of the crisis are supposed to get some financial assistance to weather the storm.
“The new legislation should apply to anyone who can demonstrate an attachment to the workforce,” said Michele Evermore, policy analyst for the National Employment Law Project. “The problem is that it takes a while to get this program ready to implement.”
Evermore explained that the U.S. Department of Labor first has to issue guidelines so that states know exactly how to interpret the new law. Then the states have to set up their computer systems based on those interpretations.
“They have to go in and reprogram their computers to accept all these new people and change all the inputs so computers don’t kick people out and so that they accept new kinds of documents – rather than pay stubs – to verify employment,” she said. “They have to implement all this stuff, and the earliest any state said they could do that is by April 18.”
Evermore said the state of Washington is likely to be the first state to come online, while others won’t be out until mid-May.
“I’m actually quite concerned about how long it will take to get any benefits out,” Evermore said.
Brett Bezio, deputy press secretary for Arizona’s Department of Economic Security, said his state is still evaluating guidance from the U.S. Department of Labor on how to extend unemployment insurance to part-time or short-time employees like Misty Schuler who traditionally haven’t received benefits.
“Implementation of this provision will require significant system changes,” Brezio said in an email to USA TODAY. “We are accepting applications for (Pandemic Unemployment Assistance), and these initial claims will be processed once the system modifications are in place.”
Similar words of caution about the eventual payment of unemployment benefits appear on Ohio’s Department of Job and Family Services website.
It says that self-employed and part-time workers will be eligible for unemployment benefits once new programs are operating.
“Like other states, Ohio is waiting for further guidance from the U.S. Department of Labor on how to operationalize it,” the Ohio website says. “Once it is up and running, retroactive benefits will be provided. We will share more information as soon as we have it.”
Workers vulnerable in crisis
In the meantime, gig workers, independent contractors, the self-employed, freelancers, part-time and temporary workers are in a vulnerable position.
According to a recent Urban Institute report, many part-time and self-employed workers were already living close to the edge before the coronavirus crisis took hold.
“About 44% of both hourly and self-employed workers reported difficulty paying for basic needs such as housing, utilities, food, or medical care during 2019,“ the report said.
The report added that more than a quarter of hourly workers and 21% of self-employed workers said they would have trouble coming up with $400 to pay for unexpected expenses within the next month.
Some work two or three jobs to make ends meet, and if they lose one job or get cut way back, it would put their families at risk.
Scott Gibson, a full-time career services director at the Interactive College of Technology in Atlanta and a part-time Grubhub delivery driver, recently had his hours at his full-time job cut from 40 to 30 per week.
He filed for unemployment to make up the difference.
"I’m worried that my second job will affect my unemployment wages from my first job," Gibson told USA TODAY.
Gibson’s employer helped him process his unemployment claim on Apr. 8, but he has not yet heard back from the Department of Labor.
Evermore, the National Employment Law Project analyst, said Gibson has a good chance of getting a partial payout.
“If I work two jobs and lose one that causes my income to go down by a quarter, I should be eligible for Partial Unemployment Insurance” she said. “And I should also get the extra $600.”
But she added that the Grubhub income does complicate matters and will have to be declared.
Evermore added that many people are confused on how having a second job will affect their unemployment wages.
Any person who is not being paid is considered unemployed and is entitled to receive federal assistance, she said. The date payments are supposed to be deposited is still unclear.
"It’s going to be hard and it’s going to take some time, but people need to be reminded that these are their earned benefits,” Evermore said. “The system should cover them."
Contributing: Charisse Jones, Michael Braga