COVID-19 Unemployment and Sick Pay Benefit Options for North Carolina Workers Compensation Claimants
In response to the continuing pandemic, Congress passed and the President signed-an unprecedented series of laws designed to help people effected by the COVID-19 crisis. The following is intended as a brief summary of these benefits and how they can apply in workers’ compensation cases, as well as generally.
Expanded Unemployment Benefits:
Traditionally, North Carolina has been among the stingiest and worst unemployment benefits in the country. To be eligible, the unemployment cannot be attributable to the employee’s “fault” (layoffs or furloughs due to COVID-19 are not the employee’s fault) and the employee must actively seek work. The employee must be ready, willing, and able to work.
Benefits are limited to 20 weeks and a maximum amount of $350.00 per week. To be eligible, you generally must have worked 2 of the previous 5 quarters (3 month periods or 15 months), and earned more than $780.00 in each of those quarters. The earnings usually are required to be paid subject to W2 reporting, not independent contractor/1099 earnings or “under the table” cash payments. The amount of benefits is determined by taking the earnings for the last two quarters (six months) and dividing that amount by 52. So if someone earned $20,000 per year on a steady basis, the last two quarters (six months) would be $10,000; divided by 52 would equal a benefit of $192.31 per week. The maximum benefit is $350.00 per week. The math means unemployment benefits are maxed out by anyone making more than $36,400 per year. Put another way, a person making $36,400 per year gets $350.00 per week in benefits; a person making $125,000 per year also gets . . . $350.00 per week in benefits. To be eligible, the unemployment cannot be attributable to the employee’s “fault” (layoffs of furloughs due to COVID-19 would meet this requirement) and the employee must actively seek work.
Under the CARES Act, unemployment benefits are expanded significantly by what is called “Pandemic Unemployment Assistance.” The expansion has three main elements:
- It increases the amount of benefits by $600.00 per week with a maximum benefit of $950.00 per week. In our example above, the $20,000 worker would get $792.31 per week, the $36,400 worker would get $950.00 and the $125,000 worker would get $950.00. the
- It expands the eligibility period to potentially 39 weeks of benefits (it is not known if the extended time for benefits is paid at State (lower) benefit plus the additional $600 Federal benefit or just the Federal benefit; that will be determined as time goes on).
- It expands eligibility benefits to include independent contractors and self-employed individuals in certain circumstances. In general, they need to show they earned income by self-certification or a 1099.
The unemployment needs to be “because of the COVID-19 emergency.” If a restaurant worker is unemployed because they currently are forbidden to be open, that would certainly be subject to the increased benefits. It is less clear if restaurants are allowed to reopen and their particular restaurant shut down because of financial problems whether they would still be eligible for the increased benefits. The following is the Department of Labor’s guidance on what qualifies for the increased benefits:
- The individual has been diagnosed with COVID-19 or is experiencing symptoms of COVID-19, and is seeking a medical diagnosis;
- A member of the individual’s household has been diagnosed with COVID-19;
- The individual is providing care for a family member or a member of the individual’s household who has been diagnosed with COVID-19;
- A child or other person in the household for which the individual has primary care-giving responsibility is unable to attend school or another facility that is closed as a direct result of the COVID-19 public health emergency and such school or facility care is required for the individual to work;
- The individual is unable to reach the place of employment because of a quarantine imposed as a direct result of the COVID-19 public health emergency;
- The individual is unable to reach the place of employment because the individual has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
- The individual was scheduled to commence employment and does not have a job or is unable to reach the job as a direct result of the COVID-19 public health emergency;
- The individual has become the breadwinner or major support for a household because the head of the household has died as a direct result of COVID-19;
- The individual has to quit his or her job as a direct result of COVID-19; or
- The individual’s place of employment is closed as a direct result of the COVID-19 public health emergency.
The most common of these situations is people whose place of business is closed because of the COVID-19 or who must care for their children due to school shutdowns. Note that if you are eligible for telework and refuse, the benefits are not available.
As it relates to workers’ compensation, most people getting workers’ compensation will not get the expanded benefits. This is because either they have not been working recently enough to be eligible or they are not “available to work” as required by the statute. Workers’ compensation benefits are paid at a rate of 67% of average pre-injury earnings, up to a maximum compensation rate of $1,066.00 per week.
There are a couple of situations where it might apply, however. First, if an injured worker was performing light-duty and they can no longer perform that light-duty because the place of business is closed or one of the other requirements apply, that person would be eligible if they meet the other requirements. In this situation, it would almost certainly be more beneficial to collect unemployment than workers’ compensation, as the unemployment benefits may be higher, at least initially. The time limit on benefits would eventually stop the unemployment benefits, especially if the business reopens, whereas workers’ compensation benefits can be paid for much longer. The second situation is where someone is recently injured and otherwise meets the requirements for unemployment. For them, it may be more beneficial to get the unemployment benefits as they may be substantially higher than worker compensation benefits. In either event, discuss this with your attorney before making the choice.
Families First Coronavirus Response Act (FFCRA)
In addition to the unemployment assistance, the Congress passed the FFCRA. What this does is dramatically expand the Family Medical Leave Act for COVID-19-related conditions.
Among the highlights:
ALL employers must provide two weeks of full-pay sick leave and 2/3 pay for 10 weeks if an employee is unable to work because of an isolation order, or the employee gets Covid-19 or has to isolate because of exposure or caring for someone else; or
Has to care for a child whose school and/or daycare has been closed due to Covid-19-related reasons.
It applies to all employers with fewer than 500 employees, regardless of full or part-time status and regardless of length of work. In addition, health insurance and other employment benefits must be continued as if the employee is working.
For any questions about these matters, contact Ramsay Law Firm and the attorney working on your case.