What Workers Should Know About Unemployment Benefits, Whether They're Extended by Congress Or Not

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Some 12 million Americans and their families are another week closer to losing their main source of income as Congressional debates over new pandemic stimulus remain at a standstill.

Two provisions under the CARES Act that extend jobless aid to more people, including self-employed and gig workers, and add 13 more weeks of payments, are set to expire by Dec. 26. Meanwhile, lawmakers remain divided on how to extend a number of financial lifelines to Americans as the coronavirus continues to devastate the country.

Workers should understand what could happen to their benefits whether or not Congress and the White House act to extend relief, says Michele Evermore, a senior policy analyst at the National Employment Law Project.

If unemployment benefits are extended

A surge of unemployment during the pandemic has exposed a severely underfunded and outdated network of state unemployment systems. Even if Congress acts soon to extend the CARES unemployment programs, Evermore says it's likely payments will be delayed due to the difficulties of programming new benefits into computer systems and administering them by state.

Even a short lag of payments in early 2021 could be "catastrophic" for these families and have long-term consequences, Evermore tells CBNC Make It: "We're going to see a wave of evictions, poverty, suicide — this is already a tough time of year for mental health. People may end up going without medicine, exacerbating chronic health conditions, possibly filling up high-interest credit cards, getting payday loans or going to pawn shops."

Some relief-package proposals aim to reinstate the weekly unemployment boost for all recipients that ended in July, although it could be reduced from $600 to $300 per week.

Again, Evermore says to expect delays for several weeks in receiving these benefits if they are passed. Though the $600 weekly benefit was signed into law March 27, it took roughly a full month for all 50 U.S. states and the District of Columbia to start paying out the benefit.

Furthermore, many states offer Extended Benefits, which trigger "on" based on the unemployment rate and provide an additional six to 20 weeks of federal aid to people who have exhausted their state benefits. People currently collecting EB in states providing this aid will continue to receive it into January 2021.

However, full federal funding for these programs expires in December, which could result in states turning off this aid; Congress has the ability to extend it.

If enhanced jobless aid ends

Roughly two-thirds of people receiving jobless aid at the end of November are doing so under the two CARES Act programs that will end Dec. 26. Beginning January 2021, unless Congress acts to pass new stimulus, only workers who traditionally qualify for unemployment benefits can continue to receive aid in the new year.

Pandemic Unemployment Assistance extends benefits to more workers including freelancers, gig workers, the self-employed and parents who had to leave work in order to provide child care. Without a federal extension, these workers will no longer qualify for unemployment benefits come January.

People receiving aid through Pandemic Emergency Unemployment Compensation, which provides an extra 13 weeks of aid to people who've exhausted state benefits, may be able to roll into their state's EB program if it's offered.  

For workers who have been notified to return benefit overpayments

In recent months, hundreds of thousands of workers receiving PUA in several states have been notified that they received overpayments in benefits, and that they must return thousands of dollars of aid directed to them since March.

Evermore says the issue is PUA was an entirely new program created in one or two weeks, and then states rushed to get benefits out the door and may have released funds incorrectly. At the same time, many people applying for unemployment for the first time, and to an entirely new system, may have made errors throughout the process.

Regardless, Evermore stresses that people who receive an overpayment notice and believe it to be in error are entitled to an appeal and should seek out legal services or an attorney with unemployment compensation expertise in their state. People with specific legal questions concerning an overpayment notice may qualify for free or low-cost assistance from a local legal services agency.

She adds that legislation following a new stimulus package from Congress could allow states to waive recovery of PUA overpayments.

If you or someone you know is in crisis, call the National Suicide Prevention Lifeline at 800-273-8255.

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