Unemployment Compensation in the Time of COVID-19

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Unemployment Compensation in the Time of COVID-19

By Jennifer Vorih, Esq., Ty Hyderally, Esq.

Workers in New Jersey and across the country are becoming unemployed in droves, and wondering how they are going to pay their bills and feed their families. Whether you were unemployed before COVID-19, became unemployed due to the pandemic, lost your job for other reasons during this time, or are concerned that you may get laid off due to the economic situation, you probably have lots of questions about unemployment compensation.

Families First Coronavirus Response Act

Signed on March 18 and effective April 1, 2020, the FFCRA applies to business with fewer than 500 employees. It will provide up to 80 hours of paid sick leave (at up to $511/day) for workers who cannot work due to COVID-19. It will also provide paid child care leave –up to 12 weeks, at up to $200/day — for employees who need to stay home to care for children whose schools are closed or for whom child care is not available. Under the Act, employers will pay leave to their employees and will be reimbursed for 100% of these costs. FFCRA also covers health insurance costs, and provides that employers will not have any payroll tax liability. Further, workers who are self-employed are to receive an equivalent credit.

Note, though, that businesses with less than 50 employees can get an exemption from the requirement to provide leave for employees to take care of their children, if the business’ liability is threatened. Employers will be able to recoup the monies they pay out to employees as leave, by not having to pay the IRS payroll taxes. If this payroll tax break does not cover the amount the employer pays out in leave, the employer can ask the IRS for an accelerated payment.

CARES Act – in Progress

In addition to the FFCRA, the Federal government is working on the CARES Act. This is not in place yet, but is expected to contain three important components:

First, there is expected to be a Pandemic Unemployment Assistance (PUA) program. This is expected to be available to many workers who otherwise are not eligible for state unemployment insurance. The duration of this benefit is 39 weeks, and eligibility runs from January 27 to December 31, 2020.

In addition, this Act creates the Pandemic Unemployment Compensation (PUC) benefit, which is $600 per week in addition to what employed workers receive from their state unemployment insurance or from PUA. Unlike PUA, PUC will not be retroactive, and will only run through July 31, 2020.

Finally, the CARES Act provides 13 weeks of Pandemic Emergency Unemployment Compensation (PUEC) for workers who have exhausted or will exhaust their state unemployment insurance benefits before finding a new job.

Extension of New Jersey Unemployment Insurance Compensation

During periods of very high unemployment, New Jersey may offer extension of benefits. This is triggered by the economic situation…so it is likely that benefits will be extended soon, due to the current pandemic.

New Jersey Shared Work Program

You may not have heard about a program in New Jersey which could be of tremendous help to both employees and employers during the pandemic and its aftermath. The Shared Work Program has been in place since 2014. Employers with 10 or more employees can apply for the program, whose purpose is to stabilize the workforce during an economic disruption.

Instead of being laid off, employees of approved employers can retain some hours with their employer, keep their health insurance and pension coverage, and receive “short-time” unemployment benefits for the hours of work they lose. You can learn more about the Shared Work Program at


Collecting Unemployment Compensation Benefits

Even if you’ve already been collecting New Jersey unemployment, this will be impacted by the current situation. Unemployed workers are now given specific times, according to their Social Security numbers, to certify that they are able to work, actively seeking work, and available for work. Take a look at https://myunemployment.nj.gov/ to find your time slot.

Another change due to the Coronavirus pandemic is that unemployed New Jerseyans can no longer go to the One-Stop locations for help in looking for work. All One-Stop locations were closed as of Wednesday, March 18, 2020.

This blog is for informational purposes only.  It does not constitute legal advice, and may not reasonably be relied upon as such.  If you face a legal issue, you should consult a qualified attorney for independent legal advice with regard to your particular set of facts.  This blog may constitute attorney advertising.  This blog is not intended to communicate with anyone in a state or other jurisdiction where such a blog may fail to comply with all laws and ethical rules of that state of jurisdiction.

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