It's no secret that unemployment has reached record levels in the United States since the beginning of the COVID epidemic. Many people found themselves out of work because their State or their employer mandated they shut their doors or limit the number of customers allowed in their businesses. Other businesses limited hours of operations, furloughed workers or had employees work part time. Some businesses, like non-essential retail, travel, hospitality or event hosting, could not survive being closed for several months, only to be followed by a dramatic decrease in customers for the rest of the year. Some workers stayed home to care for loved ones who became sick, while some people became sick themselves and spent weeks or months in the hospital. Other workers who had high risk health conditions which would make them vulnerable to the virus, stayed home.
According to the US Bureau of Labor Statistics (BLS), which gets its mandate to track and release official unemployment numbers under Title 29 of US Labor Code, unemployment reached as high as 14.8% in April 2020. By December 2020 unemployment was still 6.7%. Previously, the highest rate of unemployment from the last 20 years was 10%, in October 2009 during the height of the Great Recession. As a comparison, the early 2000’s recession, saw an unemployment rate of 6.3% in June 2003. Unexpectedly, the lowest unemployment rate seen over the last 20 years also occurred in 2020, from January to February at 3.5% vs. the 14.8% in April. Dramatic shifts in the labor force have never been greater.
In response to the record unemployment rate and work stoppage, Congress passed the CARES Act (Coronavirus Aid, Relief and Economic Security Act) on March 27th, 2020. It was passed as US Code, under Commerce and Trade Code Title 15 Chapter 116. A unique section of the law allowed self employed and contract / gig workers to claim unemployment for the first time in history. Previously, workers who drove for, among others, Uber, Dolly for moving services or food deliverers such as Doordash, would not have qualified for unemployment. This added an unprecedented number of people to the unemployment rolls, who previously would not have counted as unemployed under official BLS reporting. States were left scrambling to figure out how to get unemployment benefits to a larger variety and number of people than seen before in modern times. The high unemployment rate not only occurred during a pandemic but during a Presidential election that was rife with extreme political division, also coupled with protests and violence. As well, 2020 saw large wildfires across the western US, followed by a media and legal battle over the legitimacy of the Presidential election. Volatility was the backdrop to an unprecedented year for joblessness.
The 2020 CARES Act provided for 39 weeks of unemployment that expired shortly before the end of the year, while a $600 weekly Federal payment expired in August of 2020. After a short political battle, Congress provided additional funding and benefits under the CARES Act with PEUC (Pandemic Emergency Unemployment Compensation), which added 13 weeks of unemployment benefits to those who exhausted their 39 weeks. Also added was PUA (Pandemic Unemployment Assistance), which extended unemployment for gig / self employed workers. Benefits are slated to expire yet again in March 2021.
With all of these controversies, lost in the conversation, has been one item in the CARES Act that impacted workers early in the COVID pandemic. 15 USC 9021 established the framework for pandemic unemployment assistance; the applicability of the law established that the unemployment times frame started in January 27th and ended in December 2020. Benefits under the CARES Act legislation started on March 27th, 2020. What has not been discussed is that the CARES Act specifically states that the Secretary of Labor also needs to provide assistance for those who were impacted by the pandemic from January 27th - March 27th, 2020. While there are no specifics for what type of assistance was / is needed for those who stopped working prior to March 27th and those numbers may be limited, it remains to be seen what type of assistance will be provided. Unemployment benefits in all 50 States have not been backdated for those who stopped work in February and early March, while a process exists to compensate workers for this time frame of not working due to COVID-19. It remains to be seen if the new Secretary of Labor, Al Stewart, will work to create a process for these workers and if this due compensation will be part of the national conversation. With COVID continuing to take lives and political polarization still in the headlines, it seems unlikely that the issue of up to two months of potential outstanding worker benefits, will grab national attention anytime soon