Updated: May 4, 2020
We are facing a global pandemic, as well as a national emergency. Across the world, hundreds of thousands of people have gotten seriously ill from the novel coronavirus (COVID-19) — and thousands have died. In the United States, this pandemic has seriously impacted the economy, with many businesses forced to close their doors for the duration.
Californians are also feeling the impact. In addition to shelter-in-place orders, many Californians have been laid off or have had their hours drastically reduced because of the coronavirus. Fortunately, the state has recognized that this situation has left people in financial jeopardy and has thus expanded unemployment benefits, as well as other types of benefits for people who have lost wages due to the coronavirus.
What Are Unemployment Benefits?
Under California law, employees who are out of work through no fault of their own may collect unemployment benefits. Unemployment benefits are partial wage replacement payments that are designed to aid workers who have lost their jobs.
Eligibility for these benefits is based on a number of factors, including prior earnings and the reason for unemployment. The California Employment Development Department (EDD) administers these benefits.
There are three main requirements to qualify for unemployment in California: (1) past wages and work history; (2) reasons for unemployment; and (3) available and actively seeking work. In other words, you must meet certain thresholds for earnings within a certain time period, and cannot have been fired from your job for misconduct or quit without cause. Finally, if you apply for unemployment benefits, you must be available for work, able to work, and be actively seeking work.
The spread of the novel coronavirus has led to record levels of unemployment in the United States. Across the country, 3.3 million people filed for unemployment benefits in the week ending on March 21, 2020 — the highest number ever recorded. In California, 186,800 people filed for unemployment in the same week.
As a result, California has changed the requirements for unemployment benefits. In addition, the federal government is poised to enact a stimulus package that will give people who are entitled to $600 per week on top of benefits from the state.
Eligibility For California Unemployment Benefits During COVID-19
California has responded to the spread of COVID-19 by relaxing the requirements for unemployment benefits. Workers who cannot work due to a lack of childcare, who are self-employed, or whose hours have been reduced may also obtain benefits.
First, employees who work in a business that has shut down operations due to COVID-19 can file an unemployment claim. During this time, you are not required to actively seek work each week that you receive benefits if your unemployment is temporary. However, you must be able and available to return to work in order to qualify, and must meet other eligibility criteria.
Similarly, employees whose hours have been reduced due to COVID-19 can also file for unemployment benefits. Payments for employees who have lost their jobs or who have had their hours reduced will range from $40 to $450 per week, depending on your earnings and the wages that you have lost.
Typically, there is a one week waiting period before you can receive unemployment benefits. However, Governor Newsom has issued an executive order that waives this unpaid period. Typically, your unemployment claim will be processed and payments will be issued by EDD within a few weeks of filing your application.
Second, workers who are unable to work due to a lack of childcare or school closures may also be eligible for unemployment benefits. To qualify, you must have no other care options and be unable to work from home.
Third, if you are self-employed, you may be able to obtain unemployment benefits if you have paid into the program, if a past employer has paid into the program, or if you were misclassified as an independent contractor rather than as an employee.
Under California law, a worker is presumed to be an employee of the business that has hired it, unless the employer can prove:
A. The worker is free from the hirer’s control and direction in connection with performing the work, both under contract and in fact.
B. The worker performs work that is outside the usual course of the hirer’s business.
C. The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.
This is known as the ABC test. It was originally adopted by the California Supreme Court in 2018, and later was added to the California Labor Code through Assembly Bill 5 (AB 5).
In addition to benefits for self-employed individuals and those employed in the gig economy under California law, you may qualify for benefits under the federal stimulus plan. If you fall into one of these categories, you may be eligible for up to $600 per week in unemployment compensation from the federal government in addition to benefits that you may receive from California.
Beyond Unemployment Insurance
Unemployment benefits will cover a vast number of workers who cannot work or have been laid off due to the coronavirus. However, unemployment may not protect all people who are affected by this pandemic.
Under California Law, employees who cannot work because they either have been diagnosed with COVID-19 or because they have been exposed to the virus can file for disability insurance. This is a type of short-term benefit for workers who suffer a full or partial loss of wages due to an illness or injury that is not related to work, as well as for pregnancy. Disability insurance payments will be between 60 to 70% of wages, depending on your income, and may range from $50 to $1,3000 per week. To qualify, your diagnosis or exposure must be certified by a medical professional.
If you cannot work because you are caring for a family member who is sick or who has been quarantined due to COVID-19, then you may be able to file a claim for paid family leave. This benefit allows for up to six weeks of payments for workers who experience a partial or full loss of benefits in order to care for a seriously ill family member or to bond with a new child. The amount of the benefits will be approximately 60 to 70% of your wages, ranging from $50 to $130 per week.
For both disability insurance and paid family leave, claims are processed by the EDD. The one week unpaid waiting period if waived for disability insurance benefits.
How To File For California Unemployment Benefits
If you are out of work due to COVID-19 (or for another reason), then you can file a claim for unemployment insurance (UI) benefits though the EDD website. You should file a claim within the first week that you lose your job or when your hours are reduced.
To file a claim, you will need to provide your personal information, such as your name, address, and a method of contacting you. In addition, you will need to provide:
Information about your last employer, including the name of your supervisor
The date that you last worked
The reason you are no longer working
Gross earnings in the last week that you worked (starting on Sunday and ending on the last day that you worked)
You can file online, by phone (1-800-300-5616; check the EDD website for additional numbers for foreign language applicants, and for those who require TTY), or by fax or the mail.
After your claim is filed, you should look for certain documents from the EDD in the mail that you will receive within 2 weeks. Check these documents to make sure that the information is correct. These documents will also include your EDD customer account number (EDDCAN), which you will need to register for UI online.
Every two weeks, you will be required to provide eligibility information to EDD. This is known as certifying for benefits, and can be done online, by phone, or by mail. You will need to report work and wages that you have received, as well as information about your work search.
Within 21 days of filing your UI claim, you must also add or update your résumé in CalJOBS, unless you are instructed otherwise by the EDD. If you are out of work due to COVID-19, you may not be required to take this step. Check with a California employment lawyer if you have any questions about this requirement.
When your benefits are available, you will receive an EDD Debit Card in the mail. You will need to activate the card in order to receive payments.
Finally, you may be scheduled for a phone interview if the EDD requires additional information about your claim. It is important to keep the interview, as the EDD will otherwise make a decision based on the information that they currently have, which may result in a delay or denial. The EDD will send you notice of an interview via mail.
During these incredibly stressful times, benefits like unemployment insurance are more important than ever. The expanded benefits available for Californians under both federal and state law may provide financial stability if you cannot work due to being ill, taking care of a sick family member, being quarantined, or simply because you have been laid off or had your hours reduced due to the shutdown.
The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from Odell Law, PLC. or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.