Millions to lose jobless benefits temporarily even with Covid deal

Even as Congress inches closer to striking a deal on another coronavirus relief bill, experts say jobless benefits for an estimated 12 million people will lapse at least temporarily in the coming week.

Lawmakers are still working out exactly what will be in the next bill, including the number of weeks it will extend unemployment insurance (UI) for gig workers and independent contractors qualifying for it through the Pandemic Unemployment Assistance (PUA) program and the long-term unemployed who have maxed out their benefits from the Pandemic Emergency Unemployment Compensation (PEUC) program. Earlier today, the relief bill seemed poised to extend the benefits for 10 weeks.

But even if Congress manages to pass a bill before the benefits officially expire on Dec. 26, "it takes usually around two to three weeks to turn benefits back on," says Michele Evermore, a senior policy analyst at the National Employment Law Project. That means that starting next week, the millions of people currently receiving PUA and long-term benefits will at least temporarily lose their weekly payments.

That's because each state operates its own UI system, and it takes time to get them running each time the law changes, says Evermore. This same dynamic played out earlier this year, when President Donald Trump signed an executive order to use funds from FEMA to provide an extra $300 in benefits for a few weeks, after enhanced benefits of $600 per week expired at the end of July. It took some states months to get the extra funds to those who were eligible.

That said, while there may be a lag in actually receiving the payments, there should not be a gap in eligibility, Evermore wrote in a blog post. So when states are able to start making payments, they should be retroactive to the start date in the final bill.

Again, all of this will depend on what Congress actually includes in the bill, and if and when it passes. Currently, unemployment benefits are reportedly one of the sticking points in negotiations: Already, the bill being negotiated has reportedly changed from providing 16 additional weeks of UI to 10.

The bill will also reportedly include a second, slimmed-down stimulus check, which could likely make it into some Americans' bank accounts faster than continued UI benefits.

Check out: 

  • Americans call slimmed down $600 stimulus checks a 'disgrace' but better than nothing
  • 'I've never been so broke in my life:' Cash-strapped Americans grapple with Covid at Christmastime
  • The bipartisan coronavirus relief bill unveiled Monday includes more UI benefits—here's what to know

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