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no1prdiva
Community Member

COVID-19 Stimulus Package

I realize the Stimulus Package was just announced and the details have to be worked out with various government agencies, but the word is that contractors and gig workers will be covered for unemployment, which isn't typically the case and not sure how one would even qualify or prove their status.  Any thoughts on how Upworkers may fit into this and would we qualify since the employer in normal circoumstances must pay into the system in order for you to collect which isn't the case here on Upwork. If a client suspended a contract or reduced the hours, would that be cause and would there be a way to apply or are we still not covered and considered self employed/unclear work status?

As info is available, if anyone has thoughts or Upwork knows how this will work, please feel free to add comments to this post.

29 REPLIES 29
no1prdiva
Community Member

Gig workers, freelancers, self-employed are eligible

In an unprecedented move, the stimulus bill expands unemployment protections to gig workers, freelancers and self-employed individuals, who typically don’t qualify for unemployment benefits.

Seth Harris, former Deputy U.S. Secretary of Labor, describes this aspect of the stimulus package as a “gigantic change,” but notes that it could be complicated to execute.

“It will be harder [to calculate] because these workers don’t have a W-2 or an average weekly wage,” Harris says. “These folks have income that varies dramatically from week to week or month to month.”

It’s not clear yet how state benefits will be calculated for these workers; unemployment is traditionally calculated as a percentage of weekly earnings, up to a maximum amount.  

In the UK, they've announced that "regular" workers who've been laid off will get 80% of their salaries, but the self-employed are only getting £95/week. (For context, even a tiny studio flat in London costs upwards of £1,000/month to rent.) It seems to me that it would be pretty easy to be fair to us - just look at our tax returns for the past year and calculate our average weekly earnings based on that. 

 

I hope that freelancers in other countries are treated more fairly. But if you have a claim, I'd get in there sooner rather than later; I imagine that it'll take quite awhile to sort everything out and get payments into the hands of those will will need it most.

Hi Christine, thanks for your reply and sharing how unemployement is being handled in the U.K. for self-employed. Smiley Happy The inclusion of self-employed and gig workers here in the U.S. for unemployment is something new and the details and forms for applying are evolving and handled state by state.

 

As of today, most state's are telling people to go ahead and apply and complete info "as best you can" so we will see. 

 

Good luck to all of us gig workers and I will continue to add info I receive for U.S. workers.

Lisa

PER NY TIMES

Are gig workers, freelancers and independent contractors covered in the bill?

Yes, self-employed people would be newly eligible for unemployment benefits.

Benefit amounts would be calculated based on previous income, using a formula from the Disaster Unemployment Assistance program, according to a congressional aide.

Self-employed workers would also be eligible for the additional $600 weekly benefit provided by the federal government.

my state said to please wait a bit longer as they are adapting the application form for this category--we will have to wait to see what info they require to process.

I am happy to report that at least my state, New York, has now posted
guidance on how self-employed people can complete the online unemployment
form: https://www.labor.ny.gov/ui/pdfs/self-employed-ui-guide.pdf

Using this guidance, I was able to get past the "roadblock" of information
about former employer. Maybe this is helpful for freelancers in other
states.

After that, it was quite easy. However, I still have to call an agent to
complete the process. Not sure why, but let's see how that goes.

Playing it Forward:

 

Recent Federal legislation offers direct cash support for businesses, especially small businesses, who are trying to maintain their staffs in the face of the corona virus. I want to ensure you are aware of two programs that were announced this week.

 

Advance Payment of Employer Credits Due to COVID-19

 

The IRS on Tuesday issued a new form and instructions for employers to use to obtain advance payments of three tax credits that were created to help businesses cope with the coronavirus pandemic. Employers may file new Form 7200, Advance Payment of Employer Credits Due to COVID-19, to obtain advances of employment taxes that are refundable as a result of the new tax credits: the employee retention credit, the qualified sick leave credit, and the qualified family leave wages credit. The qualified sick leave credit and the qualified family leave wages credit were enacted by the Families First Coronavirus Response Act, P.L. 116-127. The Coronavirus Aid, Relief, and Economic Security (CARES) Act, P.L. 116-136, created the employee retention credit and provided for advance repayment of the first two credits. The IRS also issued guidance on the employee retention credit.

 

Qualifying employers must fall into one of two categories:

 

  1. The employer’s business is fully or partially suspended by government order due to COVID-19 during the calendar quarter;
  2. The employer’s gross receipts are below 50% of the comparable quarter in 2019. Once the employer’s gross receipts go above 80% of a comparable quarter in 2019, the employer no longer qualifies after the end of that quarter.

Here are the links to the form and the instruction https://www.irs.gov/pub/irs-

 

pdf/i7200.pdf https://www.irs.gov/pub/irs-pdf/f7200.pdf

 

Paycheck Protection Program

 

The Small Business Administration initiated a program that grants low interest loans through normal lending channels. Loan payments are deferred for 6 months and in many cases completely forgiven if:

 

• The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8-week period after the loan is made; and,

• Employee and compensation levels are maintained.

 

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program-pp...

 

There are addition loans and debt relief options available to small businesses. Check out:

 

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options 

 

I hope you can take advantage of one or both programs to help your business stay afloat in these very challenging times. From me to you and your employees, we wish you the best and stay safe.

tlsanders
Community Member

The bill hasn't even passed yet, so there's no point in trying to guess at how it's going to work if and when it becomes law. 

The bill has passed, and according to the National Employment Law Project, freelancers will be entitled to unemployment under the Pandemic Unemployment Assistance provision:

 

EMERGENCY ASSISTANCE TO REACH WORKERS TYPICALLY LEFT OUT

 

Pandemic Unemployment Assistance (PUA)

 

Pandemic Unemployment Assistance (PUA) provides emergency unemployment assistance to workers who are left out of regular state UI or who have exhausted their state UI benefits (including any Extended Benefits that might become available in the future). Up to 39 weeks of PUA are available to workers who are immediately eligible to receive PUA.

The program will expire on December 31, 2020, unless otherwise extended.

 

Importantly, this program will provide income support to many workers who are shut out of the state UI systems in this country. In fact, workers who are eligible for state UI are not eligible for the PUA program.

 

Those eligible for PUA include self-employed workers, including independent contractors, freelancers, workers seeking part-time work, and workers who do not have a long-enough work history to qualify for state UI benefits.

 

(Note that in most states, however, “gig” workers should qualify for regular UI because of the broad definitions of employment in so many state UI laws and should be encouraged and supported in applying for regular UI. States should be encouraged to streamline their applications and to request pay data in bulk from major companies. In states that have passed formal exemptions from UI for transportation network company drivers or app-based workers, PUA will provide crucial benefits.)

 

Applicants will need to provide self-certification that they are (1) partially or fully unemployed, OR (2) unable and unavailable to work because of one of the following circumstances:

 

  • They have been diagnosed with COVID-19 or have symptoms of it and are seeking diagnosis;
  • A member of their household has been diagnosed with COVID-19;
  • They are providing care for someone diagnosed with COVID-19;
  • They are providing care for a child or other household member who can’t attend school or work because it is closed due to COVID-19;
  • They are quarantined or have been advised by a health care provider to self-quarantine;
  • They were scheduled to start employment and do not have a job or cannot reach their place of employment as a result of a COVID-19 outbreak;
  • They have become the breadwinner for a household because the head of household has died as a direct result of COVID-19;
  • They had to quit their job as a direct result of COVID-19;
  • Their place of employment is closed as a direct result of COVID-19; or
  • They meet other criteria established by the Secretary of Labor.

Workers are not eligible for PUA if they can either telework with pay or are receiving paid sick days or paid leave. Unfortunately, workers must be authorized to work to be eligible for PUA, meaning that undocumented workers will not qualify.

 

The PUA program will run from January 27, 2020 through December 31, 2020. Workers will be eligible for retroactive benefits and can access benefits for a maximum of 39 weeks, including any weeks for which the person received regular UI. But eligibility will sunset on December 31, 2020 absent any extensions.

 

PUA benefits are calculated the same way as they are for the federal Disaster Unemployment Assistance program under the Stafford Act, which is the model for the PUA program. PUA will have a minimum benefit that is equal to one-half the state’s average weekly UI benefit (about $190 per week).

****

Iowa is the only state I could find  with a page for submitting  Pandemic Unemployment Assistance prof of income, but even they are asking people to wait until the benefits are available..

yes, thank you so much, the bill did pass and was signed yesterday!  You do have to apply/check eligibility first via your state and the states have not yet figured out the process, yet, or at least my state hasn't.  They said they don't have an answer yet but to fill out the form as best you can.  That said, I am waiting before filing it out as I don't have an "employer" as the form now stands per se, I work pretty much full-time on Upwork.  I will post what my state advises--they said they are looking into it.

 

On another note, here is another resource for freelancers:

https://www.freelancersunion.org/resources/freelancers-relief-fund/?fbclid=IwAR0LVUzla_lG9b47zUO7gu0... 

I, too, notice that the New York State form asks you for the name and address of an employer. However, like you, I am one who works exclusively on Upwork, I am not sure how to proceed. Suggestions would be most welcome. Thanks.

Hi Nilotpal!

I think the state's are scrambling to figure it out.  My state says they will advise as soon as they can but they are swamped.  I also asked Upwork in another forum on how they will handle if people list Upwork as their employer, since we can't usually do that for unemployment or for the IRS but with the expanded inclusion of gig workers and freelancers as part of the stimulus plan, I don't know what the policy will be or if/how we will be covered and how we apply if our contract/project was cancelled or reduced due to COVID.

 

I will post update if Upwork responds to me or my state issues any guidelines.

Thanks very much for your prompt response. Do you have a link to your other Upwork post that you mentioned. If it is public, I'll follow it to see how Upwork answers you. Thanks again, Nilo

In case other Upworkers are wondering about whether they qualify for Pandemic Unemployment Insurance, the following outlines the legal definitions of telework and the way to self certify.

 

Upworkers do not "telework," and the lawmakers have designed a bill that does include us.  Simply put, finding work online and teleworking are two legally distinct processes as noted by the government.

In the same way the terms "freelancer" and "self employed" are defined legally by whether you file your taxes with a 1040 Schedule C, the term "telework" is defined legally in the Telwork Enhancement Act and is outlined by the U.S. Office of Personnel Management at 
https://www.opm.gov/faqs/topic/telework/index.aspx?page=1

"The Telework Enhancement Act defines telework or teleworking as a work flexibility arrangement under which an employee performs the duties and responsibilities of such employee's position, and other authorized activities, from an approved worksite other than the location from which the employee would otherwise work.  In practice, telework is a work arrangement that allows an employee to perform work, during any part of regular, paid hours, at an approved alternative worksite (e.g. home or telework center)."

Since upwork independent contractors are not employees working from an approved worksite  during regular, paid hours, you qualify for Pandemic unemployment insurance as a gig worker, again, as defined by your filing for taxes using a 1099. 

 

To say this differently, Upworkers find work online, but they do not telework. They are gig workers that use online resources to find work, but they do not telework. The lawmakers understood that clients worldwide are impacted and that our income has plummeted, sometimes to zero.  That is why they used a legal term in the CARES act.  

 

NOW--THE BAD NEWS!!!!!!!!

Please note: the problem is not whether you qualify--you do--the problem is how you will "self certify" your earnings and whether that self certification will be  accepted.

 

If you listed your earnings on your 1040 for 2019 or for 2020, you will be fine. If your state requires a 2020 schedule C, your 2019 earnings will not suffice, and ou will need to file your 2020 taxes and do so using your schedule C.

However, if you did not report your earnings, you will have screwed yourself because unlike many other online platforms that operate on the backs of gig workers, neither Upwork nor its workers issue workers a 1099, which is a crock of shot.

 

You will need your schedule C.

Hello all:

I'm happy to report that the NYS now allows you to file online for Pandemic Unemployment Assistance (PUA) via their Dept. Of Labor (DOL) website.

 

There is a simple step by step form to fill out. It asks you to state your self-employment income from your latest filed tax return (which could be 2018, I guess, if you haven't filed one for 2019).

 

To access the form sign into the DOL website: labor.ny.gov/signin and look for "My online forms". One of these (see LHS) will be the form for PUA.

 

I hope this helps someone in NYS.

 

Thanks.

The National Writer's Union Website has put up a page explaining the CARES Act Pandemic Unemployment for freelancers.

 

For writers, here's what they suggest:

 

Applicants will have to provide self-certification that they are (1) partially or fully unemployed, OR (2) unable and unavailable to work because of one of the following circumstances:

  • They have been diagnosed with COVID-19 or have symptoms of it and are seeking diagnosis;
  • A member of their household has been diagnosed with COVID-19;
  • They are providing care for someone diagnosed with COVID-19;
  • They are providing care for a child or other household member who can’t attend school or work because it is closed due to COVID-19;
  • They are quarantined or have been advised by a health care provider to self-quarantine;
  • They were scheduled to start employment and do not have a job or cannot reach their place of employment as a result of a COVID-19 outbreak;
  • They have become the breadwinner for a household because the head of household has died as a direct result of COVID-19;
  • They had to quit their job as a direct result of COVID-19;
  • Their place of employment is closed as a direct result of COVID-19; or
  • They meet other criteria established by the Secretary of Labor.

Until other criteria is established, the circumstance that will most closely apply to most freelance writers (including those who are still working part-time, but have less work) would probably be the bolded criterion above, which in the CARES Act reads: “(ii) the individual has to quit his or her job as a direct result of COVID–19.” We recommend being as specific as possible about the loss of work and income, and why that loss was a direct result of the outbreak – how many jobs/how much you were earning previously, when those jobs/income fell off, what triggered that fall-off (e.g. a shelter-in-place order, the closure of certain publications, declarations of emergency in certain states), and how much income/how many jobs you have lost.

 

The article concludes with:

 

Because state agencies will not have freelance writers’ wage records, writers should collect, to the extent possible, documentation of their earnings to submit with their application or at a later stage.  Documentation could include bank statements, copies of checks, 1099s, or other materials.

 

I expect to provide the weekly timesheets from my contract that has been put on hold and the message from the client explaining the situation. But from what I understand, each state will interpret the Department of Labor guidelines in its own way.

 

Hope this helps!

The official document that I found on the NYS DOL  online form for filing PUA rewrites the last three items (compared to the National Writers Union link sent by Judith) as follows:

 

  • You had to quit your job as a direct result of COVID-19; OR
  • Your place of employment is closed as a direct result of COVID-19; AND
  • You are self-employed, seeking part-time employment, or do not otherwise qualify for benefits.

I have emphasized (in bold) the parts that are changed from the news article. I assume that these will be true for all other states, too.

 

My question for freelancers on Upwork is: Which of the two criteria

  • You had to quit your job as a direct result of COVID-19; OR
  • Your place of employment is closed as a direct result of COVID-19;

applies to a freelancer who only works on Upwork and works out of one's home. I guess the second criterion does not apply and so we are left with only the first one. Is it sufficient to show that many of one's contracts are stopped or on "pause"? Or that the volume of appropriate jobs for one's skills have died down? Any way to quantify that?

 

Any thoughts on this would be much appreciated.

Thanks.

 

 

 

Tiffany, It's been passed and the applications are live now. I hope upwork posts an info page to help guide all of us. Is anything like that posted yet? We all need some help and this is a great central resource.

Upwork won't likely respond since we don't technically work for them, but I did ask them on another forum and their response is earlier on this thread.

 

You have to check with your state's UI website.  Most are overwhelmed right now and have not been abe to update the application form yet to include freelancers, gig workers, self-employed.  

 

Some state's have updated their websites, but most are still in process and say will be complete mid-month.  You will be able to file a that time and back date your application.  No point submitting now as you will likely fill it out wrong since the self employed/freelancer/gig category is new/not there.  You cannot list Upwork as your employer, similar to how you can't on your Tax Return.  Most people in this category submit as self employed or small biz owner.

 

There are also small biz loans available via banks and other resouces and grants--a couple are listed in this thread.

 

New York's application appears to have been updated to be able to submit.  My state's hasn't yet but I will post on how to complete it when it is up and running.

 

Good Luck!

resultsassoc
Community Member

US citizens and legal residents will receive stimulus checks of about $1,200/adult and $500/child within a month. These will be handled by the Internal Revenue Service. If you are a US citizen or legal resident who has not filed a tax return in the last few years due to disability or student status, or not earning enough to owe any taxes, file one now for 2019. Otherwise you may slip below the radar for the check.

 

I know of three sites that allow for free filing of electronic returns that are very simple. Two are decent: the one that is intuitive to use and the one that is block solid. Another one is very difficult; it Acts up all the time.

 

Feel free to delete material you believe promotes a vendor. I did my best.

Im gettin my NEETbux ooooh yeah bring it on.

Good advice.  You missed speaking to the upper limit of income at which payments start to curtail or are not available. 

 

I believe speaking to this would give hope and pause to Upworkers that they can find ways to earn $75,000 or more, on the platform and off, as need be. 

 

It shows a potential  career trajectory in real dollar amounts.  It can set internal expectations and know it can be done, should have any of us achieved that.

John.

no1prdiva
Community Member

Upwork's response, FYI:

Hi Lisa, you are correct that Upwork is not your employer and does not pay you. Upwork provides a marketplace for self-employed freelancers to find clients and projects of their choice and on terms agreed to with the client, and then paid by the client through our escrow services. Often, freelancers find it appropriate to put that they are self-employed, but you may want to check in with your own advisors depending on your situation.

Mods, please sticky this thread so everyone can find it!!

no1prdiva
Community Member

we don't 'technically work for them' is no reason not to comment on topics of interest and concern for the entire community. They're advertising 'New US Freelancer Taxes Webinar'. Would be nice if they consolidated and presented some expert SBA advice too. Maybe nobody paid them for the opportunity. I guess I'll suggest a couple of banks jump on here and get some ad bucks for upwork if that's what they need to help us.


Jason T wrote:

we don't 'technically work for them' is no reason not to comment on topics of interest and concern for the entire community.


"Entire community?" You mean for the community from all the180 countries that make up "the community?"

 

absolutely, especially people outside the US who aren't eligible. c'mon. give me a break.

no1prdiva
Community Member

My state finally opened up the UI site for self-employed people.  I don't have an answer yet on if I will be eligible as an Upworker, but providing an update for those who are still waiting.  For my state, you have to apply for "regular" UI first as part of the process.  You are then auto denied and have to re-apply under the CARES act.  From there, I am waiting.  Will continue to update in case it helps anyone.

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