COVID-19 > Unemployment
- If employees seek unemployment benefits, does that change their status from inactive employees (furloughed) to terminated?
Employees who are laid off or furloughed are eligible for unemployment benefits if their weekly pay is reduced by more than 80% through no fault of their own. Therefore, they can still be employed and working or not working and be eligible for unemployment benefits. If they are still working, but only a few hours, the TWC will prorate their unemployment benefits according to their current wages. They will have to produce their pay checks on a periodic basis to continue receiving benefits.
- How will Texas Workforce Commission be handling layoffs due to COVID-19?
The Texas Workforce Commission has determined that a Texas employer’s account will not be charged for any claims filed due to COVID-19. Benefits paid to a former employee as a result of COVID-19 will not be included in the employer’s future tax rate calculations.
Please note employers will receive a Notice of Maximum Potential Chargeback regarding the reason for claimant separation(s). Employers should provide a detailed reason to assist the TWC's Benefits Department in making any COVID-19 Chargeback determinations.
- I need to temporarily close my business. What steps do I need to take with the TWC?
If a business has closed temporarily or permanently, a Mass Claim may need to be initiated.
If you expect to have 10 or may layoffs in the future, consider filing a Mass Claim with the Texas Workforce Commission (TWC). This could save you and your employees time. Some advantages:
- Can submit the layoff information before the layoff, which ensures a smooth transition for both employer and worker
- Can establish claims more efficiently than workers who submit their own unemployment benefits claims
- Can submit the worker's final week of earnings, helping to ensure proper payment
- Can submit information on severance pay or wages in lieu of notice of layoff, reducing subsequent contact by TWC
- Are not inundated with a written notice of application for each individual who applies for unemployment benefits
- Automatically become a party of interest to each claim filed
For reference, please see the following resources:
- BFG's Guide: How to Submit a Mass Claim Request
- TWC's Guide: https://www.twc.texas.gov/businesses/mass-claims-unemployment-benefits#howToSubmitAMassClaimRequest
- I need to drastically reduce employee hours. What steps can I take with the TWC?
If employee hours are reduced, layoffs can potentially be avoided through TWC’s shared work program
- How does the TWC’s Shared Work program work?
If you are able to reduce hours (rather than lay off employees), you can apply with TWC for their Shared Work Program, which will allow your employees to work and get benefits, ultimately resulting in higher income for them.
Employers must apply and be accepted to participate in the Shared Work program. Once selected, employers must submit included employees’ information to the TWC. Eligible employees are assigned to work for other employers participating in the program by the TWC and can be disqualified from the program if they refuse an assignment. Participating employers and employees must report wages to the TWC. The TWC allows employees to work part-time outside of the program, and they are not required to report those wages. As you know, employers are required to report wages to the TWC along with the employee’s name and SSN. Therefore, the expectation would be that the TWC is monitoring this and will contact the employee to refund any benefits they should not have received and refund employer accounts accordingly.
- How does the CARES Act affect unemployment?
The CARES Act allows those who are collecting unemployment to receive an additional $600 per week of federal funds in addition to their state unemployment benefits.Per the law, individuals who are covered under the Pandemic Unemployment Assistance (PUA) can collect for up to 39 weeks, though the Act states that this timeframe could be extended by future legislation.
- Who can claim Pandemic Unemployment Assistance (PUA)? Are owners eligible?
The CARES Act expands who is covered under PUA.Unemployment is typically available to individuals who are otherwise able to work except for the fact that they are unemployed or partially employed.The CARES Act expands unemployment so that the individuals, who are unable or unavailable to work for the following reasons, would be eligible to receive PUA:
- the individual has been diagnosed with COVID-19 or is experiencing symptoms of COVID-19 and seeking a medical diagnosis
- a member of the individual's household has been diagnosed with COVID-19
- the individual is providing care for a family member or a member of the individual's household who has been diagnosed with COVID-19
- a child or other person in the household for which the individual has primary caregiving responsibility is unable to attend school or another facility that is closed as a direct result of the COVID-19 public health emergency and such school or facility care is required for the individual to work
- the individual is unable to reach the place of employment because of a quarantine imposed as a direct result of the COVID-19 public health emergency
- the individual is unable to reach the place of employment because the individual has been advised by a health care provider to self-quarantine due to concerns related to COVID-19
- the individual was scheduled to commence employment and does not have a job or is unable to reach the job as a direct result of the COVID-19 public health emergency
- the individual has become the breadwinner or major support for a household because the head of the household has died as a direct result of COVID-19
- the individual has to quit his or her job as a direct result of COVID-19
- the individual's place of employment is closed as a direct result of the COVID-19 public health emergency
- the individual is self-employed, is seeking part-time employment, does not have sufficient work history, or otherwise would not qualify for regular unemployment or extended benefits
Individuals who cannot claim PUA include the following:
- someone who has the ability to telework with pay
- someone who is receiving paid sick leave or other paid leave benefits, regardless of whether they meet any of the qualifications above
- Has the TWC provided any extensions?
Due to COVID-19, the due date for the 1st Quarter 2020 tax reports and payments is extended to May 15, 2020.