Self-employed workers will have to wait at least a month for benefits, state labor official says

The Alaska Department of Labor and Workforce Development building in Juneau. (Photo by Heather Bryant/KTOO)

Update (April 16) — Lex Treinen, Alaska Public Media

The Alaska Department of Labor and Workforce Development is now asking self-employed, independent contractors, and gig-economy workers to apply for regular unemployment benefits, even though they will likely be denied. (Read more)

Original story

Self-employed workers or those working in the gig economy who lost work due to the coronavirus will have to wait at least four weeks before applying for benefits, Alaska’s Department of Labor and Workforce Development said.

In 2018 over 43,000 Alaskans were classified as self-employed, according to information from federal income tax fillings. Those workers are ineligible for unemployment insurance benefits, which can pay up to $370 per week, because they don’t pay the employment security tax when they file their federal income tax.

But, for the first time ever, the recently-passed CARES Act will provide unemployment insurance for self-employed workers or workers in the gig economy.

Alaska Department of Labor officials said Monday those those workers will have to wait before the program can be properly implemented — at least four weeks, and possibly longer, according to Cathy Muñoz, the deputy labor commissioner.

“The reason for that is we’re standing up a brand new system. We’re putting into place the IT upgrades, the changes to the computer system, the income verification methods,” she said in a phone call.

The department will have to train new staff and negotiate implementation with the federal government, which funds the program. Muñoz says that guidance from the federal level to states didn’t come in until late Sunday.

For now, self-employed workers affected by closures will have to wait.

“Everybody is working very hard to get this done, and to do it so that the rollout is done successfully. And to do that, a number of things need to happen for it to be successful,” she said.

The federal program, called Pandemic Unemployment Assistance, will pay an additional $600 per week, depending on income, plus $74 for each dependent.

 

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