States are now slowly starting to reopen, and people are expected to get back to work. However, many are still avoiding work because of the high unemployment benefits, including the $600 federal unemployment benefit, they are getting. For some, the unemployment benefits are more than the pay they would get from returning to work. Thus, they don’t want to return to work. But, there are ways that will allow people to get unemployment benefits even if they return to work.
Return to work and still get unemployment benefits
The CARES Act, which was passed in March, added $600 weekly in federal unemployment benefits, in addition to the state-level unemployment benefits. For many, the total unemployment benefits, state and federal, turned out to be more than what they were making or would make by working.
Now that things are slowly returning to normal, such people are deciding not to return to work, but would rather enjoy the unemployment benefits. However, there are two ways that people could get unemployment benefits even if they return to work.
These two ways are: work-sharing programs or reduced unemployment insurance benefits. Both of these ways will allow the employee to get a partial unemployment check if they start working on a part-time basis. These two ways are not available to full-time workers.
Work-sharing programs, or short-time compensation or shared-work programs, are offered by the employer. Under this, instead of laying off workers, a business can reduce the number of hours anywhere from 10% to 60%.
As per Maryland's government website, the work-sharing scheme is a “voluntary Unemployment Insurance program that provides employers with an alternative to layoffs when they face a temporary and unexpected downturn in business. …. While you are working fewer hours, you will receive a percentage of your regular Unemployment Insurance (UI) benefits.”
Work-sharing programs: how does it work?
Employees under work-sharing programs get a prorated state unemployment benefit to make up for the loss in wages. For example, if an employee’s working hours are reduced by 50%, he or she would get half of the state unemployment check and the $600 weekly federal unemployment benefit.
However, to use the benefits under this program, your employer needs to get approval from the state. Also, you should not cut your own working hours, rather the reduced hours should be due to the employers’ staffing needs. Moreover, you should be willing to work for more hours, but the circumstances don’t allow it.
Another program that will allow you to get unemployment benefits even if you return to work is the Partial unemployment benefits. It is more complicated than the work-sharing program and its rules vary between states. To be eligible for this, the working hours should have been cut drastically, about 60% or more. Or, workers should be earning less per week than the average unemployment benefit that they would get from the state.
For example, if the average state unemployment benefits are $350, then the worker should be getting less than that from the job to qualify for the program. Also, to get the partial unemployment benefits, workers need to file an application with the concerned department.
One may argue that these programs may not be needed as the $600 federal unemployment is going to expire next month. Once the federal benefits expire, the unemployment benefits may become less attractive. Yes, the $600 benefits will expire next month, but there are chances that it could get extended by the next coronavirus stimulus package.
What about after the $600 federal benefits expire?
In March, when the CARES Act chose the expiration date for the federal benefits as July 31, not many would have thought that the coronavirus pandemic would continue beyond July. The economic conditions are still far from satisfactory. Though businesses are slowly starting to reopen, fear of the virus is keeping most customers away.
The $600 is proving to be a lifesaver for many who lost their jobs due to the shutdown. Even though unemployment numbers came down in May, millions still are jobless with no source of income. For them, it is very important that the federal benefit get extended beyond July until the job market improves.
The $3 trillion HEROES Act does promise to extend the $600 weekly jobless benefits. It was passed by the House last month, but Republican lawmakers are not very excited about this bill. Many believe that the federal unemployment benefit is discouraging people to get back to work. Thus, they are planning to replace it with a bonus that would encourage people to get back to work.
Even if Congress does not extend the unemployment benefits, then also it will be beneficial for you to register for these other programs. This is because once the $600 benefit expires, you would not have many reasons to avoid work as the unemployment benefits you would get will likely be less than the expected pay.
So, if your employer is going for reduced hours of work, you will be able to make up for the loss in pay with the benefits under the work-sharing programs and partial unemployment insurance benefits.