Tag Archives: unemployment

Illinois, Tips

Illinois Unemployment Claimants Concerned With Change In IDES Policy

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I received a call and email today from a concerned Illinois citizen, trying to bring awareness to what seems like a serious error on the part of the Illinois Department of Employment Security (IDES). I have contacted our State Representative’s office and they are looking into it. I will post an update here when I have one; in the meantime, here is the information I received — just in case you are struggling with the same issue, you can know you’re not alone, and folks are indeed trying to get it addressed.
Note: I have not yet vetted this information… it was provided to me via an individual who is not a client.

Summary: The state of Illinois shut down on March 20th, and the CARES Act, including the Federal Pandemic Employment Compensation (FPUC) passed on March 27th. Even before it passed, the official message from the State of Illinois was that there was no different way to apply for the federal aid aside from applying normally for state unemployment. IDES posted on their FPUC FAQ that individuals otherwise eligible for unemployment during the weeks of the program would be eligible for and receive the increased assistance. They also wrote that the additional $600 per week would be active in benefit payments for unemployment certifications (not applications or claims) completed starting April 6th. Then, on April 15th, they retroactively decreed through a PDF that anyone who had any claim for benefits pending or active before March 29th would be denied the FPUC.
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The IDES is not applying the $600 FPUC increase for mandatory COVID-19 economic shutdown to people receiving regular unemployment benefits (in violation of the federal implementation guidelines and the CARES Act).

IDES put out this fact sheet where they claim, “Pursuant to the federal legislation, this $600 will not be retroactively applied to unemployment claims that arose prior to March 29, 2020“
https://www2.illinois.gov/ides/News%20%20Announcements%20Doc%20Library/Federal-Stimulus-FAQ-April2020.pdf

While the $600 payments cannot be retroactively applied to before the CARES act took effect, it is incorrect to not apply the $600 to later weeks for those with existing claims started prior to March 29th. There is no requirement in CARES FPUC that individuals may not already receive unemployment benefits or forfeit eligibility. In fact, the opposite is true, and the $600 is an increase to existing benefits.

The IDES COVID FAQ also states the correct interpretation in their FPUC FAQ:
“Who is eligible to receive FPUC?
FPUC is payable to individuals who are otherwise eligible for unemployment benefitsfor weeks of unemployment beginning March 29, 2020 and ending July 31, 2020“
https://www2.illinois.gov/ides/Pages/COVID-FPUC-FAQ.aspx#h2

IDES provides no alternative method to apply for or receive federal assistance beyond applying for normal state unemployment benefits. After certifying for benefits through 4/18, [this claimant] still has not received additional payments from FPUC/CARES, even though the IDES website had indicated that FPUC would be included for eligible recipients with their normal benefits starting April 6th:

“The $600 federal increase is now available! Those claimants certifying beginning April 6 will see the additional supplemental income applied to their weekly benefit amount. This increase is available through the week ending July 25, 2020.”
https://www2.illinois.gov/ides/Pages/default.aspx

Due to the fact that [this claimant] has seen no additional $600 materialize, and the IDES changed the wording in their April 15th PDF, it seems they may have mistakenly adjusted the policy to not grant the $600 to recipients in this situation. IDES had not previously stated that claimants had to wait until after March 29 to apply to get FPUC — in fact, they indicated the opposite: that people should apply normally, and once it was enacted and implemented they would start seeing the additional funds.

Those who apply before March 29 are still eligible for benefits for weeks after March 29th, and thus still eligible for FPUC.  The date of March 29th is to start $600 payments, not to cut off eligibility. This seems to be a serious error.

(Federal guidelines for the law are copied below for reference.)

CARES FPUC Guidelines:
C. Operating Instructions.
1. Eligibility for FPUC.
For an individual to receive FPUC, the applicable state must have a signed agreement with the Department. FPUC is payable to individuals who are otherwise entitled under state or federal law to receive regular UC for weeks of unemployment (including Unemployment Compensation for Federal Employees (UCFE)and Unemployment Compensation for Ex-Servicemembers (UCX)). FPUC is also payable to individuals receiving the following unemployment compensation programs: PEUC, PUA, EB, Short-Time Compensation (STC), Trade Readjustment Allowances (TRA), Disaster Unemployment Assistance (DUA), and payments under the Self-Employment Assistance (SEA) program. A number of state laws include provisions extending the potential duration of benefits during periods of high unemployment for individuals in approved training who exhaust benefits, or for a variety of other reasons. Although some state laws call these programs “extended benefits,” the Department uses the term “additional benefits” (AB) to avoid confusion with the Federal-State EB program. FPUC is not payable to individuals receiving AB payments.
2. FPUC Eligibility and Relation to Other Types of Benefit Payments.
Individuals receive FPUC payments concurrently with payments under those programs identified above. Refer to UIPL 14-20, Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 –Summary of Key Unemployment Insurance (UI) Provisions and Guidance Regarding Temporary Emergency State Staffing Flexibility, issued April 2, 2020, for additional information on how FPUC interacts with other programs authorized under the CARES Act.States that are unable to immediately pay benefits the week following the execution of the agreement with the Department to operate the program must provide retroactive payments to individuals eligible for FPUC for the weeks they would have been entitled.

https://wdr.doleta.gov/directives/attach/UIPL/UIPL_15-20_Attachment_1.pdf

Here is the full UIPL 14-20 —
https://wdr.doleta.gov/directives/attach/UIPL/UIPL_14-20.pdf

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Education, Illinois, Tips

Self-Employed To Begin Receiving Unemployment Benefits May 11

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UPDATE MAY 11 — see new post here:
http://www.thedancingaccountant.com/?p=1611

Many of my clients are self-employed (they file Schedule SE to pay payroll taxes on their income tax returns, rather than receiving a W-2 as an employee), and therefore are not required to pay into the state’s unemployment fund at the Illinois Department of Employment Security. This also means that they are not allowed to draw on the unemployment system.

However, with the current pandemic raging, the government recognized that these folks need the same safety net the rest of society can count on, and states were instructed to make benefits available to them.

There were a few problems with that. Although the federal government instructed states to cover self-employed people — this includes sole proprietors who have employees, as well as folks who don’t think of themselves as running a business: gig workers, independent contractors, and those performing odd jobs for a living — it unfortunately did not give states any guidance, budget or other resources for how to make that happen.

First-off, keep in mind that unemployment claims have skyrocketed. In one month, IDES has received more claims than in all of 2019. Staff are overworked, and being asked to come into an office instead of working from home, because data security issues have always required it. Many folks have become sick and had to take time off, or are struggling with childcare issues due to schools being canceled.

Then take into account the fact that most state unemployment computer systems are ancient in terms of technology. Many are actually written in COBOL, a language in wide use in the 1960s. So when these programs break, there aren’t a lot of software developers around who can fix them — to the extent that IBM is actually offering free COBOL classes to computer programmers (even beginners) in hopes they can help out some of these agencies. It’s already hard enough to work with these legacy systems… but reprogramming them to accept an entirely different application, documentation and workflow (self-employed people don’t have paystubs or W-2s to prove income) is a huge overhaul project in itself. (Which they don’t have time to do because claims have skyrocketed, they are overwhelmed, and understaffed.)

Furthermore, the staff working at state unemployment agencies aren’t trained to review this new documentation, or to make calculations as to the amount of benefits to which they’re entitled. Reviewing tax returns is simply not the same as reviewing paystubs and W-2s, and this will take some time — new rules will have to be devised, new procedures created, and then employee training will have to occur… all while a pandemic rages and folks are (see above) overwhelmed and understaffed.

So when I read comments like that of Morgan Ione Yeager from Highland Park, who is “appalled and disgusted” by the delays and claims, “there’s no reason why it needs to be this difficult,” I can’t help but wonder what she knows, about software programming and benefit calculation training while being overwhelmed with an unprecedented number of current claims and working onsite with insufficient protections… that I don’t.

Which is to say — this situation is indeed horrible, and difficult, and sad. But please remember these are human beings trying to make this happen.

Enter some good news. An entirely new system specific to self-employed workers is being written in a period of weeks in order to have things up-and-running as soon as possible, with benefits rolling out around May 11th, reports the Chicago Sun-Times.

In addition to the new system, other “upgrades include: recruiting retired IDES employees to come back to work; boosting IDES’ phone system capacity by 40% plus extending daily call center hours; opening another call center with 200 employees’ and hiring consultants to overhaul and build new IDES platforms.”

In the meantime, I recommend you continue to watch the news and the IDES site — please check it no more than once-a-day, to reduce the load and make it easier for others applying for benefits — and be ready with whatever you have that can support your calculation of your annual income, such as a tax return, 1099-MISC forms you have received for work performed, or a statement print-out of earnings from the company for whom you are a contractor. You may wish, as a former administrative law judge for IDES has recommended, to write a letter with the initial date you stopped receiving income and attempted the unemployment application submission, just to make sure you have backup illustrating you began the process (to me, this seems like it would clog the system up further, but if there’s any concern about your claim not being honored, it seems like a reasonable approach).

For more information on how unemployment benefits vary so widely from state-to-state, check out this great article. The number of complicating factors involved makes apples-to-apples comparisons almost impossible.

And… if you’ve got some free time on your hands and are interested in a career change, don’t forget about those free COBOL classes.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

Illinois, Tips

BCBS Relaxes Eligibility Requirements for Current Health Insurance Group Members

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I honestly never truly expected to see this day come. Hoping against hope two weeks ago, I spent many hours on calls with my benefits advisors, health insurance reps, and every HR resource I could find, to no avail. But apparently, since then, even big bad for-profit health insurance corporations have recognized that forcing millions of furloughed Americans into losing their group health insurance is maybe a bad idea.

Here’s the issue — let’s say you run a small business and you want to start a group insurance plan for your staff. Group plans tend to be less expensive, give you more for your money, and allow access to a wider network of health providers. (Don’t get me started on why all plans aren’t group plans, or why discrimination against self-employed or single-owner businesses is allowable.) But here’s the trick: they require you to have at least one non-owner on the plan. And the second hurdle: with a group plan they require employees to work at least 20-30 hours per week to qualify for coverage (depending on the plan). You’d think the employer would get to choose the number of hours, but no — the for-profit health insurance company does. (Again: do not get me started.)

Enter the COVID-19 crisis. Suddenly small business owners are having to lay off or furlough their staff left-and-right. Hopefully they’ll be able to hire them back when PPP funds, grants or loans come through, but in the meantime, they’re on unemployment. So this means:
1) Employees who have been furloughed or laid off don’t have health insurance unless they can afford to reimburse the employer via COBRA. Which they can’t. Because they just lost their job.
2) The employer may be generous enough to pay for the health insurance for the employee in the meantime, at least to the extent they were previously contributing to it if not more, but they’re not technically allowed to do this if the employee is no longer working 20-30 hours per week (30 hours for BCBS). Some small businesses were doing it anyway and hoping insurance companies were turning a blind eye; or they were technically putting folks on COBRA but not requiring employees to pay for it, booking it instead as an “advance” to be paid back when the business could hire them back.
3) Lastly — and this part stung the most: remember I said earlier that a business owner had to have at least one non-owner in order to have a group plan? Well, what happens if you have to lay off all your employees? The group plan would be terminated and now the owner and their family aren’t even covered anymore. (This is so messed up.)

So you can imagine my shock and thrill when I received the email below last night! Blue Cross Blue Shield of Illinois is actually relaxing the eligibility requirements for currently-enrolled group members, at least through April 30th: this includes staff who are laid off, are on a leave of absence, are furloughed, or are working fewer hours. The relief will last at least through April 30th.

They are also opening up a special enrollment period for staff who had previously declined coverage to be able to get on the company health insurance plan now, or for covered employees to add dependents. This is extremely helpful for staff who may have been covered under a spouse who just lost their job. However, these folks don’t get the same flexibility I mentioned above (which is totally ridiculous, but whatever — I don’t write these rules; if it were up to me we’d all be on a single-payer system).

The take-away: PLEASE DO NOT FLIP THE SWITCH TO COBRA YET FOR YOUR COVERED EMPLOYEES, REGARDLESS OF THEIR CURRENT EMPLOYMENT STATUS. They will remain covered, hopefully up through when the PPP or other funds come to fruition and you can hire them back. If you need to be reimbursed by your employees for their portion of insurance, consider working with them on a case-by-case basis to see who is best able to afford it. Make sure to treat them fairly, but also understand that some have more means than others. For those whose hours are reduced, work with them to make sure they have sufficient pay in their paycheck to have their contribution portion withheld as usual.

And if you are a furloughed employee in danger of losing your coverage, contact your employer to negotiate an extension of benefits at your prior contribution amount — many are willing to make exceptions to reward staff loyalty. Check out this 1-minute video on how to maintain your insurance benefits.

The full text of the email I received from BCBS is here:

Special Enrollment Period and Resources for Group Members Losing Coverage
We are committed to standing with our customers and members in this changing environment. As part of that commitment, we want to let you know about some of the options that may be available to you and several different ways we can help group members who may need coverage support due to COVID-19.

Eligibility Requirements
We have relaxed the eligibility requirements for currently enrolled/covered group members. 

  • From now through April 30, employers can maintain employees who were enrolled on their plans as of March 20, regardless of the eligibility definition stated in their plan or the BPA. 
  • This includes reduced work hours, furlough, leave of absence or layoffs.
  • Groups do not need to do anything. No paperwork or email is needed, as we will accept current and accurate eligibility files.
  • This flexibility does NOT apply to those who are newly electing coverage via the special enrollment period (see below).

Special Enrollment Period
We are also offering groups an optional special enrollment period from March 30 to April 30. This would apply to eligible employees and their dependents who previously declined coverage and now want to enroll, or currently enrolled employees who wish to add an eligible spouse or dependent to their existing coverage.

  • Applicable enrollment changes must be received on or before Friday, May 1. 
  • Effective date of coverage will be the group’s standard coverage effective date/billing date – for most groups this will be April 1.
  • This enrollment event will be for medical/pharmacy and dental coverage only.
  • Employers should notify their account representative if they plan to use this special enrollment option and use the standard eligibility process to add employees.

Other Coverage Options
If you have employees losing coverage through your group health plan, those employees may have several options for alternative coverage.

Federal COBRA: Eligible employers with 20 or more employees must offer coverage under federal COBRA. Employees losing coverage due to a qualifying event, which can include job loss or a reduction in hours, may have the opportunity to enroll in COBRA coverage to continue their current group health plan.

Individual coverage:

Marketplace plans – Any individual can enroll in a Marketplace plan, and some may qualify for financial assistance, depending on their income. Employees can view their benefit plan options at Selectbcbsil.com. 

Medicaid plans – Eligibility for Medicaid depends on income and other state requirements. Employees can view their benefit plan options at bcbsil.com/bcchp.

Additional Resources
We have created materials to help you communicate these options to employees:

  • An email template you can use to explain their coverage options
  • A flier that can be printed or shared electronically

We are here to help our customers and our members during this difficult time. Please don’t hesitate to reach out to your account representative with any questions.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

Education, Illinois, Tips

Questions About Illinois Unemployment (IDES)

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I’m getting a lot of client questions about unemployment these days — understandably… one person referred to it as the “IDES of March” — and thought a short Q & A + random notes and tips might be helpful. Some of these are notes from clients and friends based on their own experiences and research.

None of this should be taken as legal advice. Please see the State of Illinois’ unemployment website or give them a call (I’m hearing wait-time is about 45 minutes, so get a book or magazine out) with specific questions.
For Employers: (800) 247-4984
For Employees: (800) 244-5631
I’ve also heard that some of the branch offices have shorter wait times, such as Arlington Heights (847-981-7400) and Skokie (847-745-3242).

Block Club Chicago has done a lot of excellent reporting since its inception, and the journalists have earned my deep respect. And they are providing all COVID-19 coverage free to the public (consider subscribing to support their work if you are able). This particular article does a nice job outlining how to obtain unemployment benefits, rent relief, and more.
https://blockclubchicago.org/2020/03/18/out-of-work-due-to-coronavirus-heres-how-to-get-unemployment-benefits-rent-relief-and-more/

IMPORTANT NOTE:
For some reason, IDES benefits cannot be applied for with a smart phone — YOU MUST APPLY USING A COMPUTER. I know, this is ridiculous. Don’t shoot the messenger. Here’s the information you’ll need to apply.

Q: What if I’m temporarily laid off because the place where I work is temporarily closed because of the COVID-19 virus?
A: An individual temporarily laid off in this situation could qualify for benefits as long as he or she is able and available for and actively seeking work. Under emergency rules IDES recently adopted, the individual would not have to register with the employment service [office of IDES]. He or she would be considered to be actively seeking work as long as the individual was prepared to return to his or her job as soon the employer reopened.

Q: What if I quit my job because I am generally concerned over the COVID-19 virus?
An individual who leaves work voluntarily without a good reason attributable to the employer is generally disqualified from receiving UI. The eligibility of an individual in this situation will depend on whether the facts of his or her case demonstrate the individual had a good reason for quitting and that the reason was attributable to the employer. An individual generally has a duty to make a reasonable effort to work with his or her employer to resolve whatever issues have caused the individual to consider quitting.

Q: How are unemployment benefits calculated?
A: Here’s the place where IDES shows how they calculate the amount: 
https://www2.illinois.gov/ides/IDES%20Forms%20and%20Publications/CLI105L.pdf  — see page 16 starting with “how your benefits are determined”.
Basically, they take the prior three 3-month periods (quarters) and average your wages during that time. So contrary to popular belief, it’s not based on the most recent week or pay-period. (In fact, the most recent quarter is not even included in calculations.) Then they pay 47% of that amount.

And for more information on how unemployment benefits vary so widely from state-to-state, check out this great article. The number of complicating factors involved makes apples-to-apples comparisons almost impossible.

Q: I heard that the federal government is paying an additional $600 per week as well. Do you have to apply separately to get the federal government amount?
A: To the best of my knowledge at this time, there is no separate Federal application form. The state is supposed to be handling that aspect, and be reimbursed for the Federal amount, as well as their “extra” expense to process everyone. Heads-up that the one week “waiting period” will not apply for the $600 weekly amount — just for the state benefit amount. Once the Federal portion kicks in, the $600 will continue for up to four months, with the state paying for normally 29 weeks, plus another 13 weeks per Congress’ bill.

Q: I use Gusto as my payroll service. What are my options for making sure my employees are eligible for unemployment until I’m able to get everyone back to work again?
A: You have two main options:
1) Dismiss all your furloughed employees in Gusto so they can apply for unemployment — Gusto will save all their data, and they will still be in the system the moment you are able to rehire. To rehire: Go to People –> Show dismissed people (right column) –> Select employee –> on the right, under actions, click “rehire employee”.
– If you dismiss an employee in Gusto, then you will no longer be charged the monthly fee to keep them in the payroll system.
– Keep in mind that when you dismiss an employee, you must then report to your benefits coordinator or health insurance company that the employee has been dismissed. This makes them eligible for COBRA for 18 months. COBRA allows them to remain on the group plan and reimburse the company for the cost (plus an admin fee).
However, many employees cannot afford to do this, given that they’ve just lost their jobs. (Desperately trying to refrain from dwelling how immensely stupid this is, and wishing we had a single-payer tax-supported universal healthcare system.)
Luckily, all the arrangements for COBRA payments happen outside both the payroll and health insurance systems. You can negotiate any arrangement you want with employees, as long as they are all treated fairly. So if the company is able to and wants to foot the bill for health insurance while the employees are furloughed, they can. If they want the employee to continue to pay only their employee percentage, and not the whole cost, they can. Or if they want to offer to fully or partially foot the bill, but defer the employee’s payment until the company reopens and they can return to work, that is also a choice you can make. Just be sure to track the liability, and document the agreement in writing.
2) The other option is to keep them on payroll at a zero or very reduced pay rate. Some employers are keeping the pay just exactly high enough for the employee to be able to have their portion of health insurance benefits withheld from their paycheck. However, it is not as easy to apply for unemployment, and they may only qualify for partial benefits. But they should be able to show the reduced or zero wages, explain that they are furloughed due to business slowdown from COVID-19 sequestering orders, and be treated accordingly as unemployed or partially-unemployed per IDES regulations.
– One benefit of this approach is that they do not use up any of their 18 months of COBRA, and it allows you to easily have them pick up a shift or an odd job here or there.
– This allows the employee to potentially qualify for up to 2 weeks of paid sick leave (or partially-paid leave to take care of a sick family member or a child that must be home-schooled due to school closings), and another 10 weeks of partially-paid family medical leave — to be reimbursed to the employer by the federal government in the form of refundable payroll credits.
– Gusto is also providing options for deferring or waiving monthly payroll processing charges for those who need it.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.