WASHINGTON – Today, U.S. Sens. Mark R. Warner (D-VA) and Tina Smith (D-MN) introduced the Mixed Earner Pandemic Unemployment Assistance Act of 2020 to help ensure Americans who earn a living through a mix of traditional (W-2) and independent employment income (1099) can fully access the financial relief made available under the Pandemic Unemployment Assistance (PUA) Program.

Following March passage of the CARES Act, states were directed to establish PUA to distribute benefits to workers who would normally not be eligible for unemployment assistance, such as self-employed workers or freelancers, to help them stay afloat during the COVID-19 economic crisis. However, the program has unintentionally disqualified these non-traditional workers from participating in the PUA program if they have mixed sources of income that make them eligible to receive the minimum benefit in regular unemployment insurance. This affects any primarily self-employed or independent worker who receives a secondary source of W-2 income, such as working part-time as a server or caterer, retail worker, entertainment worker, or otherwise are hired by a company part-time as an employee.  

“As the nation continues to deal with the economic devastation caused by COVID-19, we’ve got to ensure that workers have the assistance they need to cope with the dire financial straits many are unexpectedly finding themselves in,” said Sen. Warner. “While Congress extended a lifeline under the Pandemic Unemployment Assistance Program, a large swath of gig and independent workers were unexpectedly left out from receiving the full benefits they are entitled to. Today, we’re introducing a commonsense fix to help millions of independent, freelance, and entrepreneurial workers who were left out of this critical safety net at no fault of their own.”

“In the current economic crisis we must do all we can to support Americans who have been forced to go without work," said Sen. Smith. "Earlier this year, Congress enacted a historic expansion of unemployment insurance, but some people who worked multiple jobs have found themselves in an unintended no man’s land between unemployment programs that has resulted in drastically reduced unemployment compensation. I’ve heard directly from several Minnesota workers caught in this position who are now struggling to get by. That’s why I’m working to fix this problem and help these families get the assistance they need during difficult times.”    

According to recent figures by the Bureau of Labor Statistics, as many as 1 in 10 American workers may presently participate in the labor market with gig, independent, and self-employed work as their primary form of occupation. Last week, based on the unadjusted data released by the U.S. Department of Labor, 2 million Americans filed new unemployment claims – 1.2 million for regular unemployment insurance and almost 1 million for the PUA program. The data also indicates that 33.8 million Americans are either receiving unemployment benefits or have applied and are awaiting approval. Out of the total number of unemployment claims, more than 15 million have been for the PUA program. 

The Mixed Earner Pandemic Unemployment Assistance Act would:

·       Allow workers who earn a minimum of $7,250 independent (e.g. 1099) income to request reconsideration into receiving PUA benefits instead of regular state unemployment compensation.

·       Allow states to opt-in to implement this expanded coverage for mixed earners, acknowledging that not every state will be ready to implement this change.

The bill is cosponsored by Sens. Richard Blumenthal (D-CT), Kamala Harris (D-CA), Ed Markey (D-MA), Amy Klobuchar (D-MN), Dianne Feinstein (D-CA), Elizabeth Warren (D-MA), Martin Heinrich (D-NM), and Chris Coons (D-DE). A copy of the bill text can be found here. Companion legislation was also introduced in the House of Representatives by Reps. Adam Schiff (D-CA) and Judy Chu (D-CA).

The Mixed Earner Pandemic Unemployment Assistance Act is endorsed by the Actors’ Equity Association, All Creative Writes – New York, Alternate ROOTS, American Association of Independent Music, American Federation of Musicians, Americans for the Arts, American Photographic Artists, Artist Rights Alliance, Arts & Business Council of Greater Boston, Arts Council of Greater Baton Rouge, Arts in a Changing America, Arrowmont School of Arts and Crafts – Tennessee, Asian American Arts Alliance, Association of Performing Arts Professionals, Atlanta Contemporary – Georgia, The Authors Guild, BMI, C4 Atlanta, California Lawyers for the Arts, CERF+- the Artists Safety Net, Chocolate Factory Theater – New York, Chorus America, Christian Music Trade Association, Copyright Alliance, CreativeFuture, Dad’s Garage Theatre Company – Georgia, Dance/NYC – New York, Department for Professional Employees – AFL-CIO, Digital Media Association, Dramatists Guild of America, The Field – New York, Fourth Arts Block – New York, Freelancers Union, Future of Music Coalition, Graphic Artists Guild, Guild of Italian American Actors, Halau Hula Ka Lehua Tuahine – Hawaii, Independent Music Professionals United, International Documentary Association, The Laundromat Project – New York, Lawyers for the Creative Arts – Chicago, League of American Orchestras, Live Nation, Maryland Volunteer Lawyers for the Arts, Mississippi Center for Cultural Production, More Art Inc – New York, Museum of Contemporary African Diaspora Art, Music Artists Coalition, Music Business Association, Music Workers Alliance, Musicians for Musicians Inc., The Nashville Songwriters Association International (NSAI), National Coalition for the Art’s Preparedness and Emergency Response, National Employment Law Project, National Press Photographers Association, National Writers Union, Naturally Occurring Cultural Districts – New York, New Yorkers for Culture and Arts, New York Foundation for the Arts, North American Nature Photography Association, Opera American, PA’I Foundation – Hawaii, Peters Valley School of Craft – New Jersey, Philadelphia Volunteer Lawyers for the Arts, Power Haus Creative – Georgia, Recording Academy, the Recording Industry Association of America, SAG-AFTRA, Songwriters Guild of America, Songwriters of North America, SoundExchange, Southeast Community Cultural Center – Georgia, Springboard for the Arts, Minnesota Lawyers for the Arts, St. Louis Volunteer Lawyers and Accountants for the Arts, True Colors Theatre Company – Georgia, Universal Music Group, UrbanGlass – New York, Washington Area Lawyers for the Arts, and the Writers Guild of America – East.

The legislative fix comes on the heels of a letter Sens. Warner and Smith led, along with Sens. Richard Blumenthal (D-CT), Kamala Harris (D-CA), Ed Markey (D-MA), Amy Klobuchar (D-MN), Martin Heinrich (D-NM), Dianne Feinstein (D-CA), Elizabeth Warren (D-MA), Chris Coons (D-DE), to urge Senate leaders to ensure that these workers who have mixed forms of income can access the PUA program – which is available through December 2020 – as negotiations between Senate Republicans and Democrats continue.

“It is clear that allowing workers in alternative work arrangements to access the PUA program is an important lifeline for many during this crisis,” the Senators wrote in a letter to Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, and the Chairman and Ranking Member of the Senate Committee on Finance. “However, for workers whose primary source of income is independent, freelance, or self-employed work but who also receive some W-2 wages as a secondary source of income – such as working part-time as a server or caterer, retail worker, entertainment worker, or otherwise are hired by a company part-time as an employee – an exclusion leaves them without access to a safety net for their primary source of income. Specifically, we hope that modification of the PUA program can be made to allow individuals with over $7,250 in self-employed income to request a reconsideration of their PUA eligibility, where both their 1099 and W-2 income will be aggregated for their weekly benefit calculation. Acknowledging that some states will be better positioned than others to implement this, participation in the fix to the PUA process should be optional for individual states.”

A copy of the letter can be found here.

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