Employment & Labor Alert
(by Stephen Antonelli, Mychal Schulz and Brian Lipkin)
At this uncertain time, many employers are considering whether to lay off or furlough employees – particularly employees who are unable to work remotely. Earlier this week, we provided guidance on an alternative to layoffs and furloughs, as some employers are exploring grants and loans that are available under the new federal and state stimulus programs. With this Alert, we are providing an update on recent changes to Pennsylvania and West Virginia unemployment laws:
- Increased Benefit Amounts Normally, unemployment benefits are capped at $573 per week in Pennsylvania and $424 per week in West Virginia. Under the Paycheck Protection Program provision of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the federal government will supplement state unemployment benefits by $600 per week. Through July 31, 2020, unemployment benefits will be capped at $1,173 per week in Pennsylvania, and $1,024 per week in West Virginia. As a result, for the next four months, some workers may actually earn more in unemployment benefits than they would have earned in wages. For example, an employee who would otherwise receive $100 per week of state unemployment benefits will now receive an additional $600 per week from the federal government. After the federal supplement of $600 per week expires, the employee may continue to collect unemployment benefits at the usual rate in each state
- Expanded Eligibility Until recently, Pennsylvania and West Virginia limited unemployment benefits to certain employees. In Pennsylvania, to receive unemployment benefits, an employee must have earned at least $116 per week, during at least 18 weeks in the past year. In West Virginia, employees must satisfy two requirements within the past year: they must have earned a total of at least $2,200; and they must have worked during at least two calendar quarters. Therefore, in both states, part-time employees who meet these minimum requirements can be eligible for unemployment benefits. Under the CARES Act, however, both states will expand eligibility for unemployment benefits to self-employed workers, freelancers, “gig” workers, and independent contractors. Notably, an employee may not receive benefits under both the Families First Coronavirus Response Act (FFRCA) and unemployment compensation laws.
- COVID-19-Related Unemployment Both Pennsylvania and West Virginia have clarified that employees will collect unemployment benefits if their employer closes, lays them off, furloughs them, or reduces their hours below certain thresholds. In both states, employees may also collect unemployment benefits if they are unable to work remotely because they are self-isolating due to COVID-19. Both states also have expanded unemployment benefits to cover situations where an employee needs to care for a child, elderly parent, or other household member because a school, daycare center, or adult care facility has closed.
- Unemployment Due to Generalized Fear of COVID-19 Pennsylvania employees are ineligible for unemployment benefits if they choose not to work due to a generalized fear of contracting the COVID-19 virus. According to Scott A. Adkins, the Acting Commissioner of WorkForce West Virginia, an individual may not obtain unemployment benefits in West Virginia based solely on a “fear” of the coronavirus or COVID-19, and any approved application that is later determined not to qualify for benefits may be subject to an overpayment demand.
- Longer Duration Normally, workers in both Pennsylvania and West Virginia may collect unemployment benefits for up to 26 weeks. Under the CARES Act, the federal government will fund a 13-week extension of benefits at the usual rate in each state, so that workers in Pennsylvania and West Virginia may now collect up to 39 weeks of benefits.
- Suspension of Waiting Period Normally, Pennsylvania and West Virginia require unemployed workers to wait one week before collecting benefits. Both states have temporarily suspended this waiting period, so that eligible applicants in Pennsylvania and West Virginia may collect benefits immediately.
- Suspension of Work Search Requirements Normally, Pennsylvania and West Virginia require unemployed workers to certify that they are actively seeking work. Both states have temporarily suspended this requirement, so that unemployed workers no longer need to certify that they are actively seeking work.
- Impact on Employer’s Experience Rating Normally, Pennsylvania and West Virginia track each employer’s “experience rating,” which takes into account the frequency and amount of past unemployment claims involving their employees. An employer with a higher experience rating contributes more toward unemployment benefits than an employer with a lower experience rating. Pennsylvania is assuring employers that their tax rate “will not be increased because of COVID-19 related claims.” Similarly, West Virginia will freeze an employer’s experience rating at some point before March 1, 2020, so that COVID-19-related claims have no impact on the ratings, with the frozen rating likely continuing into next year.
- Pennsylvania Notification Requirement In Pennsylvania, employers are now required to affirmatively notify employees, when their employment ends, that they may be eligible for unemployment benefits. Pennsylvania offers a model notice that includes all of the required information, although the notice has not yet been updated to reflect the new provisions of the unemployment law. On the other hand, West Virginia does not currently require employers to notify employees that they may be eligible for unemployment benefits.
The laws and guidance in this area are changing daily, so Babst Calland’s Employment and Labor Group will continue to alert clients of important developments. If you have any questions on how these updates will affect your business, please contact Stephen A. Antonelli at (412) 394-5668 or santonelli@babstcalland.com, Mychal S. Schulz at (681) 265-1363 or mschulz@babstcalland.com, or Brian D. Lipkin at (412) 394-5456 or blipkin@babstcalland.com.
