COVID-19Unemployment Benefits

The COVID-19 Unemployment Dilemma

I hope everyone is doing okay. We are taking a lot of calls from people looking for legal assistance who are placed in a very difficult situation. I call this the COVID-19 unemployment dilemma.

Calls From Employees

Employees of companies are calling me and the conversations are going something like this:

(1) I filed for unemployment and benefits were approved.
(2) I am receiving unemployment benefits.
(3) I am receiving more in unemployment benefits than when I was working.

Financially, that might sound like more money to the employee during this difficult time. The problem comes in with the next set of details I am hearing

(4) My boss called and said that he/she just received Payroll Protection Program funding from the SBA
(5) My boss told me that he wants to pay me my wages now
(6) My boss explained to me that he wants to pay me my wages so that he/she can request forgiveness (meaning the employer won’t have to repay the money if it goes towards paying employees’ wages)

Questions from Employees

The questions I then get asked are as follows:

(1) What do I do? I am receiving more money on unemployment than I was getting paid at the job.
(2) If I say no to my boss offering to pay wages, then does that affect my unemployment in any way?
(3) How can I protect my job?

Of course every situation is different, so I need to start out by saying that. The answers might even depend on the specific industry in which you work. But generally speaking, I think the consensus from employment lawyers on this issue is that if your boss offers to pay you your wages, and you say no, then your boss has the right to find someone else to replace you.

The COVID-19 Unemployment Dilemma

I also think the consensus on this difficult dilemma is that if your boss offers to pay you wages and you say no, you are risking your unemployment compensation benefits. In other words, your boss could let the Department of Labor know that he or she offered you your wages and you rejected them, and that could mean that you may forfeit your right to continue to collect benefits.

I think the best way to protect your job as an employee is to accept the offer from your boss and be paid the wages. As someone who advocates strongly and often for employees, I do recognize with the way that this has developed that the situation puts the employer in a difficult position – the only way they can obtain forgiveness of the loan is if they meet certain requirements, one of which is that the proceeds go towards paying employees. But if the employer is in an industry that is not yet reopened (for example, restaurants, hair salons and barber shops, and dental practices), it places the employee in a difficult spot between deciding on the short term – should I receive more money now through unemployment?, or the long term – should I get paid the money from my boss even though its less than unemployment because it will be more likely that my job will be there for me when I get back to work?

These are indeed confusing and scary times. Please call me if you have any questions about this blog or have other employment law questions.

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