Lyft driver John Anderson knows there’s help in the federal relief bill for him and the millions of other gig economy workers across the United States who have lost work during the coronavirus pandemic.
But how long will they have to wait for relief? It could be three weeks. Maybe four. No one seems to know.
“You’ve got so many drivers out here and they’re confused. Either confused or misled,” said Anderson, waiting for what’s now a trickle of customers at the Sacramento International Airport.
“You really don’t know what to believe until somebody says ‘Here’s the federal paper, here’s how you apply, step one, step two, step three,’” he said, noting he’s lost two-thirds of his income since the outbreak.
Under the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, self-employed workers — including independent contractors such as rideshare drivers, freelance writers and musicians who have lost income, plus part-time workers affected by the outbreak — can qualify for $600 per week plus half their state’s weekly average unemployment insurance payment, which in California is $333.
Typically, these positions do not qualify for unemployment assistance or have limited options. This expanded eligibility will be in place until Dec. 31, but the total benefit will be reduced this summer because the additional $600 per week only runs through July 31.
There are more than 2 million self-employed people in California and 3.4 million who work part-time, according to an estimate this week from Sen. Dianne Feinstein. Millions more work in the gig economy.
“These non-traditional workers comprise as much as one-quarter of all workers in the state,” Feinstein said in a press release.
Several readers have asked about the relief bill, with some wondering how the $2 trillion package of benefit programs will be implemented. In California, we found that’s still a work in progress.
Waiting On Direction From The Feds
The self-employed, part-time and gig workers must apply for their money through the California Employment Development Department. But the state agency said this week it still hasn’t received instructions from the federal government for how to make the money available.
“We are awaiting direction at the federal level. We haven’t gotten instructions on how to implement the benefits,” Aubrey Henry, a spokesperson for the California Employment Development Department, or EDD, said this week. “We’re waiting for them anxiously like all states are.”
Henry said the state agency would make those details public as soon as they get them from the U.S. Department of Labor, but did not have advice for what affected workers should do in the meantime.
Spokespersons for the federal department did not respond to requests for comment.
State employment departments have seen a huge volume of jobless claims. Last week, the federal government said 3.3 million people filed for first-time unemployment benefits in the seven-day period ending March 21.
Gov. Gavin Newsom said on Tuesday more than 1.6 million Californians have filed for unemployment since March 13, including 150,000 since the start of this week.
In “normal times,” Henry of the California EDD said, his department takes about three weeks to process applications, but it could take even longer given the recent surge.
More information about benefit programs for workers affected by the coronavirus is available at the EDD’s website.
‘Pay Now, Verify Later’
University of Massachusetts Amherst economist Arin Dube has studied the federal bill. To get money to people faster, he’s called on states to use a “pay now, verify later” approach to paying out claims.
“This is a really important and good policy that I think the Congress has passed,” Dube said. “Now the issue is to make it work and make it work in a way that is relatively fast and can help fill the gaps in those family budgets.’
Dube estimated it will take states about a week to get the federal benefit program ready for people to send in applications.
The California employment agency is already swamped with calls, and many benefit-seekers such as Gabe Krieguer are losing patience.
Responding to a post on the agency’s Twitter account, Krieguer wrote:
“I’ve called over 100 times JUST TODAY. Been trying for over a week now. I also tried going to an office but it’s closed. I CAN’T file online. Imagine if this was a global crisis or something.”
Henry, the EDD spokesperson, wrote in an email late Wednesday afternoon that the agency's website "is under tremendous strain" but working normally.
"It’s possible an individual may have issues with their own internet provider," Henry wrote "These are historic times creating an unprecedented demand for unemployment benefits. Call lines are swamped so it is still strongly recommended that unemployed workers apply for benefits through our UI Online system for the fastest processing possible on your claim.”
‘Everybody Is Strapped’
As those affected wait, the loss of income won’t leave all gig workers destitute.
Anderson, the Lyft driver, said he’s lucky his wife is still employed. The two have an 11-year-old son and rent an apartment in Elk Grove.
“My wife and I got a little bit of a cushion to get by for a little while. But eventually it’s going to come down to the point where we’re going to have to tell our landlord that ‘Hey, we ain't got it,” he said.
But for some like rideshare driver Evelyn Williams of Sacramento, the loss is devastating. She can no longer afford the extended stay motel where she and her two sons recently lived.
“Everybody is strapped,” she said, predicting “a flood” of gig workers and their families will be forced onto the streets.
