Federal Pandemic Unemployment Compensation (FPUC): What is it? How to Apply

Key Points

• The FPUC is an emergency program created by the federal government under the CARES Act of 2020, to increase unemployment insurance benefits to individuals who have become unemployed as a result of the COVID-19 pandemic.

• All eligible individuals who qualify for state or federal unemployment insurance will receive an additional $600 each week from March 29, 2020, through July 31, 2020.

• The CARES Act also created the Pandemic Emergency Unemployment Compensation (PEUC) program which would extend the unemployment program for 13 weeks, and the Pandemic Unemployment Assistance (PUA) program which extends unemployment benefits to self-employed workers, part-time workers, independent contractors, and freelancers.

• Unemployment benefits can be applied for on individual states’ websites.

The Federal Pandemic Unemployment Compensation is a program created by the United States government. The FPUC program falls under the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020, signed into law by President Trump on March 27, 2020. The CARES Act was put in place as a way to provide additional payment to unemployed individuals that are receiving either state or federal unemployment insurance payment. The federal government funds it, with the exclusion of state unemployment taxes paid by employers.

The Federal Pandemic Unemployment Compensation program was created to increase unemployment benefits to cover over 6.3 million unemployed Americans who have either lost their jobs or cannot work as a result of the novel coronavirus pandemic.

Why Federal Pandemic Unemployment Compensation?

The Federal Pandemic Unemployment Compensation program was created in response to the devastation the coronavirus pandemic was creating amongst employees of many firms. The pandemic has forced an emergency shutdown of states and by extension, businesses. Not only are businesses not able to operate in these lockdown times, but there is a high possibility of many businesses not recovering from the coronavirus impact in a short time. As a result of this, many businesses and companies have laid off or furloughed some employees. Some experts have predicted that there could be nearly 20 million unemployed Americans by July 2020.

As a result of this national and global loss, many Americans will be out of work for the next few weeks or months, and they will need to depend on unemployment insurance (UI) to cover basic needs like groceries, toiletries, and any other expenses that would arise in the coming months. The Federal Pandemic Unemployment Compensation is one of the many unemployment insurance programs created under the CARES Act. Other programs under the CARES Act include The Pandemic Unemployment Assistance program and the Pandemic Emergency Unemployment Compensation program.

The Pandemic Unemployment Assistance (PUA) extends unemployment benefits to self-employed workers, part-time workers, independent contractors, and freelancers who cannot work due to the coronavirus pandemic and lockdown. While the Pandemic Emergency Unemployment Compensation (PEUC) extends benefits for an additional 13 weeks after regular unemployment compensation benefits have been elapsed.

Through the Federal Pandemic Unemployment Compensation program, US citizens that are either unemployed or had recently lost their jobs due to the coronavirus pandemic, and qualified for unemployment benefits are to receive an additional $600 payment per week. The unemployment benefits qualification includes unemployment compensation for federal employees (UCFE), unemployment compensation for Ex-Servicemembers (UCX), Pandemic Emergency Unemployment Compensation (PEUC), Pandemic Unemployment Assistance (PUA), Disaster Unemployment Assistance (DUA), Extended Benefits (EB), Trade Readjustment Allowances (TRA), and Short-Time Compensation/Voluntary Shared Work (STC/VSW).

The FPUC payments started from March 29 and April 4, respectively to last till July 31, 2020.

How to be Eligible for the Federal Pandemic Unemployment Compensation

To be eligible for the Federal Pandemic Unemployment Compensation benefits, individuals must:

• First, qualify for a state or federal unemployment insurance program

• Be willing to work and is actively seeking work. An exception is made at this time as a result of the COVID-19 pandemic.

• Complete and have a record of work searches. (Work searches will be required on some claims)

• Report any/all covered earnings made in the week being claimed. These covered earnings may include wages, vacation pay, holiday pay, and paid sick time. (It is however not limited to these).

How to Apply for an Unemployment Insurance Claim

• If you are yet to file a claim, visit the government unemployment insurance website in your state to file an online claim

• If you have recently filed a claim, the FPUC additional $600 payment would be added to future unemployment weeks as the program is set up by the department.

• All weekly claims can be submitted from 8:00 am to 7:30 pm every Sunday. And 8:00 am to 5:30 pm from Mondays through Fridays.

Additional Information for Employees Affected by COVID-19

Employees that have recently lost their jobs as a result of the COVID-19 pandemic must file an unemployment insurance claim online (state unemployment insurance website) to receive the forms of unemployment insurance. The claimant’s claim will be reviewed to determine if they are eligible for FPUC. Once a claimant is eligible for any state or federal benefit payment in any week from March 29, 2020 till July 31, 2020, such a person will be eligible for payments of FPUC. Also, claimants would still be required to report their weekly claims each week to be paid, when receiving payments on the FPUC program. Payments will be made through the same payment methods as other previously paid benefits.

Additional Information for Claimants

• Child support obligations MUST be deducted from the additional $600 FPUC payment as other regular unemployment insurance benefits.

• FPUC payments are NOT tax-free. The payments will be included on claimants’ 1099G that they will receive for the 2020 tax year. It is also possible to have taxes withheld from FPUC payments if an individual has elected to have taxes withheld from their unemployment insurance benefits.

Information for Employers

• No employer would be charged for benefits paid to employees that receive FPUC payments

• Employers should be timely in filing their quarterly unemployment insurance reports so their employees will receive their benefits as soon as possible. Delayed quarterly filings would result in delayed FPUC payments.

• Employers should duly respond to all Notice of Claims (65-5317) or SIDES notifications if they file a claim for an individual that is not working due to other reasons asides COVID-19.

• Employers should duly respond to the Notice of Claim (65-5317) or SIDES notification to report any paid sick leave or other paid leave benefits.

Important Fraud Warning!

• Employees that deliberately quit their jobs only to obtain additional benefits under the regular unemployment insurance program or the CARES Act will be treated as fraud. Anyone that attempts this will be subject to criminal prosecution under section 1001 of title 18, United States Code. Such a person will also be mandated to pay back the benefits and will be ineligible for any additional benefit payments.

• Anyone who knowingly make or cause another person to make a false statement o fail to disclose a material fact, and as a result, benefits of the Federal Pandemic Unemployment Compensation payment to which they are not entitled, they shall be subject to prosecution under 19 section 1001 of the title 18, United States Code. Anyone that is found guilty of this fraud will be disqualified for weeks and will become ineligible to receive any additional payments of FPUC in the future.

• Any deliberate misrepresentation in the report of earnings earned in any of the weeks in the continued weekly claims for unemployment insurance can be treated as fraud. This attracts disqualification from benefits, and an overpayment of benefits, in addition to other penalties and potential criminal prosecution.