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Posted on: April 28, 2020

COVID-19: Applying for unemployment if you are self-employed or an independent contractor

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COVID-19: Applying for unemployment if you are self-employed or an independent contractor

Normally, self-employed people and independent contractors would not be eligible for unemployment benefits in Minnesota. But the Coronavirus Aid, Relief, and Economic Security (CARES) Act – passed by Congress and signed into law on March 27, 2020 – created a new program to provide benefits specifically for these people.

This program, called Pandemic Unemployment Assistance (PUA), provides weekly benefit payments, just like regular unemployment insurance (UI). It specifically provides benefits to people who would not be eligible for regular unemployment benefits, including:

  • Self-employed people
  • Independent contractors
  • Workers in non-covered employment
  • People lacking sufficient work history to get regular UI
  • People living in a household where the head of household has died as a direct result of COVID-19

It’s important to understand that PUA is a brand new program that did not exist before the CARES Act became law. It includes a complex system of new eligibility considerations and factors that our regular UI system never considered. We cannot use the same technology, data or processes that we use for regular UI to pay PUA benefits.

Our regular UI system, for example, operates on a foundation of eligibility rules and income information. PUA, on the other hand, is for a new group of people that DEED does not have income data for. To solve that problem, we created a new partnership with the Department of Revenue to expedite verification of income while also preventing fraud.

As of Friday, April 24, DEED has begun the process of making payments to people who are eligible for PUA. We’ve processed initial payments for more than 10,000 people already, and more will be coming every day.

Because of the program’s complexity and the fact that it had to be created from the ground up in less than one month, it is going to take some time to get PUA benefits out to everyone who is eligible. But we’ve prioritized getting this done because we know that the COVID-19 pandemic has created unprecedented and unexpected challenges to so many Minnesotans.

Our team is working around the clock to get this right for everyone who is eligible. Minnesota is proudly one of the first states in the nation to fully implement all three programs of the CARES Act, which also included the additional $600 FPUC weekly payments and the PEUC 13-week extension, which we implemented earlier this month.

Lastly, here are a few things you should know: 

  • We’ve provided a lot more COVID-19 information for self-employed people and independent contractors on – please start there for answers to your questions and information about how to apply, what happens once you apply, and how you’ll get paid if you are eligible.
  • If you have already applied for regular unemployment benefits, you do not need to do anything extra to qualify for PUA. DEED will automatically establish a PUA benefit account for you if you are eligible.
  • If you have not applied for unemployment benefits yet, special instructions for self-employed and 1099 workers are available here. These instructions include steps you can take to make your account easily identifiable as potentially eligible for PUA.

    • If you applied for unemployment benefits without following those instructions, don’t worry – you don’t need to change anything. Your account will still be reviewed for PUA eligibility.
  • If you have not heard from DEED yet, don’t worry. We expect to be in touch with most people who are eligible for benefits under PUA by the end of April. There is no need to call or follow-up; you will hear from us proactively if we need additional information to determine eligibility.
  • You will receive information about PUA benefits in your online account, by email, and by mail.
  • Applicants who receive PUA benefits will also receive the $600/week additional payment.
  • PUA benefits will be backdated to whenever you first became eligible due to COVID-19.

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