No driver wants to be idle. You enjoy being out, meeting passengers, serving them … and making good money in the process. Unfortunately, that’s just not our reality right now. The coronavirus (COVID-19) crisis has made the highly social, and lucrative, occupation of rideshare and delivery driving almost impossible.
With travel at a standstill, social distancing the new normal, and stay-at-home orders fast becoming our way of life, your car is parked and your income has taken a drastic nosedive. Delivery drivers are impacted too, even though there’s still a trickle of business from restaurants open for takeout only.
So what can you do?
Until recently, drivers, as independent contractors, might have (rightly) believed they were out of luck when it came to getting unemployment compensation. In fact, there’s been a lot of back and forth between some drivers and rideshare and delivery platform companies involving the impact of drivers not being actual, hired employees.
With the coronavirus crisis, things have changed drastically. The federal government has stepped up to help states with the expenses of unemployment through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Within this bill are provisions for independent contractors, including drivers, to collect unemployment compensation.
What we know, and what we don’t
We want to give you as much information as possible here, but because this is all so new, much of the process you need to go through to secure unemployment compensation is still in flux.
Remember, we’re not legislators or lawyers – but we are here for you, and doing the best we can to share the information we discover as our research comes in. We can’t guarantee anything for you, but we can definitely offer some guidance and advice.
Now, let’s get down to the nitty gritty.
The answer is, if you’re a driver for Uber, Lyft, GrubHub, Postmates, or another driving or delivery service, and you’re an independent contractor – yes. You didn’t qualify before the CARES Act was enacted, but you do now.
“Expanded eligibility would provide benefits to self-employed individuals, independent contractors, “gig economy” employees, and individuals who were unable to start a new job or contract due to the pandemic. Individuals would apply for these temporary new federal benefits at the state UC office, and states would be fully reimbursed for the cost of benefits and administration.”
Under the CARES Act, you will self-qualify. This means you will attest to the fact your income has been drastically reduced as a result of the COVID-19 pandemic.
Do keep in mind that you are going to have the best chance of getting your application accepted if your driving job is your chief source of income. If, for example, you have a regular job, can continue to work from home and get paid, but have lost the income from the driving job you had as a side-gig, you may not qualify. However, that doesn’t mean you can’t apply.
When in doubt, go ahead and apply.
One of the hardest things about answering this and many other questions is that unemployment compensation varies widely from state to state. You will need to adjust your expectations to what your state has to offer, except for one thing.
Any independent contractor who qualifies for unemployment compensation will receive $600 per week, which will be funded by the federal government. This is over and above anything you might receive from the state. From the Ways and Means Committee again:
“Through July 31, 2020, the federal government would provide a temporary Federal Pandemic Unemployment Compensation (FPUC) of $600 a week for any worker eligible for state or federal unemployment compensation (UC) benefits. The FPUC would be paid in addition to and at the same time (but not necessarily in the same check) as regular state or federal UC benefits. The FPUC, combined with the underlying state unemployment benefit, would replace 100 percent of wages for the average U.S. worker
As you can see, this compensation is much better than the kick in the teeth you came to expect as an Independent Contractor before all this happened. Even if your state doesn’t give you a lot of money, you will still have that $600 per week.
This money will still come through your state unemployment compensation program, though, so you will still have to apply with your state to get it, plus any other benefits you may have coming your way.
Filing for unemployment compensation isn’t as difficult as many people think.
It’s unlikely that you’ll have to stand in long lines because the in-person unemployment offices in most states are closed down, due to stay-at-home orders and social distancing. You can easily apply online by visiting your state’s unemployment compensation website. It’s also possible in many cases to apply by phone if you’d prefer the option of talking to someone.
With that said, you need to know that under the circumstances of enacting brand-new legislation, the websites for individual states are not yet tooled to handle the nuances of the Independent Contractor’s income.
For instance, you might go to your state’s unemployment compensation site and find they want you to enter the number on your W-2. Well…you don’t have one. You probably have a 1099 from your company’s platform instead. Just fill out the form as best you can. Someone from the office is very likely to get back to you to ask for the details they need.
Individual state sites are not yet set up for independent contractors.
Our advice is: Check your state website (information is below) and follow the given instructions.
Another Tip: Apply during off-hours. With so many people trying to apply for unemployment at once, websites and bandwidth will be highly strained.
Your first step is to find information about the status of your states unemployment program and how to apply. Not every state is setup for drivers to be able to apply for unemployment benefits, so find your state’s information below.
If your state’s information is not listed below, or you need more information you can use this handy Unemployment Benefits Finder that can link you to the website for your state.