Feds Tighten Grip on State Jobless-Aid Programs for Gig Workers

The U.S. Labor Department is increasing scrutiny of how states are managing a new jobless-benefits system for independent contractors and threatening to terminate some states’ authority to operate the virus-relief program if they don’t take corrective action, Bloomberg Law has learned.

The federal government in recent weeks has demanded that states across the country come into compliance in processing Pandemic Unemployment Assistance claims, sending as many as three dozen states detailed letters specific to their circumstances following initial inquiries, according to interviews with unemployment officials in six states.

The program is a first-of-its-kind stimulus initiative Congress created as part of ...