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Michigan to Begin Paying Gig Workers Unemployment Benefits (1)

April 10, 2020, 8:35 PMUpdated: April 10, 2020, 10:05 PM

Michigan gig workers and the self-employed could start receiving unemployment benefits April 20, according to an announcement that could make Michigan one of the first states to provide long-anticipated benefits to independent contractors out of work due to the coronavirus pandemic.

Michigan’s announcement Friday comes at a time when state officials nationwide are assuring independent contractors such as Uber and Lyft drivers sidelined by Covid-19 that they may be eligible for unemployment compensation, but only after computer systems are reprogrammed in accordance with the stimulus law and federal guidance.

“As soon as we heard this was a possibility we started to develop,” said Steve Gray, director of the Michigan Unemployment Insurance Agency. Michigan got a jump on other states by using templates from programs the state created to help workers after flooding and programs used during the Great Recession. This allowed them to anticipate what federal guidance the state would have to follow, and when they turned out similar the state was able to quickly adjust its software to the new federal rules.

“The pandemic is very similar to disaster assistance, which we had to implement before, and the $600 payment is similar to what was put out in the Great Recession,” he said. “We had staff working ‘round the clock.”

On Friday afternoon, neighboring Ohio Lt. Gov. Jon Husted (R) told reporters that based on a conference call with all of the country’s lieutenant governors, he’s unaware of any state system that has been updated to process payments for independent contractors using the new federal guidance. He said states with experience in disaster relief, especially hurricanes, had provided similar relief in the past.

Michigan’s unemployment system, which has received more than 800,000 applications for unemployment since March 15, currently denies applications from gig workers, who have had their claims put into a holding pattern. But starting Monday, these applicants will be able to log back in and complete the process, Gov. Gretchen Whitmer‘s (D) office said in a Friday statement.

(Updated with comments from Steve Gray, director of the Michigan Unemployment Insurance Agency, and more comments from Ohio Lt. Gov. Jon Husted.)

To contact the reporter on this story: Alex Ebert in Columbus, Ohio at aebert@bloomberglaw.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; John Lauinger at jlauinger@bloomberglaw.com