Higher Unemployment Benefits Cause Concerns For Employers

Author: Mesriani Law Group
Posted on: May 1, 2020

Commonly, unemployment benefits cover approximately 40% of an employee’s wages. To expand the unemployment insurance, the federal stimulus bill passed last March provides the unemployed with $600 per week for up to four months.

The stimulus payments won’t completely cover the lost wages of those who have higher salaries, but they will definitely boost weekly payments when combined with the state benefits. According to the Department of Labor, the total benefit is at least equal to or higher than the average weekly pay for those lost jobs in at least 30 states.

In those states, the employers and businesses who are about to reopen and are worried that their former employees are not eager to return for work. Many of these employees are from industries with usually lower wages, and with the combined state and federal financial aid, they are now getting paid more than what they did when they were employed.

The food industry is among those that have been hit the hardest, with almost 60% jobs lost within the first month of the coronavirus pandemic. Restaurant owners had to transition to pick-up and delivery services only, leaving just a handful of staff. With the growing demand for food pick-up and delivery, they are now trying to rehire their former employees to meet such demands. Once the stimulus payments rolled out, they are now finding it difficult to rehire, citing reasons of better unemployment benefits package or fear of exposure to the coronavirus.

Not everyone will have the option to decline work and stay on unemployment. Many states are hinting that those who refuse to return to work will have their unemployment benefits discontinued. The Department of Labor maintains strict guidelines for eligibility and many are still able to avail of those benefits and various unemployment assistance programs, but ordinary worry of exposure to COVID-19 is not a viable reason to stay jobless and keep collecting benefits.