Benefits eyed for idled contract workers
May 17—BOSTON — Hair stylists, Uber drivers, food service workers and hundreds of thousands of other self-employed people don't have a safety net if they are laid off because they're ineligible for traditional unemployment benefits.
During the pandemic, those workers have been thrown a lifeline by federal programs that help independent contractors idled by measures to prevent spread of COVID-19. But those benefits end in September.
A proposal filed by Sen. Barry Finegold, D-Andover, which will be heard by the Legislature's Committee on Labor and Workforce Development on Tuesday, seeks to ensure that "gig economy" workers and other independent contractors have access to state unemployment benefits long after the pandemic subsides.
Under the plan, contractors employing 100 or more people would be required to pay into the state's Unemployment Insurance Trust Fund, which covers jobless benefits.
Finegold said he's heard from Uber and Lyft drivers who want the flexibility of working as independent contractors but the protection of unemployment insurance.
Under state law, those contractors don't qualify to participate in the system.
"I believe there is a third way, in which we allow drivers to maintain their independence but also provide them with a safety net in the event that we go through another pandemic or major economic crisis," Finegold said.
Workers who are laid off during a declared state of emergency would be eligible to receive up to half of their average weekly wages, under Finegold's plan.
To qualify, workers must have been employed at the company for at least three-quarters of the previous year. The plan also includes a work search requirement obligating workers to look for new jobs while they're getting benefits.
While the changes are aimed at ride-hailing drivers, Finegold said they would benefit any workers who don't qualify for traditional state unemployment.
Nationwide, about 15.9 million Americans — roughly 10% of the country's workforce — are self-employed, according to the U.S. Bureau of Labor Statistics.
Congress threw self-employed workers a lifeline last year when it extended federal jobless benefits to those laid off during the pandemic, providing $600 per week. The state distributed the money.
Of course, Finegold's proposal comes amid growing concern about the fiscal stability of the state's unemployment insurance trust fund, which is nearly $3 billion in the red following a crush of jobless claims over the past year.
The state has borrowed nearly $2.3 billion to replenish the fund, and that has dramatically increased contribution rates for employers who pay into the system.
His proposal is among several that will be heard by the labor committee on Tuesday. Others seek to restore the trust fund to solvency and tackle pressing issues with the unemployment system that were highlighted by the pandemic.
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group's newspapers and websites. Email him at cwade@cnhinews.com.
