Coronavirus News: Many New Yorkers still ineligible for unemployment despite change

NEW YORK (WABC) -- The New York State Department of Labor announced a partial solution to an unemployment loophole that has kept many people throughout the state from receiving benefits.

While the state and federal government expanded who is eligible for unemployment, it did not forgive or postpone penalties individuals received for collecting unemployment when the state determined they shouldn't have.

Despite the coronavirus pandemic, the state has been denying those individuals assistance until they exhaust forfeit penalty days assessed against them.

"We are in a crisis right now. It's not like I can go outside and say, 'I'm going to work here. I'm going to work there.' You want us to stay inside. For right now, freeze it. Freeze the penalty," Queens resident Nifiteria Marsh said.

Marsh said she misunderstood the conditions of unemployment when she accepted some odd jobs while she was unemployed. She said she paid the state back the unemployment benefits she had received.

She only realized the state had also imposed an additional forfeit penalty that would keep her from receiving unemployment for about 13 weeks when she lost her job in the tourism industry amid the coronavirus pandemic and applied for help.

The state denied her benefits.

"I'm like, "Forfeit? I paid you back," Marsh said. "You have to laugh to keep from crying."

Marsh is not alone. There is now a Facebook group dedicated to shedding light on the problem.

Executive Director of the Workers Defense League, Jon Bloom, said he has also received hundreds of calls from individuals seeking help.

"We normally go to hearings and represent claimants at hearings. That hearing process is suspended at the moment so that is not an avenue we can use," Bloom said. "I think the state should respond promptly and favorably in part or in whole to what the constituents are asking for. This is an emergency situation."

After assuring us for over a week, that the state was working on the problem, a DOL spokesperson emailed a partial solution saying people, "will pay a portion of the penalty, but they will still get a portion of their weekly benefit as well."

The spokesperson said the penalty would be applied in increments but couldn't give any more specifics.

She added, "Again, we continue to get guidance from the US DOL every day so this may change."

We are continuing to ask for a more detailed explanation.

New York Senator Monica Martinez, D-Brentwood, has also written letters and made calls pushing the state for action.

She has asked the state to release the additional $600 weekly federal benefit authorized by the Cares Act to these individuals while the state sorts out the unemployment issue.

"All I keep hearing is they're still working on it, and while they are still working on it, I have constituents calling every single day," Martinez said. "We are running out of time. These families are running out of time."

While the state has not fully resolved this unemployment loophole, the DOL spokesperson said it had resolved issues with the state's application process that was keeping individuals not typically eligible for unemployment benefits made eligible for relief under pandemic legislation, often referred to as independent contractors or 1099 workers, able to apply.

"Prior to today, due to cumbersome federal guidelines, New Yorkers were required to apply for regular Unemployment Insurance and be rejected before applying for Pandemic Unemployment Assistance. With this new application, which aligns with updated federal policy, New Yorkers will be able to simply fill out one form to get the correct benefits," wrote the DOL in a press release.

"I have been unemployed before myself, and I understand the pain, fear and anxiety New Yorkers are facing. The DOL's mission is to help our neighbors through some of their toughest days, and in the last week we have made great strides in updating our systems," NYS Department of Labor Commissioner Roberta Reardon said. "While it appears the coronavirus pandemic is beginning to stabilize - at least from the public health perspective - we know that many New Yorkers are still facing an uncertain economic future, and the Department of Labor will continue to dedicate every resource available to helping New Yorkers weather this storm."

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