Retailers: Your re-employment assistance questions answered

June 3, 2020

This paid piece is sponsored by the South Dakota Retailers Association.

Even as businesses reopen and customers re-enter, it still may be a few months until business is back to normal.

The state’s re-employment assistance program provides temporary financial assistance for people who have lost their job through no fault of their own. Workers who become unemployed because their employer needs to temporarily shut down or isolate workers because of COVID-19 might be eligible to receive benefits.

The South Dakota Retailers Association wants to make sure businesses are doing what is best for themselves and their employees, so it put together answers to some of the most frequently asked questions about the topic.

If I lay off employees, how much can they expect to receive in unemployment benefits?

As a rule of thumb, South Dakota unemployment benefits generally equal 50 percent of an employee’s average weekly earnings. State law provides that the maximum amount a person may receive is $414 per week in benefits; the minimum is $28 weekly, but it would be rare for a person to receive that minimum amount.

Individuals receiving unemployment benefits in conjunction with COVID-19 may be eligible for an additional $600 per week in benefits under the federal CARES Act. Information about this will be available from the South Dakota Department of Labor and Regulation at the appropriate time as individuals work with the re-employment assistance/unemployment insurance, or RA/UI, system.

If I lay off part-time employees, would they be eligible for unemployment benefits?

Possibly. To be eligible, the first criteria is sufficient qualifying earnings. Recommend individuals apply.

Will the $600 federal weekly unemployment benefit apply to part-time employees?

The $600 per week payment will be provided to each recipient of unemployment insurance for up to four months. This expires July 31. The $600 is covered fully by the federal government.

Are seasonal employees eligible for COVID-19 unemployment benefits if an employer planned to hire them for the spring and summer months but didn’t do so because the business won’t be opening or will be on a reduced scale?

Unemployment benefits are not paid out to individuals for future employment that no longer will occur. Keep in mind, that individual may have or have had other employment, and if they lost that other job because of COVID-19, they may be eligible for unemployment benefits. Also, under the federal CARES Act, those scheduled to commence employment and because of COVID-19 no longer have a job or cannot reach the job might be eligible to apply for Pandemic Unemployment Assistance, or PUA.

Are employees of businesses that are classified as seasonal businesses entitled to unemployment benefits in the off-season?

Special provisions in South Dakota’s RA/UI laws and regulations pertain to seasonal employers that close for revenue purposes for five months or more each year. Administrative rule in South Dakota identifies which industries are considered seasonal. Employers in those industries can request to have a seasonal designation applied to their business. If they do so, their employees cannot receive benefits in the off-season.

I operate a restaurant and need to lay off employees because of COVID-19. Would tips be considered part of wages for purposes of calculating the amount of benefits they will receive?

Declared tips are considered part of their wages and are used in determining the amount of the benefit. If a tipped employee does not declare tips as income, their benefits would be based on the state minimum wage, which is $9.30 an hour.

I have workers who are paid on commission. If I lay them off, are they eligible for unemployment benefits?

Yes. Commissions are considered wages.

Are independent contractors and self-employed individuals eligible for unemployment benefits?

Ordinarily, the answer is no. However, individuals who usually would not be eligible for unemployment benefits – including self-employed individuals and independent contractors – but who are unable to work as a direct result of COVID-19 may receive benefits under the CARES Act. The act temporarily extends unemployment benefit coverage to workers who traditionally were not eligible to receive unemployment benefits.

I have employees who have been staying at home with their children because of school and child care closures that resulted from COVID-19. Will they be eligible for federal benefits?

Yes, they may be eligible and should apply.

If employees are laid off and apply for benefits, do they have to be out looking for work?

Usually, the answer would be yes – they must be able and available to work and actively be seeking work. However, in conjunction with the governor’s declared state of emergency regarding COVID-19, Labor Secretary Marcia Hultman has exercised authority to waive that requirement for workers filing for unemployment. The waiver remains in effect until further notice.

I temporarily laid off employees because of the COVID-19 pandemic. I am planning to call the laid-off employees back to work. If an employee refuses to come back to work, would they be eligible to continue receiving unemployment benefits?

The South Dakota Department of Labor and Regulation says unemployment claimants who have been placed on a temporary layoff related to COVID-19 must return to work if called back to remain eligible for benefits. Not returning to work when there is available work could be considered a “refusal of work” and potentially disqualify claimants from receiving benefits. If an employer calls an employee back to work, but the individual refuses and continues to receive unemployment benefits, the business should report it to RAFraud@state.sd.us.

Email additional questions to DLRRADivision@state.sd.us.

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Retailers: Your re-employment assistance questions answered

Businesses have a lot of questions about the state’s re-employment assistance program. Retailers, this will help answer your most common ones.

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