WASHINGTON, D.C. (July 20, 2020) — A broad coalition of arts and entertainment unions and organizations came out today in support of the Mixed Earner Unemployment Assistance Act of 2020, which was introduced by U.S. Representatives Adam Schiff (D-CA) and Judy Chu (D-CA) to remedy some of the unintended flaws in previous COVID-19 relief bills.
Unfortunately, American workers who have mixed income – income they report as W-2 and 1099 or other self-employment income – are being penalized simply because they earned some income as a W-2 employee. If a mixed-earner such as an entrepreneur, seasonal worker, gig worker, or local musician, singer, actor, writer, photographer, or other creator makes enough income as a W-2-employee to qualify for any amount of traditional state unemployment benefits, only their W-2 income is considered in determining a weekly base benefit amount. As a result, these taxpayers are losing thousands, sometimes tens of thousands, of dollars in vital benefits that could cover the cost of rent or food during a global pandemic.
Given the unique nature of the arts and entertainment industry, many creators work project to project and gig to gig, not only in multiple jobs but in various capacities. As a result, creators often find themselves working as employees – such as under a union contract – receiving W-2 wages and as independent contractors (or otherwise self-employed) in the same year.
“For many workers, the relief provided by the CARES Act is making a crucial difference in helping make ends meet during this unprecedented period of disruption. Yet due to the nature of independent work, particularly in industries like entertainment, many workers are currently excluded from Pandemic Unemployment Assistance because they earn a living through a mix of self-employment and traditional W-2 jobs,” said Rep. Schiff. “Our bill will ensure that mixed earners are no longer excluded from this critical assistance because of the nature of their employment and income.”
“The coronavirus pandemic brought the economy to a halt for millions. Fortunately, we were able to quickly respond and through the CARES Act put support into the hands of workers who need it. But our traditional system of supporting unemployed workers was not set up for nontraditional workers with mixed income, like the many artists and craftspeople in my district who supplement a W-2 with independent gig work,” said Rep. Chu. “There is no reason these workers should be penalized now for having a mixed income. I’m proud to work with my colleague Rep. Adam Schiff to make this commonsense change to recognize the various ways our constituents earn a living and ensure they are rightly compensated for that during this crisis.”
This new legislation grants the states the option to transition eligible Mixed Earners from their state unemployment program into the federal PUA program, which will ensure equitable benefits for the recipient going forward. Under this legislation, a mixed earner who earned at least $7,250 from self-employment in 2019 could amend their application to qualify for the PUA program where all income will be aggregated to calculate a new weekly base benefit amount based on actual income.
In order for these Americans to survive – and recover – after this crisis, they must be able to access the full support intended by Congress.
The organizations in support of the Mixed Earner Unemployment Assistance Act of 2020 include The Authors Guild, Department for Professional Employees AFL-CIO, Freelancers Union, Future of Music Coalition, Lawyers for the Creative Arts in Chicago, Music Artists Coalition, The Recording Academy, The Recording Industry Association of America, Screen Actors Guild – American Federation of Television and Radio Artists, and the Songwriters of North America.
Quotes from each of the supporting organizations follows.
“The exclusion of freelance mixed-income workers from the PUA has taken a terrible toll on the many authors who supplement their freelance income with part-time jobs reported as W-2 income. A survey of our members revealed that on average they had lost 43% of their regular income since the start of the Covid19 crisis, with lack of available freelance opportunities and cancellation of speaking engagements—both of which are compensated on a 1099-basis—being the top two causes of the decline. The mixed-income problem in the PUA system needs an urgent fix, and we are grateful to the members of Congress who have made the well-being of our country’s authors and freelance workers a priority.”
Department for Professional Employees, AFL-CIO
“Union creative professionals were among the first affected by the COVID-19 pandemic’s economic impact, and many will likely be among the last workers able to return safely to their jobs due to longer-term social distancing requirements. It is crucial that Congress not just maintain economic support for them and other workers, but also ensure that the programs are administered so that all creative professionals can receive the maximum possible support. Pandemic Unemployment Assistance is a critical lifeline for workers providing the basics for themselves and their families during this historic crisis that’s keeping them out of work,” said Jennifer Dorning, President, Department for Professional Employees, AFL-CIO.
“Freelancers are experiencing the greatest financial crisis in modern history. With over 80% of our members reporting loss of income and work opportunities because of the pandemic, they are depending on government relief in record numbers. There are countless freelancers who have lost the opportunity to claim full UI benefits putting them at a further disadvantage to navigate this crisis. Moving forward we must ensure that all of their wages are taken into full consideration when PUA / UI is calculated in states across the country. Freelancers are rent burdened, depending on food assistance and left with no other recourse to provide for their families,” stated Rafael Espinal, President of Freelancers Union.