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Coronavirus relief act to modify the unemployment system so self-employed people out of work can apply

Previously, self-employed people could not apply for unemployment benefits

MEMPHIS, Tennessee —

The lack of income for small business owners has them applying for unemployment, but the current system wasn't designed for self-employed people. Now non- essential business owners mandated to shut down by the government are left questioning how they'll make ends meet without government assistance right now. 

While the cornavirus pandemic was unprecedented, the Department of Labor wasn't prepared for how many self-employed people would have to file for unemployment. The application requires information that is different from someone who is self-employed and those who are employees. State Rep. Antonio Parkinson, D-Memphis, said the application has been more discouraging than helpful for a number of his constituents.

"Those that get tired and frustrated just give up and those that do navigate through the whole process once they are finished they get a denial letter," Parkinson said.

Parkinson said in January the state legislature budgeted $1 billion for coronavirus relief. He said the legislature talked about what will need to be done for self-employed people filing for unemployment, but nothing has happened until now.

"The state of Tennessee was absolutely unprepared for this situation and there’s more to come and that’s unfortunate and people’s lives are going to be affected," Parkinson said.

Nadia Matthews, the owner of Lily Roze Studios, filed for unemployment at the end of March and was denied immediately. She's owned her theater school for almost nine years and has never had to apply for unemployment before.

"I was immediately denied, and of course it didn’t say anything on the website," Matthews said. "It said you are monetarily ineligible to receive any type of support or benefits.”

She said the system is designed for employees and not all small businesses are in the system.

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"When you answer the questions you don’t have the same information as a worker has," Matthews said. "By being self-employed there are certain certifications, there are certain questions you cannot absolutely answer because you’re not an employee."

The Tennessee Department of Labor and Workforce Development told Local 24 News the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) will change the system so self-employed people can qualify. The department said once federal guidelines are implemented at the state level, it will look at claims that were originally denied and process them again.

For self-employed people trying to navigate the application, there is guidance on the department's website.