To say that the coronavirus crisis will devastate the creative community is an understatement. Design and other creative industries rely heavily on freelancers and independent studios, both of which are seeing their work dry up and earnings plummet. According to a recent study conducted by the Freelancer’s Union, 85% of freelance visual artists and photographers report contract cancellations due to the coronavirus pandemic, and 91% of freelancers expect to lose income in the coming weeks.
The federal government recently passed the CARES Act—a $2 trillion stimulus package to provide economic relief amid record filings for unemployment and business closures across the country. For those in creative industries, there are two key components to pay attention to: new and expanded unemployment benefits (to include freelance workers) and relief for small businesses. But there are additional resources outside the stimulus package, too, and I’ve compiled a list of them below.
Unemployment benefits for independent designers
The stimulus package will provide an additional $600 a week to those who qualify for unemployment or for Pandemic Unemployment Assistance benefits for up to four months. (Unemployment benefits are typically about half your average weekly salary.)
What is Pandemic Unemployment Assistance, exactly? It’s a provision that expands the benefit to include those who are not typically eligible to receive unemployment but who have not been able to work due to the coronavirus, including independent contractors or those with a limited work history or who are self-employed—freelance designers, that means you. It can also provide 13 additional weeks of unemployment benefits on top of the average 26 weeks. The Pandemic Unemployment Assistance program runs through December 31, 2020. So if your work dries up between now and then, you might be eligible to file for unemployment. Keep in mind, however, that you must first apply for regular unemployment insurance and be denied to be eligible for PUA, according to this list of COVID-19 resources for freelancers, artists, and gig workers based in New York.
Benefits for small businesses: Agencies and studios
Good news for agencies and small studios: Businesses can now get government assistance to meet payroll and keep workers on staff. Under the program outlined in section 2108 of the CARES Act, an employer can reduce employees’ hours rather than resort to layoffs. The employees are then eligible for prorated unemployment benefits, and the government would pay the costs that businesses incur by continuing to pay workers through December 31, 2020, according to a document by the House Committee on Finance.
The U.S. Small Business Administration also launched the Paycheck Protection Program, which offers loans to help businesses keep employees on payroll. The loan is forgivable if all employees are kept on for eight weeks, and the loan is used for payroll, rent, mortgage payments, and utilities. Forgiveness will be reduced if your full-time headcount goes down or salaries decrease, according to the SBA site.
Employers faced with closing their doors due to the coronavirus could also be eligible for an “employee retention credit,” i.e. a payroll tax credit. It applies to 50% of the wages you pay employees between March 13 and December 31, and maxes out at the first $10,000 in compensation.
Resources for everyone
Both employers and people who are self-employed can defer their employment tax (typically a 6.2% Social Security tax on wages), and can pay over two years: the first half of the amount would be due by December 31, 2021 and the second half by December 31, 2022, according to that same document. This would allow you to pay your employment tax over a longer, incremental basis, when you hopefully have a bit more cash on hand.
Help from outside the stimulus package
All that said, the CARES Act leaves freelancers and gig workers in a precarious position. “The guidance of how it will be implemented and the criteria and the documentation that you would need for your income—that guidance has not been developed yet from the department of labor,” said Congresswoman Carolyn B. Maloney of New York’s 12th district during a COVID-19 relief webinar for New York-based artists, freelancers, and gig workers. The federal government is already working on a fourth relief package, but it’s unclear when such a bill would pass. (Maloney could not be reached for additional comment by press time.)
In the interim, there are other resources for relief available.
- The New York Foundation for the Arts (NYFA) lists a slew of emergency grants that are available to artists and designers in cities across the country.
- The Freelancers Union has launched a Freelancers Relief Fund to support those affected by the coronavirus. You can also donate.
- This site lists national grants from a variety of national and local nonprofits and unions. It also lists a variety of crowdfunding efforts.
- This Freelancers & Community Resources 2020 doc is a grassroots effort to provide relief to fellow creatives with links to self-care, work opportunities, funding, mutual aid, webinars, and more.
- The Volunteer Lawyers for the Arts has created its own list of resources for artists in need, including links to funding, legal resources, and mental health.
- Design firm consultant Emily Cohen has tips to help keep your agency afloat through the economic downturn.
- Cities like Boston, San Francisco, Los Angeles, Seattle, Portland, and New York have offered relief packages to small businesses. Check your local government website to see what’s available.
One last thing: Know your rights. It’s always a good idea to see if your city has a law in place like New York’s Freelance Isn’t Free Act, which stipulates that freelancers are due a written contract, timely payment, and freedom from retaliation.