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New relief bill boosts unemployment insurance by $600 a week for gig workers, freelancers and more

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President Donald Trump approved an unprecedented $2 trillion stimulus package Friday to help Americans who have lost jobs and wages due to the coronavirus pandemic. The relief bill is said to be the largest rescue package in modern American history.

One component of the Coronavirus Aid, Relief and Economic Security (CARES) Act will provide an estimated $250 billion to expand unemployment insurance benefits. The stimulus package will increase the amount of money jobless Americans can receive, extend the length of time they can receive it and include more workers previously not eligible for assistance.

Increased funding for financial assistance will benefit the growing number of Americans losing jobs and working reduced hours as coronavirus disrupts people's lives and the national economy. The Labor Department reported Thursday that a record 3.28 million Americans filed unemployment claims in the last week.

Here's what workers should know.

You can get a bigger unemployment check, for a longer period of time

The amount of money a worker receives when they apply for unemployment benefits, and for how long, varies by state.

Generally, individuals are paid half of their weekly wages based on earnings from the previous four quarters. In January 2020, unemployed workers were paid an average of $385 per week, and most benefits lasted 26 weeks, according to the Center on Budget and Policy Priorities.

Under the new stimulus package, workers will be paid an additional $600 per week on top of what they would normally receive for up to four months until July 31. Once that additional federal assistance is exhausted, they will continue to receive their normal benefit amount, administered by their state.

The relief package will also allow workers to receive benefits for an additional 13 weeks, providing up to 39 weeks (or nearly 10 months) of financial assistance in total.

"This size of an increase is unprecedented," says Wayne Vroman, an economist with the nonprofit research firm The Urban Institute. In 2009, following the Great Recession, a federal stimulus package increased unemployment benefits by just $25 per week, Vroman explains. "So $600 is in different league; it could go a long distance in stabilizing American household income and help to maintain purchasing power for the consumer sector of economy."

More people qualify: gig workers, self-employed and freelancers

The stimulus package loosens unemployment insurance eligibility requirements to include those who are self-employed, gig workers, independent contractors and freelancers.

This is a major change for gig workers, such as Uber and Lyft drivers, who are typically classified as independent contractors. 

Part-time workers, furloughed employees and anyone who can no longer physically go to their jobs (like waitstaff at restaurants ordered to close) will be covered under this expansion. Unemployment insurance will also be extended to people who recently started a new job but were laid off due to the pandemic, even if they don't have sufficient work history previously required to be eligible.

People who in the past didn't qualify for unemployment insurance will receive 50% of their state's average benefits payout, plus $600 per week, said Arindrajit Dube, an economics professor at the University of Massachusetts Amherst.

Individuals who are newly eligible under the stimulus bill and have been unemployed since the week of January 27, 2020, will be able to receive the additional $600 weekly benefit and 13-week period extension.

Those who are already receiving unemployment assistance can also apply for an extension. Unemployed individuals currently coming to the end of their benefits period can reapply for additional coverage and receive the $600 additional payment and a 13-week extension.

How to check if you're eligible

It's crucial workers who've lost their jobs, or had their hours reduced, due to coronavirus file for unemployment insurance benefits as soon as possible.

Applicants should check with their state's department of labor, as well as the U.S. Department of Labor for more information at the federal level, Erik Josowitz, analyst at comparison site InsuranceQuotes.com, tells CNBC Make It.

"Every state has its own website that will help individuals determine eligibility and go through the application," Josowitz says, adding that most states have added information about what's changed in response to the COVID-19 pandemic. Applicants can also get answers to questions or file their claim by phone.

However, many state labor department offices have been overwhelmed with activity in recent weeks, resulting in site crashes and long waiting times to contact someone by phone. Vroman says Monday is a typically common day to file, so applicants may want to try on another day of the week instead.

Expanded benefits will last through December 2020.

Check out: The best credit cards of 2020 could earn you over $1,000 in 5 years

Don't miss: How states are expanding unemployment eligibility to include more people impacted by coronavirus

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