Administration announces plan for pandemic premium pay for low-income workers

The Baker-Polito administration today announced plans to begin distributing $500 payments to 500,000 lower-income workers who worked during the COVID-19 pandemic.

Municipal employees who meet the income qualifications are among those eligible for this first premium pay program of its type in the nation, which was created by the state’s $4 billion COVID recovery law, enacted in December.

The payments, totalling $250 million, represent the first round of funds to be distributed as part of the Essential Employee Premium Pay program established by the Legislature and the governor, which uses a portion of the state’s allocation from the American Rescue Plan Act. The administration said payments will be mailed to 500,000 people by the end of March.

Gov. Charlie Baker said his administration “has worked quickly to design the parameters for the program,” which “will support those workers who served our communities, especially early in the pandemic.”

The state has created an informational webpage about the program, including income eligibility by family size, at www.mass.gov/premiumpay.

Based on filed 2020 Massachusetts tax returns, individuals will be eligible for payments if their income from employment was at least $12,750 and their total income put them below 300% of the federal poverty level. The lower bound of this range equates to working 20 hours a week for 50 weeks at minimum wage as of 2020 ($12.75).

The federal poverty level is set by the federal government and increases with household or family size. The maximum total income for a single filer with no dependents will be $38,280, according to the administration. A resident who files with a spouse and two dependents, or with no spouse and three dependents, could be eligible with a household income up to $78,600. Married filers can each be eligible, provided each independently qualifies.

Individuals who received unemployment compensation in 2020 will not be eligible for the first round of payments, nor will state executive branch employees who received or will receive a one-time payment from the state as their employer.

Those eligible to receive a payment from this program will automatically receive a check by mail.

The first round of payments will be based on 2020 state income tax returns. Following the 2021 tax filing season, the next round of payments will be made using information from 2021 returns. After that, the program will be evaluated for any additional rounds.

This $460 million program accounts for most of the $500 million for low-income essential workers called for in the legislation creating the Premium Pay program, with the other $40 million allocated to fund previous agreements with state employee unions.

The administration said it would release additional information on plans to disburse subsequent rounds of funds in the future.