Small businesses ask Gov. Walz to expand who qualifies for unemployment benefits

Beauty professionals in Minnesota have been out of work for nearly a week, following an executive order signed by Gov. Walz.

The owners of Sola Salon Studios decided to stop charging rent when it went into effect. Erin and Patrick Elgin operate eight locations where about 340 beauty professionals rent space for their businesses.

“What that doesn’t help all of those people with though is paying their bills, paying their personal bills,” said Patrick Elgin.

They said many beauty professionals will be without income during the closure, and they may struggle to buy groceries or pay their mortgage.

“We need to make sure those people are getting taken care of,” he said.

They posted a letter on Facebook calling on Walz and state lawmakers to adjust unemployment benefits so that all self-employed sole practitioners can apply.

The letter goes on to say, “If that is not possible, then I would ask that an emergency program be established immediately that provides a similar benefit to self-employed workers affected by the state-mandated closure.”

The letter has been shared more than 600 times on Facebook.

According to the State Dept. of Employment and Economic Development (DEED), self-employed workers and independent contractors can access unemployment benefits if they previously elected to be covered. The unemployment insurance program is not available for those who did not buy into it.

The Elgin’s argue these are extenuating circumstances.

“The whole unemployment fund doesn’t contemplate that people would be out of work because the government is the one who shut them down,” said Patrick Elgin.

“In a normal situation, a self-employed person that can’t work anymore, they wouldn’t get the unemployment benefit,” he said. “But when they can’t work because of the government order, what we’re asking the government to do is take that into account and try to provide some relief to those people.”

On Monday, Walz announced a Small Business Emergency Loan program to help. According to the executive order, zero interest loans will be available to all small businesses.

Over the weekend, he said Minnesota businesses are also eligible to apply for disaster assistance through the Small Business Administration.

Patrick and Erin Elgin said it’s a step in the right direction but falls short.

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“We don’t really need interest-free loans to cover business expenses, we need income replacement,” said Erin Elgin.

The Governor did not directly respond to their letter during Tuesday’s briefing but acknowledged more needs to be done.

“I’m hearing from people that it doesn’t take all considerations, independent contractors,” said Walz. “We are continuing to work to provide that data and that support.”

He said that he is working with Minnesota’s congressional delegation to develop a plan to provide relief to small business owners.

According to DEED, the state received 149,443 new applications for unemployment insurance from March 16 to March 23. More than 48,540 were from the food prep and service industry.

“In the personal care and service industry, that’s salons and spas and tattoo parlors, we’ve seen about 10,844 applications,” said Steve Grove, the DEED commissioner.

Grove said they are working to create the emergency loan program, which was established by Walz’s executive order. It will involve 23 lenders across the state. DEED hopes to start accepting applications by the end of the week.

“We’re going to work with local lenders across Minnesota to make sure that small businesses can get the help that they need, while also helping those businesses access funds from the Small Business Administration’s emergency loan program as well,” said Grove. “This is a critical support line.”