The CARES Act: Unemployment Benefits

The CARES Act: Unemployment Benefits


The CARES Act creates a temporary unemployment benefits program for those who are unable to work as result of COVID-19. The Act extends the coverage to workers who are self-employed and working part-time, do not have sufficient work history for the relevant state or those who do not qualify for regular unemployment rules of the applicable state.
The Covered individuals are those who are unemployed, partially unemployed, or unable to work because:

  • They have tested positive for COVID-19 or are experiencing symptoms of COVID-19 and are seeking a medical diagnosis;
  • A member of their household has been diagnosed with COVID-19;
  • They are providing care for a family or household member who has been diagnosed with COVID-19;
  • A child or other person in the household for whom they have primary caregiving responsibility is unable to attend school or another facility that is closed as a direct result of COVID-19, and such school or facility care is required for the individual to work;
  • They cannot reach the place of employment, or the place of employment is closed, because of a quarantine imposed as a direct result of a COVID-19 outbreak;
  • They were scheduled to commence employment and do not have a job or are unable to reach the job as a direct result of a COVID-19 outbreak;
  • They have become the breadwinner for a household because the head of the household has died as a direct result of COVID-19; or
  • They had to quit their job as a direct result of COVID-19.

During the weeks of unemployment, partial unemployment, or inability to work caused by COVID-19, the covered individuals will receive the benefits. This program is applicable only the unemployment started on or after January 27, 2020 and ending on or before December 31, 2020 while the unemployment caused by COVID-19 continues.

Increased Unemployment Benefit

The Act increases the unemployment benefits for the eligible individuals. The Act gives an additional $600 per week, regardless of the total benefits go over the employees' pre-unemployment earnings and an additional 13 weeks of eligibility for benefits. Governmental entities and non-profit organizations can be reimbursed for half of what they pay in unemployment compensation.

Short-Time Compensation Program

The Act provides funding to support states that have a “short-time compensation” program for employers that reduce hours in lieu of a layoff. With the Act, states will receive funding from the Federal Government for running the program. New Jersey, New York, and Texas have the Short-time Compensation program.

Excluded Payments

Employees who are able to telework with pay and those who are receiving Emergency Paid Sick Leave (EPSL) or FMLA-Public Health Emergency Leave under the FFCRA, or are receiving paid leave under an employer plan or state or local law, cannot simultaneously receive unemployment benefits under the CARES Act.

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