Enhanced Unemployment Benefits Under the CARES Act

The greatly enhanced unemployment benefits mean much more money each week, for longer, for many more kinds of workers, and many others.

 

Our last blog post was about the emergency $1,200 Economic Impact Payment that’s “rapidly” coming to most American adults. (Plus $500 for each qualifying dependent child.) For updates on this payment since then, see the IRS’ “Coronavirus Tax Relief” webpage. That links you to its News Release IR-2020-61, which came out on March 30, 2020. It was modified and updated on April 1, specifically about Social Security recipients.

The $2.2 Trillion Coronavirus Aid, Relief, and Economic Security Act (“CARES”) includes about $260 Billion for expanded unemployment benefits. Although that’s only about one-eighth of the whole package, it’s still a considerable amount of money. By way of comparison, $260 Billion is almost 40% of last year’s entire defense budget.

These new unemployment benefits include the following distinct components.

More extensive Checks—Federal Pandemic Unemployment Compensation

Federal Pandemic Unemployment Compensation provides an additional $600 per week even for individuals who already qualify for unemployment benefits under state law. The states will pay this extra $600 per week in addition to the regular amount of unemployment benefits. Section 2104 of CARES.

This additional payment is a significant increase, especially compared to the usual weekly amount. That usual amount varies widely. In Connecticut, the maximum benefit is $631, in Florida, it’s $275. No matter your state, the Act significantly increases your benefits.

Longer Payment Period—Extended Unemployment Compensation

Individuals usually get up to 26 weeks of unemployment benefits under state law. Some states provide less. For example, Florida gives only 12 weeks of benefits. CARES adds up to 13 more weeks of benefits, for up to 39 weeks of benefits. Section 2102(c)(2) of CARES.

These additional weeks of benefits include BOTH the regular state unemployment benefit amount PLUS the $600 per week referred to above. Section 2102(d)(1)(A) of CARES.

Extension of Exhausted Benefits—Available to Work but Can’t Find Work

The new law also reinstates unemployment benefits for those “have exhausted all rights to regular compensation under the State law or under Federal law” for the benefit year. This benefit assumes that the individual is “able to work, available to work, and actively seeking work.” Section 2107(a)(2) of CARES.

The unemployment benefit amount under this part of the law includes the regular state-determined weekly amount plus $600, as discussed above. Section 2107(a)(4) of CARES.

Pandemic-Related Individuals—Virtually Everyone Who’s Impacted

The law gives unemployment benefits to a wide array of individuals affected by the health emergency, covering ten categories. An individual who doesn’t otherwise qualify for the unemployment benefits receives them by providing a “self-certification” that states you are “unemployed, partially unemployed, or unable or unavailable to work because” of the following conditions. The individual:

1. has been diagnosed with COVID-19 or has symptoms and is currently being diagnosed
2. has a household member who’s been diagnosed with COVID-19
3. is caring for a family or household member diagnosed with COVID-19
4. has a child or other dependent who can’t go to school or a care facility because of the health emergency
5. can’t get to the workplace because of a quarantine
6. can’t get to the workplace because of being “advised by a health care provider to self-quarantine due to concerns related to COVID–19”
7. was scheduled to return to work but can’t because of the health emergency
8. became the “breadwinner or major support for a household “because the head of the household has died as a direct result of COVID–19”
9. “has to quit his or her job as a direct result of COVID–19”
10. lost a job because the “place of employment is closed as a direct result of the COVID–19 public health emergency”

Section 2102(a)(3)(A) of CARES.

Consistent with the other parts of the law, weekly benefits equal the regular state-determined amount plus $600. Section 2102(d)(1)(A) of CARES.

Nontraditional Workers May Receive Benefits

State Unemployment benefits usually do not cover Self-employed and independent contractors. Very significantly, many of the benefits we’re discussing here do apply to these nontraditional workers. The law says that

The term “covered individual”—(A) means

(II) [an individual who] is self-employed, is seeking part-time employment, does not have sufficient work history, or otherwise would not qualify for regular unemployment or extended benefits under State or Federal law or pandemic emergency unemployment compensation under section 2107 and meets the requirements of subclause (I)

Section 2102(d)(1)(A) of CARES. The reference to Section 2107 is to those who already qualify for benefits otherwise, as discussed in two sections above. The other reference to subclause (l) is to the list of 10 COVID-19-related circumstances listed in the section immediately above. So the self-employed and independent contractors receive unemployment benefits if they fit any of the ten conditions.

However, these benefits to the self-employed and independent contractors are not available to those who can work remotely—who can “telework with pay.” Also, individuals “receiving paid sick leave or other paid leave benefits” don’t qualify. That’s true even if they fit into any of the 10 COVID-19-related categories discussed above.