On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Section 2104 of the CARES Act provides for a temporary emergency increase in unemployment compensation benefits and includes funding to states for the administration of the program.
Under the CARES Act, eligibility for benefits has been extended an additional 13 weeks to up to 39 weeks, and an additional $600 has been added to an employee’s weekly benefit through July 31, 2020.
How does this work?
First, an employee who is eligible for traditional unemployment benefits must first apply for and be entitled to receive unemployment benefits under state law. It is recommended for employees to file for unemployment benefits in the state in which the individual is employed. The DOL acknowledged that an employee’s quitting work without good cause should still mean that they are not entitled to unemployment benefits.
If an employee is eligible for benefits under state law, then he or she is entitled to an additional $600 weekly payment if the loss of employment is related to the COVID-19 pandemic. An individual is eligible for expanded unemployment benefits if they affirm that they are available for work, but cannot work due to a COVID-19-related reason (e.g., being diagnosed with COVID-19, caring for a family member who has been diagnosed, caring for a child whose school is closed due to COVID-19).
Thus, an individual need not show they are actively looking for work if the individual is collecting unemployment benefits due to reasons related to COVID-19. In addition, the CARES Act allows for an individual to possibly be eligible for the additional 13 weeks of benefits.
Further, an employee who is eligible for even partial unemployment benefits is entitled to receive the entire $600 premium. The State of Indiana estimates that these premium payments will begin to be paid by the State of Indiana on or around April 20, 2020. Employees may possibly see multiple deposits hit their bank account since payments are retroactive back to the end of March.
Significant for employers is that the $600 premium will NOT impact the employer’s experience rating and will not otherwise be charged back to the employer.