Unemployment Insurance Provisions in the CARES Act, Updated April 9, 2020

Summary

An In Focus brief, updated April 9, 2020, summarizes the unemployment insurance provisions in Title II, Subtitle A, of the CARES Act (P.L. 116-136, enacted March 27, 2020) and compares them with the Families First Coronavirus Response Act. It describes an additional federally financed $600 weekly benefit, called FPUC, payable for weeks of unemployment ending on or before July 31, 2020. It describes PEUC, which authorizes up to 13 additional weeks of benefits through the end of December 2020. It also notes Pandemic Unemployment Assistance and 50% federal funding of regular benefits for reimbursing employers.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

                                                                                                        Updated April 9, 2020
Unemployment Insurance Provisions in the CARES Act
This In Focus summarizes the Unemployment Insurance               (DUA). All PUA benefits, like other UI benefits, are
(UI) provisions in Title II, Subtitle A, of the Coronavirus       augmented by $600 a week by FPUC through July 2020.
Aid, Relief, and Economic Security Act (CARES Act; P.L.
116-136; enacted March 27, 2020). It also provides a brief        PEUC: Additional Weeks of Benefits
comparison with the UI provisions enacted in the Families         Section 2107 creates PEUC, which authorizes up to 13
First Coronavirus Response Act (FFCRA; P.L. 116-127).             additional weeks of federally financed UI benefits for
                                                                  individuals who exhaust state and federal UI benefits and
Additional $600 Weekly Federal Compensation                       are able, available, and actively seeking work, subject to
Section 2104 provides an additional, federally financed           COVID-19-related flexibilities.
$600 benefit (Federal Pandemic Unemployment
Compensation [FPUC]) that augments weekly UI benefits             PEUC is administered by states and is authorized through
including regular, state Unemployment Compensation                the end of December 2020. The PEUC benefit amount is
(UC), Extended Benefits (EB), Pandemic Unemployment               the WBA as calculated under state law. All PEUC benefits
Assistance (PUA, see description below), and Pandemic             would be increased $600 a week by FPUC through July
Emergency Unemployment Compensation (PEUC, see                    2020. (During the period that PEUC is authorized, states are
description below). This FPUC is payable through                  prohibited from reducing UC benefit amount or duration.)
agreements with states for weeks of unemployment ending
on or before July 31, 2020. (During the period that this          Other UI Provisions
payment is authorized, states are prohibited from reducing
their UC benefit amount or duration.)
                                                                   Section 2103 provides, through December 2020, 50%
                                                                     federal funding of regular UC benefits based on service
                                                                     with reimbursing employers, which are state and local
FPUC income is disregarded for the purposes of Medicaid
                                                                     governments, Indian tribes, and nonprofit organizations
and the Children’s Health Insurance Program (CHIP).
                                                                     that have opted not to pay UI taxes, but instead
                                                                     reimburse states for UC benefits paid to their former
PUA: Expanded Benefit Eligibility
                                                                     employees. This Section provides financial relief to
Section 2102 of the CARES Act creates a temporary,
                                                                     these reimbursing employers. It also allows for state
federal UI program for individuals not otherwise eligible
                                                                     flexibility in the timing of required reimbursement
for UI benefits (e.g., self-employed, independent
                                                                     payments for these employers.
contractors, gig economy workers): PUA. PUA is
administered by states and provides up to 39 weeks of
federally financed UI benefits to unemployed workers who
                                                                   Section 2105 provides 100% federal financing through
                                                                     the end of December for UC benefits provided during
(1) are ineligible for any other state or federal UI benefit;
                                                                     the first week of unemployment in state UC programs
(2) meet conditions related to being unemployed, partially
                                                                     with no one-week waiting period (thus, incentivizing
unemployed, or unable to work due to COVID-19; and (3)
                                                                     states that require one-week waiting periods before
are not able to telework and are not receiving any paid
                                                                     receiving UC under state law to remove them).
leave. The PUA maximum duration of 39 weeks is offset by
any weeks of regular UC or EB.
                                                                   Section 2106 waives federal requirements regarding
                                                                     merit staffing for state UC programs on an emergency,
PUA is available in all states and U.S. territories, subject to
                                                                     temporary basis in response to COVID-19 until
agreements with U.S. Department of Labor (DOL). PUA
                                                                     December 31, 2020. This waiver is limited to certain
pays benefits for weeks of unemployment, partial
                                                                     temporary actions taken by states to quickly process UI
unemployment, or inability to work beginning on or after
                                                                     claims, including rehiring former employees and
January 27, 2020, and ending on or before December 31,
                                                                     temporary hiring.
2020 (hereinafter, end of December 2020). PUA benefits
are authorized to be paid retroactively.
                                                                   Sections 2108-2111 authorize 100% federal financing of
                                                                     Short-Time Compensation (STC; work sharing) in states
The PUA benefit amount is the weekly benefit amount
                                                                     with existing programs and 50% federal financing for
(WBA) as calculated under state law based on recent
                                                                     states that set up STC programs (up to the equivalent of
earnings (subject to the minimum benefit under Disaster
                                                                     26 weeks of benefits for individuals) through the end of
Unemployment Assistance [DUA], which is half of the
                                                                     December 2020. Additionally, $100 million in federal
state’s average weekly UC benefit amount). In territories
                                                                     grants to support STC are authorized. DOL is required
without UC programs, the PUA benefit is determined by
                                                                     to provide STC technical assistance to states. For
DUA regulations. For background on DUA, see CRS
                                                                     background on STC programs, see CRS Report R40689,
Report RS22022, Disaster Unemployment Assistance

                                                 https://crsreports.congress.gov
                                                                     Unemployment Insurance Provisions in the CARES Act

   Compensated Work Sharing Arrangements (Short-Time             waivers of certain federal UI requirements for state UC
   Compensation) as an Alternative to Layoffs.                     programs (Section 2106 of the CARES Act adds merit
                                                                   staffing, in some circumstances, to the list of waived
 Sections 2112-2114 provide $50 million to waive the              federal UI requirements);
   seven-day waiting period for Railroad Unemployment
   Insurance (RRUI) benefits. An FPUC-like benefit is            waivers of interest payments and suspension of interest
   authorized, providing $1,200 for RRUI biweekly                  accrual on federal advances (loans) to states to pay UC
   benefits for RRUI through July 2020, as well as an              benefits through December 2020;
   additional 13 weeks of federally financed RRUI benefits
   through the end of December 2020, comparable to               DOL assistance to states in establishing, implementing,
   PEUC. For background on RRUI, see CRS Report                    and improving STC programs (Sections 2108-2111 of
   RS22350, Railroad Retirement Board: Retirement,                 the CARES Act provide temporary, federal financing
   Survivor, Disability, Unemployment, and Sickness                (100% or 50%, depending on state action) of STC
   Benefits.                                                       benefits as well as $100 million in grants to support
                                                                   STC programs); and
 Section 2115 provides $25 million in funding for the
   DOL Office of Inspector General for audits,                   temporary, 100% federal financing for EB (under
   investigations, and oversight related to the UI provisions      permanent law: 50% state, 50% federal) from enactment
   in the CARES Act.                                               until the end of December 2020, but only for states that
                                                                   receive both halves of the emergency administrative
 Section 2116 authorizes DOL to issue operating                   grants. This law also temporarily removes the incentive
   instructions and other guidance needed to implement the         in EB law for states to have a waiting week for their
   UI provisions in the CARES Act.                                 regular UC programs through December 2020. (As of
                                                                   this date, EB is not available in any state.)
Interactions with UI Provisions in H.R. 6201/P.L.
116-127                                                         Additional Resources
In general, the UI provisions in P.L. 116-136, the CARES        For more details on the UI provisions in the CARES Act, as
Act, are non-overlapping with the UI provisions in P.L.         well as additional introduced legislation related to UI and
116-127, the Families First Coronavirus Response Act.           COVID-19, see CRS Report R45478, Unemployment
                                                                Insurance: Legislative Issues in the 116th Congress.
As described above, the UI provisions in the CARES Act
focus on temporary federal interventions to expand UI           For background on permanent-law UI programs and
benefit eligibility; provide additional federally financed      benefits, see CRS Report RL33362, Unemployment
weeks of UI benefits; and augment all weekly UI benefit         Insurance: Programs and Benefits.
payments with additional federally financed benefits
amounts, among other provisions.                                For DOL guidance to states on implementing the UI
                                                                provisions in FFCRA and the CARES Act, see
The UI provisions in the Families First Coronavirus             https://oui.doleta.gov/unemploy/coronavirus/.
Response Act provide various types of assistance to states,
including                                                       For minimum DUA amounts, see DOL Unemployment
                                                                Insurance Program Letter, No. 11-20, Attachment 1,
 $1 billion in emergency administrative grant funding to       Minimum Disaster Unemployment Assistance (DUA),
   states in calendar year 2020 for administrative purposes.    (March 19, 2020), available at https://wdr.doleta.gov/
   (Half of this amount is available to all states that meet    directives/attach/UIPL/UIPL_11-20_Attachment.pdf.
   certain requirements related to UC eligibility
   notifications and claims access. The second half of this     Katelin P. Isaacs, Specialist in Income Security
   amount is available to states that experience at least a     Julie M. Whittaker, Specialist in Income Security
   10% increase in UC claims over the previous calendar
   year and meet certain other requirements related to                                                              IF11475
   easing UC eligibility requirements for individuals
   affected by COVID-19.);




                                               https://crsreports.congress.gov
                                                                    Unemployment Insurance Provisions in the CARES Act




Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
United States Government, are not subject to copyright protection in the United States. Any CRS Report may be
reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include
copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you
wish to copy or otherwise use copyrighted material.




                           https://crsreports.congress.gov | IF11475 · VERSION 3 · UPDATED


File and source

File

crs-if11475-ui-provisions-cares-act.pdf

Size

440,714 bytes

SHA-256

1e29beef6d1efc8a609cb4398679ab4f6ff742ec337b502575e2be0f9801751b

Our copy

crs-if11475-ui-provisions-cares-act.pdf

Original

crsreports.congress.gov