Unemployment Benefits Under the CARES Act

The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law to address the current COVID-19 pandemic. The Act provides $2.2 trillion of economic relief for Americans, businesses and the healthcare industry. The relief package also provides federal funding to expand the availability of unemployment insurance (UI) benefits, breaking it down into three categories: Pandemic Unemployment Compensation (PUC), Pandemic Unemployment Assistance (PUA), and Pandemic Emergency Unemployment Compensation (PEUC).

According to the U.S. Department of Labor (DOL), all states have executed agreements to administer these UI benefits as of March 29, 2020. Under this law, virtually all types of workers may receive payments for up to 39 weeks of unemployment under certain circumstances.

Pandemic Unemployment Assistance (PUA)

An individual may receive PUA benefits for up to 39 weeks if they are otherwise able to work and available for work (as defined under state law), but are unemployed, partially unemployed, or unavailable to work because of at least one specified reason related to COVID-19.

The weekly amount of an individual’s PUA benefits depends on how the individual’s UI benefit is calculated under the applicable state UI law. An individual is not eligible for PUA benefits if they can telework or are receiving paid leave benefits of any kind.

Pandemic Emergency Unemployment Compensation (PEUC)

PEUC is a continuation of state UI benefits for 13 weeks after the state benefits end. These benefits are available to individuals who:

  • Have exhausted all rights to regular UI benefits under the appliable state (or federal) UI law for a benefit year ending on or after July 1, 2019;
  • Have no rights to regular UI benefits under any state or federal law;
  • Are not receiving benefits under the unemployment compensation law of Canada; and
  • Are able to work, available to work and actively seeking work.

The CARES Act requires states to be flexible with individual requirements for reasons related to COVID-19 such as illness, quarantine or movement restriction.

Federal Pandemic Unemployment Compensation (FPUC)

The CARES Act allocates federal funding for states to provide an additional $600 per week to any individual who is receiving UI benefits for weeks of unemployment ending on or before July 31, 2020.

The $600 FPUC benefit is taxable as income, but does not affect an individual’s eligibility for Medicaid or the Children’s Health Insurance Program (CHIP).

Under DOL guidance, states must issue FPUC payments as soon as administratively feasible.

We encourage employers to become familiar with the expanded benefits available and advise any workers who may qualify for them to apply through the UI agency of the state in which the workers were employed. Please seek additional guidance from your legal expert.


More information and details are available here.