The $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act stimulus law to help American workers and businesses weather the outbreak has a number of provisions that employers and their workers need to know about, including:
Parts of the CARES Act could benefit your organization and employees in some way. Here's what you need to know:
The CARES Act extends unemployment insurance benefits to workers, as long as they lost their jobs due to the outbreak.
Unemployment benefits under the CARES Act also apply to furloughed employees.
Depending on your state, workers will be able to collect both state unemployment and federal unemployment through the CARES Act, which was designed to augment any unemployment benefits workers may receive in your state.
The Pandemic Emergency Compensation program funded by the CARES Act will provide an additional $600 per week on top of state unemployment benefits, through July 31.
The law extends state-level unemployment by an additional 13 weeks. For example, if a state has maximum unemployment benefits of 26 weeks, the bill extends state benefits to 39 weeks. The extended benefits will last through Dec. 31.
Health plan changes
Under the CARES Act, employer-sponsored group health plans must provide for covered workers - without cost-sharing or out-of-pocket expenses - the cost of COVID-19 testing, treatment and vaccinations when and if they become available.
In response to the Coronavirus (COVID-19) pandemic, small business owners are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000.
This advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available following a successful application. This loan advance will not have to be repaid.
This program is for any small business with fewer than 500 employees (including sole proprietorships, independent contractors, and self-employed persons) as well as private non-profit organization affected by COVID-19.
And the law's Paycheck Protection Program (PPP), offers 1% interest loans to business with fewer than 500 workers.
Borrowers who don't lay off workers in the next eight weeks will have their loans forgiven, along with the interest.
These loans are designed to provide a direct incentive for small businesses to keep their workers on the payroll. If small businesses maintain payroll through this economic crisis, some of the borrowed money via the PPP can be forgiven - the funds will be available through June 30.
Under the CARES Act, the Secretary of the Treasury is authorized to implement financial assistance programs that specifically target mid-size employers with between 500 and 10,000 employees.
Loans would not have an annualized interest rate higher than 2%, and principal and interest will not be due and payable for at least six months after the loan is made. But unlike loans under the PPP, these are not forgivable.
The CARES Act provides $500 billion to the Treasury Department's Exchange Stabilization Fund for loans and other funding for large companies and corporations affected by the outbreak.
Like loans for mid-sized employers, they are not forgivable.
501 Bell St.
Dubuque, IA 52001
Phone: (563) 556-0272
An AssuredPartners Agency
In February 2020, The Friedman Group joined AssuredPartners, the 11th largest insurance brokerage in the U.S. This partnership provides us access to additional capital and a national footprint that enables us to continue to negotiate the most favorable coverage terms and conditions for our clients, and allows us to provide an even broader spectrum of risk management support services.