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