Federal ‘CARES’ Act Expands Unemployment Benefits to Laid Off Workers

March 31, 2020

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. A nearly $2 trillion economic stimulus package, the Act provides an estimated $260 billion in enhanced and expanded Unemployment Insurance (UI) to millions of workers throughout the country who are being furloughed, laid off or finding themselves without work or laid off because of the COVID-19 outbreak.

The CARES Act creates three new UI programs: Pandemic Unemployment Assistance, Pandemic Unemployment Compensation and Pandemic Emergency Unemployment Compensation.  All three programs are fully federally funded.

We are not sure yet when these benefits will be available because the State of Michigan just yesterday, March 30, entered into an agreement with the federal government to expand the benefits to Michiganders.  We expect information to be posted on the state’s website as soon as the expanded benefits are available.

Pandemic Unemployment Assistance (PUA)

  • PUA provides emergency unemployment assistance to workers who cannot get access to regular state UI or who have exhausted their state UI benefits.  Up to 39 weeks of PUA are available to workers who are immediately eligible to receive PUA. The program will expire on December 31, 2020, unless otherwise extended.  Other qualifying criteria:
    • Eligible individuals include self-employed workers, including independent contractors, freelancers, workers seeking part-time work, and workers who do not have a long-enough work history to qualify for state UI benefits.  
    • Workers are not eligible for PUA if they can either telework with pay or are receiving paid sick days or paid leave.  Applicants will need to provide self-certification that they are (1) partially or fully unemployed, OR (2) unable and unavailable to work for COVID-19 related instances.
    • Workers who are eligible for state UI are not eligible for the PUA program. 
  • Pays the amount based on Disaster Unemployment Assistance regulations in weekly benefit amount determined by the state (in Michigan, up to $362/week) and adds $600/week (federal).

Pandemic Unemployment Compensation (PUC)

  • Paid to individuals who qualify for regular unemployment compensation.
  • Paid as an additional $600 to amounts that would otherwise be paid.  Individuals will be eligible for up to $362/week in state benefits plus $600 in federal benefits.  
  • Available to individuals whose unemployment is due to the impact of COVID-19 (broadly defined).
  • Available beginning the week after US-DOL and the state sign an agreement and ending on or before July 31, 2020.

Pandemic Emergency Unemployment Compensation (PEUC)

  • Paid to individuals who have exhausted all rights to state and federal unemployment compensation for benefit years on and after July 1, 2019.   Provides up to an additional 13 weeks of state UI benefits, which will become available after someone exhausts all their regular state UI benefits.
  • To receive PEUC, workers must be actively engaged in searching for work. The bill explicitly provides, however, that “a State shall provide flexibility in meeting such [work search] requirements in case of individuals unable to search for work because of COVID-19, including because of illness, quarantine, or movement restriction.”
  • The amount to be paid is the amount of regular compensation (MI:  up to $362/week) plus $600 per week (consistent with amount of Pandemic Unemployment Compensation).

PUC, PEUC and PUA programs are fully federally funded. States will also receive additional administrative funds to operate these programs.  However, there is a “non-reduction rule” in the CARES Act, which means that as long as the states are participating in these programs, they may not do anything to decrease the maximum number of weeks of UI or the weekly benefits available under state law as of January 1, 2020.

Employers with questions about these programs may contact Wendy Block at wblock@michamber.com.  We are not taking calls or inquiries from claimants.  Please note:  These inquiries should be directed to the State of Michigan’s Unemployment Insurance Agency.