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Coronavirus Aid, Relief, and Economic Security (CARES) Act: Unemployment

Updated : February 22nd, 2022

CARES Act for unemployment

The Families First Coronavirus Response Bill was signed into law on March 18, bringing potential relief to millions of Americans. Though it is a good beginning, dealing with the COVID-19 pandemic needs a lot more. Recognizing this, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) further expands unemployment, healthcare, etc. measures and aid. 

The President signed the Coronavirus Aid, Relief, and Economic Security (CARES) Act into law on March 27, 2020. This $2.2 trillion package brings relief to the highly stressed businesses, workers and families reeling from COVID-19, while also bolstering essential goods and services. We take a brief look at everything in this law that supports the unemployed, directly and indirectly.

The government is progressively expanding the unemployment insurance umbrella to cover as many people losing jobs as possible. It’s important to remember to file unemployment insurance claim as soon as you know you are losing your job. If you have exhausted your unemployment benefits you may be eligible for Extended Benefits. Keep reading for more details.

Provisions for Unemployment Assistance

This law extends the eligibility to the following persons:

  1. Those who are not eligible for regular unemployment compensation or Extended Benefits under Law Or Pandemic Emergency Unemployment Compensation 
  2. Those who have exhausted their regular UI benefits or Extended Benefits under law or Pandemic Emergency Unemployment Compensation 
  3. Those who can self-certify that they would be able and available to work however
    1. They are suspected to have contracted COVID-19 or are suffering from it
    2. A member of the household is suspected to have contracted COVID-19 or are suffering from it
    3. They are a caregiver for a member of the household suffering from COVID-19
    4. They are primary caregiver for a child unable to attend school closed due to the pandemic. Or for a family member unable to attend a facility that provides care usually.
    5. Unable to go to work or workplace closed due to self-quarantine recommended by healthcare workers
    6. Scheduled employment didn’t commence due to the pandemic
    7. They had to quit due to COVID-19
  4. Those who are self-employed, seeking part-time employment, without sufficient work history in the base period.

It excludes the following people:

  1. Those provided telework with pay
  2. Those availing paid sick leave

Period of UI Benefits

A covered individual can receive assistance for a maximum of 39 weeks. This includes the period for which one was able to get regular unemployment assistance, which is usually 26 weeks in most states with some exceptions. One can get Extended Benefits during the remaining period. 

The Coronavirus Aid, Relief, and Economic Security (CARES) Act waives the one week waiting period to get unemployment payments. The amounts will not be less than the normally calculated weekly benefits amounts. There will also be a weekly payment of $600 over the regular unemployment allowance, for four months.

The payments will arrive without the one week waiting period because the program is fully federally funded.

Elaboration of Extended Benefits

The law details the eligibility conditions to avail Extended Benefits as follows:

  • Those who have exhausted regular compensation under state or federal Law for any benefit years after July 1, 2019.
  • Those with no right to UI compensation or any other compensation under any federal law.
  • Those who are able and available to work, and actively seeking work though they may not find work due to the pandemic.

They will get as much as they were entitled to get under the regular program or an equivalent amount.

Coronavirus Aid, Relief, and Economic Security Act: Other Important Provisions

The CARES Act includes some other important measures to help mitigate the effects of massive job losses. The unemployment phenomenon has a trickle-down effect on people’s ability to meet their basic needs, which this law addresses. COVID-19 has caused an extraordinary situation where people can’t look for new jobs even if they wanted to.

Direct Cash Transfers

Individual Americans earning up to $75,000 will receive a one time transfer of $1200, while married couples earning up to $150,000 will receive $2,400. Families with children get an additional $500 per child.

This will help buy essential supplies and out-of-pocket meds.

Withdrawing From Your Investments

  • 401(k) loan limits are now up to $100,000 from $50,000
  • Required Minimum Distribution compulsions have been suspended from IRAs and 401(k) plans (at age 72). RMDs were meant to ensure that people didn’t avoid taxation on their retirement funds to leave them as inheritances.
  • No early withdrawal penalty on withdrawing retirement accounts for COVID-19 related reasons.

Others CARES That Support People

  • Americans need healthcare the most at this crucial time and thus the Coronavirus Aid, Relief, and Economic Security (CARES) Act appropriates $127 billion to hospitals alone. 
  • The Act provides employee retention credits for businesses against an employer’s portion of payroll taxes, to encourage those trying to retain employees and paying them during this time.
  • Employment development program like the State Trade Expansion Program from the Small Business Administration will continue to be funded.
  • Funding for programs like the Geriatrics Workforce Enhancement Program will continue, potentially providing employment avenues for those interested in acquiring such training.


The Coronavirus Aid, Relief and Economic Security Act is a big step in the right direction, addressing the large-scale unemployment concerns facing the country. At the end of the pandemic, the economy should not be in shambles and the law attempts to balance this with healthcare. 

The real challenge lies in implementing the ambitious provisions effectively. People are facing problems accessing unemployment insurance departments at this point in time. The very first thing to do for the government is to scale up the capacity of state labor departments to help people file UI claims.

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