The Coronavirus Aid, Relief, and Economic Security (Cares) Act and Unemployment Benefits – Summary


By: David McGrath

March 30, 2020


The Coronavirus Aid, Relief, and Economic Security (CARES) Act enhances and extends unemployment benefits for many workers in three basic ways:

  • Increases typical unemployment insurance benefits (UIB) by $600 per week through July 31, 2020;
  • Establishes a program to provide 13 weeks of UIB for workers who remain unemployed after they have exhausted their benefits or are not otherwise eligible for benefits; and
  • Expands UIB for up to 39 weeks for those not otherwise eligible for typical unemployment compensation, including workers who have already exhausted benefits and those who are self-employed.

Not surprisingly, a record 3.3 million people in the US filed for unemployment benefits for the week ending March 27, 2020, with millions more to follow.

State Unemployment Benefits

Unemployment insurance programs in the United States are jointly funded federal-state undertakings. Generally, employees are entitled to UIB for up to 26 weeks (with some exceptions). Each state determines its own eligibility requirements, benefit levels, and duration of payments. UIB generally provides about half of what an employee was earning before losing their job. In Massachusetts UIB payments are capped at $823 per week, while in New Hampshire they are capped at $427 per week.

Most employers are required to pay federal and state taxes to help fund the unemployment compensation program in their state(s). UIB payments are usually not available to individuals who are self-employed, unable to work, voluntarily quit, were fired for misconduct (strictly defined), or who refuse to accept a job without good reason. UIB are also not typically available to individuals working for state and local governments or non-profit entities because these employers do not pay unemployment taxes.

Unemployment Provisions of the CARES Act

Under the CARES Act, nearly all individuals receiving unemployment benefits will temporarily receive an emergency increase in their weekly benefit of $600. This increased benefit is in addition the state benefit and will be fully funded by the federal government and available until July 31, 2020. With this additional $600 benefit, some workers will actually earn more than they were earning while employed.

Additionally, the length of state benefits will be extended by 13 weeks so that in the most generous states benefits will run for up to 39 weeks. Also, this benefit applies to individuals who have exhausted their UIB, those not usually eligible for UIB (such as the self-employed, independent contractors, and individuals who were scheduled to begin work but are now unable), and it applies to workers in the District of Columbia, Puerto Rico, and other territories. These individuals would be provided broad eligibility so that nearly any individual whose employment is adversely impacted by COVID-19 (including individuals who quit their job), other than those able to telework or who are receiving paid leave, would be eligible for up to 39 weeks of benefits, fully funded by the federal government.

These benefits will cover weeks of unemployment from January 27, 2020, to December 31, 2020, that are directly attributable to COVID-19. Further, for states that lift the one-week waiting period, the federal government will also fully finance the first week of benefits through December 31, 2020. Federal funding will also be provided to governmental entities and non-profit organizations for an amount equal to half of the benefits paid to workers of these organizations from March 13 to December 31, 2020. Finally, benefits for railroad workers are enhanced.

For more information on the CARE Act unemployment benefits, and how the interplay with state benefits, check your state unemployment agency website.; Also, more summaries and information related to COVID-19 and the CARE Act can be found here: