The President has signed the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), which is a $2 trillion relief package aimed at helping mitigate some of the economic impact of the COVID-19 pandemic.
The Act is massive and includes certain provisions particularly relevant to employers. Among other things, the Act:
- Creates the Paycheck Protection Program ("PPP"), which provides for loans to small businesses (those with fewer than 500 employees) to cover payroll costs, among other things.
- Increases the amount of unemployment compensation payments, creates a Pandemic Unemployment Assistance Program, and makes unemployment compensation available to independent contractors, "gig workers," and self-employed individuals.
- Creates a program for loans to mid-sized businesses (500-10,000 employees) who comply with specific requirements, including union neutrality and retention of 90 percent of their employees.
- Provides for loans to certain business sectors, including airlines and hospitals.
- Provides a payroll tax credit for employers who retain at least 50 percent of their employees.
- Provides corrections for certain provisions in the Families First Coronavirus Response Act ("FFCRA").
- Extends the deadline for submitting payroll taxes.
The Act also includes additional tax and benefits provisions and numerous provisions that are not specifically employment-related, including direct payment to affected individuals, grants to states and municipalities, and provisions related to medical supplies.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
