How the CARES Act Could Affect Your Business

46 Briefcase Newspaper Standing Man

Please visit our COVID-19 resources page with more information for business owners and employees.

On Wednesday, March 25, the Senate passed the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act. 

This bill is meant to help alleviate the burden of COVID-19 for both businesses and workers.   

While this Act still has to travel through House approval and be signed by the President before it becomes law, there are a few provisions we’d like to explore now.

The CARES Act will provide assistance for small businesses, financial aid to the healthcare system, as well as provide financial assistance to Americans within a certain income level and expand unemployment insurance. We’ve broken down a few aspects of the bill that could potentially affect your business and employees.

How it affects businesses

The CARES Act will provide financial assistance opportunities for businesses with fewer than 500 employees impacted by the COVID-19 pandemic. 

In order to be eligible for loan, a business must:

  • Have been in operation on 02/15/2020
  • Have paid employees or 1099 contractors 
  • Make a “good faith certification that the uncertainty of the current economic conditions are making a loan necessary & it’s necessary to support the business’s ongoing operations.”
  • Acknowledge funds will be used to retain employees, make payroll, and pay a mortgage, lease, or utility payment.

Loan amounts will be 2.5 times the business’ average monthly payroll for the last 12 months. This loan program has a few notable benefits including: non-recourse loans, no personal guarantee needed, no required collateral, no fees, and no obligations to seek other loan sources. 

A potential highlight of the bill also includes loan forgiveness for the amounts used for payroll, mortgage, and lease payments. 

How it affects unemployment

The CARES Act also includes relief for individuals affected by COVID-19, including an expansion of unemployment insurance. Under the bill, unemployment benefits would increase up to $600 each week for four months and extend up to 13 weeks past the typical 12-28 weeks. 

The bill also expands benefit eligibility so individuals who wouldn’t typically be eligible, like contractors or self-employed workers and those who are partially unemployed, can receive benefits.

These are just two of the changes you’ll see if the CARES Act passes. We’ll cover the other details and any changes as soon as it is signed into law. 

If you have questions about how this bill could impact your business and your employees, contact your HR business partner or call us at 888.811.5150. We’re happy to help! 

Also on Nextep

Get the low down on how to handle pay correctly. Should you pay your employees for working during lunch? Yes.  Easy answer! Right? Well, no. Though the simple answer is an emphatic yes, it’s a bit more nuanced.  The topic of lunch and compensable time can be tricky. There are many ways an employee could […]
Read more
An employee’s first day at a new job can set the tone for the working relationship going forward. In fact, according to research by Brandon Hall Group, organizations with a strong onboarding process can improve new hire retention by 82% and productivity by more than 70%. Though the employee may feel stressed or nervous, the […]
Read more
Your company policies and values are only as good as the leaders implementing them. Get your leadership team on board, make sure they’re living out your company values, and support them to ensure they get the help they need to lead well. “Half of workers who quit their jobs say they left because of their […]
Read more
…And what you should ask instead Say you’re recruiting top talent for your company and find a few excellent candidates. When it’s time for the job interview, you smile, shake hands (or wave hello over Zoom), and sit down for a productive conversation. Your first question is a softball to help warm them up: “Have […]
Read more
How often do you get the chance to expand beyond your current retention or recruiting strategies? It’s common for managers to get stuck in the daily work routine and overlook the growth opportunities their employees want. That neglect may mean a greater chance of talented employees leaving in the short run. Around 48% of employees […]
Read more
Could your employee handbook stand up to a lawsuit or EEOC claim? Here are six tricky areas that could mean trouble for your company. Landmine 1: A handbook that’s older than dirt When was the last time you reviewed your company’s employee handbook? If it’s been longer than a year, then it’s been too long.  […]
Read more
We all know the importance of regular physicals and check-ups, but when was the last time you checked in on your mental health? May is Mental Health Awareness month, serving as a good reminder of how crucial a healthy mind is in the overall map of our wellbeing. This list and infographic can get you […]
Read more
If you’ve made it to this blog on leadership training, chances are you’ve spent some time with us the last couple of months as we dove into turning The Great Resignation into The Great Retention.  So far, we’ve covered flexibility, DEI, employee growth, pay, employee engagement, and benefits. While each of these is important, when […]
Read more
It’s no surprise benefits are one of the top reasons for employees staying with a company or going elsewhere. The Society for Human Resource Management (SHRM) study shows that 36% of employees leave for better benefits. Employee retention can be daunting, but we’re here to break it down! Therefore, we’re talking today about benefits. We’ll look […]
Read more
Employee engagement is a crucial piece of the recruiting and retaining top talent puzzle. When it comes to employee engagement, few people in Nextep can speak more authoritatively on the subject than our very own Director of Happiness, Tracey Hixon. To help you get started, Tracey answers some questions about how to retain employees by […]
Read more
In our employee retention series, we’ve talked about flexibility, employee growth, and diversity, equity, and inclusion (DEI). Now, let’s look at another topic that has a massive impact on attracting and retaining top talent: pay! The Great Resignation and the impacts of an ongoing pandemic have long-lasting effects. As a result, employees are evaluating their […]
Read more
Now is the time for employers to carefully review any arbitration or employment agreements they have in place. On March 3, 2022, President Biden signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (HR 4445).  In cases of sexual assault or harassment in the workplace, many employers ask employees to sign arbitration […]
Read more

Download Our App