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Davis Brown Employment and Labor Law Blog

Historic CARES Act Signed into Law Creating New Unemployment Program - March 30, 2020

In the hundreds of conversations with employers Davis Brown has advised since the pandemic started, one thing is undeniable—Iowa employers care about their employees and their economic security. We are repeatedly asked to find the best outcome for their workers. Congress has provided an avenue to support workers with the new Coronavirus Aid, Relief, and Economic Security Act (CARES Act).

The CARES Act will work in connection with the Iowa unemployment program. Created by Governor Reynolds earlier this month, Iowa’s COVID-19 unemployment program allows unemployment insurance (“UI”) for a maximum of 26 weeks after an employee is terminated/laid off in full or part.

The CARES Act created a new federally funded unemployment program named the Relief for Workers Affected by Coronavirus Act (RWACA) to be administered by Iowa Workforce Development.

RWACA adds three major benefits to Iowans:

  1. Money
    • Recipients receive an extra $600 weekly payment for 13 weeks, ending on July 31, 2020.
  1. Time
    • Eligibility is extended 13 weeks beyond the state’s 26 weeks for a total of 39 weeks which, if started now, would expire on December 31, 2020 – the date the CARES Act expires and the Families First Coronavirus Relief Act too.
    • It is retroactive to January 27, 2020 for those who suffered job losses due COVID-19. The process for such claims will be established by the Department of Labor (DOL). It is not currently effective, but when the program starts, it will be retroactive.
  1. People
    • UI eligibility includes those who normally do not qualify, i.e., contractors, gig workers, or those who otherwise have insufficient work history. It also covers individuals who were scheduled to start a new job and were unable to do so based on COVID-19 reasons.

PTO and Remote Work

Iowa Workforce Development clarified that paid leave is not required to be exhausted as of March 30; this is not retroactive and represents a change in policy since this pandemic started. However, individuals who may telework must do so. Regular state requirements generally apply, such as the obligation to seek work, however, Iowa has suspended that obligation.

Misrepresentations and Overpayment

Intentional misrepresentations will remove eligibility and be considered a federal crime. Overpayments will be handled by Iowa Workforce Development (IWD) and repayment would be required unless it was not the recipient’s fault or if contrary to equity or good conscious.

As this program will be administered by each state, we will await further direction from the DOL and IWD as this program becomes effective in Iowa.

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