How the stimulus package applies to churches

As we work through the challenges presented by the Coronavirus pandemic, our government has passed legislation to assist employers in caring for their workers. This information is offered as a guide in response to some of the more common inquiries on the topic of compensation. You are encouraged to prayerfully make your decisions with compassion and understanding for your workers. Please understand the situation is fluid, and updates will be provided as new information is made available.

Families First Coronavirus Response Act

Under the Families First Coronavirus Response Act (FFCRA) enacted on March 18, 2020, and effective through December 31, 2020, congregations who may not have previously been considered “covered employers” under the Family Medical Leave Act (FMLA) because they had fewer than the required 50 workers, now fall within the parameters of both the Paid Sick Leave and Paid Expanded Family and Medical Leave provisions applicable to organizations with fewer than 500 workers. Here is some detailed information on employer paid leave.

A “Question and Answer” section is available on the Families First Coronavirus Response Act website.

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

Under the CARES Act Relief program enacted on March 27, 2020, and effective through December 31, 2020, many congregations will have new programs available to assist with unexpected financial needs such as the Paycheck Protection Program (PPP) Loans. The U.S. Senate Committee on Small Business & Entrepreneurship has provided a guide to help understand what is now available.

Also available under the CARES Act is the Employee Retention Credit which can provide for a refundable payroll tax credit of 50% of qualifying wages paid by eligible employers during the COVID-19 crisis. Additional information as provided by Michael Best can be found online.

Unemployment Compensation

Under the CARES Act Relief program, workers of religious non-profit organizations who do not pay into their state’s Unemployment Compensation Insurance program, meaning their workers were previously not able to collect unemployment compensation if employment ended, may now be eligible. Please be aware however that eligibility for VEBA (or other employer provided health care plans) and Pension participation requires a worker be an “active worker.” The ability to continue with VEBA coverage for any worker whose divine call has been terminated or lay worker who is laid off would fall under COBRA continuation.

Each state administers a separate unemployment insurance program, but all states follow the same guidelines established by federal law. More information regarding the updated rules in your state can be accessed here.

Common questions associated with filing for unemployment. 

Additional resources on these and other topics are available from a multitude of sources. Those sources include:

Church Mutual Insurance

Michael Best



Congregations are urged to contact tax and/or legal professionals to guide you through this process.

Note: The links provided in this article were selected because they may provide helpful information for you during this crisis. WELS does not own these sites and is not responsible for the information and opinions expressed on them.



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