The $2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES Act), signed into law on March 27, is the largest emergency stimulus plan in United States (U.S.) history. The law is intended to soften the blow of the COVID-19 pandemic on the economy and includes assistance for businesses and individuals. The Act also puts limitations on executive compensation paid by any type of organization that uses government loans and loan guarantees under the legislation. Employers should carefully assess what these restrictions are before determining whether they want to accept economic relief.
In this article, we’ll summarize the implications of the CARES Act on executive compensation as well as retirement plan provisions and what companies should consider before accepting federal loans.
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