Urgent Policy Needs for Small Businesses During Coronavirus

See our FULL NEW Small Business and COVID-19 Website for these recommendations, resources and more:

Our understanding of the impacts of the COVID-19 pandemic on small business is rapidly evolving. These policy recommendations will continue to evolve as we learn more about the needs of our small business members, their employees, and their communities.


Policy Recommendations to Support Small Business


We are in unprecedented times. Many small business owners are working to keep their businesses solvent, and supporting their communities by following public health measures. This has resulted in reduced business hours, employee furloughs and layoffs, and decreased revenue across the board.

We need urgent action to reduce both the public health and economic impacts of COVID-19 on our local and national economies and potentially stave off a longer term economic crisis or recession. Immediate emergency actions must be taken across four major areas of policy:

  • Immediate Cash Flow Assistance for Impacted Small Business Owners
  • Unemployment Insurance and Other Income Supports
  • Affordable Healthcare & Emergency Measures to Protect Coverage
  • Earned Sick Leave and Paid Family and Medical Leave (PFML)

Immediate Cash Flow Supports to Small Business

We applaud the House's swift action in passing an emergency package that expands loans available for small businesses  impacted by COVID-19. But at this point in the crisis - loans and tax breaks are not the answer. Small businesses across the country need an immediate cash infusion to weather this crisis. 

Short-term cash flow relief measures are needed such as:

  • Congress should work with the US Treasury to bail out Main Street, not Wall Street through immediate cash injections from US Treasury direct to all small businesses impacted by COVID-19 to cover immediate business expenses (rent, salaries, paid sick time, insurance premiums, utilities, and vendor contracts.) .

  • Direct cash assistance to keep money flowing on Main Street. Direct cash payment to all low-income and middle-income individuals for emergency relief (salary, rent, utilities, etc.), expanded Earned Income Tax Credit, and Refundable tax credits.

  • The Government as buyer to keep US business infrastructures in place. The government should make up the gaps in revenue through direct payments to fill supply gaps. The Defense Production Act can be used to secure supply chains and provide loan guarantees for infrastructure and homeland security needs.

  • Ensure expanded funding for social safety net (SNAP, Medicaid, etc.). Move Federal money to states to cover costs of fighting the epidemic.

  • Strengthen Tax Enforcement for Corporations and Wealthy Individuals to generate revenue to fund stimulus.

  • Expand the recently passed SBA loan program to be more responsive through: Immediate funding to Community Development Financial Institutions (CDFIs) cities and states to do outreach and help small businesses apply for SBA and other emerging funds.  Urge Bank to rapidly approve low cost loans and then back fill with money from SBA’s and CDFI funds.

  • Fair & Smart Regulations and Payment Options. Regulations and payments for loans developed in a way to avoid end of year balloon payments.

Unemployment Insurance and other Emergency Income Supports

To avoid both a short-term financial crisis and long term economic recession, federal and state governments should coordinate to provide immediate and improved income supports for small businesses and their employees. Business owners cite weak sales as the biggest problem for their business and the economy, and ensuring that employees have their consistent wages means that consumer demand won’t go lax with each illness or emergency.

Unemployment insurance eligibility should be expanded to include: 

  1. people whose hours have been reduced due to decreased demand
  2. people whose wages come primarily from tips
  3. people who have run out of sick days
  4. high-risk populations who in order to protect themselves need to stay home
  • The expansions from Washington state could serve as a model for states looking to support vulnerable workers. 

  • Disaster unemployment insurance should be implemented to apply to a broader set of impacted workers.

  • Worker advocate groups have also called for other innovative income supports including options for policymakers on unemployment insurance.

  • Small business experience rating should not be impacted by layoffs related to COVID-19  The Vermont legislature is working on such a measure.

  • Deferring or a one-time waiver of local business and property taxes 

  • Encouraging commercial landlords to defer or amortize commercial rent payments 

  • Utility payment relief (reducing penalties for late payments or discounts)

  • A moratorium on business evictions and utility shut-offs

Investment in Affordable Health Care & Emergency Measures to Protect Coverage

Access and affordability is key to making sure employees can heal and not spread the disease further, particularly for the 27.9 million people who lack access to health insurance. Handing the Pharma monopoly full power in setting prices for a needed vaccine that already has over $700 billion of public investment, betrays the public trust and will put the burden of this epidemic directly on communities to line the pockets of giant for-profit pharma corporations. 

  • COVID-19 testing and treatment must be widely accessible and affordable.

  • States should work with insurance providers to help ensure that small business policies are extended through this crisis, even if a small business owner experiences cash flow issues in their businesses that make paying short-term payments difficult. 

  • Increased government investment in public health programs, including medicare and medicaid.

  • Any vaccine must be free to the public, and treatment affordable to all.

Earned Sick Leave and Paid Family & Medical Leave Are Essential

Earned sick leave and Paid Family and Medical Leave are front-line, essential policies that ensure that workers can take time away from work if they are ill or need to care for a sick family member without fear of lost income. This encourages people to stay home and prevent the spread of illness.  We urge the following steps:

  • We urge passage of the Families First Act - that guarantees 10 paid sick days and 12 weeks paid leave for many of the workers who are and will be impacted by coronavirus. and the regulatory measure to ensure the cash advances small business needed to be able to deliver this needed benefit to impacted employees.  

But there are major problems that this bill doesn’t solve. The employer threshold leaves out at least 6.5 million workers in the country's largest companies who might still not be covered. Other emergency measures are needed to ensure all workers have access to paid leave.  And safety standards for health care workers need to be ensured.  

Finally, this current crisis lays bare the holes in our current system.  Earned sick time programs are effective tools for employers to provide an essential benefit to workers in a predictable and cost-effective way. 

States that have passed publicly funded Paid Family and Medical Leave (PFML) programs and earned sick time polices are  better equipped to support workers who have become seriously ill or who have family members who are seriously ill. At the federal level, we need to pass comprehensive policies so our country is better prepared for the next crisis.  We need to :

  • Pass a national earned sick and safe time policy to create a minimum of 7 earned sick days for all businesses. 

  • Pass a comprehensive, public insurance paid family and medical leave program to ensure that small business owners and their employees can take extended time if necessary.

Paid sick leave and paid family and medical leave policies work best in a functioning economy, with time to ramp up earned sick day benefits and paid leave reserves through small predictable payroll contributions. Many workers are not yet covered by these laws, and so we need immediate income replacement solutions in order to stem decreased demand at small businesses. 

Resources for Small Business Owners:

See our Full COVID-19 Website for more Resources.