To help companies that may shed workers amid a looming economic downturn, Iowa Gov. Kim Reynolds announced Monday that the state will pick up the tab for unemployment claims resulting either directly or indirectly from COVID-19.

Iowa Workforce Development will also try to speed up how quickly it can process claims by waving the fact-finding research it normally does.

The agency's attorney, Nick Olivencia, said business' payments for unemployment claims could be too much of a burden for companies as sales slow down amid worries about the spread of coronavirus.

"It gives them that option to get back on their feet faster and help them be in a position to hire faster again," he said.

More:The latest on coronavirus in Iowa

Employers typically cover the costs of unemployment in two ways. Most companies are contributory employers, meaning they pay into a state trust fund that covers the cost of unemployment claims related to their company. Iowa Workforce Development sets those companies' annual rates each year, based on the number of unemployment claims tied to the business.

Other companies are reimbursable employers, meaning the business pays directly for each specific unemployment claim.

With Reynolds' announcement, companies will not have to pay for employees laid off due to a business downturn because of COVID-19. Also, Iowa Workforce Development will not consider those job cuts when setting contributory employers' new annual rates for the trust fund in November.

Reimbursable employers also will not have to pay any part of the unemployment benefits for the workers they lay off due to the virus.

"All of our state agencies continue to work as one team to lessen the impact COVID-19 will have on our economy and our people," Reynolds said in a statement.

Workers seeking unemployment benefits should receive payment within 10 days of making a claim, according to a news release from Iowa Workforce Development. For more information, the agency has a handbook with details about unemployment insurance on its website.

Tyler Jett covers jobs and the economy for the Register. Contact him at 515-284-8215 and tjett@registermedia.com. Follow him on Twitter @LetsJett.

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