Newly Enacted CARES Act Offers Loan Assistance to Small Businesses

Signed into law on March 27th, the Coronavirus Aid, Relief and Economic Security (CARES) Act creates a half-dozen new programs to help distressed businesses and workers deal with the global COVID-19 pandemic and any related shutdowns. Among those programs are forgivable small business loans and other types of loan assistance. A small business as defined under the CARES Act is one that employs fewer than 500 workers or fewer than the level set by the SBA for the employer’s industry.

Paycheck Protection Program

The Paycheck Protection Program, developed under the CARES Act, is a new forgivable loan program created to help small businesses pay their expenses and continue to keep their workers employed during the health crisis.

The Program provides loans of up to 250% of the employer’s average monthly payroll costs, with a cap of $10 million. Average monthly costs are determined by looking back one year from the date of the loan. An employer may use this loan to cover salaries, group health benefits, rent, utilities, and other specified expenses. Under the Act, however, the employer cannot use the loan to pay for other coronavirus-related benefits, such as paid leave under the Families First Coronavirus Response Act (FFCRA).

The Act gives the U.S. Small Business Administration (SBA) the authority to implement the program and make the loans available through existing lenders. The SBA will also waive standard fees and personal-guarantee requirements — no collateral is required. Instead, the SBA will require employers to certify that:

  • the employer needs a loan to support its operations;
  • the employer will use the loan to retain its workers, maintain payroll, or pay other qualifying expenses;
  • the employer does not have another application for the same purpose pending; and
  • the employer has not already received a loan covering the same period.

The loan comes with an interest rate of 4% or less but will be forgiven if the employer maintains its workforce for the covered period: February 15th, 2020, to June 30th, 2020. If the employer reduces its workforce during the covered period relative to last year, or reduces the salary or wages paid to an employee by more than 25%, the loan forgiveness will drop by the same percentage.

Small Business Debt Relief Program

For small businesses that currently already have non-disaster SBA loans, the CARES Act provides immediate relief for the carriers of those 7(a) loans, 504 loans, and microloans. Under the relief program, the SBA will cover all loan payments on these loans, including principal, interest, and fees, for six months. This relief will also be available to new borrowers who take out loans within six months of when President Trump signed the bill into law. Employers who are interested in applying for a 7(a), 504, or microloan can consult with the Small Business Administration for eligibility requirements.

Economic Injury Disaster Loans & Emergency Economic Injury Grants

Also under the CARES Act, small business owners in all U.S. states, Washington D.C., and territories are eligible to receive an Emergency Economic Injury Grant, which is an emergency advance of up to $10,000. First, however, employers must apply for an Economic Injury Disaster Loan (EIDL) and then they can request the advance. The advance does not need to be repaid under any circumstance, and may be used:

  • to keep employees on payroll;
  • to pay for sick leave;
  • meet increased production costs due to supply chain disruptions; or
  • pay business obligations, including debts, rent, and mortgage payments.

According to the SBA, employers requesting the advance can expect to receive it within three days of applying for an EIDL.

Mid-Sized Business Loan Program

It isn’t just small businesses that are covered under the CARES Act; there are provisions for mid-sized employers as well. Under the Act, mid-size businesses (those with 500 to 10,000 employees) can obtain a loan through the U.S. Treasury Department with no greater than a two-percent annualized interest rate, and no interest or principal payments for six months. This is to try and enable employers to retain at least 90 percent of their workforce, at full compensation and benefits, until September 30, 2020. One of the stipulations under this program, however, is that the borrowing employer must make a “good-faith certification” that they “will remain neutral in any union organizing effort for the term of the loan.” In other words, if a mid-sized company receives the loan, it is agreeing to waive its free speech rights and allow campaigns to unionize employees during the length of the full loan term. More information about this specific program should be released in the coming days.

For a full analysis of all the provisions under the CARES Act, the SBA has released a comprehensive guide for employers to better understand the new programs that are available to them.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Recent & Upcoming Compliance Deadlines and Effective Dates for Employers

As America’s business owners continue to cope with the harsh realities of the COVID-19 pandemic, it’s easy to lose sight of key dates and deadlines pertaining to workplace compliance.  Though federal guidelines can change, the following important effective dates and compliance deadlines have not yet been delayed or postponed due to the national health crisis:

March 16th, 2020 – The U.S. Department of Labor’s (DOL) final rule on joint employer status under the Fair Labor Standards Act (FLSA) officially took effect.  The final rule provides updated guidance for determining joint employer status when an employee performs work for his or her employer that simultaneously benefits another individual or entity, including guidance on the identification of certain factors that are not relevant when determining joint employer status.

April 1st, 2020 – The emergency paid sick leave provisions of the Families First Coronavirus Response Act (FFCRA) take effect for businesses with less than 500 employees on payroll.  The new law provides two weeks of paid sick leave related to COVID-19 for qualifying workers. Additionally, employers must post a new mandatory workplace poster regarding these provisions.

April 17th, 2020 – Enforcement of the FFCRA paid sick leave provisions officially begins on this date, according to a Field Assistance Bulletin issued by the DOL.   The agency had initiated a 30-day “stay” period regarding enforcement after the law was enacted on March 18th, 2020.

April 30th, 2020 – Employers must begin using the revised Form I-9 (version 10/21/19) for all new hires by no later than this date.  Prior to April 30th, the previous version (07/17/2017 N) was still acceptable for use.

Personnel Concepts will continue to notify and remind customers of important dates and deadlines as the nation’s business community continues to face challenges from the global pandemic.  We will also notify customers if any of these dates are postponed or changed.   Please continue to check our blog for the latest information.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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COVID-19 Paid Sick Leave is Now Law

On March 18th, 2020, President Donald Trump signed into law the “Families First Coronavirus Response Act,” or “Act,” which is legislation aimed to offer temporary emergency paid sick leave relief to employees affected by the COVID-19 virus.

Qualifying Conditions

Employees who work for the government or for a company with fewer than 500 employees, regardless of length of tenure, are eligible for paid sick leave under the Act if they meet at least one of the following conditions:

  1. The employee is subject to a federal, state, or local quarantine or isolation due to COVID-19;
  2. A health care provider advised the employee to self-quarantine due to concerns related to COVID-19 (self-imposed quarantine without medical advice does not qualify under the Act);
  3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  4. The employee is caring for an individual who is either subject to a federal, state, or local quarantine or isolation due to COVID-19 or has been advised to self-quarantine due to concerns related to COVID-19;
  5. The employee is caring for the employee’s child whose school has been closed or place of care is unavailable due to COVID-19 precautions; or
  6. The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretaries of Treasury and Labor.

Full-time employees will be entitled to 80 hours’ worth of paid sick time. Part-time employees will be entitled to the number of hours they normally work in a two-week period. In calculating the pay benefit, the Act allows the following:

  • For conditions 1, 2, and 3 (listed above), eligible employees will receive paid sick leave at their regular rate of pay, except that in no event the amount paid should exceed $511 per day and $5,110 in total.
  • For conditions 4, 5, and 6 (listed above), eligible employees will receive paid sick leave at two-thirds of their regular rate, except that in no event shall the amount paid exceed $200 per day and $2,000 total.

Paid sick leave under this Act does not carry over from year to year and being paid the sick time will stop beginning with an employee’s next scheduled work shift immediately following the original need for the paid time. The employer can seek reimbursement for the emergency wages paid to the employees through tax credits applicable to the employer’s portion of Social Security taxes.

Employer Requirements

Employers cannot require eligible employees to use other company provided paid leave first before using the new paid sick leave under the Act, which means that this leave is in addition to any paid sick leave or PTO currently provided by employers. Employers also cannot require employees to give advanced notice prior to the start of taking this paid sick leave. Employers can however require employees to follow reasonable notice procedures to continue receiving paid sick time after the first workday they are off.

Finally, employers must post a notice that advises employees of their rights under the Act. The United States Secretary of Labor is required to create a notice by March 25.  (Note: Once published, Personnel Concepts subscribers will receive this mandatory update automatically in both digital and print format).

Exclusions

The Act states that U.S. Department of Labor can exempt businesses with fewer than 50 employees from providing the paid emergency leave when it would jeopardize the business’ viability. Companies with more than 500 employees are also excluded from the paid leave regulation.

The new law takes effect on April 1st, 2020 and will remain effective until December 31st, 2020.

 


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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UPDATED: Key Links for Employers During the Coronavirus Health Crisis

Last Updated on 3/30/2020

As employers throughout the U.S. struggle to maintain their businesses, keep workers safe, and transition some employees to work-from-home arrangements in light of the coronavirus pandemic, various federal government agencies have posted useful resources to answer questions and provide essential guidance about relevant workplace laws and regulations.

From the U.S. Department of Labor (DOL) to the Cybersecurity and Infrastructure Security Agency (CISA), multiple agencies have established comprehensive coronavirus resource pages to help employers navigate this national health crisis.

Paid Sick Leave: The U.S. Department of Labor (DOL) has created an overview of paid sick leave requirements during the coronavirus pandemic.  Additionally, all businesses with less than 500 employees must post a newly required Families First Coronavirus Response Act (FFCRA) paid sick leave poster in the workplace.

Wage & Hour and Employee Leave:  The DOL’s COVID-19 resource center includes helpful guidance regarding wage & hour issues under the Fair Labor Standards Act during the pandemic, as well as Q&A’s on applying the Family and Medical Leave Act during any widespread health emergency;

Business Loans and Economic Assistance: In late March, to support businesses impacted by COVID-19, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The Act addresses business loans, unemployment benefits, retirement plans, tax credits, and executive compensation. Additionally, the Small Business Administration has established an online COVID-19 assistance page for businesses seeking economic relief during the global pandemic. Similarly, the IRS has established a Coronavirus Tax Relief web page.

Safety & Health Regulations:  OSHA’s safety and health web page addressing the coronavirus health crisis includes a useful overview of which OSHA standards and record keeping rules apply during the current pandemic;

Cybersecurity Concerns:  For employers shifting a portion of their workforce to work-from-home roles, CISA has posted a coronavirus resource page that includes cybersecurity alerts and guidance for telecommuting programs;

Medical Privacy: For employers with 15 or more employees who have to comply with the Americans with Disabilities Act (ADA), the Equal Employment Opportunity Commission (EEOC) has released guidance addressing reasonable accommodations, medical privacy issues, and temperature checks during the COVID-19 outbreak;

Military Leave (National Guard):  Employers with employees who are members of the national guard must follow the Uniformed Services Employment and Re-employment Rights Act (USERRA) if these employees are called into active duty.  The DOL’s Veterans Employment and Training Service (VETS) publishes a pocket guide on USERRA that includes a checklist for employers.

Essential Industries:  As stay-at-home directives come into effect or loom on the horizon for many communities, the State of Pennsylvania’s list of essential “life-sustaining businesses” can help companies in other states determine how likely they are to stay open during aggressive social distancing measures;

Cleaning & Disinfection Guidelines: The Centers for Disease Control & Prevention (CDC) has included recommendations on cleaning and disinfecting potentially infected areas on its existing employer preparedness resource page;

Approved Disinfectants: To aid in effective cleaning & disinfecting to prevent the spread of the virus, the Environmental Protection Agency (EPA) has released a list of disinfectants approved for use against SARS-CoV-2, the coronavirus that causes COVID-19.

Employers and their key managers should review these resources to ensure they understand the most current employment-related guidance, particularly when professional legal advice is not readily available.   These resources should also be regularly re-visited to check for any updates.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Revised Form I-9 Implementation Deadline is 4/30/2020

Employers who haven’t yet started using the latest version of the Form I-9 for new hires have until April 30th, 2020, to incorporate the revised form into their hiring process.

Back on January 31st, 2020, the United States Citizenship and Immigration Services Division (USCIS) published a Form I-9 Federal Register notice announcing a new version of Form I-9, Employment Eligibility Verification, that the Office of Management and Budget had previously approved on October 21st, 2019.

This latest version (version 10/21/2019) contains minor changes to the form and its instructions.  Per the Federal Register notice published in January, employers can continue using the prior version of the form (Rev. 07/17/2017 N) until April 30th, 2020.   After that date, businesses can only use the new form with the 10/21/2019 version date. The version date is located in the lower left corner of the form.

The only changes on the form itself were revisions to the Country of Issuance field in Section 1 and the Issuing Authority field (when selecting a foreign passport) in Section 2 to add Eswatini and Macedonia, North per those countries’ recent name changes. (Note: This change is only visible when completing the fillable Form I-9 on a computer.)  Changes to the instructions include clarifications regarding authorized employer representatives and acceptable documents.

Any employers who have not yet implemented the 10/21/2019 version must begin doing so by April 30th to ensure full compliance with I-9 documentation requirements.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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CDC Releases Interim Guidance for Employers on Coronavirus (COVID-19)

On February 26th, the U.S. Centers for Disease Control & Prevention (CDC) launched new interim resources to help employers prepare for and respond to the coronavirus (COVID-19) outbreak.   The new guidance addresses recommended best practices for preventing the spread of illness in the workplace and planning for how to address any known or suspected cases among employees.

The agency’s recommendations include the following fundamental steps:

  • Actively encourage sick employees to stay home
  • Separate sick employees
  • Emphasize staying home when sick, respiratory etiquette and hand hygiene by all employees
  • Perform routine environmental cleaning with products known to be effective
  • Advise employees before traveling to take certain steps
  • Keep your workers informed about known or suspected cases, but don’t violate medical privacy laws

Additionally, the guidance provides tips and resources for creating a comprehensive workplace response plan that includes temporary adjustment of workplace policies, flexible scheduling (including telecommuting), and social distancing.

The full guidance is available at the following link: https://www.cdc.gov/coronavirus/2019-ncov/community/guidance-business-response.html


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Final Rule on Joint Employer Status Takes Effect on March 16th, 2020

On January 20th, 2020, the U.S. Department of Labor (DOL) released a final rule that interprets joint employer status under the Fair Labor Standards Act (FLSA).

The final rule provides updated guidance for determining joint employer status when an employee performs work for his or her employer that simultaneously benefits another individual or entity, including guidance on the identification of certain factors that are not relevant when determining joint employer status.

Among other clarifications and provisions, the final DOL rule:

  • specifies that when an employee performs work for the employer that simultaneously benefits another person, that person will be considered a joint employer when that person is acting directly or indirectly in the interest of the employer in relation to the employee;
  • provides a four-factor balancing test to determine when a person is acting directly or indirectly in the interest of an employer in relation to the employee;
  • clarifies that an employee’s “economic dependence” on a potential joint employer does not determine whether it is a joint employer under the FLSA;
  • specifies that an employer’s franchisor, brand and supply, or similar business model and certain contractual agreements or business practices do not make joint employer status under the FLSA more or less likely; and
  • provides several examples applying the Department’s guidance for determining FLSA joint employer status in a variety of different factual situations.

The effective date of this final rule is March 16th, 2020.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Lipnic Won’t Seek Third Term on EEOC

Victoria Lipnic, a Republican first appointed by President Obama, has announced that she will not seek a third term as a commissioner for the Equal Employment Opportunity Commission (EEOC) after her current appointment ends on July 1.

Victoria Lipnic

With only three members currently serving on the agency, that would render the EEOC quorum-less and unable to issue rulings. However, she has indicated she would be willing to stay after her term if needed. If President Trump nominates a replacement, she can stay in her position for 60 days after July 1. If he doesn’t nominate anyone, she can stay until the end of the Congressional session.

The other two members on the commission are Chair Janet Dhillon, a Republican nominated by President Trump, and Charlotte Burrows, a Democrat and Obama appointee.

Before Chair Dhillon was confirmed by the Senate, Lipnic served as acting chair. With Chai Feldblum, a Democrat, she led a task force that created guidance on workplace harassment before Trump took office. She is still at odds with the Department of Justice (DOJ) in believing that Title VII of the Civil Rights Act of 1964 prohibits discrimination based on sexual orientation and gender identity.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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Retaliation Tops Charges Filed with EEOC in FY 2019

The Equal Employment Opportunity Commission (EEOC) has released detailed breakdowns for the 72,675 charges of workplace discrimination the agency received in fiscal year 2019. The comprehensive enforcement and litigation statistics for FY 2019, which ended Sept. 30, 2019, are posted on the agency’s website, which also includes detailed breakdown of charges by state.

eeoc-files-seven-sexual-harassment-lawsuits-#metooThe FY 2019 data show that retaliation continued to be the most frequently filed charge filed with the agency, followed by disability, race and sex. The agency also received 7,514 sexual harassment charges — 10.3 percent of all charges, and an  1.2 percent decrease from FY 2018.  Specifically, the charge numbers show the following breakdowns by bases alleged, in descending order:

  • Retaliation: 39,110 (53.8 percent of all charges filed)
  • Disability: 24,238 (33.4 percent)
  • Race: 23,976 (33.0 percent)
  • Sex: 23,532 (32.4 percent)
  • Age: 15,573 (21.4 percent)
  • National Origin: 7,009 (9.6 percent)
  • Color: 3,415 (4.7 percent)
  • Religion: 2,725 (3.7 percent)
  • Equal Pay Act: 1,117 (1.5 percent)
  • Genetic Information: 209 (0.3 percent)

These percentages add up to more than 100% because some charges allege multiple bases.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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OSHA Form 300A Injury and Illness Tracking Must Be Posted by Feb. 1

The Occupational Safety and Health Administration (OSHA) requires firms with 250 or more employees and those in high-hazard industries with 20 to 249 employees to post Form 300A in their workplace from Feb. 1 to April 30.

OSHA-form-3ooa-must-be-posted--by-Feb.-1The form summarizes work-related injuries and illnesses from the previous calendar year and must be posted in a conspicuous place.

In addition, the data on the form must be submitted to OSHA by March 2.


NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
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