Loans and Taxes and CARES, oh my!
April 1, 2020 COVID Employer, Worker and Job Seeker assistance blog.
Wow, a lot has happened since my first/last FAQ I sent out Friday March 27. (It can be found with some updates here: http://strauss-hr.com/blogs.) What a week it’s been for emerging information on the myriad acts and rules and orders and programs and benefits and bills and loans and taxes and credits and regulations and data. There is a lot available which means there is a lot to navigate. Let’s all take a collective deep breath (inhale) and look at some facts (exhale).
After you read this, register for this FREE webcast to battle overwhelm and give you a boost of optimism and creative problem solving through these challenges. It’s based on TRP® Becoming the Totally Responsible Person https://www.eventbrite.com/e/moving-forward-applying-trp-in-uncertain-times-tickets-100068589846 Future webcasts scheduled for April 2, 7 and 9, all at 2pm Eastern.
Q: What unemployment benefits are in the $2 trillion Federal stimulus package the president signed into law Friday March 27 for workers?
A: The Coronavirus Aid, Relief and Economic Security Act (CARES) includes a temporary Pandemic Unemployment Assistance program which provides workers the following unemployment benefits:
· $600 for four months on top of state unemployment benefits through the end of the year. (See my last FAQ for NM benefits info http://strauss-hr.com/blogs)
· It also makes state and federal unemployment benefits available to independent contractors, the self-employed and those who haven’t hit the minimum hours (have a limited work history).
· Workers who are furloughed (temporarily laid off) can collect unemployment while remaining on shuttered employers’ books, then they can be easily brought back on once the business re-opens.
· It also provides up to 13 more weeks of payments to workers whose state benefits end before they can return to work.
Q: What is the Paycheck Protection Program and who is it for?
A: The PPP is a loan program that incentivizes struggling small- and medium-sized businesses to continue paying workers and providing benefits by helping to cover salaries, insurance, rent and other business costs:
· Employers with fewer than 500 workers would be forgiven (acts like a grant) the amounts they put into payroll costs and mortgage payments and interest for eight weeks after loan origination, with some limitations. This forgiveness is also available to businesses that rehire workers who have already been laid off.
· The bill also provides non-forgivable loans (you have to pay it all back) to businesses that reasonably maintain their current staffing through September.
(Source: https://www.law360.com/articles/1256933)
· Employers can borrow up to 2.5 months of payroll.
· It should be announced where to get loans by the end of this week. The goal is for most small businesses to go to their normal lender/bank.
· Beware of unknown resources that say they can fulfill your loan request now, as these are possibly opportunistic fraudulent claims.
(Source: NMACI and US Chamber of Commerce webinar March 31)
Q: Where is my stimulus check for $1,200?
A: A payment of $1,200 for single taxpayers ($2,400 joint) with income up to $75K ($150K joint) will be on the way as provided under the CARES Act. Plans for how and when those payments will be delivered are still coming together. Is it based on my gross or net income? What if I haven’t filed yet for 2019 – what will it be based upon? What if you earn over $75K? Find out here: https://www.cnbc.com/2020/03/31/coronavirus-stimulus-checks-answers-to-your-most-pressing-questions.html
Q: What is the option for employers to defer payroll taxes and is it worth it?
A: The CARES Act grants employers the option of deferring their share of this year’s Social Security payroll taxes (= 6.2%) until next year and 2022. While deferring payroll taxes in the present may provide businesses with cash on hand, they will need to be paid later. It may also interfere with a business’s ability to take advantage of the PPP. Sole proprietors, you can take advantage of this deferral. Talk to your payroll administrator, or the software company you use for payroll, or talk to a tax accountant.
Q: What is available in the Albuquerque Micro-Business Relief program?
A: The City of Albuquerque Economic Development Department is offering up to $5K for qualifying small business in ABQ with up to five employees that are seeing a reduction in revenue because of COVID-19. Funds can be used for day-to-day operating expenses, such as payroll or losses. There are further eligibility requirements and restrictions.
(Source: https://www.cabq.gov/economicdevelopment/small-business/micro-business-relief-program)
Q: What is the Employee Retention Credit?
A: It is part of the CARES Act and is designed to encourage Eligible Employers to keep employees on their payroll, despite experiencing economic hardship related to COVID-19. It is available if you shut down or lose business. Businesses may get a refundable credit of 50% of wages on first 10K of wages if you continue to pay employees. For employers with 100 employees or less, whether they are working or not, you can take advantage of the credit, unless you take a payroll protection (PPP) loan. (Source: https://www.law360.com/articles/1256933)
Q: What is the benefit to employers of paying sick leave under the Families First Coronavirus Relief Act (FFCRA)?
A: The FFCRA requires certain employers to pay sick or family leave wages to employees who are unable to work or telework due to certain circumstances related to COVID-19 (See last FAQ http://strauss-hr.com/blogs). Employers are entitled to a refundable tax credit for the required leave paid, up to specified limits. The same wages cannot be counted for both the Employee Retention and the FFCRA credits. (Source: https://www.law360.com/articles/1256933)
Q: If a worker is unable to work because of the order applicable to all of NM, and no telework is available to them, should they get the 10 days sick pay, and will the employer get the credit for providing it? Does NM’s “Stay at Home” order means NM employees are considered “quarantined” for the purposes of the FFCRA paid leave regulation and due the paid sick leave?
A: This one stumped some experts until the Department of Labor issued a temporary rule today (April 1.) The answer is no. “A cashier previously employed at the coffee shop who is subject to a stay-at-home order would not be able to work even if he were not required to stay at home. As such, he may not take paid sick leave because his inability to work is not due to his need to comply with the stay-at-home order, but rather due to the closure of his place of employment.” (Source: Danny Jarrett of Jackson Lewis and https://www.dol.gov/sites/dolgov/files/WHD/Pandemic/FFCRA.pdf)
Q: The FFCRA said employers should post information about the Act, however the office is closed, so where am I supposed to post it?
A: You can email the poster to employees or post on your intranet etc., however they are most likely to see it. Link here: https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf
Q: Since this is a “disaster,” what about the old 9-11 Disaster Relief tax law?
A: Section 139 — added to the Code after the September 11th attacks of 2001 — allows employers to make “qualified disaster relief payments” to employees to assist the employees in managing the COVID-19 crisis. The payments are tax-free to the employees, and fully deductible to the employer. Talk to a tax accountant. Also look into the Economic Injury Disaster Loan (EIDL) by reaching out to your local Small Business Development Center (SBDC). (Source: https://www.forbes.com/sites/anthonynitti/2020/03/23/little-known-tax-law-allows-employers-to-make-tax-free-payments-to-employees-to-cover-covid-19-expenses/#184e39c14cfc)
Q: I love big data and am curious about what’s going on around the country. How is all of this generally impacting other U.S. businesses and workers?
A: I participated in a Society for Human Resource Management (SHRM) volunteer leader sneak peak presentation of data they are releasing to the press April 1. See what their survey revealed: https://shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Documents/SHRM%20CV19%20Research%20Workforce%20Implications.pdf
Q: As an employer, I’m struggling with benefits questions right now and can’t find answers. How can I get help?
A: If you have an insurance broker, now is the time to leverage all of their knowledge and expertise; call them. If not, call the insurance company itself. If Google, your broker or your insurance company can’t help, NM broker Anne Sperling has offered to help employers where she can. She can be contacted at annesperling@vanguardresourcesinc.com
Q: I’m an individual struggling with benefits questions right now and can’t find answers. How can I get help?
A: Individuals who have a dedicated internal HR person who handles benefits for their company should contact HR. You may also call your payroll administrator or insurance company directly. If you don’t have and need individual insurance, look into Medicaid or getting benefits via the public exchange. Start by getting online with www.bewellnm.com.
Q: We are an essential employer in NM and employees are allowed to come to work. Can we talk to employees about whether they have COVID-19, we think they have it, or are at-risk?
A: According to the Equal Employment Opportunity Commission (EEOC) you may ask employees if they have it, are having related symptoms, or have been in contact with anyone who has it and may bar them from work if so. It is a best practice to ask all employees at the beginning of their shift (such as Walmart recently reportedly enacted) and not to target employees. An exception would be if a specific employee is exhibiting symptoms based on factual and objective evidence, then you may ask just that employee and not all. You may not exclude or target for lay off people in higher risk groups (older, certain pre-existing conditions, pregnancy, etc.) from coming to work due to them being in one of these protected classes. Grant any reasonable accommodations to those who need them due to medical conditions and risk of exposure. (Source: U.S. Equal Employment Opportunity Commission webinar addressing questions re Federal Equal Employment Opportunity Laws and the COVID-19 pandemic.
Q: If an employee who has recently reported or is reporting to work has COVID-19 symptoms or a diagnosis, who can I tell without breeching confidentiality?
A: If an employee is aware that a co-worker has COVID-19 or symptoms, it is not a breach of confidentiality to, and employees should be encouraged to, disclose this to management so the threat can be removed. However, the CDC and the EEOC advise that employers should make every effort to limit disclosing the name of the person. Get a list of those with whom the employee has come into contact and let them know while keeping the employee’s name confidential. The Americans with Disabilities Act (ADA) permits the employer to report this to public health agencies as they may be a direct public health threat. (Source: U.S. Equal Employment Opportunity Commission webinar addressing questions re Federal Equal Employment Opportunity Laws and the COVID-19 pandemic. https://www.youtube.com/watch?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=&v=i8bHOtOFfJU)
Q: My workplace is becoming uncomfortable due to consistent talk at work about Asians causing the pandemic. What should I do?
A: Nip it in the bud! Harassment based on national origin, ancestry, color, and/or race is prohibited and illegal in the workplace in NM, and likely a breach of many employers’ workplace respect/conduct policies. The “workplace” for these purposes also covers remote work such as communications over teleconference, web conference, email etc. The target or audience does not need to include an Asian person in order for one egregious comment/action or several comments/actions over time to possibly create an illegal hostile work environment. It should be reported to management and treated the same and as seriously as any other form of workplace disrespect or harassment.