Monthly Archives: June 2020

Paid Medical Leave Eligibility For COVID-19

The Families First Coronavirus Response Act established the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family and Medical Leave Expansion Act (EFMLEA). Effective April 1, 2020, through Dec. 31, 2020, the EPSLA requires certain employers to provide paid sick leave to employees who are unable to work or telework under certain circumstances EFMLEA provides paid family leave to employees to take care of a son or daughter in the event of a school closure or their child care provider is unavailable due to COVID-19.

Need to know if you or your employee are eligible to take advantage of this paid leave? The Department of Labor (DOL) has launched an online tool to help workers determine if they are eligible for paid leave for Covid-19 under that act. To access the DOL tool click the link below.

https://www.dol.gov/agencies/whd/ffcra/benefits-eligibility-webtool

We’re Here When You Need Us

Steve & his crystal ballAs things start to get back to the new normal, many employees and business are wondering what is next. A quick look into our crystal ball shows that while it is hard to see what lays around the bend, it’s more important that ever to be prepared for the unexpected.

Many of our clients have had to learn to work from home, ignoring distractions and sharing internet connections along with work space with children that were dealing with distance learning for the first time. While governors told us what businesses and employees were “essential” and “non-essential”.

The truth is that every business and every employee is essential. Every business is essential to those who invested their hard-earned money, the people that work in the business, and the customers that support them. In this new world it is more important than ever to support the local businesses that invest in our community, employ our friends and neighbors, and provide the products and services we have come to rely on.

Many businesses are still suffering the effects of shut down, curfews, and forced reduced capacity. This is exasperated by increased expenses to assure the public that it is safe to return. These expenses include additional cleaning supplies and staff, protective gear, such as gloves and masks, and even erecting safety shields between customers and employees.
While these challenges are unique, this is not the first time the business owners we work with have faced challenges and I am certain it won’t be the last time. For many years we have helped businesses and individuals not just survive challenging times but grow and prosper in spite of them.
Through all these challenges we have been here for our clients and friends, to answer your questions, provide the latest information on government programs, and provide support.

(SBA) issued a new interim rules on PPP – June 16, 2020

The Small Business Administration (SBA) issued a new interim rule on June 16, providing clarity on changes regarding the PPP. Specifically, the new rule gives detail on the amount of payroll costs that can be forgiven on a tax-free basis now that the covered period has been extended to 24 weeks.

This interim final rule also clarifies how much of the borrowers PPP loan can be spent on owner compensation within the new 24 week period.

The new rule states that companies can spend up to $46,154 per individual on payroll costs over the extended 24-week covered period to qualify for loan forgiveness. Payroll costs include covered benefits for employees ONLY, not owners, and can include healthcare expenses and retirement contributions.

This latest interim final rule also clarifies how much of the borrowers PPP loan can be spent on owner compensation within the new 24 week period. According to the rule, the amount permitted to be spent on owner compensation by individuals with self-employment income who file a Schedule C or F is determined based on eight weeks of 2019 net profit up to $15,385, or two and a half months of 2019 net profit up to $20,833 for a 24-week covered period.

In clarifying this issue SBA and Treasury stated … “This approach is consistent with the structure of the CARES Act and its overarching focus on keeping workers paid, and will prevent windfalls that Congress did not intend,” further explaining that “Specifically, Congress determined that the maximum loan amount is generally based on 2.5 months of the borrower’s average total monthly payroll costs during the one-year period preceding the loan.”

For example, a borrower with only one other employee who received a loan for two and a half months of his payroll plus two and a half months of payroll for the employee, for a total loan amount of five months of payroll. The government stated that without the new rule, that owner could theoretically lay off that employee, use a safe harbor in the new law, treat the entire amount as payroll, and have it forgiven.

“This would not only result in a windfall for the owner, by providing the owner with five months of payroll instead of 2.5 months, but also defeat the purpose of the CARES Act of protecting the paycheck of the employee,” the government said. “For borrowers with no employees, this limitation will have no effect, because the maximum loan amount for such borrowers already includes only 2.5 months of their payroll.”

SMALL BUSINESS ADMINISTRATION  13 CFR Part 120 [Docket No. SBA-2020-0037]  06/16/20
Business Loan Program Temporary Changes; Paycheck Protection Program – Revisions to
the Third and Sixth Interim Final Rules  (Full Text)