As California continues to navigate the quagmire of reopening the state amidst an unrelenting global pandemic, Governor Gavin Newsom unveiled a new “Blueprint for a Safer Economy” (Blueprint) to determine when businesses can and cannot open. The new metric employs a color system, where each county is assigned a color based upon “risk-based criteria.” Under the system, lower risk activities or sectors can open sooner and high-risk activities and sectors cannot open until later phases. The scheme is as follows: Continue Reading California Unveils a New “Blueprint for a Safer Economy” to Manage the Pandemic
In response to the ongoing coronavirus (COVID-19) pandemic, U.S. Congress, the executive branch, and the Internal Revenue Service (IRS) have taken several actions intended to provide immediate relief to taxpayers. In prior updates, we summarized some of the actions taken in the last several months, including the tax provisions contained in the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Continue Reading Summary of Notice 2020-65: Deferral of Employee’s Portion of Social Security Taxes
On August 8, 2020, President Trump issued a memorandum directing the Secretary of the Department of Homeland Security to make available additional unemployment payments for those who lost their jobs as a result of COVID-19. Upon a grant from the Federal Emergency Management Agency, states and territories may choose to provide eligible claimants up to an additional $400 per week in unemployment benefits through December 27, 2020. Seventy-five percent of these additional benefits are funded through FEMA’s Disaster Relief Fund. The remaining 25% of the benefits are funded through state unemployment insurance programs. The $400 lost wage assistance replaces the $600 unemployment supplement provided for in the CARES Act, which expired at the end of July. Many states have applied for the additional assistance, and at least one state (South Dakota) has declined the assistance.
In its latest interim final rule (IFR #24) providing guidance under the Paycheck Protection Program (PPP), the Small Business Administration (SBA) provided clarification on two topics impacting borrowers that are preparing to apply for loan forgiveness and, in doing so, created new limitations on PPP loan forgiveness. A summary of this latest guidance follows.
Compensation Limits for Owner-Employees
The new guidance will help some small business owner-employees understand when their compensation is subject to special limits with respect to PPP loan forgiveness. As discussed in our prior client alert (see here), the SBA announced through FAQs that special limits apply with respect to loan forgiveness for loan proceeds used to pay compensation to owner-employees. These owner-employee restrictions impose both a lower cash compensation limit on owner-employees of borrowers who use the 24-week “covered period” for PPP loan forgiveness and certain categorical restrictions that differ from the treatment for ordinary employees. However, prior guidance did not specify any ownership threshold for these compensation limits, allowing speculation as to whether these limits would apply to any business owner, only owners of more than 20% of the business, or some other category of business owners. The new guidance provides as follows: Continue Reading SBA Provides Additional Guidance on PPP Loan Forgiveness for Owner-Employees and Landlords or Sublandlords
Since the beginning of the COVID-19 pandemic, hundreds of businesses of all sizes have been forced to file lawsuits against their property insurers for failing to honor their contractual obligations to provide business interruption, extra expense, civil authority, and other coverage for the substantial losses caused by the COVID-19 pandemic. Unfortunately, this onslaught of litigation has produced little progress thus far, leaving hundreds of business-owner plaintiffs and thousands more interested outside observers waiting for the funds they are rightfully owed.
This update discusses the lessons that businesses can learn from these early decisions and proposes guidance on how to generate meaningful progress towards timely resolution of such COVID-19 coverage disputes.
Misinformation is rampant in our current COVID-19 world. On this episode, Perkins Coie partners Ann Marie Painter and Jill B. Louis are joined by Carolee Estelle, M.D., an infectious disease specialist at UT Southwestern Medical Center and Parkland Hospital in Dallas, Texas, who provides some straight answers about the COVID-19 virus, what we know about its transmission and effect on the body, and how best to avoid spread in the workplace.Listen Here
On August 12, 2020, the U.S. Department of State released implementation guidance related to two recent presidential proclamations restricting visa issuance and travel for foreign workers. (Presidential Proclamation 10014 and Presidential Proclamation 10052). In implementing these proclamations, the Department of State, in conjunction with the Department of Homeland Security, released guidance related to national interest exceptions set out in the presidential proclamations. Continue Reading U.S. Department of State Clarifies Travel Restriction National Interest Exception
On April 1, 2020, the United States Department of Labor (DOL) promulgated its Final Rule implementing the Families First Coronavirus Response Act (FFCRA). The FFCRA requires covered employers to offer emergency paid sick leave (EPSLA) and emergency family and medical leave (EFMLEA) to employees under various circumstances related to the COVID-19 pandemic, summarized in more detail here.
Since implementation, employers have scrambled to understand their obligations under the FFCRA and to provide the leave required under the new legislation. Shortly after the DOL issued its regulations, the State of New York filed a lawsuit in the Southern District of New York, State of New York v. United States Department of Labor, Case No. 20-CV-3020 (JPO), and simultaneously moved for summary judgment, attacking various requirements set forth in the regulations. On April 28, 2020, the DOL cross-moved for summary judgment and to dismiss for lack of standing.
While debates in Congress continue regarding extending or providing additional COVID-19 relief legislation, the Small Business Administration (SBA), U.S. Department of Treasury (Treasury), and lenders under the Paycheck Protection Program (PPP) are preparing for the next wave of activity for PPP loans. Specifically, the deadline to obtain a PPP loan is tomorrow, August 8, 2020. In addition, other key milestones related to PPP loan forgiveness are rapidly approaching. The SBA previously announced that it intends to make an electronic portal available on August 10, 2020 to begin processing PPP loan forgiveness applications, and on August 4, 2020 the SBA and Treasury released new FAQs regarding loan forgiveness. The new FAQs largely reiterate prior guidance but include some clarifications that may impact borrowers’ applications for loan forgiveness. Highlights of these developments and key reminders regarding the loan forgiveness process are provided below. Continue Reading New Guidance Issued Regarding PPP Loan Forgiveness in Advance of Opening of the SBA’s Loan Forgiveness Portal
On July 24, 2020, the California Department of Public Health (CDPH) published its 33-page COVID-19 Employer Playbook for a Safe Reopening. The Playbook “provides guidance for employers to help them plan and prepare for reopening their business and to support a safe, clean environment for workers and customers.” The Playbook does not supplant existing employer obligations or employee rights. In preparing and continuing any reopening plans, employers should pay particular attention to the Playbook’s guidance on managing an outbreak of COVID-19 at the workplace, which includes actions employers should take to prevent further spread of the virus in the event a case has been identified. Finally, the Playbook includes helpful resources, including a summary of relevant regulations and guidance for reporting identified COVID-19 cases, leave requirements for affected employees, and information on enforcement and compliance.
Among other helpful tips, the Playbook states that, before reopening, employers must implement a plan that is specific to their workplace:
Before reopening, all facilities must:
- Perform a detailed risk assessment and create a work site-specific COVID-19 prevention plan
- Train workers on how to limit the spread of COVID-19. This includes how to screen themselves for symptoms and when to stay home
- Set up individual control measures and screenings
- Put disinfection protocols in place
- Establish physical distancing guidelines
- Establish universal face covering requirements (with allowed exceptions) in accordance with CDPH guidelines.
Employers should also review the CDPH and Cal/OSHA industry-specific guidance and checklists designed to meet the needs of distinct industry sectors.
Employers with questions about the Playbook or other issues arising out of the pandemic should consult experienced counsel.