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At-Home COVID-19 Testing Options and Alternatives

January 20 - Posted at 8:17 AM Tagged: , , , , , , ,

In fulfillment of President Biden’s promise to make at-home COVID tests more available for all of us, two significant action steps have now occurred:

  1. Every U.S. household has access to free at-home COVID-19 tests. As of January 18, 2022, any individual with a residence in the United States may request up to four (4) at-home COVID test kits.  There is no cost to register or for the kits themselves.
  1. At-home COVID-19 testing is available at no cost without a prescription under an employer’s group health plan. On January 10, 2022, the Department of Labor (DOL) released updated guidance and an FAQ that, as of January 15, 2022, now extends an employer’s obligation to cover all types of COVID-19 tests, between those performed or prescribed by a physician or other health care provider,  and for in-home COVID-19 tests provided without a doctor’s order.

Key Points:

All group health plans and insurance carriers must now cover the cost of at-home COVID-19 test kits, passing none of that cost to employees or individuals covered under the plan, and without requiring a medical diagnosis or prescription from a health care provider.

  • The plan or insurer need not provide this coverage to employees not covered under the employer’s plan.
  • For these purposes, the coverage can be provided through an employer’s medical plan, pharmacy benefit plan/PBM, or both. Employers should discuss the options and costs for administering this arrangement under their particular plan with their brokers and consultants or insurance carriers.
  • The guidance allows a plan or insurer to meet this coverage obligation in one of two ways:
    • The plan can work with its insurance carrier or third-party claims administrator (TPA) to create “direct contract” arrangements with retailers (e.g., Walmart, RiteAid, Walgreens, etc.) and other insurance network providers to provide COVID tests to covered individuals at no cost to the individual at the counter; costs are negotiated and paid between the plan/insurer/TPA with the retail service provider directly.
    • Individuals can also purchase COVID tests through any other resource and submit the receipt for reimbursement through the plan or insurer’s established process, either through the insurance carrier, TPA or PBM. The maximum amount to be paid in reimbursement is the lesser of: (a) the actual cost of the COVID test; or (b) $12 per test (note: if the COVID kit comes with two tests, the cost to be reimbursed would be per test or a maximum of $24).  The plan or insurer does not have to reimburse for COVID tests purchased before January 15, 2022.
    • Suppose a plan or issuer is unwilling or unable to satisfy the above criteria in providing the opportunity to receive COVID testing coverage under either of the above criteria. In that case, the plan or issuer must still provide reimbursement of at-home COVID tests without the above cost limitations.
  • The plan or insurer can limit the total number of COVID tests to 8 per person per month (or 4 kits if the kit includes two tests). A separate limit applies for each covered family member (e.g., a family of 4 could receive up to 32 tests per month (or 16 kits, if it includes two tests each).  There is no annual maximum limit.
  • An individual need not provide proof of medical need, but the plan can require the individual to attest that they are purchasing only for personal use (not for resale).
  • Employers are encouraged to communicate to all covered individuals about the alternatives available and processes for seeking reimbursement of purchased tests.
  • The obligations for coverage of at-home COVID tests remain in effect for at least the remainder of the Public Health Emergency period, which has now been extended to at least April 15, 2022.
  • COVID testing and other related costs provided at a health care provider or other health care facility as part of a medical assessment must still be covered 100 percent by the plan or issuer without being subject to the test or cost limits that apply for over-the-counter COVID tests, under previous guidance under the CARES Act, and the First Families Coronavirus Response Act (FFCRA).

 

The Feds Are Coming, Is Your Business Ready? Part 2: FFCRA

June 14 - Posted at 9:00 AM Tagged: , , , , , ,

This is the second in our four-part series designed to let you know what changes have taken place that may affect your business. AAG is a benefit brokerage that specializes in working alongside an employer’s Human Resource/Management Team to assist with keeping companies in compliance with the ever-changing state and federal regulations. 

The Family First Coronavirus Response Act (FFCRA) was amended earlier this year under the American Rescue Plan Act (“ARPA”). The amended act encompasses the same covered categories as the Federal law required last year with some expansions, options, and more room for abuse. 

If you are a private employer with less than 500 employees, you have the option to voluntarily extend FFCRA paid leave from April 1, 2021 through September 30, 2021 and receive a tax credit. However, you must proceed with caution because the rules have changed and if not followed you may not be eligible for the tax credit.

In addition to the previous six reasons for emergency paid sick leave (EPSL) under the FFCRA, if an employer chooses to offer, you must allow for the following three reasons:

  • An employee seeking or awaiting results of a COVID-19 test or diagnosis;
  • An employee obtaining a COVID-19 vaccine;
  • An employee recovering from an injury, disability, illness, or condition related to the COVID-19 vaccine.

The change also includes 10 new days of available leave effective April 1, 2021. If an employee took 80 hours of EPSL leave prior to April 1st, they will be eligible for a new bank of paid leave after April 1, 2021. 

The emergency family medical leave (EFML) under the FFCRA also has some key changes to be aware of:

  • Includes “all” of the EPSL reasons for leave, including the 3 additional reasons
  • Expanded to include the first 10 days of leave and increases the maximum paid leave over 12 weeks from $10,000 to $12,000

Employers will not have the option of whether to apply the new reasons for leave or the fresh 10-day bank. Should you decide to offer EPSL to employees, it must be offered completely and available to all employees. Strict compliance is required in order to be eligible for the tax credit.

As the world continues to open and more employees return to work, changes to these paid leave revisions will no doubt continue. With AAG on your side, you can focus on your employees while we stay on top of required changes and keep you informed! If you have any questions or would like additional information please reach out, we are here to help!

Intro to New 4 Part Series of Myra’s Minutes

June 03 - Posted at 8:45 AM Tagged: , , , , , , , ,
Business owners and HR professionals alike say that it’s nearly impossible to keep up with all the changes, but as the Employer Advocate, we’re here to help. AAG has compiled a series of informative videos and articles to help your business navigate the upcoming changes.

Check out the intro to our newest 4 part series of Myra’s Minutes 
here!

President Biden’s latest COVID-19 stimulus package – the American Rescue Plan – has been passed by Congress and will become law once the president signs it into effect this Friday (3/12/21). The measure provides $1.9 trillion in economic relief, with many of the specific items directly affecting employers. What do businesses need to know about this finalized legislation?

What Is Not Included In The American Rescue Plan?

Before examining the areas of law that changed, it is just as important to review portions of the initial proposal which were not included in the final version signed by the president. The three most critical pieces NOT included:

  • $15 Minimum Wage: Despite House passage of a bill including a minimum wage hike and efforts by Senator Bernie Sanders and others, the Senate (with bipartisan support) removed the minimum wage provisions from the American Rescue Plan before sending it to Biden for signature.
  • Elimination of Tip Credit: Though it has gotten little press, buried in the provisions to raise the minimum wage was language which would have phased the tip credit out of existence. Hospitality employers hope this is more than a temporary reprieve.
  • Paid Leave: The White House originally planned for the plan to include paid leave for employees needing to be absent for COVID-19 reasons, including to get vaccinated or to recover from side effects related to the vaccination. These paid leave benefits were not included in the House bill and were not added as the bill proceeded.

What You Should Do: While these provisions did not make it into the final American Rescue Plan, the White House and Democratic leaders have stated their intent to introduce new legislation in the future to fulfill these campaign promises.

Extension Of FFCRA Tax Credits

The federal Families First Coronavirus Response Act (FFCRA) expired on December 31, 2020 – and with it, covered employers’ obligation to provide emergency paid sick leave and emergency family and medical leave. Shortly before the end of the year, Congress extended the tax credit for employers who voluntarily continued to provide such paid leave through March 31, 2021. 

President Biden’s original vision for the American Rescue Plan proposed to extend and expand emergency paid leave obligations in several key areas. However, the House version of the current COVID-19 relief bill does not extend the employer obligation to provide paid leave. Instead, the legislation merely extends the tax credit for voluntary provision of leave through September 30, 2021 and makes related changes. These provisions of the relief bill include the following:

  • Extends the tax credits available for employers who voluntarily provide FFCRA leave from March 31, 2021 to September 30, 2021.
  • Provides that the tax credits are available for paid sick leave and paid family leave provided for the additional following qualifying reasons:
    • the employee is obtaining immunization (vaccination) related to COVID-19;
    • the employee is recovering from any injury, disability, illness or condition related to such vaccination; or
    • the employee is seeking or awaiting the results of a diagnostic test or medical diagnosis for COVID-19 (or their employer has requested such a test or diagnosis).
  • Adds non-discrimination rules to provide that no tax credit is available if the employer, in determining availability of the paid leave, discriminates against highly compensated employees, full-time employees, or employees on the basis of tenure with the employer. This provision appears designed to compel employers who make the decision to voluntarily provide leave do so in a uniform manner, without discriminating against certain categories of workers.
  • Re-sets the 10-day limit for the tax credit for paid sick leave under the FFCRA beginning April 1, 2021. As a result, an employer could voluntarily provide an additional 10 days of FFCRA paid sick leave beginning April 1, 2021, and would be eligible for a tax credit for doing so. But employers are not required to do so.

Even though the current legislation does not extend the employer mandate to provide paid FFCRA leave, this is likely not the last conversation on this topic. There are indications that the Biden administration may attempt to resurrect pieces of the American Rescue Plan that did not make it into this bill into subsequent legislation in the near future.  

What You Should DoDetermine which, if any, state and local paid sick leave laws may apply to you as many have been extended beyond the December 31, 2020 expiration of the FFCRA paid leave mandate. In addition, you should continue to monitor developments at the federal level. Although an extension of paid leave was not included in this stimulus package, it is still on the Biden administration’s and many members of Congress’s “to do” list. We could see new leave mandate proposals in the immediate future, so this will be one area to watch closely.

Boost For Vaccine Efforts

The American Rescue Plan provides over $15 billion aimed toward enhancing, expanding and improving the nationwide distribution and administration of vaccines, including the support of efforts to increase access, especially in underserved communities, to increase vaccine confidence and to fund more research, development, manufacturing, and procurement of vaccines and related supplies as needed. The upshot? We may see the widespread proliferation of vaccine availability even earlier than expected.

What You Should Do: Despite developments indicating that vaccines are likely to become much more widely available in the short term, many employers remain unprepared to deal with related issues. Those issues include not only the initial administration process, but also the extent to which the greater prevalence of vaccinated employees may (or may not) affect your safety protocols in terms of mask mandates, physical distancing, and related rules. 

Relief For Small Businesses

The American Rescue Plan Act provides additional funding for small businesses, with a focused effort on those in hard-hit industries like restaurants and bars. The new bill provides $25 billion for a new Small Business Administration program focused on supporting restaurants and other food and drinking establishments. These grants are available for up to $10 million for those eligible and can be used to pay expenses like payroll, mortgage, rent, utilities, and food and beverages.

The bill provides an additional $7 billion for the Paycheck Protection Program, which provides small businesses with the potential for 100% forgivable loans. The additional PPP funding brings the total for the current round of the program to over $813 billion. Likewise, both bills expand PPP eligibility for certain nonprofit organizations.

The new law also provides $15 billion to the Economic Injury Disaster Loan (EIDL) Advance program designed to provide economic relief to businesses currently experiencing a temporary loss of revenue due to COVID-19. Like the PPP, the EIDL program is administered through the SBA to help qualifying businesses meet financial obligations and operating expenses that could have been met had the disaster not occurred. Priority funding is also allocated to businesses with less than 10 employees that the pandemic has severely impacted.

Finally, the law includes funding under the Shuttered Venue Operators Grant (SVOG) program, which had previously appropriated $15 billion in the December 2020 stimulus package. Eligible entities for the SVOG include live venue operators or promoters, theatrical producers, live performing arts organization operators, museum operators, motion picture theatre operators, and talent representatives. Eligible entities for the SVOG program can also qualify for loans under the PPP.

What You Should Do: If you’re a small business operating in a hard-hit industry such as the hospitality sector, you should quickly determine eligibility for funding. Even if you’re not a bar or a restaurant, you might still be eligible for economic assistance through the various grants or loan programs detailed in the plan if the COVID-19 pandemic has severely impacted your business.  

Unemployment Benefits

President Biden considers it imperative that workers impacted by the pandemic not lose out on emergency enhanced unemployment benefits, but the expanded unemployment assistance under the CARES Act and Stimulus 2.0 are set to expire soon in mid-March. Without an extension, millions of unemployed Americans impacted by the COVID-19 pandemic would be impacted. Luckily, both the House’s and Senate’s versions of the American Rescue Plan increase and further extend these unemployment benefits. However, there were some key differences between the two versions of the proposal, and the finalized version differs from the initial proposal.

The finalized legislation retains the $300 per week unemployment benefits, however, the version signed into law extends these benefits until September 6, which is more in alignment with Biden’s proposed outline for the American Rescue Plan. 

Another major change related to the unemployment benefits in the finalized version is the addition of a provision making the first $10,200 in unemployment received in 2020 non-taxable for households with incomes under $150,000. This provision will go a long way to address the looming concerns for the millions of Americans currently on unemployment insurance.

What You Should DoThere is not much for employers to do in response to this provision of the bill, as it is primarily geared toward workers. However, it is important to understand the lay of the land in terms of unemployment insurance, as certain industries may face obstacles in hiring for certain positions for the time being. You should be aware that the benefits will expire on September 6 and adjust your hiring plans accordingly.

Stimulus Payments

The American Rescue Plan means that the federal government will send $1,400 stimulus checks on top of the $600 payments issued through the December stimulus bill. Under the structure agreed to during lawmaking negotiations, the payments will phase out at a quicker rate for those at higher income levels compared with the initial proposal floated by President Biden. Those earning $75,000 per year and couples earning $150,000 will still receive the full $1,400-per-person benefit but those earning more than $80,000 and couples earning more than $160,000 will not be eligible.

Tax Credits And Benefits

The bill expands three important tax credits: the child tax credit, the earned income credit, and the employee retention credit. The bill also increases certain health and pension benefits.    

  • The bill increases the child tax credit from $2,000 per child under age 17 to $3,000 for those age six through 17 and to $3,600 for those under age 6. Currently, the credit phases out at $200,000 for single tax return filers and $400,000 for joint filers. The new bill lowers those thresholds to $75,000 and $150,000 respectively. Another key provision makes the credit fully refundable – meaning that those who pay little or no taxes will still be able to take full advantage of the credit. Recipients can receive monthly installments (which would facilitate paying monthly living expenses) or a lump sum.
  • The earned income credit for lower income taxpayers has also been expanded. The amount has nearly tripled and the minimum age to claim to the credit is reduced from 25 to 19. No upper age limit is imposed under the new bill.
  • The employee retention credit (ERC) is extended through December 31, 2021. It also is expanded to include certain start-up businesses (with an ERC capped at $50,000 per quarter) that otherwise would not have qualified for the ERC.

The bill also provides for a 100% COBRA premium subsidy effective April 1 through September 2021 for those who are involuntarily terminated and want to remain on their employer’s health insurance. The employer would pass along the subsidy so that qualifying individuals would pay nothing for their COBRA coverage during this period.   

Finally, the bill expands the class of those who are entitled to help with the cost of their insurance under the Affordable Care Act. Consumers would be able to receive assistance if their premiums exceed 8.5% of their incomes rather than the current income cutoff of $51,000. The bill provides over $24 billion to shore up childcare facilities which have been hit particularly hard by the pandemic. It provides help to childcare workers making less than $12 per hour. 

Conclusion

We will keep a close eye on further legislative proposals and provide updates as warranted.

What Employers Need To Know About Latest Federal COVID-19 Stimulus Package

December 24 - Posted at 8:34 AM Tagged: , , , , , , , , , , , , ,

Federal lawmakers agreed to a second round of stimulus legislation late Monday night, sending a nearly 6,000-page bill to President Trump for his expected signature. The proposal allocates $900 billion in economic relief to businesses and workers across the country. Of the many provisions tucked within the mammoth bill are several key provisions of interest to employers. Specifically, the proposal continues the popular small business loan program, provides new options for unemployed workers, extends tax credits for continued paid sick leave, and offers a variety of other tax- and benefit-related provisions. It does not, however, create a liability shield for COVID-19 litigation. What do you need to know about the critical workplace-related portions of Stimulus 2.0? Here are summaries of the most significant employment-related provisions and recommendations for actions you should consider as a result of each.

Continuation Of The Paycheck Protection Program

Foremost in the eyes of many businesses, Stimulus 2.0 apportions approximately $284 billion to a revamped Paycheck Protection Program (PPP). It provides small businesses with much-needed financial support in the form of potentially forgivable loans equal to the total money spent on payroll and other specified costs during an eight or 24-week period after the disbursement of the loan. However, the Stimulus 2.0 program makes many critical changes from the previous PPP, including lowering the employee threshold for businesses to 300 employees or fewer (down from 500), and the loan maximum to $2 million (down from $10 million). What do potential borrowers need to know?

Tax Deductibility of Expenses

The first PPP iteration provided that the forgiven amount was tax-free, but the Internal Revenue Service (IRS) ruled that the expenses paid with forgiven PPP loan proceeds were not deductible. Thus, before Stimulus 2.0, the amount of loan proceeds used to cover payroll, if forgiven, would not be deductible. 

Stimulus 2.0 changes that, clarifying that gross income does not include any amount that would otherwise arise from the forgiveness of the PPP loan. The bill states:

no deduction shall be denied or reduced, no tax attribute shall be reduced, and no basis increase shall be denied, by reason of the exclusion from gross income provided by [the loan forgiveness provision that says forgiven PPP loans will not count as income.

This means that deductions are allowed for deductible expenses paid with forgiven PPP loan proceeds. This provision is effective as of the date of enactment of the CARES Act and applies to second draw PPP loans.

New Allowable Expenses

Stimulus 2.0 expands qualifying expenses for new borrowers and those who have not yet applied for forgiveness, including the following:

  • Payment for any software, cloud computing, and other human resources and accounting needs;
  • Covered property damage costs, including costs for property damage due to public disturbances that occurred during 2020 that are not covered by insurance;
  • Covered supplier costs for expenditures supplier according to a contract, purchase order, or order for goods in effect before taking out the loan that are essential to the recipient’s operations when the expenditure was made (supplier costs of perishable goods can be made before or during the life of the loan); and
  • Covered worker protection expenditures for personal protective equipment (PPE) and help for compliance with federal health and safety guidelines or any equivalent State and local guidance related to COVID-19 during the period between March 1, 2020, and the end of the national emergency declaration.

The bill also allows loans made under PPP before, on, or after enacting Stimulus 2.0 to be eligible to utilize the expanded forgivable expenses except for borrowers who have already received loan forgiveness.

Second Draw PPP Loans

Section 311 of Stimulus 2.0 provides for second draws of PPP loans for smaller businesses, capping the loan amount at $2 million. Under this section, eligible borrowers must (1) employ not more than 300 employees; (2) have used or will use the full amount of their first PPP; and (3) demonstrate at least a 25% reduction in gross receipts in the first, second, or third quarter of 2020 relative to the same 2019 quarter. Borrower applications submitted on or after January 1, 2021, are eligible to utilize the gross receipts from the fourth quarter of 2020. Eligible second draw borrowers also include non-profit organizations, housing co-operatives, veterans’ organizations, tribal businesses, self-employed individuals, sole proprietors, independent contractors, and small agricultural co-operatives.

Second draw loan terms are reduced and calculated up to 2.5X the average monthly payroll costs in the 12 months before the loan application or the calendar year (2019), with maximum loan amounts capped at $2 million. However, Stimulus 2.0 maximizes benefits for borrowers in the restaurant and hospitality industries by calculating loans up to 3.5X average monthly payroll costs. Additionally, the bill reinstitutes the waiver of affiliation rules that applied during initial PPP loans for second loan borrowers with multiple locations employing not more than 300 employees per location.

Second draw loan recipients are eligible for loan forgiveness equal to the sum of their payroll costs and expanded allowable expenses, subject to the previous program’s 60%/40% allocation between payroll and non-payroll costs.

Streamlined Applications For Borrowers Under $150K

Stimulus 2.0 provides a streamlined process for loans under $150,000. In fact, such borrowers will not be subject to the required reductions in forgiveness amounts generally imposed by reductions in salaries or headcount by simply certifying that the borrower meets the revenue loss requirements described above on or before the date the entity submits the loan forgiveness application.

What You Should Do Next: If you are considering seeking financial assistance, regardless of whether or not you’ve previously received any, you should determine your eligibility for this second round of PPP loans. Additionally, you should continue to follow this rapidly developing situation, especially given the fluidity of the previous Paycheck Protection Program. 

Continued Assistance For Unemployed Workers

The CARES Act previously expanded unemployment assistance for countless Americans whose employment was impacted by the COVID-19 pandemic. Among other things, the CARES Act provided a $600 weekly supplement to state unemployment benefits until the end of July and expanded eligibility to cover COVID-19 related reasons as well as many workers not traditionally covered by unemployment benefits. However, many of the unemployment benefits provided by the CARES Act were set to expire December 31. In light of the ongoing COVID-19 pandemic, Stimulus 2.0 provides for further unemployment benefits in an attempt to bring cash flow to millions of Americans whose employment was adversely impacted. 

Pandemic Unemployment Assistance

Stimulus 2.0 expands the Pandemic Unemployment Assistance (PUA) created by the CARES Act to March 17, 2021 and allows those who have not yet exhausted their rights under PUA to continue to receive such assistance until April 5, 2021. The stimulus package also expands the number of weeks for these PUA unemployment benefits from a 39-week period to a 50-week period.

While providing these additional benefits, Stimulus 2.0 adds a documentation requirement starting January 31, 2021 for both new applicants as well as those receiving PUA. Specifically, new applicants must submit documentation to substantiate employment or self-employment within 21 days although this deadline may be extended for good cause. Similarly, individuals receiving PUA as of January 31, 2021 must submit documentation to substantiate employment or self-employment within 90 days.

Federal Pandemic Unemployment Compensation

Stimulus 2.0 restores the Federal Pandemic Unemployment Compensation (FPUC) supplement to all state and federal unemployment benefits. While lower than its predecessor under the CARES Act, this stimulus package provides a $300 weekly boost from December 26, 2020 to March 14, 2021.

Pandemic Emergency Unemployment Compensation

Like the PUA, the Pandemic Emergency Unemployment Compensation (PEUC) permits individuals receiving benefits as of March 14, 2021 to continue to receive such assistance through April 5, 2021 as long as they have not reached the maximum number of weeks. The new stimulus also increases the number of benefit weeks under the PEUC from 13 weeks to 24 weeks.

Mixed Earner Unemployment Compensation

Stimulus 2.0 provides $100 per week additional benefit to individuals who have at least $5,000 a year in self-employment income but are disqualified from PUA because they are eligible for regular state unemployment benefits.

 

Federal Support To Governments And Non-Profit Organizations

To help make these expanded benefits possible, Stimulus 2.0 extends the unemployment relief for government entities and non-profits from December 31 to March 14, 2021. Similarly, this stimulus package extends several CARES Act provisions originally created to incentivize states to provide the unemployment benefits by aiding with the expense and burdens created by these unemployment programs.

Return-To-Work Reporting Requirement

Stimulus 2.0 requires states to implement methods within 30 days to address situations where claimants refuse to return to work or accept an offer of suitable work without good cause. This must include a reporting method for employers to notify the state when an individual refuses employment and a notice to claimants informing of return-to-work laws, their rights to refuse work, and what constitutes suitable work.

What You Should Do Next – You should ensure you provide information on the additional unemployment benefits to those employees impacted by your staffing decisions. In addition, you should continue to monitor your obligations to report when individuals refuse employment, as states will likely change these over the next 30 days.  

No Extension Of FFCRA Paid Leave (Yet) – But Tax Credit Period Extended Through March

The compromise agreement does not extend the paid sick leave and paid family and medical leave requirements of the Families First Coronavirus Response Act (FFCRA), which expires on December 31. Therefore, an employer’s obligation to provide paid leave under the FFCRA will cease at the end of the year. 

However, the final legislation does extend the tax credit for both the Emergency Paid Sick Leave and the Emergency Family and Medical Leave under the FFCRA until March 31, 2021. This means that you are not required to provide paid leave under the FFCRA after December 31, 2020. If you choose to voluntarily do so (assuming the employee still has eligible leave remaining), you will be able to obtain a tax credit for those payments until the end of March under the compromise agreement contained in Stimulus 2.0.

In addition, depending on the circumstances of an employee’s leave, it is possible that the employee could be entitled to normal unpaid leave under the FMLA even after the FFCRA expires, if they still have weeks available under the FMLA. You should work with counsel to determine whether any employees out on FFCRA leave may be entitled to regular FMLA unpaid leave after the end of the year. 

Moreover, you should pay close attention to developments in Congress after the new year. There is already talk about a larger stimulus package after Congress returns and President-elect Biden is inaugurated. Congress could very well pass legislation early in the new year that extends (or even expands) the paid leave requirements of the FFCRA, and they could make it retroactive to the expiration of the prior law. 

In addition, you need to be aware of state and local laws passed in recent months that require the payment of sick leave to employees for a variety of COVID-19-related reasons. Some of these local laws expire at the end of the year, some are tied to the expiration of the FFCRA, and some do not expire. We could also see state and local lawmakers extend these paid sick leave requirements into the future. You should work closely with counsel to determine any applicable state and local mandates, and to continue to monitor developments on this front into 2021.

What You Should Do Next – Decide whether you will voluntarily extend paid leave benefits into the new year in order to gain a tax credit for those payments through March 2021. Work with counsel to determine whether any employees out on FFCRA leave may be entitled to regular FMLA unpaid leave, or some other form of leave under state law, after the end of the year. 

Tax And Benefit-Related Provisions

The bill also contains the following tax and benefit related provisions:

  • PPP Forgiven Loan Amounts – The IRS had argued that expenses incurred using forgiven PPP funds were not deductible. For example, wages paid with those funds could not be deducted. With Stimulus 2.0, Congress overruled the IRS and decreed that expenses incurred using forgiven PPP funds are deductible.
  • 2019 income may be used for the earned income tax credit – If 2020 earned income is less than 2019 earned income, 2019 income can be used when calculating the earned income tax credit. A lower 2020 income (for example, due to loss of employment during the year) may reduce the amount of credit available. Using a higher 2019 income amount may mean a higher credit for those who otherwise qualify.
  • Deductibility of business meals – Derided by some as the “three martini lunch” deduction, business meals after December 31 and before January 1, 2023 will be fully tax deductible. The current administration believes this provision will aid in reviving the ailing restaurant industry.
  • The Employee Retention Tax Credit – The employee retention tax credit is a credit for wages paid to certain employees during: i) a full or partial suspension of operations; or ii) a significant decline in gross receipts. The stimulus package enacts several technical clarifications but more importantly extends the credit’s availability from January 1, 2021 until June 30, 2021.
  • Flexible Spending Accounts – The law has several provisions which increase employer flexibility in administering health and dependent care flexible spending accounts. Usually subject to the “use it or lose it rule” (unused amounts at the end of the year are forfeited) the act makes available expanded carryover, grace period, and election change rules.

What You Should Do Next – Work with your counsel and your tax preparers to ensure you understand the new tax and benefit provisions and work them into your planning for 2021 and beyond.

No Federal Liability Shield In Stimulus 2.0

It is often said that the result of a good mediation leaves both sides a little bit unhappy. The negotiations for the stimulus bill could be said to have done that with the Democrats not getting aid to state and local governments, and Republicans not getting liability protection for business owners.

Republicans had sought through various bills, such as the Safe to Work Act, to offer a liability protection for business owners. These efforts were criticized by organized labor and safety advocates as potentially diminishing employee safety measures. The proposal also sought to pre-empt state laws that conflicted with it. While the liability shield did not survive the sausage making process of Congress, some states have already taken measures to implement similar shields.

Roughly a dozen states have instituted some form of liability shield through either legislation or executive order. The types of protection vary from broad to narrow. Some states provide immunity for businesses as long as the owner attempted in good faith to comply with guidance from public health agencies. This protection may be in the form of an affirmative defense where the burden is on the business to demonstrate that it made good faith efforts to at least attempt to comply with public health guidance. Other states provide broader protections: as long as the owner did not act with willful misconduct or gross negligence, the burden will be on plaintiffs to prove that the business acted with willful misconduct or gross negligence. At least one state, North Carolina, has limited these protections to “essential businesses.” While some of the states provide immunity from civil liability, others focus on limiting what types of damages can be recovered.  

The majority of states have not implemented any COVID-19-specific protections – or at least not yet. This has led to a cottage industry of COVID-19 litigation springing up in workplaces across the country, as detailed in the Fisher Phillips COVID-19 Employment Litigation Tracker (with over 1,200 such lawsuits having been filed against employers through date of publication).

What You Should Do Next – You should determine whether the states in which you operate are providing any form of liability protections, and if so how is it limited. The best thing employers and businesses can do, even in state that are providing liability shields, is to make best efforts to comply with the ever-changing guidance from health departments, the CDC, and state and federal OSHA.

Will a Biden Administration Push to Expand Paid-Leave Benefits?

November 24 - Posted at 9:19 AM Tagged: , , , , , ,

Federal coronavirus-related paid-leave benefits are set to expire at the end of the year, and if those benefits aren’t extended, some workers may be left without coverage as the pandemic persists through the winter months.

The Families First Coronavirus Response Act (FFCRA), which took effect in April 2020, is a temporary measure that provides COVID-19-related paid-sick-leave and paid-family-leave benefits to certain eligible workers.

Will FFCRA’s emergency benefits be renewed as the coronavirus crisis continues? Will President-elect Joe Biden make expanding paid leave a priority? Here’s what employment attorneys had to say.

FFCRA Leave

Coronavirus cases in the U.S. recently hit record highs with more than 150,000 new cases reported each day since Nov. 16, according to the U.S. Centers for Disease Control and Prevention. FFCRA benefits will end on Dec. 31 unless Congress renews them. 

For now, many employers are required to provide up to 80 hours of paid-sick-leave benefits if employees need leave to care for their own or someone else’s coronavirus-related issues. The legislation also updated the Family and Medical Leave Act (FMLA) to provide workers with job-protected, paid leave when they can’t work—either onsite or remotely—because their son’s or daughter’s school or child care service is closed due to the public health emergency.  

FFCRA’s emergency paid-leave provisions apply to certain public employers and businesses with fewer than 500 employees, and there are exceptions available for small businesses and companies that employ health care workers.

Will FFCRA leave be extended? With the upcoming change in the presidential administration, employment attorneys are divided in their predictions.

“It will be renewed,” predicted Philip Voluck, an attorney with Kaufman Dolowich & Voluck in Blue Bell, Pa. He said it may be renewed by the Trump administration, noting the Biden administration does not assume office until Jan. 20, 2021. Voluck said new legislation may expand the FFCRA’s reach and clarify employer’s paid-leave obligations.

Employers covered by FFCRA earn refundable tax credits that reimburse them for the cost of providing paid leave related to COVID-19. “These need to be carried over to any new legislation to ease the financial strain on covered employers,” he noted.

Senate Majority Leader Mitch McConnell, R-Ky., said he wants Congress to finalize a new coronavirus economic stimulus bill before the end of the year, but that might be difficult during a lame-duck session, according to Politico.

Sara Jodka, an attorney with Dickinson Wright in Columbus, Ohio, believes that there will be a FFCRA extension or supplemental legislation but not until Biden takes office. Biden’s current COVID-19-related leave plans would expand FFCRA to provide for 100 percent wage coverage up to $1,400 a week, provide for paid leave during a mandatory quarantine or isolation period, and expand coverage to domestic workers, caregivers, gig-economy workers and other independent contractors. Employers would also continue to receive tax deductions and reimbursement for COVID-19-related paid leave.

Charles Thompson, an attorney with Ogletree Deakins in San Francisco, noted that the Biden administration may focus on other coronavirus priorities, such as putting money directly in people’s pockets.

Nationwide Paid Leave

In addition to the FFCRA’s paid-leave provisions, there is the longer-term consideration of whether a lasting nationwide paid-leave law may garner bipartisan support.

In the 116th Congress, Democrats and Republicans put forward several proposals to provide paid leave to new parents. In December 2019, Congress passed paid parental leave for qualifying federal employees. Senate Minority Leader Chuck Schumer, D-N.Y., has said he “will not stop fighting until this benefit is provided to all workers nationwide.”

Biden supports the Family and Medical Insurance Leave Act, which is known as the FAMILY Act. The proposed legislation would provide workers with paid time off to care for a newborn or recently adopted child, take care of themselves or family members with serious health conditions, or care for military family members and help them prepare for deployments.

Jodka noted, however, that the Biden-Harris campaign platform focused on expanding other employee rights, such as making it easier for workers to organize and collectively bargain, increasing the federal minimum wage, and extending overtime pay to more workers.

She thinks any paid-leave law will likely stem from an amendment to the FMLA, like the FFCRA did. “Employers, especially smaller ones, struggled—and continue to struggle—to meet the paid-leave requirements of the FFCRA,” she said, “so it is likely that first attention will be to the COVID-19 response with a discussion of a federal paid-leave law well off into the future.”

State and Local Trends

Some states and cities already provide paid leave, and their laws operate independently of federal law, Voluck explained. “States will likely become even more generous with paid leave,” he predicted.

SHRM has long advocated for a voluntary federal framework for paid leave, rather than a fragmented patchwork of state and local leave laws, and recently outlined employers’ need for consistency and simplicity in a letter to the U.S. Department of Labor’s Women’s Bureau.

Thompson thinks that states and local jurisdictions “will continue to be at the forefront of requiring that employers provide COVID-related leave.”

Many jurisdictions—including Arizona, California, Colorado, Michigan, New Jersey, New York, Rhode Island, Washington and Washington, D.C.—have enacted their own emergency paid-leave laws in response to the pandemic. Many cities in California and elsewhere have also passed supplemental leave ordinances. Employers should note that state and local COVID-19-related paid-leave laws may have different expiration dates.

“I think state laws will continue to trend upward in favor of paid-leave law mandates,” Jodka said. “The most typical is a paid-sick-leave mandate, and with COVID-19 cases rising, the need to value proper medical care and time away from work without risking losing a paycheck is at an all-time high.”

DOL Revises COVID-19 Leave Regulations

September 14 - Posted at 1:37 PM Tagged: , , , , , , , , , , , ,

Employers of healthcare providers will soon be required to provide paid sick leave and partially paid family leave to a broader category of employees, and all employers subject to the law now have clarification on a number of other obligations, thanks to a revised set of regulations released by the Labor Department late Friday afternoon. After a federal court judge recently knocked down the agency’s first attempt to provide employers with practical direction in complying with the Families First Coronavirus Act (FFCRA), the Labor Department issued a second set of rules on September 11 that in some instances revise and in other instances clarify employer compliance duties. Here are the key changes and clarifications, which are slated to go into effect on September 16, that employers need to know about:

  1. The definition of workers deemed “health care providers” – whose employers may exclude them from coverage under the law – was narrowed to only include employees who are health care providers under the Family Medical Leave Act (FMLA) and those providing diagnostic services, preventive services, treatment services, or other services that are integrated with and necessary to the provision of patient care.
  2. The agency reaffirmed that leave can only be taken only if the employee has work available from which to take leave.
  3. Employees must still obtain their employer’s approval to take leave on an intermittent basis.
  4. Employees must give their employer information to support their need for leave as soon as practicable.
  5. The Labor Department revised the rules to correct an inconsistency regarding when an employee may be required to give notice of family and medical leave to their employer.
(more…)

How To Balance School Re-Openings And COVID-19 Workplace Leave: FAQs For Employers

August 28 - Posted at 11:00 AM Tagged: , , , , , , , , , ,

As the summer draws to a close, schools are announcing their re-opening plans, which vary widely across states and localities. Some schools plan to remain open several days a week and direct students to attend remotely the other days. Others will split classes into morning and afternoon sessions, allowing students attending in the morning to participate remotely at home for the rest of day and vice versa. Still others will require physical attendance at all times, while some will choose to operate entirely under a remote learning model.

In light of these different reopening plans, employers need to understand how the Families First Coronavirus Response Act (FFCRA) affects the leave rights of employees for each of these different types of school schedules. The below serves as a list of answers to frequently asked questions related to the issues you could face as schools begin to reopen.  

The Basics: FFCRA Leave Benefits For Working Parents

Under the FFCRA, eligible employees are entitled to Emergency Paid Sick Leave (EPSL) and/or expanded family and medical leave (EFML) if they are unable to work or telework because they need to care for their son or daughter if (a) the child’s school or place of care is closed, or (b) the child care provider is unavailable, due to COVID-19-related reasons. The FFCRA regulations provide that an employee may take leave to care for their child only when the employee needs to, and actually is, caring for the child. The Department of Labor (DOL) has advised that “generally, an employee does not need to take such leave if another suitable individual — such as a co-parent, co-guardian, or the usual child care provider — is available to provide the care the employee’s child needs.”

Frequently Asked Questions

1. Is a child’s school or place of care deemed “closed” for purposes of the FFCRA if it has moved to online instruction or to another model in which children are required to complete assignments at home?
Yes. If the physical location where an employee’s child received instruction or care is closed, the school or place of care is deemed “closed” for purposes of the EPSL and EFML. The DOL has instructed that this is true even if some or all instruction is being provided online or whether, through another format such as “distance learning,” the child is still expected or required to complete assignments. But this seemingly does not contemplate a hybrid model (discussed below) and likely pertains only to those circumstances where the child is not reporting to a physical location. Also note that in order to be eligible for FFCRA leave, employees must still certify that there is no other suitable person that can care for the child.

2. Is an employee entitled to FFCRA leave if they choose to keep the child at home or have the child homeschooled even though the child’s school is open?
No. The DOL has stated that employees do not need to take leave if their usual child care provider is available to provide care. But if the school is operating on a reduced capacity due to COVID-19, which then necessitates remote learning for the child, FFCRA leave could be available. See DOL guidance on summer camps

3. Would an employee qualify for FFCRA leave if their child’s school is open but the employee chooses remote learning based on a doctor’s recommendation due to the child’s vulnerability to COVID-19?
EFMLA is likely not available to the employee because the child’s school is not closed. The employee might be eligible for EPSL if they can demonstrate that they are taking leave to care for a person who has been advised by a health care provider to self-quarantine due to concerns related to COVID-19 (permitted reason #4 under EPSL). It is unclear however, whether a recommendation for remote learning is the same as a recommended self-quarantine for purposes of the FFCRA.

4. Will employees be eligible for FFCRA leave if a child’s school is operating on a hybrid model (whereby children are to alternate between physical attendance and remote learning)?
Likely yes. While this scenario is not specifically addressed in the statute or DOL guidance, one would argue that the child’s school is technically “closed” to that child on the days when the child is required to participate via remote learning. Thus, if the employee cannot work or telework during those days, they should qualify for FFCRA leave.

It is uncertain, however, whether a parent may take the leave consecutively or intermittently to coincide with the days and times the child is home remote learning. If the child’s school requires them to attend school daily (e.g., child attends school half of the day and spends the other half remote learning), leave is likely to be taken consecutively. If, on the other hand, the child’s schedule requires the child to physically attend school only on certain days of the week, leave is likely to be taken intermittently. Note that while the DOL regulations mandate employer consent for intermittent leave, a New York federal court recently struck out this requirement as unreasonable.

5. Would an employee qualify for FFCRA leave if the child’s school is open but the child’s before or after school program is closed?
Yes. The DOL defines a “place of care” as a physical location in which care is provided for the child. The physical location does not need to be solely dedicated to such care. Examples include day care facilities, preschools, before and after school care programs, schools, homes, summer camps, summer enrichment programs, and respite care programs.

6. Can an employer deny FFCRA leave to an employee who previously teleworked while the child’s school was closed but intends to request leave if the child’s school remains closed for the fall?
No. The DOL has made clear that simply because an employee has been teleworking despite having their children at home does not mean the employee is prevented from now taking leave to care for the child whose school is closed for a COVID-19-related reason.

7. Can more than one parent take paid sick leave or expanded family and medical leave simultaneously to care for a child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons?
No. An employee may take EPSL or EFML leave to care for their child only when they need to, and actually are, caring for the child if they are unable to work or telework as a result of providing care. Generally, employees do not need to take such leave if a co-parent, co-guardian, or the usual child care provider is available to provide the care the child needs.

8. Can an employee take paid FFCRA leave to care for a child who is 18 years old or older?
It depends. EPSL and EFML leave may only be taken to care for an employee’s non-disabled child if they are under the age of 18. If the employee’s child is 18 years of age or older with a disability and cannot care for themselves due to that disability, the employee may take EPSL and EFML leave to care for the child if their school or place of care is closed or the child care provider is unavailable due to COVID-19-related reasons and the employee is unable to work or telework as a result. Additionally, EPSL is available to care for an individual who is subject to a federal, state, or local quarantine or isolation order related to COVID-19 or has been advised by a health care provider to self-quarantine due to concerns related to COVID-19. If an employee has a need to care for a child age 18 or older who needs care for these circumstances, the employee may take EPSL if they are unable to work or telework as a result of providing care. But in no event may the employee’s total paid sick leave exceed two weeks.

9. Can an employee use EPSL for child care purposes if the employee already used up their 80 hours of EPSL for other permitted purposes?
No. The DOL regulations state that employees are entitled to only a one-time use of 80 hours of EPSL, regardless of the reason. However, if an employee has not exhausted their full EPSL allotment, they may use the remaining time for other permitted reasons.

10. If a new employee has used up their EPSL leave allotment while employed at their previous employer, are they entitled to another 80 hours of EPSL leave with the new employer?
No. The DOL regulations specify that any person is limited to a total of 80 hours of EPSL. An employee who has taken all such leave and then changes employers is not entitled to additional EPSL from their new employer. However, an employee who has taken some (but fewer than 80 hours of) EPSL and then changes employers is entitled to the remaining portion of such leave from their new employer, but only if the new employer is covered by the FFCRA.

11. Can employees use EFML leave if they have already exhausted all of their FMLA leave allotment for the benefit year?
No. An employee may only take a total of 12 workweeks for FMLA or EFMLA reasons during the employer’s designated benefit year.

12. Does EFML contain the same limitation contained in the FMLA that requires spouses who work for the same employer to share the 12 weeks of leave (instead of each getting 12 weeks)?
No. Under 29 CFR 201(b), spouses who work for the same employer can be required to share a combined 12 weeks of FMLA leave to bond with their new child or care for their own parent with a serious health condition. The EFMLA does not provide for the same carveout. But keep in mind that while both employees who work for the same employer would each be eligible for EFMLA leave, they would likely not be able to both take leave to care for their child since they have to certify that there is not alternative suitable caregiver. 

13. What supporting documents must employees provide to their employers for FFCRA purposes?
When requesting EPSL or EFML leave, employees must provide the following information to their employers, either orally or in writing:

  • Employee’s name;
  • The date(s) for which employee requests leave;
  • The reason for leave; and
  • A statement that the employee is unable to work because of a FFCRA qualifying reason.

If the employee requests leave because they are subject to a quarantine or isolation order or to care for an individual subject to such an order, they should additionally provide the name of the government entity that issued the order. If the employee requests leave to self-quarantine based on the advice of a health care provider or to care for an individual who is self-quarantining based on such advice, they should also provide the name of the health care provider who gave the advice.

If the employee requests leave to care for a child whose school or place of care is closed, or child care provider is unavailable, they must also provide:

  • The name of the child;
  • The name of the school, place of care, or child care provider that has closed or become unavailable; and
  • A statement that no other suitable person is available to care for the child.

Notably, a New York federal court recently held that supporting documentation may not be required as a precondition for FFCRA leave. Thus, employers should ensure documentation is not required to commence the leave under the FFCRA. Supporting documentation can be submitted after the leave has commenced.

DOL Issues New FMLA Forms

July 30 - Posted at 2:37 PM Tagged: , , , ,

Earlier this month, the DOL’s Wage and Hour Division issued new model forms for employers to use when administering employee leave under the FMLA. The revised model notice of rights, certification, and designation forms were immediately effective and are now available to assist employers and employees in meeting their FMLA notice and certification obligations.

Background

The federal Family and Medical Leave Act (FMLA) covers private employers with 50 or more employees as well as public agencies and public and private elementary or secondary schools, regardless of the number of employees. The FMLA generally entitles eligible employees to take up to 12 weeks of unpaid, job-protected leave in a 12-month period for specified family and medical reasons and additional leave to care for a covered servicemember.

All covered employers must post a general notice about the FMLA (FMLA poster) in each workplace and distribute a notice to new hires. Additionally, covered employers who have FMLA-eligible employees must provide them with notices about: FMLA eligibility status, rights, and responsibilities; when specific leave is designated as FMLA leave; and the amount of time that will count against their FMLA leave entitlement. When an employee requests FMLA leave due to their own or a covered family member’s serious health condition, or for military family leave, the employer may require appropriate certification.

Revised FMLA forms

The DOL’s Wage and Hour Division (WHD) released revised versions in mid July of its model notice of rights, certification, and designation forms under the FMLA. According to the WHD, the new forms, which are effective immediately, are “simpler and easier for employees, employers, leave administrators and healthcare providers to understand and use.”

The following updated FMLA forms are now available to assist employers and employees in meeting their FMLA notification and certification obligations:

These optional-use forms can be used by employers to provide required notices and by employees to provide certification of their need for FMLA qualifying leave. The new forms are electronically fillable PDFs that can be saved and transmitted electronically. Employers may still use the agency’s prior model forms or they may use their own forms, as long as they provide the same basic notice information and require only the same basic certification information.

To some extent, the new model forms simplify FMLA administration by substituting check boxes for some previously required written responses. The revised Notice of Eligibility & Rights and Responsibilities form contains additional information on the substitution of paid leave and concurrent leave usage during a qualifying FMLA absence. The revised certification forms similarly include additional information on the circumstances in which employers may obtain follow-up information from health care providers and are reorganized to make it easier to determine whether a serious health condition exists. As the WHD made clear, an employee who already provided the required FMLA information using the old certification form cannot be required to provide that same information using the revised form.

Notably, the WHD did not revise the FMLA poster or issue a generic “Fitness-for-Duty” certification. Further, the new forms do not address the paid sick leave or expanded FMLA leave requirements of the Family First Coronavirus Response Act (FFCRA). 

 

 

Recording Available for AAG’s 2020 Education Seminar

April 23 - Posted at 4:20 PM Tagged: , , , , , ,
The recorded presentation of AAG’s 2020 Educational Seminar on April 23, 2020 is now available for viewing.

Guest Speaker and attorney Keith Hammond, with Hammond Law Center, covered the impact of COVID-19 on businesses in relation to the Families First Coronavirus Response Act (FFCRA) as well as the Emergency Leave Act and CARES Act.

This seminar is also approved for 2 Professional Development Credits (PDCs) with SHRM for all attendees.

Please contact our office for the link to view the presentation or the Activity ID for the PDCs.
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