‘CARES” BILL PASSES CONGRESS
We expect more details in the near term, but until then broadly there are benefits for individuals, small business, and larger business.
The main features for small businesses are emergency grants and a forgivable loan program for companies with 500 or fewer employees. There are also changes to rules for expenses and deductions meant to make it easier for companies to keep employees on the payroll and stay open in the near-term.
Also included is expansion of unemployment benefits, adding $600 per week from the federal government on top of whatever base amount a worker receives from the state. That boosted payment will last for four months, and the bill adds 13-additional weeks of benefit.
DOL UPDATES Q&A
Last evening, the USDOL issued updated Q&As regarding the administration of the Emergency Sick Leave and Expanded FMLA coverage associated with the Families First Coronavirus Response Act.
FORM I-9 PHYSICAL DOCUMENT INSPECTION REQUIREMENT RELAXED.
The Department of Homeland Security (DHS)
announced on March 20, 2020
, that it will relax the in-person verification requirements of the Form I-9, Employment Eligibility Verification for employers operating remotely due to COVID-19. Beginning March 20, 2020, employers will not be required to review an employee’s identity and/or employment authorization documents while in the employee’s physical presence.
This relaxation of the in-person verification requirements is effective for a period of 60 days from that date of the notice, or for up to 3 business days following the termination of the COVID-1
e Trump administration, whichever comes first.
FLEX SPENDING ACCOUNTS MAY BE A COBRA QUALIFIED PLAN
We advise our clients to check with their Healthcare Flexible Spending Account TPAs when terminating a plan participant.
Generally, a health
FSA is considered an ERISA-covered health plan, and, unless an exception applies, an employer subject to COBRA provisions must offer COBRA continuation coverage to qualified beneficiaries who experience a loss in coverage due to a qualifying event. Healthcare Flexible Spending Accounts that are overspent do not need to offer COBRA continuation.
FEDERAL DISASTER LOANS:
he U.S. Small Business Administration is offering low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19). SBA will issue under its own authority, as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act, an Economic Injury Disaster Loan declaration.
- SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
- These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%.
- SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
For additional information, please contact the SBA disaster assistance customer service center. Call 1-800-659-2955 (TTY: 1-800-877-8339) or email
ADDITIONALLY, as mentioned above, The CARES Act is expected to be signed into law shortly. Included within the bill is the following Small Business Administration aid for small business:
There is $350 billion allocated for the Small Business Administration to provide loans of up to $10 million per business. Any portion of that loan used to maintain payroll, keep workers on the books or pay for rent, mortgage and existing debt could be forgiven, provided workers stay employed through the end of June.
Relief for existing loans:
There is $17 billion to cover six months of payments for small businesses already using SBA loans.