OFF THE RECORD
SPECIAL COVID-19 ALERT
A Message From Our Firm

Dear Clients and Friends!

During these unprecedented times, we are committed to providing you with regular updates on how you and your business can best navigate legal issues which are arising daily from the COVID-19 pandemic. We are “virtually here,” diligently working around the clock and accessible to support your needs!

We have recently added a dedicated section to our firm website where you will be able to access important COVID-19 updates and links to prior alerts and newsletters. This page can also be easily accessed from our homepage at  www.darslaw.com .
 
We hope that you are able to make the best of these difficult and uneasy times. Please know we are prepared to do what we can to help support you, our friends, clients and colleagues, to overcome the challenges during this period of uncertainty and disruption.  Our thoughts are with the individuals and communities that have been directly impacted by the virus. Please stay safe and healthy.

Very truly yours,
Paul G. Skalny
Managing Director
For Businesses, Entrepreneurs & Organizations
PHANTOM STOCK:
A VIABLE ALTERNATIVE TO SALARY REDUCTIONS?

Many business owners are facing difficult employment decisions in wake of the COVID-19 pandemic. Some are being forced to cut salaries of key employees. One way to incent key employees to “stick around” despite a pay cut may be to offer them phantom equity (also commonly referred to as phantom stock or stock rights) in your company. Phantom equity offers many of the benefits of equity ownership, without actually conferring ownership to the employee. Upon fulfillment of certain conditions defined in an approved plan, employees are eligible to receive payment in exchange for their phantom equity. For instance, payment can be tied to a sale of your company or revenue benchmarks. Phantom equity helps to further align an employee’s financial interest with the interest of the company and may help soften the impact of a reduced salary. In addition to the phantom equity, there are other incentives that may be suitable for your company and its employees. Contact an attorney in our Business & Transactional Practice Group to discuss further .  
DEPARTMENT OF LABOR WEIGHS IN ON
THE FAMILY FIRST CORONAVIRUS RESPONSE ACT

We recently briefed our clients and friends on the newly passed Family First Coronavirus Response Act (“FFCRA”). The Department of Labor (“DOL”) issued additional guidance addressing numerous questions related to the implementation of FFCRA ( https://www.dol.gov/agencies/whd/pandemic/ffcra-questions ).

Here are some highlights:

Business with Fewer than 50 Employees Exemption
 
The exemption criteria for businesses with fewer than 50 employees under the DOL initially stated employers with fewer than 50 employees would be exempt from the FFCRA where compliance would jeopardize “the viability of the employer’s business as a going concern.”

The DOL has clarified that a small business is exempt from certain paid sick leave and expanded family and medical leave requirements if providing an employee such leave would jeopardize the viability of the business as a going concern. This means a small business is exempt from mandated paid sick leave or expanded family and medical leave requirements only if the:

  • employer employs fewer than 50 employees;
  • leave is requested because the child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and
  • an authorized officer of the business has determined that at least one of the three conditions described below is satisfied.

The conditions are as follows:

  1. The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity; 
  2. The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or 
  3. There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.

This exemption criteria only applies to leave that is requested because of the child’s school or child care provider being closed. The DOL may also issue small business exemption criteria pertaining to paid leave provided for other qualifying reasons under the Emergency Paid Sick Leave Act (EPSLA), presently, businesses still need to comply with the EPLSA for the other 5 qualifying reasons.

  1. The employee is subject to a federal, state, or local quarantine or isolation order related to COVID–19.
  2. The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID–19.
  3. The employee is experiencing symptoms of COVID–19 and seeking a medical diagnosis.
  4. The employee is caring for an individual who is subject to either number 1 or 2 above.
  5. The employee is experiencing any other substantially similar condition specified by the secretary of health and human services in consultation with the secretary of the treasury and the secretary of labor.
 
Individuals Who are Not Eligible for FFCRA
 
The DOL further clarified that individuals are not eligible for EPSL and EFMLA in the following situations:

  • Employees who, prior to April 1, 2020, were sent home and are no longer being paid because the employer worksite closed.
  • Employees who, on or after April 1, 2020, are sent home and are no longer being paid because the employer worksite is closed.
  • Employees who are already on EPSL or EFMLA when the employer closes the worksite on or after April 1, 2020 (in this case, the employer must pay for any leave taken prior to the closure).
  • Employees who are furloughed on or after April 1, 2020 due to lack of work, even if the worksite remains open.

These rules apply whether the employer closes the worksite due to lack of business, closes the worksite pursuant to a federal, state, or local directive, or furloughs specific employees due to lack of work. In all of these cases, unemployment benefits may be available to these employees.

Enforcement OF FFCRA
 
It is important to note that the DOL explained that it will not bring any enforcement actions against employers making reasonable, good faith efforts to comply with the FFCRA through April 17, 2020. Employers attempting to implement the new requirements under the FFCRA will accordingly have some additional time to comply without penalty, provided that they are making these reasonable, good faith efforts. Employers should be aware, however, that employees could still bring their own lawsuits for violations occurring beginning on April 1, 2020. .
PRIVACY AND SECURITY CONCERNS WHEN
WORKING ON-LINE AT HOME

Many employees and business owners are teleworking because of the mandate to stay at home to slow the spread of COVID-19. Consequently, most individuals are using on-line services to do their work. When using on-line services, there are certain issues regarding privacy and information security that must be kept in mind to avoid creating problems for you, your employer and customers. Below are some things to think about.

  • Hacking incidents have increased 15 to 20% since January of 2020. Make sure that the computer that you are using at home has up-to-date security software protection. To reduce exposure to hackers, make sure that all of your software programs are up-to-date. When companies update their software, these updates frequently address security flaws.

  • One of the most important things to keep top-of-mind while interacting with clients using various web tools is the protection of confidential information. Many employees are now working in a shared space and using their personal devices, such as phones and tablets. Are there confidential documents laying out? Can private conversations be overheard? Employers should have appropriate use policies that specifically addresses the access, use and disclosure of the company’s electronic proprietary information and data.

  • Microsoft, Google Cloud Service and most other main streams apps and software products provide for two-factor authentication. Take advantage of these safeguards to protect the privacy of what is stored in the Cloud and in your on-line communications. This safeguard will make it more difficult for hackers to attack and obtain private information from you and your employer.

  • Avoid phishing scams in emails. Microsoft research reveals that 91% of hacking attacks come from malicious email messages. You should avoid opening any email where you don’t recognize the sender. In this vein, be sure to look at the sender’s actual email address to ensure that it corresponds to the email you have on record for that individual. Any email asking for personal financial information, Social Security numbers or other identification information should be questioned and not responded to until you are completely sure the request comes for a legitimate source. And, even then, such information should be sent in a secure manner. Many hackers have very carefully disguised their email messages to appear to be official.

  • With mandatory social distancing, many are using Zoom and other similar video conferencing apps and programs to connect with colleagues and clients. When using these resources, there are several things to keep in mind. The host can sometimes use a tattle-tale attention-tracking feature that can tell them if you aren't paying attention to their meticulously-composed visual aids. Whether you're using Zoom's desktop client or mobile app, a meeting host can enable a built-in option which alerts them if any attendees go more than 30 seconds without Zoom being in focus on their screen. You should consider using a separate device if you are preparing notes and comments that you do not wish the host to have access to when they are prepared. .

  • Social media, such as Facebook, Instagram and Twitter can be a source for sending privacy information to third-parties and creating security risks. Everyone should be cautious about what is disclosed on any Social Media. Be aware that these sites are for profit businesses and any information shared on these sites are often sold to third parties. Consider blocking third party cookies and using tracker-blocker browser extensions to make sure extraneous information isn’t being passively transmitted to third parties. Finally, review and limit your Privacy Settings regularly to make sure they are up-to-date.

In summary, on-line software and use of the cloud will make us more productive as we work out of the office. However, keep in mind that you need to be aware of how these services can impact privacy and exposure to third-party disclosure of your information and work product.  
REDUCING STRESS WHILE WORKING FROM HOME

Our new role as an employee, a teacher, and a parent can be a little overwhelming, right? This is uncharted territory and it can bring a whole new level to the meaning of stress. Many of us have mastered one, or perhaps even two of these roles, but trying to gracefully manage all of these at once definitely requires some patience and forgiveness. Here are some tips to help you manage your stress while working from home and be the best version of each of these roles that you can be.

Have a routine . Try to keep consistent with a routine, much like a day in the office; it will help separate home from work. Perhaps you wake up earlier than the rest of your family and you can get a jump-start on your day. Pack lunches or snacks for your family to limit the interruptions or the eating out of boredom. If possible, have set office hours and stick to them.

Take time for yourself . Take advantage of your “commute” time and begin your day with a work-out, meditate, or relax by yourself with coffee before you jump into your workday. You have been given a gift on an extra 20 – 60 minutes (sometimes more) in your day---use it to your advantage!

Set boundaries . This goes for both work and home. Don’t feel guilty about explaining to your family that you cannot be interrupted for a conference call, but at the same time, don’t feel guilty about letting your colleague know you are signing off for the day to make dinner for your family.

Have a dedicated work area . Not everyone has the luxury of a home office with doors, but try to get creative and have a work-area. Maybe there is a room in the basement you never use; or, a dining room that is only used for special occasions. And, if you have a spouse or children, and everyone is working from home, set up additional tables and chairs where everyone can have their own dedicated space.

Take a mental break . It is very easy to start your day earlier or end your day later while you are working from home. Sometimes you’ll even find yourself working right through lunch. It is especially important to step away from your desk and take a mental break, even if it is for only 15 minutes. Try to go “out” for lunch---maybe that means your kitchen table or maybe you sit out on the deck and eat. If you are busy and can’t step away, then consider taking your call outside and getting some fresh air at the same time.

Hydrate . Being out of your normal routine can allow some healthy habits to fall by the wayside. To keep your mental focus and reduce stress, stay hydrated. Start your day with a large glass of water on your desk and take time to fill it up regularly. If you easily forget, put an alert on your phone to take a water break.

Try and build as many of these habits into your routine over a period of a few weeks. We don’t know how long this “new normal” will last, so do what you can to stay productive and reduce your level of stress in your new role!
EMPLOYEE "AUTHORIZATION TO WORK" LETTER

As most of you know, Governor Hogan issued a Stay At Home Directive for the State of Maryland that went into effect at 8:00 PM on Monday, March 30th. With this Order in place, the scrutiny by law enforcement to ensure that individuals are complying with this Order is likely to increase. If you own or operate an Essential Critical Infrastructure Business and the job responsibilities of your employees requires them to commute, it is advisable that they be provided with a letter from your company setting forth that they work for an Essential Critical Infrastructure Business and that their job responsibilities require them to leave their home. Please contact our firm if you would like our assistance in preparing such a legally compliant letter.

For Individuals & Families

THINGS TO LOOK FOR WHEN REVIEWING YOUR ESTATE PLAN

Many of our clients have reached out to us in the past few weeks to discuss changes they want to make to their estate plans after taking their time at home to review them. Now is a good time to dust off your estate planning notebook and take a look at your current estate planning documents. Here are the top 5 things to look for when reviewing your estate plan.

Who are named as your Agents, Personal Representatives (Executors), and Trustees?

These roles are often filled by people you are close to and trust. Those people change over time. Make sure the people you name in your documents are still the people you want serving in those roles. For a refresher on what these people do, please see our To the Point brochures on Estate Planning and Probate.

Are the names of your family members correct?

Often, our clients execute their estate planning documents while their children are minors. Are your children’s names up to date and are they all included in your document? If not, this may also be a sign that it’s time to review beneficiary designations on your life insurance and retirement accounts.

How do you leave property to your beneficiaries?

Beneficiaries are the people who benefit under your Will or Revocable Trust. Do you leave your assets to your spouse, your children, other family members, or charities? Do you leave your assets to them outright or in trust?

Do the end of life decisions stated your Advance Medical Directive reflect your current wishes?

There are often life experiences that make us reconsider the what health care we would like to receive at the end of our own lives. Do the wishes stated in your Advance Medical Directive reflect what you want now?

Do you have a Maryland Statutory Power of Attorney?

If you signed your estate planning documents before 2010, you likely do not have a Maryland Statutory Power of Attorney. There are additional protections for your agent provided by using this form and its use often makes it more likely to be accepted by third parties when needed, so your estate plan should include one.
 
Please contact us if you would like to schedule a time to review your estate plan with one of our attorneys.
REMOTE NOTARIZATIONS

On Monday, March 30 th , Governor Hogan instituted a temporary Executive Order that allows for remote notarization of documents during this State of Emergency. Remote notarization allows a notary to observe you sign a document through technological means and the notary then affixes a notary “stamp” to your document. To use this technology, you must have a phone, tablet, or computer with a camera and microphone. The remote notary will provide you with instructions on how to participate in the signing.