On March 27, 2020, the House of Representatives approved the third coronavirus relief bill, and is now headed to President Donald Trump for his signature. The CARES Act focuses on providing funds for distressed small businesses and laid-off workers and will provide $2.2 trillion in financial relief.

The bill has four main objectives:

• Provide emergency cash to individuals and their families.
• Deliver fast and significant relief to small businesses.
• Help stabilize the economy and curb layoffs.
• Rush resources to frontline health care workers.

Impact on Unemployment Benefits

• The bill enhances unemployment benefits by expanding eligibility and offering recipients an additional $600 a week—beyond what state unemployment programs pay—for four months.
• Before the Senate approved the Act, four Senate Republicans raised concerns that the Act’s additional unemployment benefits might encourage people to leave the workforce, holding up the vote with a proposed amendment, which was defeated.
• Unemployment Benefits are state-specific, so it is critical to follow each state’s guidelines.

Families First Coronavirus Response Act

• On March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act (H.R. 6201), which will provide paid emergency family leave in limited circumstances, as well as paid sick leave for people affected by COVID-19, the respiratory disease caused by the coronavirus.
• In general, the legislation’s emergency paid-leave provisions apply to businesses with fewer than 500 employees, but there may be some exceptions available for small businesses and companies that employ health care workers.
• Provisions of the Act take effect on April 1, 2020 and expire on Dec. 31, 2020.
• The U.S. Department of Labor (DOL) announced a nonenforcement period for employers that make good-faith compliance efforts. The department will focus on compliance assistance during that time and enforcement measures will begin April 18, 2020.
• New FFCRA notice posters are now available: https://www.dol.gov/general/topics/posters
  • Each covered employer must post a notice of the Families First Coronavirus Response Act (FFCRA) requirements in a conspicuous place on its premises. An employer may satisfy this requirement by emailing or direct mailing this notice to employees or posting this notice on an employee information internal or external website.

500 Employees Criteria

• The 500 Employees threshold to exclude companies from the FFCRA requirements will be counted based solely on workers in the United States or any US territory. Those who are already on a leave of absence would also be included.
• According to the Labor Department, Companies will not be able to include independent contractors in their count. However, they can include temporary workers provided by staffing firms.
• The DOL’s Wage and Hour Division stated in a Q&A post that small businesses with fewer than 50 workers can qualify for an exemption from the law by documenting that their viability would be jeopardized by providing the required paid sick and other leave to workers affected. Details of the criteria for that exemption will in forthcoming regulations.

We’re here to help.

The MCM COVID-19 Solutions Group is committed to keeping you informed on this legislation’s progress and how it will affect your workplace, if signed into law. Please contact covidHR@mcmcpa.com for more information and a member of the MCM COVID-19 Solutions Group will be in touch.

 

 

You should consider consulting your legal counsel regarding these matters as well as any union contract considerations. Nothing in this document should be construed as providing tax advice.  Please consult with your own professional tax advisor.  In addition, this document represents the information that we have up to the date the presentation was made and cannot be relied upon for additional updates beyond that date.