Updates to PPP and Loan Forgiveness Employer-Friendly Changes as of June 5, 2020
Extension of Loan Period from 8 to 24 weeks or 12/31/2020 WHICHEVER COMES FIRST
BUT BE CAREFUL THE BILL STATES “TO RECEIVE LOAN More FORGIVENESS FROM UNDER THIS proceeds can 75/25 SECTION, AN be spent on ELIGIBLE RECIPIENT SHALL USE AT LEAST TO non-payroll 60 PERCENT OF THE 60/40 COVERED LOAN costs AMOUNT FOR PAYROLL COST…” HR 7010 APPEARS TO CREATE A CLIFF.
In the prior rules a borrower could restore any reduction in the forgiveness amount if it either restored FTE’s or salary/hourly wage to their 2/15/20 levels before 6/30/20. HR 7010 solves this issue by extending the 6/30 deadline to 12/31/20. Longer to replace As long as the FTE’s or FTE’s/restore salary/wage are restored to 2/15 levels any time prior to salaries the end of 2020, no reduction in forgiveness will be required.
Businesses that remain partially or fully closed through the end of the year will get new relief.
Inability to rehire individuals who were employees on 2/15. Inability to hire similarly qualified employees for unfilled positions on or before 12/31/20 Inability to return to the same level of activity as business was operating at before 2/15 due to For borrowers who lose FTE’s... compliance with requirements From 2/15/20 and ending 12/31/20 established by SHHS, CDC r OSHA the amount of loan forgiveness will during the period 3/11 thru NOT be reduced when there is a 12/31/20, related to standards for reduction of FTE’s if the borrower, sanitization, social distancing, or in good faith, is able to document any other worker or customer safety requirement related to any of the following: COVID-19.
8-week covered period remains an option. You can now defer certain payroll taxes even if you received a PPP loan.
The defined term “covered period,” for purposes of the Act, has changed from June 30, 2020, to Dec. 31, 2020. This makes new PPP loans available until Dec. 31, 2020 or the date the funds allocated to the program run out, whichever comes first. Note, Section 3(b)(1) of H.R. 7010 also establishes Dec. 31, 2020, as the outside date for use of PPP loans to obtain forgiveness
10-Month Deferral Deadline A new clause (v) provides that if a borrower fails to apply for forgiveness within 10 months after the last day of the forgiveness covered period (as amended, either 24 weeks after loan origination or Dec. 31, 2020, whichever occurs first), then borrower must start making payments of principal, interest and fees on PPP loan beginning on the date that is “not earlier than the date that is 10 months after the last day of such covered period.” There is no indication whether SBA would continue to accept forgiveness applications after the end of that 10-month period.
Return to Work Virginia Phase II HUMAN RESOURCES & BENEFITS CONSIDERATIONS
FMLA EFMLA ESL PRACTICAL TIPS FOR ADMINISTRATION
EMPLOYEES WHO DO NOT RETURN TO WORK
Disciplining Employees: WHAT IF YOU SEE EMPLOYEES NOT SOCIAL DISTANCING ON THEIR SOCIAL MEDIA POSTS?
Does the 90-day waiting period apply? Restoration of benefits Affordability concerns for ALEs BENEFITS: Post furlough or termination...
HIPAA SPECIAL ENROLLMENTS Impact on benefit plans SBC and SPD requirements
FLEXIBLE SPENDING ACCOUNTS Special Election Considerations Dependent Care Amending the 125 Plan
COBRA & THE OUTBREAK PERIOD RULES Challenges for Administrators Challenges for COBRA Eligible Beneficiaries or those on COBRA
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