Coronavirus: The Latest from Congress, and What It Means for Employers

America has been experiencing a fast-spreading, wide-reaching health emergency pandemic of seismic proportions. Residents nationwide are sick and/or quarantined, unable to work, and unable to earn incomes. Many Americans are forced to stay home, and non-essential businesses are barred from operating.

Congress has been presented with an insurmountable task in response to the pandemic. It must create and enact new legislation, and develop economic stimuli to protect the health of America’s citizens and businesses. Congress does not have the luxury of time, as it does in other circumstances. Congress must act fast, must adapt quickly, and work – at least – at the same speed of the growing pandemic itself. Unfortunately, the pandemic is moving much quicker than the usual pace of Congress.

As of the date of this article’s publishing, Congress has rolled out four phases of COVID-19 pandemic response –with additional phases likely to follow.

The first phase, called “Coronavirus Preparedness and Response Supplemental Appropriations Act” addressed Congress’s initial action item: to fund vaccine and research development for COVID-19. It was signed into law on March 6, 2020, and created $8.3 billion of funding for this purpose.

The second phase addressed Congress’s secondary action item: working citizens must be encouraged to stay home when they are sick or dealing with COVID-19. Furthermore, working citizens must be assured they will continue to be paid while unable to work because they are experiencing COVID-19 symptoms, caring for someone with COVID-19 symptoms, or while caring for a child whose school or childcare provider is unavailable due to COVID-19. This second phase birthed the “Families First Coronavirus Relief Act” (FFCRA), which was signed into law on March 18, 2020.

The third and fourth phases address the biggest issue: stimulating the entire national economy – providing loans and grants to businesses, and direct financial assistance to citizens. The third phase, “Coronavirus Aid, Relief, and Economic Security Act” – referred to as the “CARES Act” – does just that, and was signed into law on March 27, 2020. It creates $2 trillion of funding to: expand the availability & length of unemployment benefits; provide economic stabilization for distressed industries (passenger airlines, cargo airlines, etc.); give individual stimulus payments of up to $1,200 to citizens, and create tax credits and loan programs to fund businesses’ payroll and rent/utility obligation.

The latter portion of the CARES Act authorized $349 billion of federally guaranteed Paycheck Protection Program (PPP) loan funds, which can be 100% forgiven so long as borrowers use the loans to maintain payroll and jobs. Unfortunately, though, the maximum $349 billion was claimed just 13 days into the funds’ availability.

Less than four weeks after the passage of the CARES Act, the President signed H.R. 266, the Paycheck Protection Program and Health Care Enhancement Act on April 24, 2020, which adds another $310 billion into the Paycheck Protection Program – in addition to $75 billion for hospitals/providers, $25 billion for COVID-19 testing, and $60 billion for the SBA’s existing Economic Injury Disaster Loan (EIDL) program, which provides employers up to $10,000 in emergency relief that does not have to be repaid.

New applications for small business assistance through PPP and EIDL are, once again, being taken as of April 27, and FFCRA’s emergency paid sick leave and expanded paid family leave programs are still in place.

FFCRA marks the first time the federal government has ever mandated that employers must provide paid leave. It requires employers with less than 500 employees to provide up to two-weeks of paid leave at the employee’s regular rate of pay (up to $511/day) if an employee is unable to work due to government quarantine, recommendation by a healthcare provider to self-isolate, or because the employee is experiencing COVID-19 symptoms and is seeking treatment.

FFCRA further requires employers to provide up to two weeks of paid leave at 2/3 of the employee’s regular rate of pay (up to $200/day) if an employee is unable to work because he/she is caring for an individual who is isolating due to government order or by recommendation from a health care provider, or because the employee must care for a child whose school or place of childcare is unavailable for reasons due to COVID-19.

Additionally, employees who have been employed for at least 30 calendar days must be given up to an additional ten weeks of leave for an employee who needs to care for a child due to a school closure or childcare unavailability for COVID-19 reasons (12 weeks total, for employees employed at least 30 calendar days).

These paid leaves are funded by the IRS via payroll tax credits, and health benefits must be maintained during leaves. Employers are required to distribute a FFCRA model notice from the Department of Labor (DOL) to employees (currently available in English, and in Spanish), and post in a common area where applicable. The DOL continues to release regulation and guidance on how FFCRA applies in many real-life examples, and has said it will continue to do so for at least the month of April – and likely into May and June.

Stay tuned to W&B for more details on continued actions by Congress and plans for Coronavirus/COVID-19 support; visit the W&B COVID-19 Response Forum. There you will find a comprehensive carrier survey on policy questions related to COVID-19, an employer FAQ, as well as industry and carrier resources (for brokers, employers, and employees). Please also join us every Tuesday for a recurring live webinar on COVID-19 updates, including deep explanations of applicable laws – and all of the week’s many changes. Word & Brown is here for you, always – we are in this together, and sincerely extend our warmest hearts to you, your family, clients, and loved ones.

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