Updates to PPP and Loan Forgiveness Employer-Friendly Changes as of - - PowerPoint PPT Presentation

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

More proceeds can be spent on non-payroll costs

FROM

75/25

TO

60/40

BUT BE CAREFUL THE BILL STATES “TO RECEIVE LOAN FORGIVENESS UNDER THIS SECTION, AN ELIGIBLE RECIPIENT SHALL USE AT LEAST 60 PERCENT OF THE COVERED LOAN AMOUNT FOR PAYROLL COST…” HR 7010 APPEARS TO CREATE A CLIFF.

Longer to replace FTE’s/restore salaries

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. As long as the FTE’s or salary/wage are restored to 2/15 levels any time prior to 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.

For borrowers who lose FTE’s... From 2/15/20 and ending 12/31/20 the amount of loan forgiveness will NOT be reduced when there is a reduction of FTE’s if the borrower, in good faith, is able to document any of the following: Inability to rehire individuals who were employees on 2/15. Inability to hire similarly qualified employees for unfilled positions on

• r before 12/31/20

Inability to return to the same level

• f activity as business was
• perating at before 2/15 due to

compliance with requirements established by SHHS, CDC r OSHA during the period 3/11 thru 12/31/20, related to standards for sanitization, social distancing, or any other worker or customer safety requirement related to COVID-19.

8-week covered period remains an

• ption.

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

• ccurs first), then borrower must start making payments
• f 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

WHAT IF YOU SEE EMPLOYEES NOT SOCIAL DISTANCING ON THEIR SOCIAL MEDIA POSTS?

Disciplining Employees:

BENEFITS: Post furlough or termination...

Does the 90-day waiting period apply? Restoration of benefits Affordability concerns for ALEs

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