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ASA is Dedicated to Making Sure its Members Have the Latest Information Regarding COVID-19

Dear Members,

The emergence of COVID-19 in the United States has undoubtedly impacted our members both personally and professionally. Please know that the ASA is a resource to you during this difficult time and is working diligently to ensure you have the most up to date information available from federal agencies along with all pertinent developments related to Congress' response. Please utilize this webpage to stay up to date on the latest COVID-19 information as we all work through this together.

ASA Resources

OSHA COVID UPDATES

ASA Submits Comments to OSHA Regarding COVID-19 Vaccination and Testing

January 20, 2022 - The American Subcontractors Association (ASA), along with the Construction Industry Safety Coalition (CISC), submitted comments in response to the Occupational Safety and Health Administration's (OSHA) COVID-19 Vaccination and Testing: Emergency Temporary Standard (ETS).  Per the comments offered, we “reiterate the proactive measures taken by the CISC and the construction industry to address COVID-19, including the CISC’s efforts to increase vaccinations among the construction workforce; discuss the CISC’s concerns regarding the lack of stakeholder involvement in OSHA’s development of the ETS; describe how and why the construction industry is low risk and, thus, applying the ETS to the construction industry is not appropriate under the Occupational Safety and Health Act of 1970; and discuss some additional issues with the ETS as applied to the construction industry. Full comments can be accessed below:

CISC Comments-OSHA-2021-0007 COVID-19 Vaccination and Testing ETS 1.19.2022

OSHA ETS Blocked by the Supreme Court

January 13, 2022 - The Supreme Court just announced a temporary block of the Biden administration's vaccine-or-test mandate for large employers but upheld the vaccine-only mandate for health care providers. The court ruled 6-3 against the Occupational Safety and Health Administration's employer mandate, blocking it from taking effect while other legal challenges play out. Unless a further order is issued by the Court, the ETS is blocked nationwide in its entirety.

The court ruled 5-4 to keep the CMS health care worker mandate, with Chief Justice Roberts and Justice Brett Kavanaugh joining the court's three liberal justices. CMS has announced that it will begin enforcing the mandate on January 27. All employees, contractors, and volunteers affiliated with covered entities must receive the first dose of a COVID-19 vaccine (or the single dose vaccine) prior to January 27. In addition, all affected persons must receive a second dose of their COVID-19 vaccine by February 28.

OSHA ETS Vaccine Rule

January 4, 2022 - On Monday, January 10, 2022, OSHA will begin enforcing the first phase of the Emergency Temporary Standard (ETS) requiring employers with 100 or more employees to combat the spread of COVID-19 including that all employees either be vaccinated or submit to weekly testing. This Friday, January 7, 2022, the Supreme Court will be hearing arguments on lawsuits filed against this ETS.  Enforcement of the ETS vaccine and testing requirements in particular are set to begin on January 9th .  Please see memo below from our partners at the Small Business Legislative Council for more information:

SBLC OSHA Vaccine Rule Alert

American Subcontractors Association (ASA) Applauds the Associated General Contractors (AGC) of America ’s Legal Challenge Against the Occupational Safety and Health Administration (OSHA)’s COVID Vaccine Mandate Emergency Temporary Standard (ETS)

November 17, 2021 - ASA applauds the AGC of America regarding their legal challenge against OSHA’s COVID-19 Vaccine Mandate ETS, which will have significant implications for the construction industry’s workforce, particularly since OSHA has generally characterized the construction industry as low risk. The AGC of America’s petition filed in the U.S. Court of Appeals for the Fourth Circuit notes “that OSHA exceeded its statutory authority to promulgate an ETS, and it failed to comply with the Occupational Safety and Health Act.” Additionally, this new standard will impact all construction companies with 100 or more employees by causing many of them to lose a substantial number of their workers to smaller companies, instead of leading to more people getting vaccinated in the industry.

ASA OSHA ETS Vaccine Mandate Press Release

Federal Appeals Court Blocks Biden Administration's
New Vaccine or Testing Policy
SESCO Update - 11/8/2021

The U.S. Circuit Court of Appeals for the Fifth Circuit has issued a stay temporarily blocking President Biden’s new COVID-19 vaccination-or-testing policy for employers with at least 100 employees companywide. The court granted the emergency stay, saying it raises “grave statutory and constitutional issues,” and added that the rule was suspended “pending further action by this court.” The court ordered the Biden administration to file initial legal papers by late Monday afternoon and is expected to move quickly to rule on whether the new policy can be enforced.

It is SESCO’s current recommendation for those employers (other than federal contractors) who do not wish to mandate vaccines for all employees to “count to ten” before implementing such policy. SESCO will continually monitor developments as to the progress of legal challenges.

SESCO Management Consultants will continue to monitor and report on developments with respect to the COVID-19 pandemic and will post updates in the firm’s COVID-19 Resource Center as additional information becomes available.

SESCO retainer clients and members of select associations can call or email SESCO to discuss specific industry, state and/or company questions and concerns. Those receiving these alerts that are not SESCO clients can contact SESCO by phone, fax or email to explore support options.

BREAKING: OSHA ISSUES VACCINE/TESTING STANDARD

Thursday, November 4, 2021 - Today, OSHA released the anticipated COVID-19 Vaccination and Testing Emergency Temporary Standard (ETS), which can be found https://public-inspection.federalregister.gov/2021-23643.pdf and is scheduled to be published in the Federal Register tomorrow.  The New Vaccination Requirement for Employers With 100 or More Employees: OSHA is issuing a COVID-19 Vaccination and Testing Emergency Temporary Standard (ETS) to require employers with 100 or more employees—including construction (i.e., “covered employers”) to:

  • Get Their Employees Vaccinated by January 4th and Require Unvaccinated Employees to Produce a Negative Test on at Least a Weekly Basis: All covered employers must ensure that their employees have received the necessary shots to be fully vaccinated – either two doses of Pfizer or Moderna, or one dose of Johnson & Johnson – by January 4th. After that, all covered employers must ensure that any employees who have not received the necessary shots begin producing a verified negative test to their employer on at least a weekly basis, and they must remove from the workplace any employee who receives a positive COVID-19 test or is diagnosed with COVID-19 by a licensed health care provider. The ETS lays out the wide variety of tests that comply with the standard. Given that vaccines are safe, free, and the most effective way for workers to be protected from COVID-19 transmission at work, the ETS does not require employers to provide or pay for tests. Employers may be required to pay for testing because of other laws or collective bargaining agreements.
  • Pay Employees for the Time it Takes to Get Vaccinated: All covered employers are required to provide paid-time for their employees to get vaccinated and, if needed, sick leave to recover from side effects experienced that keep them from working.
  • Ensure All Unvaccinated Employees are Masked: All covered employers must ensure that unvaccinated employees wear a face mask while in the workplace.
  • Other Requirements and Compliance Date: Employers are subject to requirements for reporting and recordkeeping that are spelled out in the detailed OSHA materials available here. While the testing requirement for unvaccinated workers will begin after January 4th, employers must be in compliance with all other requirements – such as providing paid-time for employees to get vaccinated and masking for unvaccinated workers – on December 5th. The Administration is calling on all employers to step up and make these changes as quickly as possible.
  • Streamlining Implementation and Setting One Deadline Across Different Vaccination Requirements: The rules released today ensure employers know which requirements apply to which workplaces. Federal contractors may have some workplaces subject to requirements for federal contractors and other workplaces subject to the newly-released COVID-19 Vaccination and Testing ETS. To make it easy for all employers to comply with the requirements, the deadline for the federal contractor vaccination requirement will be aligned with those for the CMS rule and the ETS. Employees falling under the ETS, CMS, or federal contractor rules will need to have their final vaccination dose – either their second dose of Pfizer or Moderna, or single dose of Johnson & Johnson – by January 4, 2022. This will make it easier for employers to ensure their workforce is vaccinated, safe, and healthy, and ensure that federal contractors implement their requirements on the same timeline as other employers in their industries. And, the newly-released ETS will not be applied to workplaces subject to the federal contractor requirement or CMS rule, so employers will not have to track multiple vaccination requirements for the same employees.

OSHA Fact Sheet below and more information can be found on their website for this 2nd ETS: https://www.osha.gov/coronavirus/ets2.

Finally, we are in the process of reviewing the ETS and we plan on submitting comments on the rule, which looks like they will be due December 5.

OSHA FACT SHEET

Employer Vaccine Resource Portal

Construction Industry Safety Coalition OSHA Employer Vaccine Mandate Letter 

Tuesday, September 28, 2021 - On September 9th, President Biden issued a new plan Path out of the Pandemic, which includes a six-pronged, comprehensive national strategy to combat the surge of COVID-19 variants, with the primary goal of vaccinating the unvaccinated.  One prong of the plan would entail OSHA issuing an Emergency Temporary Standard (ETS) that will require all employers with 100+ employees to ensure their workforce is fully vaccinated or require any workers who remain unvaccinated to produce a negative test result on at least a weekly basis before coming to work.  OSHA is currently developing this 2nd ETS and the Agency does not have to follow the Administrative Procedure Act, meaning there is not an opportunity for a formal public notice-and-comment period.

We believe it is very important for the construction industry to engage on this issue quickly, as we did with the 1st COVID ETS.  The CISC has prepared the letter below to James Frederick, OSHA Deputy Assistant Secretary, that highlights the CISC COVID-19 prevention efforts to date, states the construction industry is low-risk for COVID-19, and raises issues of concern, including Workforce Shortages, Employer and Employee Obligations for Vaccinations and Testing, Paperwork Burdens, Recordability of Adverse Reactions to the COVID-19 Vaccine, Cost of Paid Time Off for Vaccinations and Adverse Reactions, and Availability of Testing Kits. Read letter below:

CISC Comments on Upcoming ETS

SESCO Vaccine Mandate Update
September 21, 2021

Private Employers with 100 or More Employees

As we previously reported, President Biden has directed the Department of Labor's Occupational Safety and Health Administration (OSHA) to issue an Emergency Temporary Standard (ETS) that would require all private employers with 100 or more employees to mandate all employees be vaccinated or be tested at the employer’s expense at least once per week. OSHA has not yet issued ETS. It is anticipated the ETS will require private employers with 100 or more employees to provide paid time off for employees to receive the vaccine and to recover from any side effects of the vaccine.

Federal Contractors

The President has also signed an Executive Order requiring all federal contractors (regardless of size) and all government employees be vaccinated, with no option of being regularly tested.

  • The Safer Federal Workforce Task Force has issued FAQs that provide employees of federal contractors must be fully vaccinated by November 22, 2021.
  • "Fully vaccinated" means two weeks have passed since someone received a single-shot vaccine or the second dose of a two-shot vaccine, so the last dose must be administered by November 8.
  • New hires who start on or after November 22 must be fully vaccinated when their employment begins.
  • Federal contractors must require documentation from employees to prove vaccination, even if an employee has previously attested to their vaccination status.

Vaccine mandates must comply with federal anti-discrimination laws. An employee with a religious objection or disability may need to be accommodated. The task force said the following factors should be considered to determine whether an exception is legally required:

  • The basis for the claim;
  • The nature of the employee's job responsibilities; and
  • The reasonably foreseeable effects on the agency's operations, including protecting other employees and the public from COVID-19.

Given many governors, pro-business groups and trade associations are vowing to challenge Biden’s directives, it is SESCO’s current recommendation for those employers (other than federal contractors) who do not wish to mandate vaccines for all employees to “count to ten” before implementing such policy. SESCO will continually monitor developments as to when regulations will be implemented and subsequently the progress of legal challenges.

As we have communicated previously, employers can currently mandate that all employees be vaccinated regardless of the number of employees. Many employers have decided to do so; however, given the current economic and staffing challenges some have made business decisions to not mandate the vaccine.

SESCO Management Consultants will continue to monitor and report on developments with respect to the COVID-19 pandemic and will post updates in the firm’s COVID-19 Resource Center as additional information becomes available.

Construction Subcontracting and COVID-19 Recovery in the Southwest

June 21/28, 2021 - Check out this insightful ENR Southwest piece on the impact of COVID-19 on the Subcontracting industry: Click here for article

OHSA RELEASES COVID-19 EMERGENCY TEMPORARY STANDARD

 

Workers in a hospital using PPE

June 14, 2021 - Nearly three months after its original due date, on Thursday, June 10, 20201, the Occupational Safety and Health Administration (OSHA) finally released its much anticipated COVID-19 Emergency Temporary Standard (ETS). The ETS is much more limited than anticipated and only applies to healthcare and healthcare support service workers.

One of President Biden’s first actions upon assuming office was to issue an Executive Order on COVID-19 safety which, among other things, directed OSHA to “consider whether any emergency temporary standards on COVID-19, including with respect to masks in the workplace, are necessary, and if such standards are determined to be necessary, issue them by March 15, 2021.” OSHA indicated that it planned to release an emergency temporary standard but missed the March 15 deadline. Then on April 27, the Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA) confirmed that OSHA had submitted an emergency temporary standard for review.

The ETS (which spans just over 900 pages) makes it clear that it only applies to “settings where any employee provides healthcare services or healthcare support services.” OSHA estimates that around 10.3 million workers will be covered by the new ETS. Of course, businesses with covered employees will have their work cut out for them to make sure that they are conforming with each and every requirement of the ETS, which includes provisions related to PPE, the physical workplace and paid leave for employees so they can get vaccinated and recover from vaccines. That said, these businesses may be relieved to find that many of the provisions are consistent with prior OSHA guidance and that they are already in compliance in many respects.

For businesses that are not covered by the new ETS, OSHA simply updated its Guidance on Mitigating and Preventing the Spread of COVID-19 in the Workplace. Though many employers have relied on this Guidance to assist them over the last year, compliance with the OSHA Guidance (as opposed to the ETS) is voluntary. That said, since many jurisdictions have drawn from the guidance to create their own state and local rules – some of which are mandatory – it will be important for businesses of all stripes to make sure they are staying in compliance with the rules that apply to them.

 

CDC New Mask Guidelines

On Tuesday, April 27, 2021, the Centers for Disease Control (CDC) announced new rules on mask wearing outdoors.   The mask guidance states that Americans who are fully vaccinated against the coronavirus no longer need to wear a mask outdoors while walking, running, hiking, or biking alone, or when in small gatherings, including with members of their own households. Masks are still necessary in crowded outdoor venues like sports stadiums.

The CDC guidance can be found here:  https://www.cdc.gov/coronavirus/2019-ncov/daily-life-coping/participate-in-activities.html

 

RETURNING TO WORK

Both OSHA and CDC regularly update their webpages with reopening guidance relevant to the business community.  We encourage you to regularly check for update guidance at:

OSHA has also released general guidance for preparing workplaces for COVID-19:

For all workers, regardless of specific exposure risks, it is always a good practice to:

  • Frequently wash your hands with soap and water for at least 20 seconds. When soap and running water are unavailable, use an alcohol-based hand rub with at least 60% alcohol. Always wash hands that are visibly soiled.
  • Avoid touching your eyes, nose, or mouth with unwashed hands.
  • Practice good respiratory etiquette, including covering coughs and sneezes.
  • Avoid close contact with people who are sick.
  • Stay home if sick.
  • Recognize personal risk factors. According to U.S. Centers for Disease Control and Prevention (CDC), certain people, including older adults and those with underlying conditions such as heart or lung disease or diabetes, are at higher risk for developing more serious complications from COVID-19.

Industry-Specific Guidance Documents: In addition to the general guidance above, OSHA frequently issues specific guidance tailored to specific industries. View the construction industry guidance here.

OSHA Issue’s New FAQ’s on COVID-19 and the Workplace

The Occupational Safety and Health Administration (OSHA) released answers to nearly 40 frequently asked questions (FAQs) on protecting workers during the ongoing COVD-19 pandemic. OSHA’s FAQ’s now speak to key issue areas including employee testing, employer requirements, use of personal protective equipment, return to work protocols, and cleaning guidelines in the workplace. The FAQ guidance is part of a series of OSHA publications on workplace safety during COVID-19. Click here to review the FAQ’s (insert link: https://www.osha.gov/SLTC/covid-19/covid-19-faq.html)

General Resources

Click Here to Download the ASA COVID-19 Resource Guide

Reopening a Business Without Opening Employer Liability- SESCO

ConsensusDocs COVID-19 Resource Center

CDC

CDC: Prepare your business and employees for the effects of COVID-19

CDC Fact Sheet on preparing your business and employees for COVID-19

CDC: Employer Information for office Buildings

OSHA

OSHA COVID-19 Resource Center 

OSHA Guidance for the Construction Industry

OSHA COVID-19 Safety Standards

Department of Labor

DOL COVID-19 Resource Page

COVID-19 and the American Workplace

EEOC

EEOC: Updated Covid 19 Technical Assistance

SBA Loan Programs

Click Here to Apply for the SBA Economic Injury Disaster Loan Program

Click Here for Information on the SBA Paycheck Protection Program
(Application is in the COIVD-19 section of InfoHub)

Click Here for the Department of Treasury's PPP Loan Guidance Document

(NOTE: Question #46 addresses PPP loan self-certification and review of loans over $2 million)

Click Here for the PPP Loan Forgiveness Application

Click Here to review the Small Business Legislative Council's memo outlining the PPP Loan Forgiveness Application! (NOTE: The ASA is a member of the SBLC)

Click here to review key provisions of the SBA Interim Final Rules on PPP Loans

Click Here to Learn More about the SBA CARES Loans Program

FFCRA New Paid Leave Provisions

SESCO Management Consultants: DOL Releases Revised FFCRA Regulations on Concurrent Leave

IRS FAQ's on Employer Tax Credits for Paid Leave

Click here for IRS Form 7200 for Advanced Payment of Employer Credits Due to COVID-19

Click here for IRS Fact Sheet on New Credits for COVID-19 Related Paid Leave

ASA Members Only Resources

These resources are only available within the MEMBERS ONLY ASA Info Hub.

To access the MEMBERS ONLY ASA Info Hub:
1. Go to the Member Login Page.
2. If you need a Username and Password, create an account.
3. Once logged into the Info Hub, choose "Resources" from the left-hand menu.
4. Choose "COVID-19" from the drop-down menu at the top of your screen.

RETURNING TO WORK

Both OSHA and CDC regularly update their webpages with reopening guidance relevant to the business community.  We encourage you to regularly check for update guidance at:

OSHA has also released general guidance for preparing workplaces for COVID-19:

For all workers, regardless of specific exposure risks, it is always a good practice to:

  • Frequently wash your hands with soap and water for at least 20 seconds. When soap and running water are unavailable, use an alcohol-based hand rub with at least 60% alcohol. Always wash hands that are visibly soiled.
  • Avoid touching your eyes, nose, or mouth with unwashed hands.
  • Practice good respiratory etiquette, including covering coughs and sneezes.
  • Avoid close contact with people who are sick.
  • Stay home if sick.
  • Recognize personal risk factors. According to U.S. Centers for Disease Control and Prevention (CDC), certain people, including older adults and those with underlying conditions such as heart or lung disease or diabetes, are at higher risk for developing more serious complications from COVID-19.

Industry-Specific Guidance Documents: In addition to the general guidance above, OSHA frequently issues specific guidance tailored to specific industries. View the construction industry guidance here.

OSHA Issue’s New FAQ’s on COVID-19 and the Workplace

The Occupational Safety and Health Administration (OSHA) released answers to nearly 40 frequently asked questions (FAQs) on protecting workers during the ongoing COVD-19 pandemic. OSHA’s FAQ’s now speak to key issue areas including employee testing, employer requirements, use of personal protective equipment, return to work protocols, and cleaning guidelines in the workplace. The FAQ guidance is part of a series of OSHA publications on workplace safety during COVID-19. Click here to review the FAQ’s (insert link: https://www.osha.gov/SLTC/covid-19/covid-19-faq.html)

General Resources

Click Here to Download the ASA COVID-19 Resource Guide

Reopening a Business Without Opening Employer Liability- SESCO

ConsensusDocs COVID-19 Resource Center

CDC

CDC: Prepare your business and employees for the effects of COVID-19

CDC Fact Sheet on preparing your business and employees for COVID-19

CDC: Employer Information for office Buildings

OSHA

OSHA COVID-19 Resource Center 

OSHA Guidance for the Construction Industry

OSHA COVID-19 Safety Standards

Department of Labor

DOL COVID-19 Resource Page

COVID-19 and the American Workplace

EEOC

EEOC: Updated Covid 19 Technical Assistance

SBA Loan Programs

Click Here to Apply for the SBA Economic Injury Disaster Loan Program

Click Here for Information on the SBA Paycheck Protection Program
(Application is in the COIVD-19 section of InfoHub)

Click Here for the Department of Treasury's PPP Loan Guidance Document

(NOTE: Question #46 addresses PPP loan self-certification and review of loans over $2 million)

Click Here for the PPP Loan Forgiveness Application

Click Here to review the Small Business Legislative Council's memo outlining the PPP Loan Forgiveness Application! (NOTE: The ASA is a member of the SBLC)

Click here to review key provisions of the SBA Interim Final Rules on PPP Loans

Click Here to Learn More about the SBA CARES Loans Program

FFCRA New Paid Leave Provisions

SESCO Management Consultants: DOL Releases Revised FFCRA Regulations on Concurrent Leave

IRS FAQ's on Employer Tax Credits for Paid Leave

Click here for IRS Form 7200 for Advanced Payment of Employer Credits Due to COVID-19

Click here for IRS Fact Sheet on New Credits for COVID-19 Related Paid Leave

ASA Members Only Resources

These resources are only available within the MEMBERS ONLY ASA Info Hub.

To access the MEMBERS ONLY ASA Info Hub:
1. Go to the Member Login Page.
2. If you need a Username and Password, create an account.
3. Once logged into the Info Hub, choose "Resources" from the left-hand menu.
4. Choose "COVID-19" from the drop-down menu at the top of your screen.

ASA Government Relations Updates

ASA COVID-19 Advocacy Communications

COVID-19 Emergency Relief Package Signed Into Law

On Monday, December 21, 2020, Congress overwhelmingly passed a $900 billion COVID-19 relief package and government funding bill, its second effort this year to bring much-needed aid to Americans struggling during the pandemic. The package includes a new round of stimulus checks, an extension of unemployment benefits, and more money for vaccines and education. The legislation easily passed in the House — 359 to 53 — before breezing through the Senate shortly before midnight in a 92-6 vote. On Sunday, December 28, 2020, President Trump signed the COVID-19 relief package into law.

Click here for a detailed breakdown of what's included in the COVID-19 relief package. 

Emergency COVID-19 Relief Package Draft Agreement

Click here to review a bipartisan agreement on a $908 Billion Bipartisan COVID-19 Package, which includes the following: "Business expenses paid for with the proceeds of PPP loans are tax-deductible, consistent with Congressional intent in the CARES Act. " This package must be agreed to in both chambers and voted on before December 18th. Stay tuned to ASA as the details and status of this COVID-19 package emerge.

SBA Interim Final Rule on Rent

On August 24th, the SBA issued the first guidance on Interim Final Rules (IFR) with respect to the number of expenses a borrower can count towards forgiveness of their Paycheck Protection Program (PPP) loan.

Four helpful examples in the IFRs explain the application of this new rule:
  • Example 1: A borrower rents an office building for $10,000 per month and subleases out a portion of the space to other businesses for $2,500 per month. Only $7,500 per month is eligible for loan forgiveness.
  • Example 2: A borrower has a mortgage on an office building it operates out of, and it leases out a portion of the space to other businesses. The portion of mortgage interest that is eligible for loan forgiveness is limited to the percent share of the fair market value of the space that is not leased out to other businesses. As an illustration, if the leased space represents 25% of the fair market value of the office building, then the borrower may only claim forgiveness on 75% of the mortgage interest.
  • Example 3: A borrower shares a rented space with another business. When determining the amount that is eligible for loan forgiveness, the borrower must prorate rent and utility payments in the same manner as on the borrower’s 2019 tax filings, or if a new business, the borrower’s expected 2020 tax filings.
  • Example 4: A borrower works out of his or her home. When determining the amount of nonpayroll costs that are eligible for loan forgiveness, the borrower may include only the share of covered expenses that were deductible on the borrower’s 2019 tax filings, or if a new business, the borrower’s expected 2020 tax filings.

Related Party Rent Payments Limited to Mortgage Interest and Payment of Mortgage Interest to a Related Party Disallowed

The new IFR is that rent paid to a related party is only eligible for forgiveness if (1) the amount of loan forgiveness requested for rent or lease payments to a related party is no more than the amount of mortgage interest owed on the property during the Covered Period that is attributable to the space being rented by the business, and (2) the lease and the mortgage were entered into prior to February 15, 2020.

As a result of the above, borrowers who own their building in a separate entity free and clear with no mortgage will not receive credit towards forgiveness for rent paid to the related entity. This rule is made even more penal since the above limitation applies if there is ANY common ownership between the two entities, meaning that the limitation applies even if an individual owns just 1% of the entity receiving rent payments.

Further, the IFRs provides that mortgage interest payments to a related party are not eligible for loan forgiveness.

The SBA provided their reasoning for the above limitations in the IFRs stating that "PPP loans are intended to help businesses cover certain nonpayroll obligations that are owed to third parties, not payments to a business’s owner that occur because of how the business is structured. This will maintain equitable treatment between a business owner that holds the property in a separate entity and one that holds the property in the same entity as its business operations."

Many borrowers will be shocked to find out that expenses paid pursuant to arm’s length lease or debt arrangements with related parties that have been in place for many years will now not be counted towards forgiveness.

IRS releases Payroll Tax Holiday Guidance

 

The IRS has issued guidance on President Trump’s August 8 payroll tax holiday memorandum. The notice from Treasury allows, but does not force, employers to postpone payroll taxes for the period starting September 1, 2020, and ending December 31, 2020. Employers would then be required to remit the deferred taxes between January 1, 2021, and April 30, 2021. Following the direction of Trump’s memo, the payroll tax holiday only applies to individuals with wages below a bi-weekly threshold of $4,000, which translates to an annualized salary of below $104,000 a year (there are 26 pay bi-weekly pay periods each year).

Click here to review the guidance document. 

COVID-19 ​Stimulus Relief Bill

On Saturday, August 8, 2020, after negotiations broke down between the White House and House and Senate Democratic negotiators, President Trump signed an executive order and a number of Memoranda. It is expected that the President’s orders are likely to be challenged in the courts over whether they violate core constitutional principles, separation of powers and tax and appropriations law.

The Executive Order and Memoranda can be found below:

Unemployment Benefits - Memorandum on Authorizing the Other Needs Assistance Program for Major Disaster Declarations Related to Coronavirus Disease 2019 can be found here.

​The President intends to reprogram unspent funding from the CARES Act and funds from the Homeland Security Department’s Disaster Relief Fund (DRF) to provide weekly unemployment benefits of $400 with $100 of the benefit required to be covered by States. The previous amount was a $600 weekly benefit with the entire cost covered by the Federal government. The benefit will be extended through December 6, 2020 or until the DRF is spent down to $25 billion.

Payroll Taxes - Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster can be found here.

The memorandum directs the Department of Treasury to authorize employers to defer payment of the employee portion of certain payroll taxes for those earning up to $100,000. The deferred payment takes effect on September 1st and will end of December 31, 2020.

Deferment of Student Loan Payments - Memorandum on Continued Student Loan Payment Relief During the COVID-19 Pandemic can be found here.

Student loan payments would be deferred through December 31, 2020.

Extending the Eviction Moratorium - Executive Order on Fighting the Spread of COVID-19 by Providing Assistance to Renters and Homeowners can be found here.

The President plans to extend the CARES Act federal moratorium on evictions and directs the Federal Housing Finance Agency to suspend foreclosures until August 31st. The order also includes a directive to try to halt evictions include instructing HHS and the CDC to consider suspending residential evictions of tenants “to prevent the further spread of COVID-19 from one State or possession into any other State or possession”; directs DOT and HUD to identify Federal funds to provide temporary financial assistance to renters and homeowners experiencing COVID-19 hardships; and directs HUD to take actions to “promote the ability of renters and homeowners to avoid eviction or foreclosure resulting from financial hardships caused by COVID-19.”

Open Items: In order to reach a deal the following major areas of disagreement need to be resolved:

  • Unemployment benefits: Republicans are pushing for $400 for 20 weeks or 70% of wage replacement with States picking up 25% of the costs. Democrats are holding firm on $600.
  • Housing: Democrats want rental assistance and a cease of evictions. Republicans offered an eviction moratorium.
  • Education: Democrats are at $175 billion for K-12 compared to Republicans' $75 billion.
  • State and local aid: Republicans are supporting $150 billion for a year and flexibility on the $112 billion that was unspent from the CARES Act. Democrats are pushing for $900 billion over two years, with Pelosi floating the idea of $500 per year.
  • Contact Tracers: Republicans are opposed to Democrats' idea of a new national service program for contact tracers.

COVID-19 IV Stimulus Funding Bill

On Monday, July 27, 2020, Senate Majority Leader McConnell introduced the Republican version of the next stimulus package, the Health Economic Assistance Liability Protection & Schools Act “HEALS Act,” totaling approximately $1 trillion and Democrats stated the package was insufficient.  The package includes:

  • Direct payments: Up to $1,200 per adult and $500 per dependent.
  • Unemployment insurance: Benefits until September would be at a rate of $200 each week, down from the $600 benefit that expires this week. Starting in October, the benefit would be calculated so that a jobless worker's combined state and federal benefits would amount to 70 percent of lost wages, with a $500 cap on federal benefits.
  • Paycheck Protection Program: Small businesses that meet the requirements could apply for a second round of forgivable loans from the program, with about $190 billion available.
  • Liability protections: Businesses that open during the pandemic would be protected from coronavirus-related medical claims through Oct. 1, 2024, if they make "reasonable efforts" to comply with public health guidelines and don't engage in "willful misconduct or grossly negligent behavior."
  • Health funding: $306 billion in emergency funding for federal agencies, the Department of Health and Human Services would take the largest share, $118.4 billion, for vaccine research, testing and other medical needs.

 

PAYCHECK PROTECTION PROGRAM (HEALS Act): Senate Republicans propose some modifications as well as additional funding for the Paycheck Protection Program (PPP) as part of their proposal.  

  • Additional funding – After some moving around of funds, PPP is ultimately provided an additional $90 billion. 
  • Lower loan cap – All new PPP loans moving forward are capped at $2 million, below the previous $10 million cap. 
  • Expansion of acceptable and forgivable expenses – PPP funds may now be used on the following expenses, with spending on the following also qualifying for forgiveness: 
    • Additional operations expenses, including certain software, cloud computing, and payroll, human resources, and accounting expenses 
    • Property damage costs resulting from damage related to public disturbances that occurred during 2020 and that are not covered by insurance 
    • Supplier costs resulting from a contract for goods in effect prior to February 15, 2020 that are essential to a business’s current operations 
    • Worker protection expenses, including personal protective equipment for employees and other adaptive investments to help a loan recipient comply with federal health and safety guidelines related to COVID-19 during the period between March 1, 2020, and December 31, 2020. 
    • Employer-provided “other group insurance” benefits are included in payroll costs (more of a clarification provision) 
  • Borrower selection of loan forgiveness spending period – Borrowers can choose the forgiveness covered period with no length limitations, but the period must begin on the loan origination date and end between 8 weeks after the loan origination date and December 31, 2020. This effectively means any PPP loan monies spent according to forgiveness rules through December 31 can qualify for forgiveness. 
  • Simplifies the forgiveness application process – The forgiveness application process is simplified for all loans up to $2 million, with loans of $150,000 or less only requiring the borrower attest to a good faith effort to comply with PPP loan forgiveness requirements, retain relevant records for three years, and submit demographic information (no SBA approval for loan forgiveness required). All borrowers accepting loan forgiveness may be audited by SBA, and SBA must submit to Congress a report 30 days after enactment detailing their review and audit plan.  

Please note: As of now, the bill is currently opening up PPP for small businesses to take a second loan if they meet certain requirements, with these second loans called Paycheck Protection Program Second Draw Loans. One such requirement is that the business demonstrate at least a 50% loss in gross revenue when comparing gross revenue for a specific 2020 period to that of 2019.

U.S. Department Of Labor Publishes Additional Guidance on Wage And Hour Rules, Family and Medical Leave As Workplaces Reopen

 

 The U.S. Department of Labor today published additional guidance for workers and employers on how the protections and requirements of the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA), and the Families First Coronavirus Response Act (FFCRA) affect the workplace as workplaces reopen amid the coronavirus pandemic. The guidance from the Department’s Wage and Hour Division (WHD) includes commonly asked questions and answers that address critical issues in all three laws.

 

“The U.S. Department of Labor understands how critically American workers and employers need this information as they return to work. Continuing to provide it remains a top priority for the Wage and Hour Division,” said Wage and Hour Division Administrator Cheryl Stanton. “With so many workers and employers committed to the greatest comeback the American workforce has ever seen, we are providing ongoing guidance to help them better understand their rights and responsibilities to protect workers and help ensure a level playing field for employers as our economy recovers.”

 

Today’s guidance is the latest addition to compliance assistance materials the WHD has published. These materials include a Fact Sheet for Employees, a Fact Sheet for Employers and a Questions and Answers resource about paid sick and expanded family and medical leave under the FFCRA. WHD has also produced two guidance posters, one for federal workers and one for all other employees, that fulfill notice requirements for employers obligated to inform employees of their FFCRA rights; Questions and Answers about posting requirements; and simple Quick Benefits Tips to determine how much paid leave the FFCRA allows workers to take.

 

FFCRA will help the U.S. combat and defeat the coronavirus by reimbursing, through tax credits, American businesses with fewer than 500 employees for the cost of providing employees with paid leave taken for specified reasons related to the coronavirus. The legislation enables employers to provide such paid leave, while at the same time ensuring that workers are not forced to choose between their paychecks and the public health measures needed to combat the virus.

 

WHD provides additional information on common issues employers and employees face when responding to the coronavirus and its effects on wages and hours worked under the Fair Labor Standards Act and job-protected leave under the Family and Medical Leave Act at https://www.dol.gov/agencies/whd/pandemic

SBA ISSUES UPDATED IFR ON PPP LOANS

On Friday, June 11, 2020, the Small Business Administration (SBA) released revisions to their original Interim Final Rule (IFR) on the Paycheck Protection Program following the enactment of the Paycheck Protection Flexibility Act on June 5, 2020. The IFR update's key program guidelines including the following:

  • Loan Maturity Date
  • Deferral Period
  • Loan Forgiveness minimum payroll costs and amounts

To review the updated IFR on the PPP, please click here. 

Paycheck Protection Program Flexibility Act Signed Into Law

HR 7010, the Paycheck Protection Program Flexibility Act, passed the House 417-1 and the Senate by Unanimous Consent. President Trump signed the legislation into law on Friday, June 5, 2020. The legislation provides the following:

  • Extending the minimum maturity of PPP loans to five years. This would take effect on the date of the bill’s enactment and apply to any PPP loan made on or after such a date; however, lenders and borrowers would not be prohibited from mutually agreeing to modify the maturity terms of prior-disbursed PPP loans.
  • Extending the covered period for using PPP loan proceeds from June 30, 2020, to December 31, 2020.
  • Extending the covered period for PPP loan forgiveness from eight weeks from the date of origination to the earlier of 24 weeks from the origination date or December 31, 2020. A borrower who received a loan before the bill’s enactment could elect to continue using the 8-week covered period set forth in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
  • Extending the deadline for the re-hire exception to forgiveness reduction in the loan forgiveness provisions from June 30, 2020, to December 31, 2020.
  • Providing that the amount of loan forgiveness will not be reduced by a reduction in the number of full-time equivalent employees, if, with respect to the period February 15, 2020, to December 31, 2020, the borrower is able to document in good faith (A) an inability to rehire employees who had been employed on February 15, 2020, and an inability to hire similarly qualified employees for unfilled positions by December 31, 2020, or (B) an inability to return to the same level of business activity at which the borrower was operating before February 15, 2020, due to compliance with federal governmental requirements or guidance set forth between March 1, 2020, and December 31, 2020, relating to standards of sanitation, social distancing, or other worker or customer safety requirements due to COVID-19.
  • Providing that at least 60 percent of PPP loan proceeds should be used for payroll costs to receive loan forgiveness (overturning the 75 percent standard set forth by the Small Business Administration (SBA) and U.S. Treasury Department).
  • Eliminating the six-month deferral of payments due under PPP loans and replacing it with deferral until the date on which the amount of forgiveness determined under the CARES Act is remitted to the lender. If a borrower fails to apply for forgiveness within 10 months after the last day of the PPP loan forgiveness covered period (i.e., the earlier of 24 weeks from origination or December 31, 2020), the borrower must then begin to make payments of principal, interest, and fees on its PPP loan.
  • Allowing all employers to take advantage of the CARES Act deferral of the 6.2 percent employer portion of social security payroll taxes, regardless of whether they have had a PPP loan forgiven.

SBA Issues New Rule on the Paycheck Protection Program

On Friday, May 22, 2020, the Small Business Administration (SBA) released two new interim final rules on the Paycheck Protection Program (PPP) clarifying some aspects of the program including general eligibility qualifications and payback provisions. One rule addresses the requirements for loan forgiveness and the other outlines PPP loan review procedures and related borrower and lender responsibilities. With the first funds disbursed under the PPP on April 3, the first 56-day period of payroll protection is expected to end this week for the first batch of loan recipients.

Click here to review key provisions of the SBA Interim Final Rules on PPP Loans

Click here to review the SBA Interim Final Rule on Loan Review Procedures and General Rules for Lenders and Borrowers

Click here to review the SBA Interim Final Rule on PPP Loan Forgiveness 

House Passes CARES Act II

The House passed a $3 trillion coronavirus relief package that would deliver federal aid for state and local governments, provide rent and mortgage relief and expand unemployment and food assistance programs.
The massive aid package was approved mostly along party lines with only a handful of Republicans joining most Democrats in backing the legislation.
The GOP-controlled Senate is not expected to take up the measure.

Senate Passes Legislation for Additional COVID-19 Funding for Small Businesses

On Tuesday, April 21, 2020,  the Senate passed H.R. 266, the Paycheck Protection Program and Health Care Enhancement Act, to provide $484 billion in COVID-19 aide small businesses, hospitals and to expand testing.

The $484 billion aid package negotiated by congressional leaders and the administration would include:

• $310 billion in additional lending authority for the Paycheck Protection Program, with some funds set aside to support loans issued by smaller lenders.

•$60 billion for separate disaster loans to small businesses.

• $75 billion for hospitals.

• $25 billion for virus testing.

The legislation will next go to the House and Speaker Pelosi has indicated that the measure will pass. President Trump is expected to sign the legislation into law.

For a one page summary of the legislation, please click here

For a section by section summary of the legislation, please click here

U.S. Department of Labor Issues Regulation for New Paid Leave Programs

             On Thursday, April 2, 2020, the U.S. Department of Labor (DOL) issued their regulations regarding how American workers and employers will benefit from the protections and relief offered by the Emergency Paid Sick Leave Act and Emergency Family and Medical Leave Expansion Act, both part of the Families First Coronavirus Response Act (FFCRA). The department’s Wage and Hour Division (WHD) posted a temporary rule issuing regulations pursuant to this new law, which went into effect on Wednesday, April 1, 2020. Click here to view the new paid leave regulation.

IRS Guidance on COVID-19 Tax Credits for Businesses Through Required Paid Leave Programs

The FFCRA provides small and midsize employers refundable tax credits that reimburse them, dollar-for-dollar, for the cost of providing paid sick and family leave wages to their employees for leave related to COVID-19. For a more detailed overview of these tax credits, click here. For basic FAQ's, click here.

Coronavirus Aid, Relief, and Economic Security (CARES) Act

On March 25, 2020, the Senate passed the $2.2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act unanimously (96-0). The House passed the CARES Act on Friday, March 27, 2020 by a vote of 419-6 and the legislation was immediately signed into law by President Trump. The CARES Act is the third economic stimulus package passed by Congress in response to the outbreak of coronavirus (COVID-19) and its size and scope makes it the largest stimulus package in U.S. History.

Click here for a summary of key provisions

DOL Issues FFCRA Paid Leave Poster for Employers to Post 

The Department of Labor has released further guidance on the new employee paid leave benefits enacted under the FFCRA. Below is a link to a poster that employers with 500 or fewer employees should post at their business locations.

Please stay tuned for additional guidance from the Department of Labor

DOL Guidance on New Paid Leave Provisions

The U.S. Department of Labor (DOL) is rolling out their guidance t on the new paid leave provisions enacted under the Families First Coronavirus Response Act (FFCRA).
The guidance outlines employer requirements and employee rights under the expanded family and medical leave provisions along with answers to frequently asked questions. Please review the DOL’s guidance below:
The ASA Government Relations Team is continuing to monitor further developments from the DOL.

COVID-19 Resources Available from ASA National Sponsors

We would like to thank the ASA National Sponsors for doing their part to support the subcontracting community during these difficult times.  Please click on the company name to be directed to their COVID-19 resources.