Tag Archives: Unemployment

What President Biden’s American Rescue Plan Could Mean for Employers

Contributed by Suzannah Wilson Overholt, February 17, 2020

COVID-19 stimulus package, US dollar cash banknote on American flag

Congress is turning its attention to President Biden’s $1.9 trillion economic stimulus package, which is called the American Rescue Plan.  Because the package includes enhanced unemployment benefits that are currently set to lapse in mid-March, Congress is under pressure to take action by then.

The following aspects of the proposal have a specific impact on employers:

  • Restoration and expansion of emergency paid leave
    • President Biden has proposed reinstating and expanding the paid sick and family leave benefits passed as part of the Families First Coronavirus Relief Act (FFCRA) which expired in December. The proposal would reinstate those leave provisions through September. (Read more about the FFCRA leave requirements in our previous blog from March 2020).
    • The proposal expands the leave requirements to cover businesses with fewer than 50 and more than 500 employees, as well as first responders and healthcare workers, who could be exempted from the original leave requirements.  (The proposal would also grant leave to federal workers.) 
    • The government will reimburse employers with fewer than 500 workers for the full cost of providing the leave.
  • Restaurant industry:  The proposal includes the FEMA Empowering Essential Deliveries (FEED) Act that uses the restaurant industry to get food to families in need and helps get laid-off restaurant workers back to work. 
  • Minimum wage:  President Biden’s proposal includes raising the minimum wage to $15 an hour over four years and ending the tipped minimum wage and the sub-minimum wage for people with disabilities. Whether this will actually be considered by Congress as part of the stimulus package is uncertain.
  • Worker safety:  The proposal includes provisions regarding worker safety, which we addressed in a previous blog

Other aspects of the proposal that, while not being specifically workplace related, have an impact on workplace issues are as follows:

  • Vaccines and testing:  The proposal seeks $160 billion for vaccines, testing and related programs to fight COVID-19.  It includes $20 billion for a national vaccination program and $50 billion for testing.  Part of the funding would be directed to hiring public health workers to help administer vaccines and tests.  The goal would be for more people to be vaccinated faster, which should allow more employees to return to work and more businesses to re-open.
  • Extension of pandemic unemployment programs
    • President Biden has proposed increasing federal supplemental unemployment assistance by $100 a week, making it $400 a week instead of the $300 a week that Congress approved in December. 
    • The Pandemic Emergency Unemployment Compensation program, which applies to those who have exhausted their regular state jobless payments, and the Pandemic Unemployment Assistance program, which provides benefits to the self-employed, independent contractors, gig workers and certain people affected by the pandemic, would both be extended.
    • These payments and programs would be extended through September. Currently, they are set to expire in mid-March.
  • Child care: President Biden’s proposal creates an emergency stabilization fund for child care providers to allow them to re-open and stay open. It also contains additional funding to assist families with child care expenses. 

We will provide updates about the status of these proposals as they work their way through Congress.

What if a Laid Off Worker Refuses to Return to Work under the PPP?

Contributed by Carlos Arévalo, May 5, 2020

3d human character a question mark

A couple of weeks ago, we examined two general factors that the Treasury will be examining to determine PPP loan forgiveness, namely whether at least 75% of the borrowed funds have been spent on “payroll costs” and whether employers maintained the same headcount and salary levels for full-time equivalent (FTE) employees.

On Sunday May 3rd, the Treasury issued additional guidance regarding the impact of layoffs on the headcount calculation for purposes of loan forgiveness. Specifically, FAQ #40 asked whether a borrower’s PPP loan forgiveness amount would be reduced if the borrower laid off an employee, subsequently offered to rehire the same employee, but the employee declined the offer. The Treasury’s answer reads in part as follows:

…SBA and Treasury intend to issue an interim final rule excluding laid-off employees whom the borrower offered to rehire (for the same salary/wages and same number of hours) from the CARES Act’s loan forgiveness reduction calculation. The interim final rule will specify that, to qualify for this exception, the borrower must have made a good faith, written offer of rehire, and the employee’s rejection of that offer must be documented by the borrower. Employees and employers should be aware that employees who reject offers of re-employment may forfeit eligibility for continued unemployment compensation.

Based on the Treasury’s answer, there should be no adverse impact on a business “headcount” for purposes of loan forgiveness even where the business initially laid off a worker, but then extended the worker a WRITTEN offer to return and the worker rejected the offer. However, the business should keep a record of the worker’s rejection of the offer just like other PPP loan related documentation, i.e. payroll tax filings, cancelled checks, payment receipts, etc.

It should also be noted that, while not required, the written offer should include a statement that if the worker chooses not to return to work after the offer is made, doing so may, under some circumstances, be deemed a voluntary resignation potentially disqualifying the worker from continued unemployment benefits.   

NOTE: This is general information and should not be construed as legal advice. New guidance is continually being published. This information is only current through May 3, 2020.

Unemployed Job Applicants Need Not Apply…

Contributed by Samantha Esmond

In March, the District of Columbia enacted the first law in the nation to prohibit discrimination against unemployed job applicants. The Unemployed Anti-Discrimination Act of 2012, signed by Mayor Vincent C. Gray, makes it unlawful for employers and employment agencies to consider the employment status of a job applicant in making employment and hiring decisions. This law also bars employers from indicating in a job advertisement that unemployed individuals are either disqualified for the job or that unemployed individuals will not be considered or hired for the vacant position. Employers who violate this law will be subject to civil penalties not to exceed $20,000 per violation.

While the District of Columbia is certainly at the forefront, passage of similar laws may become a national trend. With the unemployment rate still hovering around 8%, more and more states may be considering passage of similar laws.

The California assembly is currently considering passage of a similar bill. Assembly Bill 1450 introduced on January 5, 2012 by Assembly Member Allen, would make it unlawful for an employer, employment agency, or person who operates an internet website for posting jobs in California to refuse to hire a person because of that person’s employment status. California AB 1450 further prohibits the publishing of an advertisement or announcement for any job that includes provisions stating or indicating that a person’s current employment is a requirement for a job or that unemployed applicants will be not considered based on that person’s employment status.

Other state legislatures, such as Michigan, with Senate Bill No. 606 titled “The Fair Consideration of the Unemployed Act,” are currently considering laws which prohibit discrimination against unemployed job applicants in job advertisements and postings. States such as Oregon and New Jersey have previously enacted laws that prohibit discrimination against the unemployed in job advertisements. As recently as March 27, 2012, the Governor of Oregon signed off on Senate Bill 1548. This new Oregon state law prohibits employers from including language in a job advertisement indicating that someone who is unemployed “should not apply” or “will not be considered” for the position.