Safe Harbor Deadline for Repayment of PPP Loans Extended from May 14 to May 18

Marcia Swihart Orgill

By Marcia Swihart Orgill



On May 13, 2020, the Small Business Administration (SBA), in consultation with the Department of the Treasury, extended the safe harbor deadline to repay Paycheck Protection Program (PPP) loans to May 18, 2020. Previously in its PPP Loans Frequently Asked Questions (FAQs), the SBA reminded borrowers to carefully review the required certification on the PPP loan application that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.”

ppp loanIn further guidance, the SBA provided that any borrower of a PPP loan that repays the loan in full by the specified safe harbor deadline will be deemed by the SBA to have made the required certification concerning the necessity of the loan request in good faith.  According to the newly issued FAQ #47, Continue reading »

Warning to Employers and Medical Providers Alike Regarding Releasing COVID-19 Test Results!

Laura Gerdes Long

By Laura Gerdes Long



So, your furloughed employee[i] is returning to work – Hooray!? Not so fast. Employers and the medical providers who are treating and perhaps testing these employees/patients for COVID-19 need to be wary about who is able to disclose and use testing information and to whom.  Both sides must tread carefully and follow strict guidelines in such situations.

For over two decades, the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) has governed disclosure of an individual’s protected health information and has prevented a medical provider from unilaterally disclosing sensitive health information to employers.  Even faced with a previously unimaginable global pandemic, from its implementation in 2003, the HIPAA Privacy Rule has had procedures in place that address this thorny legal issue.

Take the following hypothetical example: An employer furloughs an employee as a reduction in work force for financial reasons. While on furlough, the rumor mill is active and the employer “hears” that this employee may have been experiencing COVID-19 symptoms while on furlough.  May the employer reach out to the employee’s medical provider to obtain medical information specifically related to COVID-19 testing? May the provider release such information if the employer contacts the provider to inquire? Work-arounds exist under the HIPAA Privacy Rule or may exist when the employer pays for COVID-19 testing.

Option 1:  Consent Upfront. Continue reading »

Federal Reserve Offers Lending Program for Small and Medium-Size Businesses

Hannah E. Mudd

By Hannah E. Mudd



Updated 9/1/2020

The Federal Reserve announced on April 9, 2020 that it has established a $600 billion lending program focused on aiding small and medium-size businesses who were in good financial standing prior to the onset of the COVID-19 crisis. This program will enable the purchase of qualifying loans from lenders lending to U.S. businesses with up to 10,000 employees or up to $2.5 billion in 2019 annual revenues. Additionally, it looks like firms who have taken advantage of the SBA Paycheck Protection Program will be eligible to participate in this program as well.

The Federal Reserve’s Main Street Lending Program will operate through two facilities: the Main Street New Loan Facility (MSNLF) and the Main Street Expanded Loan Facility (MSELF). Eligible lenders may originate new loans (under MSNLF) or increase the size of (“upsize”) existing loan/tranches (under MSELF) made to eligible businesses. The program is not operational at this time, but the comment period just closed on April 16, 2020. Accordingly, we can expect the program to start and have an application available soon.

The MSNLF will purchase participations in eligible loans originated by lenders on or after April 8, 2020. The MSELF will purchase upsized tranches or loans originated by lenders before April 8, 2020 that meet specific eligibility criteria. In either case, the purchases will be on a risk-shared basis with the lender retaining 5% of the loans and the relevant facility purchasing 95% participation in the loans originated by eligible lenders. This 95% purchased participation will be through a single special purpose vehicle on a recourse basis as set up by a Reserve Bank branch.

We will first discuss the borrower, lender, asset, and entity eligibility requirements that are the same across both facilities before delving into the facility-specific issues.

Common Requirements

Eligible lenders include U.S. insured depository institutions, U.S. bank holding companies, and U.S. savings and loan holding companies (“lenders”). While eligible borrowers are businesses with up to 10,000 employees or up to $2.5 billion in 2019 annual revenues. Borrowers must be a business created or organized in the United States or under the laws of the United States with significant operations in, and most of its employees based in, the United States. Borrowers who participate in program may not also participate the Primary Market Corporate Credit Facility as established by the Federal Reserve.

Eligible loans are unsecured term loans made by a lender(s) to a borrower that has: Continue reading »

Unemployment Benefits in the Time of Covid-19

Lauren L. Wood

By Lauren L. Wood



layoff

The United States has seen a staggering rise in claims for unemployment with nearly 3.3 million new jobless claims. With no clear end to the COVID-19 crisis in sight, Congress passed legislation and states have revised policies to ease the growing unemployment burden. This article provides an overview of the unemployment provisions of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and new measures taken by Missouri and Illinois to provide relief.

The CARES Act

The CARES Act provides for $260 billion to dramatically expand unemployment coverage for workers who are unable to work as a result of the pandemic.

In the event a worker becomes unemployed as a result of COVID-19, the worker will be eligible for Federal Pandemic Unemployment Compensation (FPUC) of $600 per week. This payment is in addition to any benefits a worker is entitled to under applicable state law. The supplemental payments will be provided through July 31, 2020.

The CARES Act also provides for 13 weeks of Pandemic Emergency Unemployment Compensation (PEUC), in addition to regular length of time a worker may receive regular state benefits. To receive these extended benefits, a worker must be actively searching for work, though the CARES Act requires states to provide flexibility in applying this requirement when COVID-19 restricts an individual’s ability to look for work.

Workers who usually do not qualify for unemployment benefits, including those who are self-employed, independent contractors and freelancers, among others, will be eligible for Pandemic Unemployment Assistance (PUA). PUA is also available to those who have already exhausted all rights to regular unemployment benefits (including the extended benefits described above). Certain criteria specific to the COVID-19 pandemic apply to individuals seeking PUA. For those who meet the criteria, PUA is available for weeks of unemployment, partial unemployment, or inability to work caused by COVID-19 for up to 39 weeks of the time period of January 27, 2020 through December 31, 2020.

Another portion of the CARES Act expands “work sharing” programs to provide partial benefits to workers with reduced hours. These programs allow employers to put workers on part-time status with partial unemployment benefits. Currently, the cost of these programs, intended to prevent layoffs, is borne by individual states. The CARES Act provides funding to states to promote and utilize these programs.

Missouri’s Response

The recently passed Families First Coronavirus Response Act (FFCRA) goes into effect April 1, 2020. The FFCRA provides states an initial influx of funding to handle the dramatic increase in unemployment benefit applications and allowed flexibility in modifying policies and procedures. Missouri Governor Mike Parson announced changes being made by the Missouri Department of Labor and Industrial Relations:

Continue reading »

Privacy and Cybersecurity Practices for Working Remotely During COVID-19

Hannah E. Mudd

By Hannah E. Mudd



Just as we are adapting our daily lives, cyber-criminals have adapted their nefarious activities to capitalize on people’s fears and potential system weaknesses during COVID-19. Hackers are targeting connection vulnerabilities and sending phishing emails with COVID-19-related subject lines or pretending to be a boss/coworker using a personal account. They have also been sending malware with fake COVID-19 tracker maps, WHO, or CDC information and making social media posts or comments with pleas related to COVID-19.

Reasons systems and data could be particularly vulnerable during COVID-19 include:

  • Human error;
  • Unvetted personal devices;
  • Devices behind in patches or updates;
  • Public Wi-Fi networks; and
  • Lack of remote work ‘protocol’ or training.

As a result, now more than ever you need to review your company’s data and privacy policies and ensure your workforce can successfully work from home. To illustrate just how important this is, consider Privacy Rights Clearinghouse’s statistic that 11,613,547,443 records have been breached since 2005.

Continue reading »

Coronavirus Scams and the FTC

David R. Bohm

By David R. Bohm



Hat tip to my friend, Harold Kirtz, who is a senior litigator with the FTC:

It is important that we, and our employees, families and friends, be vigilant for various scams playing off coronavirus fears.  For your information, click on the link below for a good summary from the FTC concerning various of these types of scams. 

More than ever, it is important that we engage in safe internet practices.

Coronavirus Scams – What the FTC is Doing

Additional Resources:

COVID-19 Business Operations for Danna McKitrick

Coronavirus/COVID-19 Resource Center

Posted by Attorney David R. Bohm. Bohm is an experienced litigator working with health care, government, and business clients on employment, intellectual property, and complex contract issues. He is also skilled in alternative dispute resolution as a means to solve disagreements without litigation.

Thoughts for Business Owners Trying to Run a Business During a Pandemic

A. Thomas DeWoskin

By A. Thomas DeWoskin



Who would have thought we’d be in a situation like this? This is the 21st century, not the Middle Ages. The need for action is certain, but the need for panic is not. In fact, panic makes the matter worse for all concerned.

On the personal front, take care of yourself first. You need to have your wits about you at a time like this.

  • Keep your mind busy with something other than worry. If you have a hobby, now is a good time to engage in it. Read a book; write a letter; call your mother. If working 80 hours a week has limited time with your kids, spend some time with them now. Just speak to them with open-ended questions. Find out what’s on their minds. Do something together.
  • Help someone else – you’ll feel good about it.
  • We’ve all heard the saying that every problem is an opportunity. One of the best ways to stay calm is to do something. You can’t sit and fret your way out of this.

On the business front, now is a great time to analyze your situation, both short- and long-term.

Continue reading »

Updated COVID-19 Recovery and Reopening Orders: St. Louis City, St. Louis County, Missouri, Outstate Missouri Areas, and Illinois

Ruth Binger

By Ruth Binger



UPDATED 8/24/2020

Review the links below for guidelines for reopening your business based on your location. If you have any questions, one of our employment attorneys can assist you.

Additional Resources:

COVID-19 ORDERS

State of Missouri
St. Louis Metro Area

St. Louis County

City of St. Louis

St. Charles County

Franklin County

Jefferson County

Lincoln County

Warren County

Other Missouri City and County Orders

Continue reading »

An Employer’s Guide to Paid Leave Under the Families First Coronavirus Response Act

Lauren L. Wood

By Lauren L. Wood



Co-authored by Lauren L. Wood and Hannah E. Mudd

UPDATED 9/21/2020

This chart is intended to provide a general overview of new obligations under the recently enacted Families First Coronavirus Response Act legislation. This new law is complex and subject to regulatory guidance and evolving interpretations. The employment law attorneys at Danna McKitrick, P.C. are available for up-to-date guidance before taking any action. For updated DOL regulations, see Department of Labor’s Updated Regulations for FFCRA effective 9/16/2020.

EMERGENCY FAMILY & MEDICAL LEAVE EXPANSION ACT
(FMLA EXPANSION)

Who must provide leave under the FMLA Expansion?

Employers with less than 500 employees

Who is eligible to
use this leave?

Employees (both full- and part-time) after 30 days from hiring, for the reasons listed below.

Why may an employee use this leave?

The employee is unable to work, either onsite or remotely, because the employee must care for a minor son or daughter whose school or place of care has been closed, or whose care provider is unavailable due to a public health emergency

How long is the
leave?

Up to 12 weeks

What is the required pay during the leave?

The first 10 days may be unpaid. An employee may choose to use accrued PTO for the first 10 days.

This is the employee’s choice and may not be mandated by the employer. After the first 10 days, the employee must receive pay based on the number of hours the employee would normally be scheduled to work. The pay must be two thirds of their regular rate of pay, not to exceed $200 per day or $10,000.00 total.

Is job protection
required for an employee who uses this leave?

Yes, the employee must be able to return to the same or equivalent position.

Are there exceptions to the requirement for job protection?

Yes, job protection requirements may not apply to employers with less than 25 employees, if specific conditions are met and the position is eliminated due to changes
resulting from the public health emergency. In this circumstance, an employee must be placed on a re-hire list for one year.

Are any employers with less than 500 employees exempt from the new FMLA expansion?

Possibly. The Secretary of Labor may choose to exempt small businesses with less than 50 employees if following the requirements would jeopardize the viability of the business.

Note that the Secretary of labor has NOT made this exemption as of the time
of this writing.

Employers of health care providers or emergency responders may exclude such an employee from the benefits of this Act. The regular FMLA definition of health care provider is limited and this exclusion should be applied cautiously.

When is the FMLA Expansion in effect?

April 1, 2020 through December 31, 2020

How will my
business recover the cost of this leave?

With a refundable tax credit equal to 100% of the qualified paid wages required under this Act.

EMERGENCY PAID SICK LEAVE ACT

Continue reading »

Reducing Payroll and Avoiding Lawsuits During the Coronavirus/COVID-19 Pandemic

Ruth Binger

By Ruth Binger



No one knows how long the COVID-19 Pandemic will last.  The predictions are all over the place, from 6 weeks to 4-6 months.  Last week, businesses instituted a hiring freeze. This week businesses are looking at terminating their entire workforce in some cases and shutting down or taking other measures.

layoff

According to Moody’s Analytics, over 50% of the 153 million jobs in the economy are at high or moderate risk of being lost.  (In perspective, there were 800,000+ jobs lost in March 2009 during the Great Recession). According to Mark Zandi, chief economist at Moody’s Analytics, “…as many as 10 million of those workers could see some impact to their paychecks — either layoffs, furloughs, fewer hours or wage cuts.

What are your company’s payroll options when your orders disappear or are substantially reduced?

As flight director Gene Kranz says in Apollo 13, “Work the problem, people.”

Continue reading »