January 2021 – Law Offices of Cynthia A. Augello, P.C

The Second Round of PPP Loans is now Available

January 14, 2021/in Blog /by admin

On Monday, January 11, the Small Business Administration (SBA) began the process of accepting applications for the second round of Paycheck Protection Program (PPP) loans that are being offered to businesses struggling due to Covid-19. The second round of the PPP program has altered requirements as to who is eligible. Some of the new requirements include that the business 1) employ no more than 300 employees, 2) have used the entire amount of their first PPP loans or anticipate using the entire amount, and 3) having gross receipts in the first three quarters of 2020 that saw at least a 25 percent reduction from the same timeframe in 2019.

Second round borrowers are given the option to calculate the maximum loan amount by multiplying the borrower’s average monthly payroll in the one-year period prior to the date of the loan’s disbursement. Additionally, the new requirements allow for a more flexible coverage period, meaning the period in which the business is required to use the loan in order to qualify for loan forgiveness. The current maximum period for using the loan is 24 weeks, which has provided business owners with a greater ability to adjust to a potential reduction in their workforce. A new development in the PPP program is the addition of covered expenses that the PPP loan can be used for. The funds can now be used for covered operation expenditures, covered property damages costs, and covered worker protection expenditures, such as expenditures made in order to ensure compliance with guidance from the CDC, OSHA, or a particular state or local government. PPP loans will not be classified as taxable income, and thus expenses that are paid off through loan funds are tax deductible.

Some additional changes in this round of PPP financing include potential eligibility for 501(c)(6) not for profit organizations and the eligibility of borrowers who are in bankruptcy. Notably, the inspector General for the SBA has mentioned that the process for this new round of application filing will involve a more stringent inspection and inquiry into the businesses that apply for the loan due to the previous granting of loans to individuals and entities who were not eligible. The inspector general stated that more than 50,000 loans were distributed to individuals who were on a do-not-pay list of ineligibility. This possible fraud has resulted in additional examination of the financial backgrounds of individuals seeking loans. All individuals applying for the PPP loan will have their names, or entity names cross-checked with the do-not-pay (DNP) list individuals/businesses who are not eligible for loans.

Although the program has simplified and expanded eligibility for PPP loans, the additional analysis with the DNP list may cause the entire process to seem very daunting. Small businesses and business owners who are in need of assistance are still encouraged to apply for these loans that may serve as a lifeline during this difficult time. If you have any questions on your potential eligibility for these loans, or need assistance in understanding the program requirements, please do not hesitate to call us at 516-888-1208 or email Cynthia Augello at caugello@augellolaw.com.

Thank you to Joel Thomas, JD for his assistance with this post.

Employment Furlough and Layoffs During Covid-19 and the Expansion of NYS WARN

January 12, 2021/in Blog /by admin

The Covid-19 pandemic has been plaguing the world for nearly a year creating a domino effect in terms of the residual effects it has had on people’s lives. One of the resulting complications is the massive number of furloughs and layoffs that have occurred because employers are unable to pay wages due to forced shutdowns and reduced business.

For companies that have been forced to furlough or completely lay off employees,

it is important to note that the Federal Worker Adjustment and Retraining Notification Act (“WARN Act”), requires employers to provide employees with 60 days advance notice of termination. The WARN Act also stipulates that plants are required to give a notice of closing if the subsequent upheaval causes a loss of the jobs of 50 or more employees. In the event that such economic upheaval is impending, the employer must provide notice within a 30-day period. The WARN Act defines a mass layoff as a reduction in force that will result in a loss of at least 1/3 of the jobs at a single site, with a minimum of 50 lost jobs, or at least 500 total lost jobs. This required notice is known as the WARN notice.

New York has its own version of the WARN Act which provides similar guidelines for how private employers are required to warn employees of a potential shutdown or plant closing. The NY WARN Act requires employers with at least 50 full-time employees who plan to conduct a closing affecting 25 or more employees; mass layoff involving 25 or more full-time employees (if the 25 or more employees make up at least 33% of all the employees at the site); or mass layoffs involving 250 or more full-time employees, to provide 90 days’ written notice to employees as well as various government entities of said triggering employment action.

Businesses that do not provide such notice may be required to pay back wages and benefits to workers in addition to civil penalties.

Additionally, employers are required to give the same 90-day advance notice of the triggering event to the New York State Department of Labor and the local workforce investment board.

On November 11, 2020 Governor Cuomo signed into law an expansion of NYS WARN which now expands the government entities that must receive notice. The expansion requires that the 90-day advance notice be given to the chief elected official of the unit or units of local government and the school district or districts in which the mass layoff, relocation, or employment loss will occur. The expansion also requires 90 days of notice to be given to each locality which provides police, firefighter, emergency medical or ambulance services, or other emergency services to the site of employment subject to mass layoff, relocation, or employment loss as applicable.

As the expansion in the NYS WARN Act now requires adoption by municipalities when it is clear that it will have to furlough its employees, it is important that all employers have an understanding of the law and what is required in order to remain in compliance. If you or your H.R. department have any questions on the implementation of the updated NYS WARN act and what specific provisions your business may be required to comply with, please do not hesitate to call us at 516-888-1208 or email Cynthia Augello at caugello@augellolaw.com.

Thank you to Joel Thomas, JD for his assistance with this post.

New York’s Paid Sick Leave Law

January 5, 2021/in Blog /by admin

On April 3, 2020 Governor Cuomo officially signed into law the right to paid sick leave for New Yorkers. The new law requires employers with five or more employees with a net income of more than $1 million to provide sick to leave to employees, and for employers with fewer than five employees and a net income of $1 million or less to provide unpaid sick leave of 40 hours to employees. Businesses with 100 or more employees are required to provide up to seven days (56 hours) of paid sick leave, and businesses with five to 99 employees must provide up to five days (40 hours) of paid sick leave. Additionally, businesses with fewer than five employees but a net income of more than $1 million, must also provide 40 hours of paid sick leave.

Small businesses with five or fewer employees and less than $1 million in net income need only provide 40 hours of unpaid sick leave. All private sector employees in New York state are covered under the statute, regardless of their industry, occupation, part-time status, or overtime exempt status. The act permits the usage of accrued leave hours that can be used for mental or physical illness, and injury or health conditions, regardless of whether the condition has been diagnosed or requires medical care at the time of the request for leave. Accrued hours can also be used for the diagnosis, care, or treatment of mental or physical illness, injury or health condition, or the need for medical diagnosis or preventative care.

Notably, the act permits usage of accrued hours when an employee or a member of the employee’s family has been a victim of domestic violence, family offense, sexual assault, stalking or human trafficking , and the time being utilized is to obtain services from a domestic violence shelter or services program, to participate in safety planning and temporary or permanent relocation, to meet with an attorney or social services provider to prepare for or participate in criminal and civil proceedings, and a number of other stipulated reasons. While employers are permitted to require that leave be used in increments such as 15 minutes or 1 hour, a minimum increment of more than 4 hours is not allowed. Perhaps most importantly, employers are required to pay employees at the normal rate of pay for any paid leave that is given under the new law.

Portions of the law have already begun the process of being fully implemented. Starting on September 30, 2020, covered employees in the state began accruing hours at the rate of one hour for every 30 hours worked. As of January 1, 2021 employees are permitted to start using this accrued leave. Notably, collective bargaining agreements that have been entered into after September 30th are not required to provide the sick leave described above as long as the agreement provides for comparable benefits and sick days. Employers must be careful and deliberate in ensuring that the new provisions of the law will be implemented within their workplaces in a consistent manner.

If you or your H.R. department have any questions on the implementation of the new paid sick leave law, and what specific provisions your business may be required to utilize, please do not hesitate to call us at 516-888-1208 or email Cynthia Augello at caugello@augellolaw.com.

Thank you to Joel Thomas, JD for his assistance with this post.

The Second Round of PPP Loans is now Available

Employment Furlough and Layoffs During Covid-19 and the Expansion of NYS WARN

New York’s Paid Sick Leave Law

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Archive for month: January, 2021

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