Covid-19 Legislation And Regulation Impacting Manufacturing
Trump Declares National Emergency in Latest Bid to Combat Coronavirus
“To unleash the full power of the federal government under this effort today, I’m officially declaring a national emergency,” he said March 13th at an announcement in the Rose Garden. “Two very big words.”
Trump said the move would eradicate the testing shortcomings that health experts say hindered the country’s ability to contain the virus when it first appeared on American shores. In recent days, much of the country’s public spaces have shuttered — professional sports have been suspended, concert halls are closed until further notice and many Americans have been asked to self-isolate. The self-isolation order has been extended through May 1st.
Families First Coronavirus Response Act
The recently passed Families First Coronavirus Response Act makes substantial changes to sick and FMLA leave for businesses and employees in 2020.
Emergency Family and Medical Leave Expansion Act
The first section of the FFCRA that applies to businesses pertains to an expansion of the U.S. Family and Medical Leave Act (FMLA). Until the end of 2020, employers with fewer than 500 employees will now be required to provide employees with up to 10 weeks of paid FMLA. The first two weeks of the normal 12-week FMLA leave may be provided unpaid, but an employee may be able to be paid through the paid sick leave provision or other paid leave the employee has available.
Emergency Paid Sick Leave Act
The second leave provision of the FFCRA that affects businesses is emergency paid sick leave. Until the end of 2020, employers with fewer than 500 employees must offer paid sick leave to those who meet criteria associated with the public health emergency.
Tax Credits for Paid Sick Leave and Paid FMLA
To help employers afford the new paid sick leave and paid FMLA benefits, companies are able to seek reimbursement through tax credits.
Each quarter, private companies are entitled to fully refundable tax credits for both paid sick leave and paid FMLA. The tax credits are applied against an employer’s already-owed Social Security taxes. However, if that offset is not enough to cover these payouts to employees, then the Treasury Department is authorized to help cover the rest with cash payouts. In addition, the Treasury is directed to issue regulations to waive penalties for businesses not submitting their payroll taxes if they do so in anticipation of a refund under the new law. In addition, the Treasury Department has said they will soon be releasing a form for small businesses to request an expedited advance on their refund.
Empire State Development determined what manufacturing businesses were essential on March 20th. That list has been updated several times.
Firms that are in one of these categories or are an essential supplier to them, are exempt from the closure order rule.
As of April 20th that list is:
- food processing, including all foods and beverages
- medical equipment/instruments
- safety and sanitary products
- paper products
Coronavirus Aid, Relief, and Economic Security (CARES) Act
On March 27, 2020, President Trump signed the largest economic stimulus package in American history into law. Although the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) made several amendments to the Families First Coronavirus Response Act (“FFCRA”), the majority of the amendments were technical corrections that do not impact the substantive provisions of the FFCRA.
The Act includes a number of different programs and interventions that provide or intend to provide financial relief to eligible employers and employees alike. We have summarized the key aspects of the law, including:
- Creates the Paycheck Protection Program through the Small Business Administration to make loans available to eligible employers and self-employment individuals. Loans may convert to grants if certain provisions are met.
- The act provides enhanced unemployment insurance benefits to employees for total and partial unemployment and to employers for retaining certain employees.
- The act confirms the emergency FMLA and sick leave benefits available to employees and advanced tax credits employers can take in providing these benefits.
- The Federal government will make loans to certain distressed businesses and places limits on compensation paid to executives servicing businesses subject to these loans.
President Trump signed an Executive Order temporarily barring new immigrants, including some family members of U.S. citizens and foreign workers looking to move to the U.S., in the next 60 days.
Mr. Trump said the immigration suspension, which he announced April 20th is designed to reduce immigration at a time when tens of millions of Americans have lost jobs as a result of the coronavirus crisis. “We must first take care of the American worker,” Mr. Trump said, adding that suspending immigration would also help “conserve vital medical resources for American citizens.”
The executive order wouldn’t impact immigrants already living in the U.S. or foreigners coming on temporary visas for work or travel. That category includes H-1B visas, which allow more than 85,000 high-skilled foreigners to come to the U.S. for at least three years to work. It also includes seasonal migrant workers who come to the U.S. annually to work on farms, where they make up about one-tenth of the agricultural workforce, and at other businesses such as resorts or county fairs.
Governor Cuomo Signs the ‘New York State on PAUSE’ Executive Order
On March 20th Governor Andrew M. Cuomo signed the “New York State on PAUSE” executive order, a 10-point policy to assure uniform safety for all New Yorkers. It includes a new directive that all non-essential businesses statewide must close in-office personnel functions effective at 8pm on Sunday, March 22, and temporarily bans all nonessential gatherings of individuals of any size for any reason.
“We know the most effective way to reduce the spread of this virus is through social distancing and density reduction measures,” Governor Cuomo said. “I have said from the start that any policy decision we make will be based on the facts, and as we get more facts we will calibrate our response accordingly. This executive order builds on the actions we have taken to reduce the spread of the virus and protect the wellbeing of our friends, colleagues and neighbors. But again, I want to remind New Yorkers that the panic we are seeing is outpacing the reality of the virus — and we will get through this period of time together.”
PAUSE has been extended through May 15th.
Council of Industry Survey: Members Operating at 78% Capacity, Employee Health Number 1 Concern
Over the week of April 10th – 17th the Council of Industry polled its members to determine their response to the COVID-19 outbreak and the government order to cease non-essential business activities. Members answered questions about employee safety, orders, supply chain and concerns about the future. The response rate was 40%.
New York State Emergency Paid Sick Leave Act
The New York State Paid Sick Leave Act creates two leave programs: The “paid sick leave” program for quarantined employees, and an expansion of existing N.Y. Paid Family Leave (PFL) and Disability Benefit Leave (DBL, or commonly called “short-term disability” leave) for quarantined employees.
The Act took effect upon Gov. Cuomo’s signing on March 18.
Critically, the Act only applies to employees who have been ordered to quarantine or isolate by New York State, the Department of Health, a local health board, or another government entity authorized to issue a quarantine or isolation order. This means that the Act does not cover employees who have voluntarily chosen to quarantine or self-isolate.
Additionally, the Act will not apply to quarantined employees who are asymptomatic and able to perform their job functions remotely.