COVID-19, PPP Loan

We’re starting to see the light! While there is still a virus out there, the state of Florida is moving towards a post-shutdown reality. So, what do the most recent re-opening rules mean for your business?

The Thrive-Lights (see what we did there?)

Governor DeSantis announced May 1, 2020, that Florida would reopen “post-coronavirus” operations in three phases, designed to align with the guidelines released by the White House under President Trump’s “Opening Up America Again” plan. You can download a searchable version of the official order here.

What Does Change on May 4th:

  • Elective surgeries can resume
  • Restaurants may offer outdoor seating with six feet of space between tables and indoor seating at 25% capacity
  • Retail stores can operate at 25% of indoor capacity

What Does Not Change on May 4th:

  • Schools continue distance learning
  • Visits to senior living facilities are still prohibited
  • Sports arenas and movie theaters will remain closed
  • No changes for bars, gyms and personal services such as hairdressers and barbers
  • Vulnerable individuals should avoid close contact with people outside the home

Businesses with Furloughed Employees

There are some additional rules related to businesses with employees that have been furloughed for the shutdown. We have created a sample “Recall from Furlough” document for you to send to your employees. You are required to send this to all employees, regardless of any verbal indications.

Employees with Children at Home

By law, employers with 500 or fewer employees must provide qualifying employees (i.e., those who’ve been working for at least 30 day and have with minor children who require care during working hours because of a school closure or lack of childcare due to COVID-19) with up to 12 weeks of job-protected leave and pay all but the first 10 days at 2/3 the employee’s regular rate of pay. This aspect of the Families First Coronavirus Response Act (“FFCRA”), is an extension of FMLA. The FFCRA also has an Emergency Paid Sick Leave provision that allows 80 hours of paid leave to employees that are diagnosed with or seek medical treatment for symptoms of COVID-19, as well as those who need to care for a family member diagnosed with the virus or have been ordered by a medical provider to self-quarantine.

As of April 1, 2020, The DOL required employers to send each of their employees a copy of this FFCRA poster and to post it in the workplace with all other employee rights notices.  

Employees Afraid of Getting COVID-19?

If you are recalling furloughed employees, you may find that some express a fear of returning to work. As a business owner and a human being, you can feel as much or as little compassion for frightful employees as you want in response to their concerns.

However, if you’re able to safely reopen, an employee’s fear is NOT grounds for continuing to receive unemployment. Therefore, they can either choose to come back to work or lose their benefits. A tough decision for many, we know. But the response of your former or furloughed employees might impact your business’s bottom line.

Here’s why: If your business got PPP funds through the SBA, whether or not an employee returns to work can have serious consequences for your ability to maximize your loan forgiveness (which we talked about in-depth in our PPP Forgiveness Webinar, which you can access here.). In short, if an employee’s failure to return to work results in an inability for your business to show the same average number of Full-time Equivalent employees on June 30, 2020, as it had on Feb. 15, 2020, the amount of principal that can be forgiven is reduced by the wages you would have paid the missing FTEs during the 56-day period covered by the PPP loan. (Note: The Senate just passed a bill that will likely change this, yet again. So stay tuned for the next episode of Days of COVID-19 Lives.)

To avoid the PPP forgiveness issue, the SBA regulations governing the program provided a safe harbor provision: the forgivability of your loan won’t be reduced if you can’t hit the same number of FTEs and (1) you offered IN WRITING  to rehire or recall your employees, and one or more rejects the offer or asks for a reduced schedule; (2) an employee quits; (3) you fire an employee for cause.

To take advantage of the PPP safe harbor, we recommend that all businesses make their rehire and recall offers to laid-off or furloughed employees by written letter, with a requirement that each employee accept or reject the offer in writing by a certain date, with the caveat that if they fail to respond by that date, the offer will be deemed rejected.

There are some additional points regarding the PPP loan forgiveness that we will cover soon. For now, you just want to make sure to document the refusal of anyone who declines to be rehired for that reason.

Use Formal Communication

As always, be sure to use formal, written communication, for any interactions related to your employees and COVID-19.

Additional Phase one Details

Additionally, phase one maintains the current Centers for Disease Control and Prevention recommendations to prevent the spread of COVID-19, including vulnerable individuals continuing social distancing while in public, avoiding groups of 10 or more, and using face masks in public when you can’t maintain six feet away from others.

State of Florida Re-Opening Order FAQ’s

Here’s the State of FL’s FAQ Guide for the Executive Order (2020-112) which incorporates by reference and continues EO-20-91 – which in turn incorporates the list of essential and nonessential business outlined by Miami-Dade’s order dated March 13, 2020.

Have More Questions About COVID-19 and Your Business?

If your specific questions are not addressed in what you’ve read here or elsewhere, please consult your business and employment counsel, or call us at Thrive Law to schedule a free 15-minute COVID-19 related consultation with one of our extraordinary lawyers. Because we want to be a positive force in our thriving business community, we are waiving our consult fees for COVID-19 related issues and discounting our fees to assist businesses with COVID-19-related issues by 25%.

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