Table of Contents:
- Changes from 12/28/20 CAA (Consolidated Appropriations Act of 2020)
- Getting employees paid accurately and on time
- Unemployment claims/benefits
- Employee benefits/insurance
- Employer-related coronavirus/Covid19 legislation
- CARES Act & PPP loan
- Workers’ compensations/injuries
Please note – the information provided below is not legal or tax advice. Organizations should always consult their legal counsel to understand how this legislation may impact their organization.
Changes from 12/28/20 CAA (Consolidated Appropriations Act of 2020)
Please scroll down this page to see recent changes in red.
Getting employees paid accurately and on time:
In this unprecedented time, we know that you are working to support employees, serve customers and protect your communities. For businesses that are offering remote work options, implementing other social distancing protocols or experiencing interruptions in regular business operations, paying people by check may have become more difficult or even impossible. Likewise, cashing of “live” paper checks creates similar exposure for your employees.
Direct deposit and pay cards can provide more flexibility and reliability for both employers and employees. Once set up, wages can be funded instantly, and employees can access funds immediately from anywhere.
We strongly encourage you to have all your employees sign up to receive their pay by direct deposit or on an electronic wage card!
- Direct deposit sign up can be done on our Employee Portal.
- A Wage Card sign-up form can be downloaded here.
If an employee files a claim, they must put the proper employer on the claim, or it will get rejected.
Different states treat the PEO co-employment relationship differently, with some using the PEO’s name and SUI account, and others requiring the Client (your company) to keep its own SUI account.
PEO’s SUI Account: If a claim is filed in AL, AZ, CA, CO, DC, FL, GA, HI, ID, IL, IN, LA, MD, ME, MT, NC, NH, NM, NY, OK, OR, TX, UT, VA, WI, WV, the claimant should list the Employer as it appears on their W-2. (Either HR Service Group LLC, INFINITIHR LLC, or INFINITI HR West LLC). W-2s can be accessed by all employees on our Employee Portal.
All PEO Clients were sent an email on Monday 3/23/20 informing them of which Employer listed above they are under contract with.
Your Company’s SUI Account: If a claim is filed in AK, AR, CT, DE, IA, KS, KY, MA, MI, MN, MO, MS, ND, NE, NJ, NV, OH, PA, RI, SC, SD, TN, VT, WA, WY, the claimant should list your Company’s legal name as the Employer, and your FEIN, and your State Unemployment Account Number. If you are unsure of your State Unemployment Account Number, please email email@example.com to request that information.
State Unemployment Websites:
District of Columbia
As of 12/28/20 the CAA legislation extends $300 a week of federal pandemic unemployment assistance for another 11 weeks, through at least March 14, 2021. The CAA also establishes procedures to handle situations when people receiving expanded unemployment benefits refuse to return to work or accept an offer of employment without good cause.
Here is some information to help classify employees who may terminated or furloughed during this COVID19 pandemic, and to explain how the payroll system handles benefits deductions for those employees.
INFINITI HR Sponsored Benefit Plans (this is no change to our normal practice)
For any active employee with benefits who is not paid, the client will be billed the full premium (both employee contribution and employer contribution) during that specific pay period. The employee portion of the premium will be accrued in arrears for the employee, and once they have hours or payable wages, deduction adjustments for the premiums due will take place, and the client will be refunded for the premium paid by the employee. Under normal best practices, an employee can take unpaid leave for up to 30 days before benefits are terminated. Once 30 days is reached, benefits coverage will be terminated and a COBRA notification will be mailed to the employee.
Client Sponsored Benefit Plans (this is no change to normal practice)
For clients that use 3rd party brokers or benefit carriers outside of INFINITI HR, it is important to understand how those carriers will operate during this time. Please understand in these situations, INFINITI HR only acts as a clearing house to take employee deductions and return those funds to our clients. It is your responsibility to work with your broker or carrier directly to ensure you communicate your situation and how that impacts active benefits. INFINITI HR is not responsible for maintaining the continuity between our clients and 3rd party vendors. We will continue to take premium from employees being paid but it is your responsibility to continue to pay the carriers.
Mass Layoffs and Impact to Health Plans
Please carefully consider the following information as it pertains to client sponsored medical plans. Most carriers will require that at least 1 active employee be enrolled in the health plan to keep the plan active and in good standing. However some carriers may terminate a policy or re-price a plan if participation is reduced by 50%. Mass layoffs are happening and those employees that had coverage would be extended COBRA (where applicable based on group size) or state continuation in this scenario. We encourage all clients that sponsor their own plans to consult with their local brokers or health plan.
IMPORTANT NOTE: Should a business completely close with no active members on the health plan, then Benefits plans are terminated and COBRA will not be an option for any prior employees (as per Federal and State benefits continuation laws, but subject to change).
Employee Termination or Employee Status Change in Prism
If you need assistance to talk through your specific scenarios, please contact firstname.lastname@example.org.
Telehealth Benefits and Resource Page
Telehealth is a great option to help you and your family stay safe and one that has gained national attention during this crisis. It provides individuals access to board certified physicians, 24/7, to help diagnose and treat minor illnesses and specifically assist with COVID19. Here is a link to free COVID19 symptom checkers and telehealth services for our clients: COVID19 Free Telehealth Assessment.
Employer-related coronavirus/Covid19 legislation:
The information provided below is not exhaustive, and as noted, is subject to interpretation and needed clarification from the DOL and IRS. Your company’s situation will be unique, and you should consult with your tax professional and legal counsel for advice on what is best for your business.
Coronavirus Aid, Relief, and Economic Security Act (CARES Act):
CARES Act – for an overview of the law click here.
Paycheck Protection Program (PPP) – for a detailed overview of the program, along with borrower information and the actual application, click here (links directly to US Treasury’s webpage). For the purposes of SBA eligibility, a client of a PEO is considered by themselves for headcount, and INFINITI HR will provide documentation of employment-related costs as described below.
The amount of loan eligibility for a business will be dependent on a 12 month look back of “payroll costs”, defined as compensation, cash tip equivalents, the cost of health benefits (including premiums), the cost of retirement benefits, the cost of leave (e.g., vacation, family, and sick leave), and the payment of state or local taxes assessed on employee compensation.
As of 12/28/20 the CAA legislation expanded the list of “other” expenses that count towards forgiveness. It includes many operating expenses (including supplies under certain circumstances) and much of the cost associated with retrofitting the workplace for safety concerns arising due to COVID-19. Of note, these expenses will be forgivable for both existing PPP loans and “second draw” loans.
Required loan application reports/documents:
INFINITI HR is making available to all clients:
- Total “payroll costs” over last 12 months = employee wage compensation + state/local taxes + employer paid benefits + employer retirement contributions
- 941 “reports” for last 4 quarters (not the actual reports for PEO clients, since they don’t exist for the Client’s FEIN)
- Number of FTEs paid per month for last 12 months
To request your loan application reports/documents please email HRIS@infinitihr.com.
PPP Loan Forgiveness Support(1) – download PDF
As of 12/28/20 the CAA legislation provided relief for employers with loans of less than $150,000. These employers will not be required to submit documentation along with their application for forgiveness. Employers should nevertheless maintain applicable documentation in the event of a future audit.
For loans in excess of $150,000, the forgiveness test period starts the day the loan money is received in the recipient’s bank account and lasts for either the 8- or 24-week period after disbursement. It is essential for you to keep good records throughout the use of this loan. You must prepare to prove that the money was used solely for payroll expenses and other sanctioned expenses. The forgiveness process will be looking at your bank statements for proof of how the money is spent. Keep in mind, once payroll has posted there is no going back to change it. Please inform your Payroll Specialist:
- Did you apply for a PPP loan? Yes / No
- If yes, was your loan application approved? Yes / No
- If yes, what is the funding date of your loan? __________________
PPP Loan Forgiveness Terms Summary(2)
How much of my loan will be forgiven? You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent, and utilities payments over the 8 weeks after getting the loan. At least 60% of it must be used for payroll costs and other “allowable expenses”.
You will also owe money if you do not maintain your staff and payroll.
- Number of Staff: Your loan forgiveness will be reduced if you decrease your full-time-equivalent (FTE) employee headcount.
- Level of Payroll: Your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualized in 2019.
- Re-Hiring: You have until June 30, 2020 to restore your full-time employment and salary levels for any changes made between February 15, 2020 and April 26, 2020.
How can I request loan forgiveness? You can submit a request to the lender that is servicing the loan. The request will include documents that verify the number of full-time equivalent employees and pay rates, as well as the payments on eligible mortgage, lease, and utility obligations. The lender must make a decision on the forgiveness within 60 days.
Documentation you will receive from INFINITI HR if you have notified us that your PPP loan has been funded:
- Payroll Costs per pay period – your Payroll Specialist will provide you with a report that lists allowable “payroll costs” for each employee. Such costs include total wages*, state and local taxes levied on the wages, and the employer’s cost of benefits and/or contribution to a retirement plan. *Wages you have paid employees for sick leave or eFMLA must be excluded.
- FTE headcount – at the end of the 8 week period starting on your loan funding date, you will receive a report showing your number of full-time equivalent employees over that period. You will then compare this to the FTEs you had in either of two baseline periods. The baseline period can be either 2/15/19 to 6/30/19 or 1/1/20 to 2/29/20, whichever has fewer FTEs.
As additional more specific guidance on the loan forgiveness terms become available, INFINITI HR will keep you informed.
(1) While INFINITI HR aims to communicate important information to you accurately, please understand that every business has its own nuances, and there are many factors involved in receiving forgiveness. It is essential for you to learn what is best for your company’s situation. We are here to help execute your business’s plan, but we cannot create your plan. Please consult your lender and business advisor or accountant for any guidance on how to manage your PPP loan and its forgiveness.
(2) From Treasury Department PPP Information sheet 4/21/20.
Deferral of Payment of Employer’s Social Security Taxes – summary of benefits and requirements are:
- Not available if a company has had a PPP Loan forgiven
- No employer size (number of Employees) limit
- Client can defer Employer Social Security Deposits (6.2% of wages), non retroactively, from when they sign an INFINITI HR Deferral Addendum, through 12/31/20. A Deferral Addendum can be requested through email@example.com.
- The credit your company is due back will show up as a separate line item on our INFINITI HR invoice.
- Pay back requirements:
a) 50% by 12/31/21
b) 50% by 12/31/22
Employee Retention Tax Credit
With the recent passing of the Consolidated Appropriations Act (CAA) of 2021, some Infiniti HR Clients may be eligible for tax credits under the Employee Retention Credit (ERC) section of the legislation.
Infiniti is putting together a process to accommodate the 2020 Form 941 amendments that will be required for 2020 “retro” Employee Retention Credits (ERC). The IRS has recommended that we, as a PEO, only file an amended return once a month to avoid creating confusion (for the IRS) and delaying the processing of the refunds. We will be sending out a communication shortly to notify you of the timeline and the process for the amendments.
Since there are numerous business qualification factors that determine your company’s eligibility, the IRS (and Infiniti HR) recommends that you consult with your CPA or business tax advisor to evaluate your unique business circumstances. Several of the general qualification factors include:
- For new 2021 ERC credits (Jan 1, 2021 through June 30, 2021)
- Number of FTEs less than 500
- Comparisons of your 2021 revenue to your 2019 revenue
- Separating out wages paid to your employees during 2021 using PPP loan funds, as they are not eligible for ERC
- For retroactive 2020 ERC credits
- Number of FTEs less than 100
- Comparisons of your 2020 revenue to your 2019 revenue, and/or time periods your business was subject to a mandatory full or partial shutdown
- Separating out wages paid to your employees during 2020 using PPP loan funds, as they are not eligible for ERC
Additional information about the ERC is available from the IRS at:
If you and your CPA determine that your business is eligible for the ERC, please send your data to: Tax@Infinitihr.com.
Use the following Pay Codes to designate applicable wages per employee
- ERTCL100 if your company has less than or equal to 100 employees
- ERTCG100 if your company has greater 100 employees
Families First Coronavirus Response Act (FFCRA):
FFCRA – see a two page overview of the law here.
There are two provisions providing paid leave to employees forced to miss work because of the COVID-19 outbreak:
- an emergency expansion of the Family Medical Leave Act (FMLA); and
- a new federal paid sick leave law
As of 12/28/20 the CAA legislation employers are no longer required to provide FFCRA leave after December 31, 2020. However, if you choose to continue to provide paid leave under the terms of the FFCRA in 2021, you may continue to take the available tax credits through March 31, 2021.
We recommend you determine how you are going to proceed in 2021, as you have several choices, such as:
- End all leave under FFCRA effective December 31, 2020. If you do, we’d encourage you to communicate to all employees, including those currently on leave, your decision to end the leave entitlement;
- Continue to allow employees to use any unused, available FFCRA leave through March 31, 2021. Employees should only be entitled to any unused FFCRA leave they have remaining as of December 31, 2020;
- Only continue Emergency Paid Sick Leave through March 31, 2021, allowing employees who contract or are exposed to the virus to stay home, but discontinue the entitlement to the much longer paid family leave for child care.
Employers who choose to end the leave entitlement are reminded that some employees may still be entitled to leave (paid or unpaid) under other laws such as the regular Family and Medical Leave Act (FMLA), state and local laws, or company policy.
Here is a link to the poster you are required to post in your workspaces: (still reflects the 12/31/20 end date)
Employee Rights: Paid Sick Leave and Expanded Family and Medical Leave under The Families First Coronavirus Response Act (FFCRA)
If you are a ‘PEO’ Client of INFINITI HR (meaning in a co-employment relationship):
On April 1st, the DOL and IRS issued clarifications regarding tax credits available to clients of PEOs, being as those clients do not actually file FICA taxes nor do they file a 941. While the client will be eligible to receive the credits (as well as also falling subject to the mandate), we are in the process of digging further into what the process and paperwork requirements will be.
We have setup Employee Pay Codes in Prism for use if an employee needs to be paid under either of the provisions bulleted below:
EFMLA for Paid FMLA generally paid at 67% of regular pay (retired previous pay code PAIDFMLA)
SIX Emergency Paid Sick Leave situations (Use same code for #1, 2, 3 below as of 4/10/20)
- EPSLS EPSL Govt Quarantine Paid at 100%
- EPSLS EPSL Doctor Quarantine Paid at 100%
- EPSLS EPSL Sick Paid at 100%
- EPSLCPQ EPSL Caring for Person Quarantined Paid at 67%
- EPSLCC EPSL Child Care Paid at 67% (retired previous pay code CCL)
- EPSLO EPSL Other Paid at 67%
How will it work? updated 4/10/20
o If quarantined or sick, also fill out Employee Statement for E-PSL Request
o If due to caring for a child, also fill out Employee Statement E-PSL & E-FMLA Request
- The credit your company is due back – from taxes that would have otherwise been due – will show up as a separate line item on our INFINITI HR invoice.
- Your company will be required to complete and file IRS Form 7200 and provide INFINITI HR with a copy.
If you are an ‘ASO’ Client of INFINITI HR (NOT in a co-employment relationship / your company is the employer):
The same processing guidelines apply as above with the PEO relationship, with the exception that, because ASO Clients are the employer, INFINITI HR will file the actual Form 941 for ASO Clients, along with appropriate adjustments.
The Employee Pay Codes listed above will be applicable.
Each injured employee situation will be evaluated on its own individual merits. Workers compensation insurance covers employees who suffer injury or illness “arising out of or in the course of their employment”. Many factors will need to be considered if presented COVID-19 type claims are work related. These include but are not limited to:
(1) The timing of when the loss occurs. Were there reports of prior infected individuals made in this same time period?
(2) The location(s) where the injured worker was present leading up to the injury or exposure. Was the injured worker within an area where exposure of the virus was present or carried a greater risk?
(3) The activities the injured worker was engaged in leading up to when the loss or exposure took place. Was the individual in contact with others or working remotely?
(4) And finally, the specific nature of the loss. What further details can be uncovered which can provide greater clarity around exposure of the virus as an occupational disease?
OSHA: COVID-19 Specific Guidance for Workplaces click here.
For State Specific Resources for COVID-19 Employee Safety Standards click here.
In most jurisdictions, individuals seeking benefits under worker’s compensation will also need to meet the burden that the Corona virus illness arose out of or was caused by conditions “peculiar” to the work. In other words, there is arguably a difference between a healthcare worker and the backroom office staff potentially being exposed to COVID-19. It is likely that Corona virus and the particular characteristics to a specific occupation may be a large part of the evaluation process of compensability. For example, black lung disease is a “peculiar” for coal or mine workers, due to the higher than average presence of dust. Possibly certain occupations may have conditions which COVID-19 exposure may be greater to their work.