The US Department of Labor, in conjunction with the Internal Revenue Service and US Department of the Treasury, issued guidance and deadline extensions applicable to ERISA-governed group health and welfare plans. The guidance provides relief for plan sponsors, plan administrators and plan participants that may be struggling to comply with applicable deadlines and requirements in the midst of the chaos related to the COVID-19 pandemic.
The Ninth Circuit’s recent en banc ruling that employers can’t excuse sex-based pay gaps by pointing to workers’ past salaries deepened a circuit split over the federal Equal Pay Act, a development that could push the issue up to the US Supreme Court.
The majority’s opinion puts the Ninth Circuit directly at odds with the Seventh Circuit amid a growing debate between workers’ and employers’ advocates over whether the common practice of basing salary offers on workers’ past salaries perpetuates illegal pay disparities between men and women.
The CARES Act created several payroll tax deferral opportunities but also left employer board members and executives asking what exactly was deferred and worrying about “responsible person” liability.
In particular, Section 2302 of the CARES Act (Public Law 116-136) allows all employers to defer the deposit and payment of the employer’s portion of Social Security taxes for a minimum of 12 months and, for some deferrals, a period of more than 32 months. Despite the confusion among some advisers, unlike the employee retention tax credit available under the CARES Act, this opportunity to defer employer Social Security taxes is even available for those employers applying for Small Business Administration loans.
Decisions aimed at preserving your workforce in response to the COVID-19 pandemic can have a long-term impact on your business. As you prepare to emerge from government shutdown orders, recall that your workforce is your single most valuable asset.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides employee retention tax credits to help employers defray the cost of keeping their workforces intact in the post-COVID business environment. At the same time, taking advantage of these credits requires careful, upfront planning, particularly in light of the recent FAQs issued by the IRS.
During our interactive discussion, we will address the critical matters that you need to understand when planning for these credits, including:
Have an (anonymous) question that you would like us to answer? Be sure to submit it via the registration link.
Wednesday, May 6, 2020
11:00 am – 12:00 pm PDT
12:00 pm – 1:00 pm MDT
1:00 pm – 2:00 pm CDT
2:00 pm – 3:00 pm EDT
In response to the COVID-19 pandemic, Germany has introduced special occupational safety measures to protect the health of employees, restore economic activity and interrupt the chains of infection. On April 16, 2020, Federal Minister of Labour and Social Affairs (Bundesminister für Arbeit und Soziales) Hubertus Heil and the CEO of the German statutory accident insurance (Deutsche Gesetzliche Unfallversicherung) Dr. Stefan Hussy presented a unified occupational health and safety standard for the duration of the Coronavirus pandemic. The regulations took effect immediately.
Her Majesty’s Revenue and Customs (HMRC) has issued its sixth update to the Coronavirus Job Retention Scheme Guidance (Guidance). Separately, the UK Treasury has issued a Treasury Direction (Direction) to HMRC setting out the legal framework for the Scheme. There are few points that have been clarified in the Guidance, but there is one glaring inconsistency between the Guidance and the Direction that will be of understandable concern to employers – the requirement that there is a written record of the furlough arrangement.
How should US employers approach the Coronavirus? With rapid developments in local, state and federal guidance and law, the appropriate approach for each employer will vary depending on the nature of the work, industries served, location(s), size, amongst other considerations. We recently updated these FAQs to provide you with the latest developments and best practices for your business.
The CARES Act provides for payroll tax relief, including employee retention tax credits and the deferral of all employer Social Security tax payments to help employers in the face of economic hardship related to the COVID-19 pandemic. Employers should work with their tax advisors, payroll providers, and payroll departments to immediately implement these valuable savings. The broad-based employer and employee relief provided under the CARES Act includes two forms of payroll tax relief related to an employer’s Social Security tax payments: deferral of all employer Social Security tax payments, and employee retention tax credits of up to $5,000 for qualified wages paid to employees. All employers should consider taking advantage of these valuable tax savings to alleviate the broad and deep impact of the COVID-19 pandemic on businesses and their employees.
The Families First Coronavirus Response Act (H.R. 6201) was signed into law on March 18, 2020. This summary reflects these changes that includes:
In the ongoing effort to help individuals impacted by COVID-19, Congress passed the Coronavirus Aid, Relief, and Economic Securities Act (CARES Act) on March 27, 2020. The President signed the CARES Act into law the same day. The historic stimulus package provides wide-ranging relief for both employers and employees. This includes rules that impact health and welfare, retirement and executive compensation plans and programs.
For more information about the impact of the CARES Act on employer-provided benefits, access our On the Subject articles on the:
In addition, for information about the frequently asked questions regarding health and welfare, retirement and executive compensation issues in the COVID-19 era, access our FAQs.
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