Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
On May 15, 2020, the U.S. House of Representatives passed H.R. 6800, the “Health and Economic Recovery Omnibus Emergency Solutions” or “HEROES” Act. The 1800+ page, $3 trillion bill includes a host of COVID-19 relief provisions, including $1 trillion for state, local, and tribal governments; an additional round of direct stimulus payments for individuals; repeal of the 2017 tax bill limitation on the deduction of state and local taxes; a requirement that the Occupational Safety and Health Administration (OSHA) issue an emergency standard to protect health care workers and emergency responders from COVID-19; and a number of other provisions directly relating to employers regarding pay, benefits, and unemployment insurance.
The bill was passed 208-199 largely along party lines, with 14 Democrats voting against it, and only one Republican voting for it. While it is clear that the bill will not be taken up by the Senate in its current form, it is likely that some, if not all, of these elements will be in play if and when a compromise package is negotiated. To date, Senate Republicans have focused their efforts on securing liability relief for employers expected to face a wave of COVID-19 lawsuits as businesses reopen. Whether and how the wide gap between the two sides’ priorities can be narrowed to reach agreement on a final package that might become law is uncertain at best, and likely to dominate the policy debate in Washington, DC for weeks to come.
That said, the House bill does give insight as to what some in Congress view as insufficient relief to date for workers, and will bear directly on employers if its proposed provisions are adopted as law in some form in the future. Key employment-related provisions of the HEROES Act include:
Expanded Unemployment Insurance. The bill would extend expanded unemployment insurance (UI) provisions created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act through January 31, 2021, including the CARES Act’s provision of an additional 13 weeks of unemployment eligibility; extra $600 per week enhanced unemployment benefits; and the Pandemic Unemployment Assistance program, which provides unemployment benefits to workers traditionally ineligible for UI such as independent contractors and self-employed workers.
Paid FMLA/Sick Leave. The bill dramatically expands the Emergency Family and Medical Leave Act (EFMLA) and Emergency Paid Sick Leave Act (EPSLA) provisions created by the Families First Coronavirus Relief Act (FFCRA). Most notably, the bill would eliminate the provisions of the FFCRA mandating that only smaller businesses (those with fewer than 500 employees) provide this leave, and would require all private-sector employers to provide 80 hours of paid sick leave and up to 12 weeks of EFMLA leave (10 of them paid) to all private-sector employers. In addition, the bill expands the reasons for which EFMLA leave can be taken, and eliminates exemptions from FFCRA requirements for health care employers, emergency responders, and small businesses. A full description of the FFCRA’s leave requirements can be found here.
Hazard Pay. The HEROES Act would create a federally funded $180 billion grant program under which employers of “essential” workers could obtain federal dollars to pay premium pay for their workers, retroactive to January 27, 2020. Premium pay for essential workers would be $13/hour, capped at $10,000 per worker ($5,000 for those earning $200,000 or more annually). Littler’s detailed analysis of this proposal (including the definition of “essential” worker) can be found here.
Paycheck Protection Program (PPP) Amendments. The bill would extend the authority of the Small Business Administration to grant loans under the PPP until December 31, 2020 (or until the current $659 billion in funding runs out). In addition, the HEROS Act would extend the covered period for use of the loan for up to 24 weeks after loan origination, or December 31, whichever is earlier; allow PPP borrowers additional time (to December 31, 2020) to bring employees back on the payroll for purposes of loan forgiveness; remove the current requirement that 75% of a PPP loan must be used for payroll to be forgivable; provide that employers would not be penalized in terms of PPP loan forgiveness where they are unable to rehire certain workers or cannot find similarly qualified employees; and extend maturity of PPP loans to a minimum of five years.
The debate over COVID-19 relief now turns to the U.S. Senate, which to date has not indicated an inclination to move as quickly as the House has, and, as noted above, where Republican leadership has suggested its focus will be on liability relief for employers. Littler WPI will be closely monitoring these debates and will keep you apprised of relevant developments.