Regulations Introduced in the Fight Against Coronavirus
To reduce the economic effects of the coronavirus, the US Congress has passed two packages so far. The negotiations for the third one continue. The following issues in these two packages are of interest to small businesses:
1- SBA Loan. Small businesses will be given loans with a rate of 2.75% for nonprofits and 3.75% for other companies, with a total maturity of up to 30 years and a total principal of $ 2 million. These loans can be used for operating expenses, i.e. loan payments (such as mortgage payments, rent payments, electricity, water, natural gas expenses etc.) and personnel expenses. Here, each application will be evaluated separately, and the amount of credit will be decided by considering the financing requirements of the company regarding the above issues.
2- Paid sick leave. Paid sick leave in two different groups are made available to the employees of small businesses with less than 500 employees
a. Companies will have to give 80 hours of paid leave to those who are unable to go to work due to prohibitions or directions issued due to his coronavirus, or to those who have to stay at home because of someone in their family or if he or she has suffered from coronavirus, or whose child’s school is closed due to coronavirus. During this period, wages will be subject to a certain deduction depending on the reason for the paid sick leave. 80 hours of paid sick leave will be calculated proportionally for part-time employees.
b.Apart from the above leave, if the employee’s child’s school was closed due to the coronavirus, a separate 12-week paid leave is available for employees who cannot come to work. While the first 14 days of this leave are unpaid, the employer must then pay 2/3 of the salary of the employee (up to $ 200 per day). Employers whose number of employees is below 25 may be exempted from this obligation provided that they meet certain conditions.
c.Employers will be able to take back their paid sick leave payments as tax credits in their tax return.
Fatih Yigit, Esq. (New Jersey Office)
28 Summit Avenue, Hackensack, NJ 07601
Ahmed Davut Atik, Esq. (Texas Office)
3 Sugar Creek Center, Suite 100, Sugar Land, TX 77478