The Commonwealth of Pennsylvania has made adjustments to the unemployment compensation requirements that employers need to know, including compelling employers to provide newly laid-off employees with information regarding unemployment benefits.
At the same time, the federal government has incentivized employers to retain employees through the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act with Paycheck Protection Program (PPP) loans, which includes a provision that grants employers repayment forgiveness if they meet certain criteria, including maintaining a high percentage of their workforce.
Smart Business spoke with Joseph Wendell Fluehr, an attorney at Semanoff Ormsby Greenberg & Torchia, LLC, about what employers need to know about these laws and programs to stay in compliance.
How has eligibility for unemployment benefits in Pennsylvania changed?
The recent federal laws, including the CARES Act, have expanded Pennsylvania citizens’ access to benefits, including gig workers like Uber and Lyft drivers, independent contractors and self-employed individuals. Employers who are making the difficult decision to reduce employees’ hours or even layoff or furlough employees, whether or not caused by COVID-19, can recommend to their employees to apply for unemployment benefits with the Pennsylvania Office of Unemployment Compensation.
What responsibilities do employers have?
Governor Wolf recently enacted Act 9, which provides that each employer, whether or not the employer is liable for the payment of unemployment benefits, must provide notice to employees of the availability of unemployment compensation. The Office of Unemployment Compensation has created form UC-1609 for employers to use to satisfy this notification requirement. The form provides employees with information in the event they decide to apply for unemployment benefits.
What if an employer is able to offer reemployment?
If an employer submits a bona fide written return to work offer for employees laid off or furloughed due to COVID-19 and the employee refuses to return to work, the employer may, but is not required, to submit Form UC-1921W – Refusal of Suitable Work available to the Office of Unemployment Compensation to avoid an employer’s unemployment compensation contribution from increasing. Pennsylvania is currently not increasing contribution rates for employers based on an increase in employees requesting unemployment compensation due to COVID-19. Before filling out and sending Form UC-1921W, it is important for the employer to consider any refusal based on its given set of facts. A former employee may rightfully refuse reemployment, or accept a position but not return to work, and be protected by federal and/or state laws, including the Families First Coronavirus Response Act. Further, former or current employees may require a reasonable accommodation based on a medical need or need to care for family members before returning to work. In these scenarios, employers should work with employees to determine if the work or job duties can be reasonably altered to accommodate an employee’s needs.
How might a borrower’s PPP loan forgiveness amount be affected?
The U.S. Department of Treasury guidance requires employers to document the written offer of rehire and the employee’s rejection of such an offer. Submitting Form UC-1921W will assist employers in abiding by the documentation requirements to exclude such employees from the PPP loan forgiveness calculations. Some of the new laws enacted to help employers and employees during the pandemic are set to expire by the end of 2020. Employers should be sure to act reasonably in these times in both operating their business and assisting employees who seek benefits. That being said, the laws and guidance are regularly being updated as the pandemic continues. Employers can contact their attorney with any questions or concerns related to operating or reopening during COVID-19, including maximizing forgiveness on PPP loans.
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