COVID-19 LBM Industry News and Updates

California COVID Update from the WCLBMA

Please note these updates do not constitute legal advice. Information contained may be subject to interpretation and companies should consult with their own counsel.

APRIL 21, 2020
CAL/OSHA COVID-19 INFORMATION
Information from the WCLBMA

With federal Occupational Safety and Health Administration COVID Guidance and rules recently released, WCLBMA members in California are reminded that this state is one of a number of states that has the state-administered CalOSHA. While much of the time the federal and state rules are coordinated and consistent, the state rules may at time have some variations.

For California employers, here is a link to the “The California Workplace Guide to Aerosol Transmissible Diseases, HERE , that has additional information.

Also, HERE are the “Interim Guidelines for General Industry”, updated by CalOSHA on March 19, 2020.

As always, this information is for general use and is not intended as legal advice.

CLICK HERE for more information from the NLBMDA.

APRIL 12, 2020
ADDITIONAL COVID INFORMATION FROM THE NLBMDA
Information taken from the WCLBMA WEEKLY UPDATE

The National Lumber & Building Materials Dealers Association (NLBMDA) has received notification from the Federal Reserve (Fed) that they are taking additional action to provide up to $2.3 trillion in loans to support employers of all sizes and bolster the ability of state and local governments to deliver critical services during the COVID-19 pandemic.

NLBMDA is still analyzing the new measures and will update members in more detail shortly, but according to the Federal Reserve, the actions the Fed is taking will:

  • Bolster the effectiveness of the Small Business Administration’s Paycheck Protection Program (PPP) by supplying liquidity to participating financial institutions through term financing backed by PPP loans to small businesses. The PPP provides loans to small businesses so that they can keep their workers on the payroll. The Paycheck Protection Program Liquidity Facility (PPPLF) will extend credit to eligible financial institutions that originate PPP loans, taking the loans as collateral at face value;
  • Ensure credit flows to small and mid-sized businesses with the purchase of up to $600 billion in loans through the Main Street Lending Program. The Department of the Treasury, using funding from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) will provide $75 billion in equity to the facility;
  • Increase the flow of credit to households and businesses through capital markets, by expanding the size and scope of the Primary and Secondary Market Corporate Credit Facilities (PMCCF and SMCCF) as well as the Term Asset-Backed Securities Loan Facility (TALF). These three programs will now support up to $850 billion in credit backed by $85 billion in credit protection provided by the Treasury; and
  • Help state and local governments manage cash flow stresses caused by the coronavirus pandemic by establishing a Municipal Liquidity Facility that will offer up to $500 billion in lending to states and municipalities. The Treasury will provide $35 billion of credit protection to the Federal Reserve for the Municipal Liquidity Facility using funds appropriated by the CARES Act.

The Main Street Lending Program will enhance support for small and mid-sized businesses that were in good financial standing before the crisis by offering 4-year loans to companies employing up to 10,000 workers or with revenues of less than $2.5 billion. Principal and interest payments will be deferred for one year. Eligible banks may originate new Main Street loans or use Main Street loans to increase the size of existing loans to businesses. Banks will retain a 5 percent share, selling the remaining 95 percent to the Main Street facility, which will purchase up to $600 billion of loans. Firms seeking Main Street loans must commit to make reasonable efforts to maintain payroll and retain workers. Borrowers must also follow compensation, stock repurchase, and dividend restrictions that apply to direct loan programs under the CARES Act. Firms that have taken advantage of the PPP may also take out Main Street loans.

To support further credit flow to households and businesses, the Federal Reserve will broaden the range of assets that are eligible collateral for TALF. As detailed in an updated term sheet, TALF-eligible collateral will now include the triple-A rated tranches of both outstanding commercial mortgage-backed securities and newly issued collateralized loan obligations. The size of the facility will remain $100 billion, and TALF will continue to support the issuance of asset-backed securities that fund a wide range of lending, including student loans, auto loans, and credit card loans.

The Fed has asked for input from lenders, borrowers, and other stakeholders to make sure the program supports the economy as effectively and efficiently as possible while also safeguarding taxpayer funds. Comments may be sent to the feedback form until April 16. NLBMDA will be submitting comments to ensure dealer members are able to easily access these programs and receive the relief they need. CLICK HERE for the feedback form.

APRIL 3, 2020
COVID-19 PAID LEAVE GUIDANCE
Information provided by NLBMDA

The U.S. Departments of Labor (DOL) and Treasury recently released new guidance for employers regarding the implementation of the Emergency Paid Sick Leave Act and Emergency Family and Medical Leave Expansion Act, both part of the Families First Coronavirus Response Act (FFRCA). The new paid leave provisions only apply to employers with fewer than 500 employees and is effective April 1, 2020. Please see below for detailed guidance on the new paid leave law.

Families First Coronavirus Response Act Guidance

Paid Sick Leave:

The FFRCA provides that covered employers must provide to all employees:

  • Two weeks (up to 80 hours) of paid sick leave at the employee’s regular rate of pay where the employee is unable to work because the employee is quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis; or
  • Two weeks (up to 80 hours) of paid sick leave at two-thirds the employee’s regular rate of pay because the employee is unable to work because of a bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor.

Paid Family and Medical Leave:

A covered employer must provide to employees that it has employed for at least 30 days:

  • Up to an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay where an employee is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.

Qualifying Reasons for Sick Leave: Under the FFCRA, an employee qualifies for paid sick time if the employee is unable to work (or unable to telework) due to a need for leave because the employee:

  1. is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
  2. has been advised by a health care provider to self-quarantine related to COVID-19;
  3. is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
  4. is caring for an individual subject to an order described in (1) or self- quarantine as described in (2);
  5. is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19; or
  6. is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.

Qualifying Reasons for Family and Medical Leave: Under the FFCRA, an employee qualifies for expanded family leave if the employee is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19.

Duration of Leave:

For reasons (1)-(4) and (6): A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

For reason (5): A full-time employee is eligible for up to 12 weeks of leave at 40 hours a week, and a part-time employee is eligible for leave for the number of hours that the employee is normally scheduled to work over that period.

Calculation of Pay:

For leave reasons (1), (2), or (3): employees taking leave shall be paid at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).

For leave reasons (4) or (6): employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).

For leave reason (5): employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $12,000 in the aggregate (over a 12-week period-two weeks of paid sick leave followed by up to 10 weeks of paid expanded family and medical leave).

Employer Notice: Each covered employer must post in a conspicuous place on its premises a notice of FFCRA requirements. If an employee is working remotely, the employer may satisfy this requirement by emailing or direct mailing this notice to employees, or posting this notice on an employee information internal or external website. The approved DOL paid leave notice document can be found HERE.

Prohibitions: Employers may not discharge, discipline, or otherwise discriminate against any employee who takes paid sick leave under the FFCRA and files a complaint or institutes a proceeding under or related to the FFCRA.

Penalties and Enforcement: Employers in violation of the first two weeks’ paid sick time or unlawful termination provisions of the FFCRA will be subject to the penalties and enforcement described in Sections 16 and 17 of the Fair Labor Standards Act. 29 U.S.C. 216; 217. Employers in violation of the provisions providing for up to an additional 10 weeks of paid leave to care for a child whose school or place of care is closed (or child care provider is unavailable) are subject to the enforcement provisions of the Family and Medical Leave Act. The Department will observe a temporary period of non-enforcement for the first 30 days after the Act takes effect, so long as the employer has acted reasonably and in good faith to comply with the Act. For purposes of this non-enforcement position, “good faith” exists when violations are remedied and the employee is made whole as soon as practicable by the employer, the violations were not willful, and the Department receives a written commitment from the employer to comply with the Act in the future.

Small Business Exemption:

A small business is exempt from certain paid sick leave and expanded family and medical leave requirements if providing an employee such leave would jeopardize the viability of the business as a going concern. This means a small business is exempt from mandated paid sick leave or expanded family and medical leave requirements only if all three of the following requirements are met:

  • The employer employs fewer than 50 employees;
  • The leave is requested because the child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and
  • An authorized officer of the business has determined that at least one of the following three conditions is met:
  1. The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
  2. The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
  3. There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.

Documentation Requirements for Employees under the FFRCA: Employees must provide employers with documentation in support of paid sick leave. Employees must support leave requests with appropriate information, including the employee’s name, qualifying reason for leave, a statement that the employee is unable to work or telework for that reason, and leave date(s). Documents that support the employee’s absence may include: a copy of the federal, state or local quarantine or isolation order related to COVID-19, or written documentation by a health care provider advising the employee to self-quarantine due to concerns related to COVID-19.

Employers may also require employees to provide additional information in support of their expanded family and medical leave taken to care for your child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19-related reasons. For example, this may include a notice of closure or unavailability from the employee’s child’s school, place of care, or child care provider, including a notice that may have been posted on a government, school, or day care website, published in a newspaper, or emailed from an employee or official of the school, place of care, or child care provider.

Please also note that all existing certification requirements under the FMLA remain in effect if employees are taking leave for one of the existing qualifying reasons under the FMLA. For example, if an employee taking leave beyond the two weeks of emergency paid sick leave because of their medical condition for COVID-19-related reasons rises to the level of a serious health condition, the employee must continue to provide medical certifications under the FMLA if required by the employer. MORE HERE

Refundable Tax Credits for Employers

  • Covered employers are entitled to receive a credit in the full amount of the qualified sick leave wages and qualified family leave wages, plus allocable qualified health plan expenses and the employer’s share of Medicare tax, paid for leave during the period beginning April 1, 2020, and ending December 31, 2020.
  • The credit is allowed against the taxes imposed on employers by section 3111(a) of the Internal Revenue Code (Social Security Tax).
  • If the amount of the credit exceeds the employer portion of these federal employment taxes, then the excess is treated as an overpayment and refunded to the employer under sections 6402(a) or 6413(a) of the Code. The qualified sick leave wages and qualified family leave wages are not subject to the taxes imposed on employers by sections 3111(a) and 3221(a) of the Code and employers are entitled to an additional credit for the taxes on employers imposed by section 3111(b) of the Code (Hospital Insurance (Medicare tax)) on such wages.
  • Covered employers that pay qualified leave wages will be able to retain an amount of all federal employment taxes equal to the amount of the qualified leave wages paid, plus the allocable qualified health plan expenses and the amount of the employer’s share of Medicare tax imposed on those wages, rather than depositing them with the IRS. The federal employment taxes that are available for retention by covered employers include federal income taxes withheld from employees, the employees’ share of social security and Medicare taxes, and the employer’s share of social security and Medicare taxes with respect to all employees.
  • If the federal employment taxes yet to be deposited are not sufficient to cover the Eligible Employer’s cost of qualified leave wages, plus the allocable qualified health plan expenses and the amount of the employer’s share of Medicare tax imposed on those wages, the employer will be able file a request for an advance payment from the IRS. The IRS expects to begin processing these requests in April 2020.
  • Recordkeeping Requirements: Eligible Employers claiming the credits for qualified leave wages, plus allocable qualified health plan expenses and the employer’s share of Medicare taxes, must retain records and documentation related to and supporting each employee’s leave to substantiate the claim for the credits, as well retaining the Forms 941, Employer’s Quarterly Federal Tax Return, and 7200, Advance of Employer Credits Due To COVID-19, and any other applicable filings made to the IRS requesting the credit.

For more detail on the refundable tax credits and the procedures to receive payment of the advance credit, see the Treasury Department’s guidance HERE.

Department of Labor FAQ: Answers to frequently asked questions (FAQ) about the new paid leave law can be found HERE.

APRIL 1, 2020
Federal CARES Act Provides Small Business Relief

Last week, Congress passed and the President signed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which among other provisions, provides financial relief for small businesses through the way of small business loans that can ultimately turn into grants.

Under the CARES Act, the Paycheck Protection Program (PPP) offers help to small businesses to weather the economic upheaval caused by the COVID-19 pandemic. Small businesses generally work with narrower profit margins relying on consistent customer buying habits and knowledge of seasonal ebbs in sales. Mandatory closures for a month or longer are disastrous. CLICK HERE for the application.

Additional information is available HERE

Paycheck Protection Program: The PPP provides funds to pay up to 8 weeks of payroll costs, including benefits. Funds can be used to pay interest on mortgages, rent, and utilities. These funds are loans that will be fully forgiven as long as at least 75% of the loan is used for payroll. Forgiveness is based on maintaining or quickly rehiring employees at the same salary. If an employer’s workforce decreases, the amount of the loan that will be forgiven also decreases.

All small businesses with 500 or fewer employees are eligible, including self-employed individuals, sole proprietors, independents contractors, nonprofits, tribes, and veteran organizations. There is a very limited opportunity for larger businesses in certain industries. Loan payments not qualifying for forgiveness will be deferred for six months. Collateral or personal guarantees are not required.

Application Information: Small businesses and sole proprietorships may begin to apply for this loan on April 3. Independent contractors and self-employed individuals can apply for this loan starting April 10.

Funding for the PPP is capped. The program is implemented by the Small Business Administration (SBA). A business may apply through any SBA 7(a) lenders or through any federally insured bank, credit union or Farm Credit System. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program.

MARCH 29, 2020
COVID-19 Relief Bill Analysis
Information taken from the WCLBMA WEEKLY UPDATE

The CARES Act, signed into law on March 27, creates a $2 trillion relief package that will help shore up the U.S. economy in response to the COVID-19 pandemic.

Click HERE for an analysis of the Legislation as prepared by the National Lumber & Building Materials Dealers Association.

MARCH 26, 2020
Safety training, US Department of Labor guidance & “social distancing” advice

Here’s an update from your West Coast Lumber & Building Material Association. As we continue to react to this crisis it is our goal to provide you with as accurate and timely information as possible, utilizing only official government statements and carefully selected information from industry and endorsed sources.

Need Coronavirus safety training for your business? Certified Safety Training (CST), endorsed by the WCLBMA, has a free safety training program available HERE

The U.S. Department of Labor’s Wage and Hour Division has issued its first round of published guidance to provide information to employers about requirements for emergency paid sick leave and paid family medical leave established by the Families First Coronavirus Response Act (FFCRA). As a reminder, the FFCRA requires all employers with fewer than 500 employees to offer up to 12 weeks of paid leave for absences related to COVID-19. Requirements are subject to 30-day non-enforcement period for good faith compliance efforts.

Complied by the NLBMDA’s COVID-19 Resource Center, here are several documents that may be of use:

– Fact Sheet for Employees HERE
– Fact Sheet for Employers HERE
– Questions and Answers documents HERE

Each covered employer must post a notice of the Families First Coronavirus Response Act (FFCRA) requirements in a conspicuous place on its premises. (An employer may satisfy this requirement by emailing or direct mailing this notice to employees, or posting this notice on an employee information internal or external website.) HERE

Additionally, Federated Insurance, endorsed by the WCLBMA for property/casualty insurance, has available three informational documents designed to help provide information to organizations facing challenging employment issues during these uncertain times.

– Employer COVID-19 FAQs document HERE
– An overview of the Families First Coronavirus Response Act HERE
– Important Rules for Employers to Know in the Wake of COVID-19. HERE

“Social Distancing” has become extremely important for business remaining open as “essential” during this crisis. Click HERE for some recommendations from a major LBM dealer in what they are doing in their stores.

MARCH 24, 2020
Safety training, “Social Distancing” recommendations for the LBM industry & legislation urged by the LBM industry

Need Coronavirus safety training for your business? Certified Safety Training (CST), endorsed by the WCLBMA, has a free safety training program available HERE

“Social Distancing” has become extremely important for business remaining open as “essential” during this crisis. Click HERE for some recommendations from a major LBM dealer in what they are doing in their stores.

On March 23, the National Lumber & Building Materials Association (NLBMDA) sent a letter to Congressional leadership urging them to include LBM industry priorities as part of any economic stimulus legislation. Those included:

  • Establish a minimum 4% Low-Income Housing Tax Credit (LIHTC) rate
  • Temporary payroll tax elimination
  • Increase the Small Business Administration’s (SBA) 7(a) loan program by $50 billion
  • Allow investors to utilize FHA 203(k) loans
  • Qualified Improvement Property (QIP) Fix

The letter can be read HERE

On March 22, Governor Gavin Newsom updated the California COVID19 resource page to include a full list of essential critical infrastructure work, outlining construction and construction suppliers as an essential service during the statewide SIP ordinance. Click  HERE for the updated information.

MARCH 23, 2020
LBM industry confirmed as “essential” in California

Yesterday, March 22, Governor Gavin Newsom updated the California COVID-19 resource page to include a full list of essential critical infrastructure work, outlining construction and construction suppliers as an essential service during the statewide SIP ordinance. Click HERE for the updated information.

Additionally, the National Lumber & Building Materials Dealers Association (NLBMDA) has worked closely with the regional lumber associations, including WCLBMA,  in drafting a unified letter urging consistency across the country in recognizing this industry as “essential.”  Attached HERE is the final letter which will go to every governor.

The US Department of Homeland Security has also issued a statement that recognizes the LBM industry as “essential.”   This document remains the same as it was when released last week. Click HERE for it.

MARCH 20, 2020
LBM industry recognized as “essential”

California state government clarifies that LBM industry is recognized as an “essential” industry during this crisis.  In Governor Newsom’s Executive Order on March 19, ordering all non-essential California businesses to close, the LBM industry was not specially mentioned, as it had been in prior statements.  The Executive Order was amended late in the evening to include LBM.

Here is that addition:

“The California State Public Health Officer and Director of the California Department of Public Health is ordering all individuals living in the State of California to stay home or at their place of residence, except as needed to maintain continuity of operation of the federal critical infrastructure sectors, critical government services, schools, childcare, and construction, including housing construction.”

There is additional information specific to California. HERE

The US Department of Homeland Security has also issued a statement that recognizes the LBM industry as “essential.” HERE