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Paycheck Protection Program Flexibility Act Signed into Law

Today the Paycheck Protection Program Flexibility Act (PPPFA) was signed into law. The Act is intended to ease the rules of the PPP. A summary of the changes follows:

• Instead of eight weeks, borrowers will now have 24 weeks from the disbursement of their loan to use the PPP funds, or until Dec. 31 when the program is now set to end. Borrowers can still opt, however, to use funds in the original eight-week period.
• Employers now have to spend 60 percent—rather than the previous 75 percent—of PPP funds on payroll costs. Payroll costs include:
 Salary, wages, commissions and tips—up to $100,000 annualized for each employee.
 Employee benefits, including paid leave, severance pay, insurance premiums and retirement benefit.
 State and local taxes assessed on pay.
The additional 40 percent could be spent on mortgage interest, rent, utilities and other costs.
• Employers now have until Dec. 31, rather than June 30, to rehire certain laid-off workers if they are seeking loan forgiveness. If a suitable offer of employment is turned down by the employee, employers must meet five conditions to avoid having their loan forgiveness reduced. Businesses must:
1. Clearly present an offer letter in writing to the laid-off worker.
2. Offer the same salary, wages and number of hours the employee had prior to the layoff.
3. Receive a rejection of the offer.
4. Document the offer and the rejection. “The refusal does not need to be in writing but should be documented and kept in the employer’s PPP loan forgiveness file,” he said.
5. Notify the state unemployment office within 30 days of the date the offer is refused (InTANDEM can do this for you, we just need to have steps 1-4 from you and then we will send the state a letter).
• The new act extends the maturity date of the PPP loans—for any portion of a PPP loan that is not forgiven—from two years to five years. With respect to already existing PPP loans, the act states specifically that nothing in the act will “prohibit lenders and borrowers from mutually agreeing to modify the maturity terms of a covered loan.”

We’re excited about the changes to the PPP that will give us more time and options for the loans as well as extended forgiveness. We welcome any questions you have regarding the PPPFA.

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Return to Work in the age of COVID-19

As some employers and employees desire to return to work, it is important to remember that doing so will not likely look anything like it did previously in our pre COVID-19 world.

Governor Polis’ Safer at Home Executive Order D 2020 044 addresses worker rights and protections when returning to work. The directive states (in part):

I direct employers to accommodate workers with childcare responsibilities and workers who live in the same household as a Vulnerable Person to the greatest extent possible by promoting telecommuting or other remote work options, flexible schedules, or other means.

I direct the Colorado Civil Rights Division within the Department of Regulatory Agencies and CDPHE to provide guidance to prevent discrimination in the workplace related to COVID-19. Employers must provide reasonable accommodation and are prohibited from discriminating against employees who are showing symptoms of COVID-19 or who have been in contact with a known positive case of COVID-19.

All Critical Businesses should continue to operate with mandatory Social Distancing Requirements and cleaning protocols.

Beginning on May 4, 2020, I permit Non-Critical Commercial Businesses to allow up to fifty percent (50%) of their employees to conduct in-person work that takes place outside a private residence in accordance with Mandatory
Social Distancing Requirements and protocols.

This Executive Order shall expire thirty (30) days from April 27, 2020, unless extended further by Executive Order. The entire order can be accessed at:

https://drive.google.com/file/d/1w4xfCKF3ELTULfpqLoASRofW_LRb2glz/view

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InTANDEM HR Service Promise during COVID-19 Pandemic

The coronavirus outbreak has challenged all of us with taking a look at our business practices (to be fair, it has challenged us to look at everything!). Our collective goal is to continue serving all of our clients and to keep thriving internally as a business in a safe, smart, and healthy manner. We have taken the following steps to ensure service continuity:

1. All non-essential in-person meetings will be conducted via telephone or teleconference until further notice.
2. All internal staff members are prepared to and able to fully conduct all essential job functions from remote locations in the event of any personal or community quarantine.
3. All paychecks are being generated to direct deposit or paycard accounts, eliminating non-payment issues due to any shutdown or slow down of mail delivery service. Additionally any paper born contamination risk is eradicated.
4. Continuing to follow CDC guidelines for employers regarding the developing COVID-19 virus.

Thank you for your support and continued business while we all navigate this unusual time. We appreciate the opportunity to talk to our clients about their own business continuity strategies as well. Please contact us with any questions you may have about HR best practice.

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New Form I-9

On Jan. 31, 2020, USCIS announced a new version of Form I-9, Employment Eligibility Verification. This new version contains minor changes to the form and its instructions. Employers should begin using this updated form as of Jan. 31, 2020.

The notice provides employers additional time to make necessary updates and adjust their business processes. Employers may continue using the prior version of the form (Rev. 07/17/2017 N) until April 30, 2020. After that date, they can only use the new form with the 10/21/2019 version date. The version date is located in the lower left corner of the form.

USCIS made the following changes to the form and its instructions:

Form:

Revised the Country of Issuance field in Section 1 and the Issuing Authority field (when selecting a foreign passport) in Section 2 to add Eswatini and Macedonia, North per those countries’ recent name changes. (Note: This change is only visible when completing the fillable Form I-9 on a computer.)

Instructions:

Clarified who can act as an authorized representative on behalf of an employer
Updated USCIS website addresses
Provided clarifications on acceptable documents for Form I-9
Updated the process for requesting paper Forms I-9
Updated the DHS Privacy Notice
A revised Spanish version of Form I-9 with a version date of 10/21/2019 is available for use in Puerto Rico only.

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New COMPS law Finalized 1/22/2020

In big news for Colorado employees and employers, Colorado Division of Labor Standards and Statistics adopted the Colorado Overtime and Minimum Pay Standards Order (“COMPS Order”) #36, which replaces Colorado Minimum Wage Order #35.

The COMPS order will go into effect on March 16, 2020. This includes expanding coverage to all employers excepting public entities. The salary basis rate will mirror the new federal salary basis of $684 a week, equating to $35,568 annually, starting July 1, 2020, through December 31, 2020. After that, there will be a gradual annual increase beginning January 1, 2021 (it had been slated to increase beyond the federal level July 1, so this gives employers another six months at the federal rate). The federal salary threshold just increased to $684 per week as of January 1, 2020. The weekly salary basis will be $778.85 for 2021, $865.38 for 2022, $961.54 for 2023, and $1,057.69 for 2024, and then will be indexed every January 1 by the same Consumer Price Index (“CPI”) as the Colorado minimum wage. The 2020 salary does not apply to non-profit employers with annual total gross revenue of under $50 million, nor to for-profit employers with annual total gross revenue of under $1 million. For those employers, the salary schedule applies as of January 1, 2021.

A copy of the COMPS order can be found at: https://www.colorado.gov/pacific/sites/default/files/7%20CCR%201103-1%20Colorado%20Overtime%20%26%20Minimum%20Pay%20Standards%20Order%20%28COMPS%29.pdf

An employee receiving less than the full wages or other compensation owed is entitled to recover in a civil action the unpaid balance of the full amount owed, together with reasonable attorney fees and court costs, notwithstanding any agreement to work for a lesser wage, pursuant to C.R.S. §§ 8-4-121, 8-6-118. Or, an employee may elect to pursue a complaint through the Division’s administrative procedure as described in the Colorado Wage Act, C.R.S. § 8-4-101, et seq. 8.2 Complaints. Any person may register with the Division a written complaint that alleges a violation of the COMPS Order within 2 years of the alleged violation(s), except that actions brought for a willful violation shall be commenced within 3 years.

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2020 Form W-4 Finalized

On December 5th, 2019, the IRS released its final version of the 2020 Form W-4. The form is very different from prior years and includes some important changes that could impact both employers and workers. The new form can be found at: https://www.irs.gov/pub/irs-pdf/fw4.pdf

Current employees are not required to complete a new Form W-4, however anyone hired on or after 1/1/2020 will only be offered this new form.

InTANDEM HR is unable to offer tax advice. Employees and employers are encouraged to speak with a qualified tax person to seek assistance with the completion of the new Form W-4.

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New Colorado and City of Denver Minimum Wage

On Wednesday November 27, 2019, Denver Mayor Michael Hancock signed an ordinance that requires all private-sector minimum wage employees working in the city of Denver to receive higher incremental minimum wages.

Effective January 1, 2020, minimum wage will increase from the current $11.10 per hour to $12.85 in Denver. It then incrementally increases as follows:

  • $14.77 an hour on Jan. 1, 2021
  • $15.87 an hour on Jan. 1, 2022
  • Annual adjustments based on the Consumer Price Index each year thereafter.
  • State law requires tipped employees like servers and bartenders can only be paid $3.02 an hour less than the minimum wage. If their tips don’t take them up to the actual minimum wage the employer must pay them in “tip credit make-up”.
  • NOTE – the Colorado minimum wage is increasing to $12.00 per hour effective January 1, 2020

As the state law stands, according to a provision in Colorado’s Fair Labor Standards Act (Section 14(c)), employers are permitted to pay people with disabilities less than the minimum wage if their disability impairs their earning or productive capacity. 

The amendment makes clear that, unlike the current state law, Denver’s law will require everyone, regardless of ability, to receive at least the minimum wage. Minors enrolled in specific employment programs are the only exception.

In addition to the increase, anyone will be able to submit a minimum wage complaint under the new citywide law starting January 1st, 2020. Complaints can be anonymous. At the start of the year, complaints can be sent to Denver Labor via email at wagecomplaints@denvergov.org

Any current employees working in the city of Denver who are being paid less than the minimum wage will be automatically increased to $12.85 effective January 1, 2020. Any current employees working in Colorado outside of Denver will be bumped up to $12.00 if they are currently earning less than that. Exceptions will be made as per above for tipped employees. Contact your Payroll Specialist or Account Manager with questions.

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NEW 2020 W4 Form – Major changes!

The 2020 Form W-4, Employee’s Withholding Certificate, is very different from previous versions. This is due to the federal tax law changes that took place in 2018. The Internal Revenue Service (IRS) is not requiring all employees to complete the revised form and has designed the withholding tables so that they will work with both the new and prior year forms. However, certain employees will be required to use the new form: those hired in 2020 and anyone who makes withholding changes during 2020.

Even though the IRS does not require all employees to complete the revised form and even if your tax situation has not changed, we recommend you perform a “paycheck checkup” to see if you need to make adjustments to your current withholding. To conduct the checkup, you can use the IRS’s Tax Withholding Estimator (www.irs.gov/W4App). To effectively use the estimator, it is helpful to have a copy of your most recent pay stub and tax return. It is likely that the estimator will be updated to account for the 2020 tax tables in early January. A DRAFT of the new form can be found at: https://www.irs.gov/pub/irs-dft/fw4–dft.pdf Please note: if you do not submit a new form, withholding will continue based on your previously submitted form.

Before completing the 2020 Form W-4, please read the instructions that are included with the form. You must complete Steps 1 and 5. Steps 2, 3, and 4 are optional, but completing them will help ensure that your federal income tax withholding will more accurately match your tax liability. Step 1 is for your personal information; Step 2 is for households with multiple jobs; Step 3 is used to claim tax credits for dependents; Step 4 is for other adjustments (additional income such as interest and dividends, itemized deductions that exceed the standard deduction, and extra tax you want withheld); and Step 5 is where you sign the form.

The IRS takes your privacy seriously and suggests that, if you are worried about reporting income from multiple jobs in Step 2 or other income in Step 4(a), you check the box in Step 2(c) or enter an additional withholding amount in Step 4(c). To determine the additional withholding amount, you can use the withholding estimator.

The IRS has also published Frequently Asked Questions that you may find helpful as you complete the form (https://www.irs.gov/newsroom/faqs-on-the-draft-2020-form-w-4).