The COVID-19 crisis presents constantly changing challenges to employers, from disrupted supply chains to emergency orders that restrict the ability of employees to get to work.

Here are the updated facts for Massachusetts employers.

New Resources November 2020

AIM Podcast | Employers Face Challenges

Massachusetts employers who have survived the COVID-19 pandemic face ongoing challenges with finances, ensuring the safety of their workplaces and helping employees figure out the shifting child-care landscape.

Listen to our podcast as AIM Executive Vice President of Government Affairs Brooke Thomson discusses a new survey of 88 employers conducted by AIM’s Re-Opening Task Force. The responses paint a compelling picture of the long, hard road that employers face as Massachusetts emerges from the public health and economic consequences of the pandemic.

Listen to the Podcast
View the Infographic

AIM Resources

Re-Opening the Massachusetts Economy

The Massachusetts economy is re-opening using a four-phase approach, based on public health guidance.

  • Phase 1 allowed limited industries to resume operations with severe restrictions.
  • Phase 2 allowed additional industries to resume operations with restrictions and capacity limitations.
  • Phase 3 allows additional industries to resume operations with guidance.
  • Phase 4 will enable resumption of a “new normal” with the development of vaccines and/or treatments.

Prior to reopening, each business must do the following:

  • Complete a written COVID-19 Control Plan.
  • Complete and post the compliance attestation poster.
  • Post signs and posters for maintaining social distancing, hygiene protocols, cleaning and disinfecting.
  • Review and comply with industry-specific guidance.

Phase Three

As of July 6, 2020, the state moved into Phase Three of the re-opening of the Massachusetts economy. The City of Boston followed and moved into Phase Three on July 13, 2020.  Refer to AIM’s Return to the Workplace Guide For Massachusetts Employers for Phase Three and future updates.

Phase Two

As of June 8, 2020, the state moved into Phase Two of the re-opening of the Massachusetts economy.

Phase Two was introduced in two steps.

Step one of Phase Two included retail, restaurants (outdoor table service), childcare facilities, and hotels with contingencies.  Step one was effective as of June 8, 2020. For the full list of businesses allowed to re-open in step one click here.

Step two began on June 23 and covered indoor table service at restaurants and close-contact personal services, with restrictions including, nail care, skin care, and hair removal and replacement. Click here for the full list.

Phase Two Step One Sector-specific Protocols:

Phase Two Step Two Sector-specific Protocols:

Additional Resources:

Governor Baker’s Phase Two Executive Order
Re-opening Health and Human Services Guidance

As of May 18, the state lifted the Stay at Home advisory and implementing a Safer at Home Advisory.

Phase One

Phase one was introduced in two parts.

Part one included the re-opening of manufacturing, construction and places of worship effective May 18, 2020.

Part two included the opening of office buildings (office space in Boston will be effective on June 1, 2020), laboratories, hair salons and barber shops, pet grooming, car washes, and retail that allowed for curbside pick-up effective May 25, 2020. In addition, beaches, parks, drive-in movie theaters, athletic fields, gardens and zoos opened effective May 25, 2020.

All businesses in Massachusetts are required to comply with Mandatory Workplace Safety Standards which vary by industry. Essential business which have remained open must comply with these standards by Mary 25, 2020. All other business must comply with these standards prior to re-opening.

Refer to the Reopening Massachusetts and Mass.gov COVID-19 site for regular updates on business openings, testing facilities, and other resources and refer to Mandatory Safety Standards for Workplaces for additional guidance.

Employers are also encouraged to review any re-opening guidance issued by local municipalities.

AIM Resource Documents

AIM “Thirty on Thursdays” Webinar Series

On-Demand Audio

Unemployment Insurance

Massachusetts enacted legislation to make state unemployment insurance (UI) more accessible to individuals affected by COVID-19. The law waived the typical one-week waiting period between submission of an application and the commencement of weekly benefits for Massachusetts employees who are separated from work due to the outbreak of COVID-19, or as a result of the state of emergency declared by Governor Baker on March 10. Such individuals are now be able to access their benefits more quickly.

The legislation also allowed self-insured, reimbursing employers including nonprofits, Indian tribes and local governments a 120-day extension to pay back into the UI Trust Fund which is currently set to expire in December 2020.

The federal CARES Act provides the following Unemployment Insurance provisions:

  • $260 billion for increased unemployment assistance, including up to four months of full replacement wages up to certain limits for individuals who lose a job or are furloughed.
  • Pandemic Unemployment Assistance (PUA) provides unemployment benefits to individuals who do not qualify for regular unemployment compensation and are unable to work because of the COVID-19 public health emergency. Qualified individuals may include self-employed workers (including gig workers and independent contractors), part-time workers, and those with limited work histories. The changes to increase the size of regular unemployment benefits and make them available for additional weeks will also apply to benefits received through the PUA program. PUA will be state administered but fully federally funded. The program is effective through December 31, 2020.
  • Pandemic Emergency Unemployment Compensation makes an additional 13 weeks of federally funded unemployment compensation available to individuals who have exhausted their state unemployment benefits available immediately through December 31, 2020.
  • Emergency Unemployment Relief for Governmental Entities and Nonprofit Organizations reduces the amount that nonprofits, Indian Tribes, and governmental entities are required to reimburse states for benefits paid to their workers who claim unemployment insurance by 50 percent through December 31, 2020.
  • Emergency Increase in Unemployment Compensation added $600 in Federal Pandemic Unemployment Compensation to every weekly unemployment benefit, effective until July 31, 2020. This $600 benefit is taxable (like regular unemployment benefits), but it will be disregarded in determining Medicaid or CHIP eligibility.
  • Temporary Full Federal Funding of the First Week of Compensable Regular Unemployment for States with No Waiting Week allows states to enter into an agreement with the federal government to receive full reimbursement for the total amount of unemployment compensation paid to individuals for their first week of unemployment, provided that the state does not have a waiting week between applying for and receiving benefits, effective until December 31, 2020. (Which was included in the Massachusetts legislation explained above).
  • Temporary Financing of Short-Time Compensation in States with Programs in Law would provide 100 percent federal reimbursement to states for payments made under qualifying short-time compensation programs (also known as work sharing programs) through December 31, 2020.

The federal Lost Wages Assistance (LWA) program was administered by the Federal Emergency Management Agency (FEMA) and initiated through an executive order signed by the president. Through LWA, Massachusetts was able to send an additional $300/week for six weeks to individuals receiving at least $100 in weekly unemployment benefits from the state during weeks ending on August 1 through September 5.

The program was initiated once the additional $600/week from the CARES Act Federal Pandemic Unemployment Compensation program expired on July 31, 2020. Legislative efforts are underway on the state level to allow more Massachusetts residents to qualify for the additional assistance.  

Disaster Financing

Listen to the AIM Webinar on business lending programs with SBA Regional Director Robert Nelson. (April 2, 2020)

The Small Business Administration offers multiple loan programs to assist small businesses impacted by the COVID-19 pandemic.

  1. (SBA) Economic Injury Disaster Loan program is open in Massachusetts. Small businesses can now access and apply for Economic Impact Disaster Loans at sba.gov/disaster. SBA issued a “declaration of economic injury” for the commonwealth.
  • Small businesses, private non-profit organizations of any size, small agricultural cooperatives and small aquaculture enterprises that have been financially impacted as a direct result of COVID-19 since Jan. 31, 2020, may qualify for Economic Injury Disaster Loans of up to $2 million to help meet financial obligations and operating expenses which could have been met had the disaster not occurred. Eligibility for Economic Injury Disaster Loans is based on the financial impact of COVID-19
  • The interest rate is 3.75 percent for small businesses.
  • The interest rate for private non-profit organizations is 2.75 percent. SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years, and are available to entities without the financial ability to offset the adverse impact without hardship.
  • Visit the SBA’s secure web site at https://disasterloan.sba.gov/ela, call the Customer Service Center at (800) 659-2955 or email disastercustomerservice@sba.gov for more information on SBA disaster assistance.

Federal Reserve Bank Main Street Lending Program

As part of the $2.3 trillion funding the Federal Reserve announced to aid in the economic response to coronavirus, the Main street Lending Program will became available to small businesses on April 9, 2020.

The Main Street Lending Program is a five-year loan for businesses with fewer than 15,000 employees and revenues of less than $5 billion per year.

Paid Family and Medical Leave

AIM is currently monitoring federal negotiations regarding additional stimulus legislation possibly before or after January 2021, which may impact FFCRA and pending deadlines in December 2020.

The U.S. Department of Labor’s Wage and Hour Division (WHD) announced its first round of published guidance to provide information to employees and employers about how each will be able to take advantage of the protections and relief offered by the Families First Coronavirus Response Act (FFCRA) which took effect on April 1.

FFCRA applies to businesses with fewer than 500 employees to provide employees with paid leave, either for the employee’s own health needs or to care for family members.  Documents provide guidance such as how an employer must count the number of employees to determine coverage; how small businesses can obtain an exemption; how to count hours for part-time employees; and how to calculate the wages employees are entitled to under this law.

The guidance is just the first round of information and compliance assistance to come from WHD. A workplace poster required for most employers will be published later this week, along with additional fact sheets and more Q&A.

AIM is also currently tracking federal negotiations that may further amend these new federal laws.  Click here for additional background on those negotiations.  AIM will continue to provide you with updates should changes to the FFCRA arise.

AIM member audit and law firms have produced great summaries of this legislation.

Taxes

AIM is monitoring federal and state tax discussions especially through state budget deliberations, please contact AIM’s Government Affairs team for the latest information or to sign up for updates.

State

The Baker Administration announced administrative tax relief measures for small local businesses that have been impacted by the ongoing COVID-19 outbreak, especially in the restaurant and hospitality sectors. The tax relief includes postponing the collection of regular sales tax, meals tax, and room occupancy taxes that would be due in March, April and May. They will instead be due on June 20. Additionally, all penalties and interest that would otherwise apply will be waived.

  • Businesses that paid less than $150,000 in regular sales plus meals taxes in the year ending February 29, 2020 will be eligible for relief for sales and meals taxes, and business that paid less than $150,000 in room occupancy taxes in the year ending February 29, 2020 will be eligible for relief with respect to room occupancy taxes.

Federal

Under the federal CARES Act:

  • Employee retention credit- a new temporary refundable 50 percent employee retention credit for employers subject to full or partial business suspension due to the COVID-19 emergency, or for employers whose gross receipts have significantly declined due to COVID-19, to be applied against the employer’s share of payroll taxes. The amount of qualified compensation (including health benefits) eligible for the credit with respect to any individual employee is limited to $10,000.
  • Payroll taxes- Delays in payment of certain applicable 2020 employer payroll taxes from date of enactment through December 31, 2020. Half of the deferred tax is to be paid by December 31, 2021, and the remainder by December 31, 2022.
  • Corporate AMT credit refunds- Accelerates the ability of companies to receive refunds of AMT credits in tax years beginning in 2019. Alternatively, companies could elect to claim the entire refundable AMT credit in tax years beginning in 2018.
  • Section 163(j) changes increase the 30 percent adjusted taxable income limitation to 50 percent for tax years beginning in 2019 and 2020. For 2019, this provision does not apply to partnerships – partners may deduct 50 percent of their distributive share of the partnership’s excess business interest in 2020 without regard to Section 163(j). The provision also allows a taxpayer to elect to use its 2019 adjusted taxable income for its 2020 limitation.

More information: PWC and The Tax Foundation

Massachusetts Workshare Program

WorkShare is a program that offers a smart alternative to layoffs. Employees work reduced hours while collecting unemployment benefits to supplement their lower wages.