The American Rescue Plan Act was signed into law on March 11, 2021 and contains features that are designed to help employers recover from the pandemic. Features of the Act include;
· The Employee Retention Tax Credit (ERTC), which was created in the CARES Act and provides tax relief for employers on employee wages, has been extended from June 30th to the end of the year. Hardest hit employers may count all wages paid as qualifying wages, not just the wages paid to employees that are not providing service. The extension of two additional quarters translates to up to an additional $14,000 in savings per employee. More assistance under the ERTC has been included in the Act.
· The paid leave tax credit created in the Families First Coronavirus Response Act (FFCRA) has also been extended, from March 2021 to the end of September. As of April 1, 2021, employers are eligible for an additional tax credit if they voluntarily provide an additional 10 days of paid sick leave and an additional 10 weeks of paid family leave. The limit on the size of the tax credit has been increased to $12,000.
· In addition, new qualifying reasons for FFCRA paid leave have been added, mostly related to COVID-19 vaccines, such as an employee;
With the COVID-19 pandemic, everyone’s resilience and adaptability has really been tested. Employee’s mental health was already a rising concern for employers and the past year has moved it to the forefront. April 6th is National Benefits day with a focus on mental health. Resources such as “How Supervisors can Support Employees with a Mental illness” to “How to face Adversity” are topics that can be provided to supervisors. For ways that your business can promote a healthy workplace with a focus on mental health, contact firstname.lastname@example.org
The bill to gradually increase the minimum wage to $15.00/hour failed to pass in the Senate and was not included in the New American Rescue bill.
While the National and Texas minimum wage remains at $7.25, employers may often offer employees a higher rate to stay competitive. We expect to hear about more efforts to increase the minimum wage in the future, but for now the labor market dictates the best compensation and benefits to offer new employees. If compensation or benefit survey information is needed, we will be glad to help.
On January 7, 2021, the U.S. Department of Labor (DOL) published a new rule for determining whether Independent Contractors are employees under the FLSA. The new rule, which was to become effective March 8, 2021 focuses on the “economic realities” of the work arrangement and, whether the employer has actual control over the Independent Contractor. The new rule if enacted would be part of the PRO Act, proposes the following:
· Adopt an “economic reality” test to determine a worker’s status as an FLSA employee or an independent contractor.
· To identify and explain two “core factors,” to help determine if a worker is economically dependent on someone else’s business or in in business for themselves;
· Identify three other factors that may serve as additional guidance in the analysis; and,
· Advise that the actual practice is more relevant than what may be contractually or theoretically possible.
However, on March 2, 2021, the DOL announced that it decided to delay the independent contractor rule from March 8th to May 7th, 2021 to allow the agency additional time to review the multiple issues of law, policy, and fact before it goes into effect. It remains to be seen if the new rule will go into effect, be withdrawn or rewritten. Stay tuned! Contact email@example.com for guidance on determining if someone is a Contractor or an employee .