On August 8, President Trump signed four executive orders to extend federal pandemic relief. These executive orders include:
Employers and employed workers will be particularly interested in understanding how the payroll tax deferral will work. The intent is to put more money in workers' pockets by increasing their take-home pay. At this point, it's understood the taxes will be deferred to be paid at a later date. However, the order directs the Secretary of Treasury to explore ways to eliminate this tax obligation altogether.
Unemployed workers will be eager to know whether their state will participate in the extended unemployment program. Each state will need to confirm whether or not they can afford to participate.
Legal challenges are expected.
On August 3, the United States District Court for the Southern District of New York struck down four portions of the FFCRA final rules that were issued by the Department of Labor. Though it is not clear if the district court's decision to strike down portions of the final rules will apply nationwide, employers should study the court's decision. It suggests employers may want to consider adopting a more generous approach on granting FFCRA leaves. Employers are eligible to receive tax credits on the wages paid under FFCRA, so this has financial ramifications.
The New York federal court decision addresses the following interpretations:
We'll continue to monitor this case and will provide updates as this ruling evolves. Have questions or need some help? Don't hesitate to reach out to our experts. For more information on keeping your business running during disruption, visit our COVID-19 Resource Center