Small businesses are on the front line of the coronavirus epidemic, and I want to help you and other small businesses and the self-employed get through this and survive and thrive by keeping you informed of what’s happening, especially what resources and financial sources are available.
I’ll try to hold a Facebook Live get-together every day at 1pm Eastern/10am Pacific at www.facebook.com/RhondaAbramsSmallBusiness. Please join me with your questions, advice.
My first event concentrated on the pending government legislation regarding paid sick leave.
PAID SICK LEAVE FOR YOU AND YOUR EMPLOYEES. As of this writing (11pm ET Monday), the House of Representatives passed the “Families First Coronavirus Response Act” but it had not yet been passed by the Senate. Here are the details:
a. COMPANIES WITH 500 OR FEWER EMPLOYEES must provide:
- paid sick leave – 2 weeks paid leave at 100% of employee’s normal pay, up to $511 per day
- paid family and medical leave – additional 12 weeks of paid family and medical leave at 67% of normal pay, up to $200 per day (small businesses can apply for a waiver of this in some limited circumstances)
b. SMALL BUSINESSES WILL GET A TAX CREDIT TO COVER THE COSTS.
c. GIG WORKERS AND INDEPENDENT CONTRACTORS get the same benefits in form of a tax credit.
What this means for you:
Small businesses: you must provide paid sick leave and/or family/medical leave for any of your payroll workers (not contractors). The government will pick up the cost of this paid leave—by applying a credit for your 6.2% payroll social security taxes. If the credit is insufficient to cover those costs, the government will pay you directly. You or your workers do not have to be sick to qualify! Anyone told to quarantine, who is exposed to the virus, showing symptoms, or needs to get tests or preventive care qualifies. Family leave is easier—up to 3 months of paid leave to adhere to quarantine, take care of a sick family member or a child who is home because of their school being closed.
Gig worker/independent contractor: if you are paid by another company (e.g., a ride share company, a caterer, a worker platform like Upwork, another contracting company), you’re eligible for a tax credit of up to 2 weeks sick leave at your average pay and 12 weeks of family/medical leave at 2/3 your average pay. The same caps apply–$511/$200 per day. You must show you had to comply with self-isolation or care for family members, including children whose schools had been closed due to the coronavirus. Tax credits will be applied against your tax payments, or you will get a rebate if your tax is lower than the credit.
Remember, this legislation is proposed—it has not yet passed.
Please join me at 10am Pacific/1pm Eastern at www.facebook.com/rhondaabramssmallbusiness for a Facebook Live get-together. I’ll try to answer any of your questions and help you, your employees, and your business survive and thrive in these trying times.
Keep up your spirits! We’ll get through this together.
Copyright Rhonda Abrams, 2020
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