The SBA’s latest round of frequently asked questions (FAQs) about the Paycheck Protection Program (PPP) gives employers an important new tool to address one of the biggest challenges of trying to maximize PPP forgiveness: How to respond to employees who refuse to return to work by June 30, 2020.
Loan forgiveness is the cornerstone of the PPP, which was established under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). To protect jobs, the PPP’s offer of loan forgiveness is in part based on an employer’s ability to maintain headcount through the COVID-19 crisis. Specifically, if between February 15, 2020 and April 26, 2020, an employer reduces its employee headcount, then the amount of loan forgiveness will be reduced. If the employer reinstates those employees by June 30, 2020, however, the loan forgiveness amount will not be reduced. Further explanation of the PPP and loan forgiveness reduction calculation can be found here.
Continue Reading Employees refusing to return to work? The SBA offers some protection of PPP forgiveness