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The Federal Reserve recently announced that it is establishing the Main Street Lending Program (“MSLP”) to provide significant financing for businesses impacted by the COVID-19 pandemic. The MSLP will provide 4-year loans to companies employing up to 10,000 workers (or with revenues of less than $2.5 billion on an annualized basis). The minimum loan size will be one million dollars. Principal and interest payments will be deferred for one year. MSLP loans are not currently available, but they are expected to come online soon, as the Federal Reserve is currently working to create the necessary infrastructure and is considering feedback provided by the public.
Congressional leaders are reportedly close to an agreement on new legislation providing additional funding for the Paycheck Protection Program (“PPP”). Eligible businesses who have not yet obtained a Payroll Protection Program loan should be prepared for the program to re-open soon. Initial PPP funding was rapidly depleted, and many eligible businesses were unable to participate in the unprecedented program.
Please compile your documents together so you can provide to your lender, as needed, to support your company’s loan request, including but not limited to payroll records. For those companies that did receive the PPP funding, make sure your company is implementing best practices to utilize and document the money in compliance with the applicable rules.
We have an important update regarding current commercial landlord/tenant issues and small business evictions. On April 6, 2020, Gov Ducey issued Executive Order 2020-21, “Prohibiting Small Business Evictions”. Click Here to read a copy of the Order.
The Order suspends, until May 31, certain commercial evictions or similar actions against tenants unable to pay rent due to financial hardship caused by the COVID-19 Pandemic unless a court determines suspension of eviction is not appropriate. It also requires landlords, tenants and lenders to take or consider taking certain actions.
Tenants may see this Order as a rent holiday.
The issue of “joint employment” under labor and employment laws has received much attention in the last few years, including attempts to hold franchisors responsible for franchisee’s employees. Both the Department of Labor and the National Labor Relations Board issued new regulations in 2020 to define when a company may be considered a joint employer and, therefore, jointly liable for violations of employment and labor laws.
Department of Labor Joint Employer Standard
The Department of Labor has issued a number of new regulations in the past few months, including the new minimum salary rate for salaried exempt employees.
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