Articles, Newsletters & Advisories
April 3, 2020U.S. DOT Agencies Extend COVID-19 HazMat Relief
In response to the COVID-19 pandemic, U.S. Department of Transportation (DOT) agencies that regulate the surface transportation of hazardous materials (HazMat) have extended several forms of relief. The Pipeline and Hazardous Materials Safety Administration (PHMSA) has waived some HazMat training requirements and delayed some equipment recertifications. The Federal Motor Carrier Safety Administration (FMCSA) and the Federal Railroad Administration (FRA) are implementing PHMSA’s waiver in their modes. FMCSA has also allowed states to extend the effective dates for commercial driver’s licenses (CDL) and commercial learner’s permits (CLP). Additionally, FRA has activated its emergency docket. FRA has not extended any hazardous materials-specific relief.
Hazardous Materials Shippers, Carriers, and Package ManufacturersOn March 25th, PHMSA issued an updated policy declining to enforce recurrent training requirements under 49 C.F.R. § 172.704(c)(2) against HazMat employers unable to train employees due to COVID-19. Employers are still required to provide initial training to a new hazardous materials employee before the employee may perform regulated functions. On April 1st, PHMSA issued two surface transportation-related emergency special permits authorizing the filling and transportation of certain DOT specification cylinders up to 12 months after they are due for a periodic requalification during the COVID-19 emergency. PHMSA also authorized the transportation of certain cylinders overdue for retesting due to COVID-19 disruptions.
Truck TransportationOn March 18th, FMCSA issued an expanded emergency declaration waiving certain provisions of Parts 390 through 399—most notably the hours of service requirements—for drivers providing direct assistance in support of relief efforts. Direct assistance includes transporting medical supplies, food, paper, and grocery products; precursors for those products; fuel; and equipment for constructing facilities to treat or house COVID-affected individuals. Direct assistance does not include routine commercial deliveries, including mixed loads with a nominal quantity of emergency...
April 3, 2020PADEP Will Consider Requests to Temporarily Suspend Environmental Requirements Due to COVID-19
As businesses in Pennsylvania struggle to deal with significant disruptions and challenges to their operations caused by the COVID-19 pandemic, environmental agencies have recognized the challenges that the pandemic presents to achieving compliance with environmental obligations. For example, on March 26, 2020, the U.S. Environmental Protection Agency (USEPA) issued a temporary policy for excusing COVID-19-related noncompliance (see Babst Calland’s March 30, 2020 Environmental Alert for further details). Similarly, on March 31, 2020, the Pennsylvania Department of Environmental Protection (PADEP) issued an Alert announcing that it would consider requests to temporarily suspend certain regulatory, permit, and/or other legal requirements due to COVID-19. It also provided the form needed to make such a request. This announcement reflects a thought change from PADEP’s previous assertion that COVID-19’s impact on businesses in Pennsylvania would not excuse compliance with environmental laws, stating that “ll permittees and operators are expected to meet all terms and conditions of their environmental permits, including conditions applicable to cessation of operations.”
What is Required to Request a Temporary Suspension?
Unlike USEPA’s temporary policy, which does not require regulated entities to submit documentation regarding an inability to meet routine compliance obligations, PADEP is requiring submittal of the request form. While PADEP did not elaborate on how it will review requests for suspension, it will generally evaluate (1) the reasons for the request in light of the COVID-19 pandemic, and (2) the risk of harm to the environment or public health if the request is or is not granted.
Importantly, it will not be enough for entities to show that COVID-19 has restricted their ability to comply with regulatory, permit, or other legal requirements; entities must demonstrate that strict compliance would prevent, hinder, or delay necessary action in coping with the COVID-19 emergency. This...
April 3, 2020Update: Interim Final Rule Issued for Paycheck Protection Program
On April 2, 2020, the Small Business Administration (the SBA) published an Interim Final Rule regarding the Paycheck Protection Program (PPP Loan), enacted as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Below are critical points that the SBA has clarified in the published guidance. The Interim Final Rule can be found here.
What is the interest rate of the loan?
The SBA has advised that the interest rate of the loan has been increased from a 0.5 percent fixed rate to a 1 percent fixed rate.
Do independent contractors count as employees for purposes of PPP Loan calculations or PPP Loan forgiveness?
No. Independent contractors have the ability to apply for their own PPP Loans, so they do not count for purposes of a borrower’s PPP Loan calculations or forgiveness.
How can PPP Loan proceeds be used?
The proceeds of a PPP loan are to be used for:payroll costs (as defined in the Act and in 2.f.); costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums; mortgage interest payments (but not mortgage prepayments or principal payments); rent payments; utility payments; interest payments on any other debt obligations that were incurred before February 15, 2020; and/or refinancing an SBA EIDL loan made between January 31, 2020 and April 3, 2020.
If you received an SBA EIDL loan from January 31, 2020 through April 3, 2020, you can apply for a PPP Loan. If your EIDL loan was not used for payroll costs, it does not affect your eligibility for a PPP Loan. If your EIDL loan was used for payroll costs, your PPP Loan must be used to refinance your EIDL loan. Proceeds from...
April 2, 2020COVID-19 Updates to Pennsylvania & West Virginia Unemployment Laws
Employment & Labor Alert
At this uncertain time, many employers are considering whether to lay off or furlough employees – particularly employees who are unable to work remotely. Earlier this week, we provided guidance on an alternative to layoffs and furloughs, as some employers are exploring grants and loans that are available under the new federal and state stimulus programs. With this Alert, we are providing an update on recent changes to Pennsylvania and West Virginia unemployment laws:Increased Benefit Amounts Normally, unemployment benefits are capped at $573 per week in Pennsylvania and $424 per week in West Virginia. Under the Paycheck Protection Program provision of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the federal government will supplement state unemployment benefits by $600 per week. Through July 31, 2020, unemployment benefits will be capped at $1,173 per week in Pennsylvania, and $1,024 per week in West Virginia. As a result, for the next four months, some workers may actually earn more in unemployment benefits than they would have earned in wages. For example, an employee who would otherwise receive $100 per week of state unemployment benefits will now receive an additional $600 per week from the federal government. After the federal supplement of $600 per week expires, the employee may continue to collect unemployment benefits at the usual rate in each state Expanded Eligibility Until recently, Pennsylvania and West Virginia limited unemployment benefits to certain employees. In Pennsylvania, to receive unemployment benefits, an employee must have earned at least $116 per week, during at least 18 weeks in the past year. In West Virginia, employees must satisfy two requirements within the past year: they must have earned a total of at least $2,200; and they must...
March 31, 2020UPDATE: Assessing Your Organization’s Stimulus Program Options
Earlier today the U.S. Treasury Department (the Department) published additional information on the Paycheck Protection Program (PPP Loan), enacted as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Below are critical points that the Department has clarified in the published guidance.
When can I apply?Small businesses and sole proprietorships can begin submitting applications on Friday, April 3, 2020 Independent contractors and self-employed individuals can begin submitting applications on Friday, April 10, 2020.
How much money can be borrowed?
The Department clarified that salary, wages, commissions, or tips are capped at $100,000 on an annualized basis for each employee.
How much of the loan is forgiven?
Due to likely high subscription, the Department anticipates that not more than 25% of the forgiven amount may be for non-payroll costs.
What is the interest rate of the loan?
0.5% fixed rate.
Read the latest guidance information issued by the Department of Treasury below.
For a top-line overview of the program, click here.
If you’re a lender, more information can be found here.
If you’re a borrower, more information can be found here.
The application for borrowers can be found here.
For more information on the above program or for assistance in applying for the program, please contact Babst Calland Attorneys Moore Capito at 304.552.8986 or email@example.com, Christian Farmakis at 412.394.5642 or firstname.lastname@example.org or Andrew Terranova at 412.773.8717 or email@example.com.
March 30, 2020Assessing Your Organization’s Stimulus Program Options
The COVID-19 pandemic is impacting every business sector in the United States. Federal government and the Commonwealth of Pennsylvania have announced various stimulus programs to assist businesses eligible to receive certain economic benefits. Babst Calland’s Corporate and Commercial attorneys have been following the existing and new stimulus programs currently being offered.
This is a time-sensitive opportunity to consider how these programs may apply to your business. Various programs are summarized below for your convenience. Together, we can help you navigate this crisis and prepare your organization to continue thriving in the months and years ahead. To schedule a private conversation to help you evaluate whether these programs are right for your company, contact Attorney Moore Capito at 304.552.8986 or firstname.lastname@example.org.
ECONOMIC INJURY DISASTER LOAN
An Economic Injury Disaster Loan (EIDL) is a long-term, low-interest loan that provides small businesses with working capital of up to $2 million directly from the U.S. Treasury. The intent of this federal program is to provide six months of working capital to qualified applicants. In response to the impacts of the COVID-19 pandemic, the U.S. Small Business Administration (SBA) has lifted certain requirements to make it easier for small businesses to receive an EIDL.
Who is eligible to receive it?
Small businesses and sole proprietors in all 50 states, Washington, D.C., and U.S. territories may apply for an EIDL, so long as they do not exceed the size standard for the industry in which they operate. For a list of the size standards per industry, click here. Eligibility is also based on a series of factors set forth on the application.
What are the terms of the loan?
An EIDL has a maximum 30-year term, with a 3.75% interest rate for...
March 30, 2020EPA Establishes Temporary Policy for Excusing COVID-19-Related Noncompliance
In light of historic protective measures and travel bans to prevent community spread of COVID-19, the U.S. Environmental Protection Agency (EPA) issued an unprecedented temporary policy for exercising its enforcement discretion for environmental noncompliance caused by the COVID-19 pandemic. On March 26, 2020, the EPA published a memorandum entitled, COVID-19 Implications for EPA’s Enforcement and Compliance Assurance Program (“EPA’s COVID-19 Policy” or “Policy”). EPA’s COVID-19 Policy applies retroactively, beginning on March 13, 2020, and is in effect until EPA provides notice online within seven days of its termination. This Alert addresses five critical questions about EPA’s COVID-19 Policy.
When Does EPA’s COVID-19 Policy Apply?
EPA’s COVID-19 Policy applies when environmental compliance is not “reasonably practical,” despite making every effort to comply. Coverage under the Policy is not automatic. It requires regulated entities to take, at a minimum, the following proactive steps: (1) minimize the effect and duration of any noncompliance; (2) identify the nature and date(s) of noncompliance; (3) identify how COVID-19 caused the noncompliance and describe the response actions taken; (4) return to compliance as soon as possible; and (5) document each of these actions.
What Compliance Monitoring and Reporting Obligations Does the Policy Cover?
Generally, EPA does not expect to assess penalties for violations of a wide-range of routine compliance monitoring, integrity testing, sampling, laboratory analysis, training, and reporting or certification obligations if: (1) the regulated entity takes the steps outlined above and documents that COVID-19 was the cause of the noncompliance, and (2) EPA agrees with the entity’s determination.
EPA expects regulated parties to use existing statutory, regulatory, and permitting requirements for reporting COVID-19-related noncompliance, unless COVID-19 response actions themselves hinder reporting, in which case EPA expects facilities to document and maintain noncompliance-related information internally and make it available...
March 26, 2020Pennsylvania Legislature Considering Modification of Public Meeting Rules, Suspension/Tolling of Land Use Application Deadlines during COVID-19 Emergency Declaration
Among the many challenges facing Pennsylvania municipalities during the Coronavirus pandemic is how to conduct business in compliance with applicable statutory requirements when the physical presence of their officials, constituents, development applicants and other interested parties is either highly discouraged by public health officials or prohibited altogether. This can be particularly problematic for applicants for a variety of local government land use approvals, consideration and action on which usually are statutorily mandated to take place at public meetings and hearings.
In an effort to address these issues, the Pennsylvania General Assembly is currently considering House Bill No. 1564 on an expedited basis. Among other things, HB 1564 would relax the requirements for physical attendance at public meetings during the Governor’s declaration of a disaster or emergency by substituting a variety of telecommunications alternatives. It also would provide for the suspension, or tolling, of statutory deadlines for municipal boards and agencies to hear and act upon a wide variety of land use and other development applications during the pendency of such a declaration. Notably, HB 1564 provides that an applicant can request, and a municipality at its discretion may proceed with, consideration and action on an application using telecommunication alternatives.
HB 1564 is on a fast track, with the House approving it on March 25, 2020, and the Senate expected to act upon it in the next several days. HB 1564 can be viewed here.
The following are the key provisions of HB 1564.
Use of Telecommunication Devices to Conduct Public Meetings
If the declaration is of a disaster or emergency which would render the conduct of public business dangerous to the health or safety of the members of the governing body, officials or members of the public, the governing body may exercise...
March 25, 2020DOL Announces April 1 Effective Date and Additional Guidance on Families First Coronavirus Response Act
Employment & Labor Alert
This is a follow-up to Babst Calland’s client alert on the Families First Coronavirus Response Act provisions and related new leave requirements. The Department of Labor announced that the effective date will be April 1, 2020. The leave is not retroactive and begins April 1. Each company’s number of employees to determine whether it meets the 500-employee threshold will be calculated at the time the leave is to be taken. The Department of Labor released Question and Answer guidance available here, providing additional preliminary information on calculating the employee threshold, leave calculations, rate of pay calculations, and interactions with other types of leave. The full regulations have not yet been released, and are expected prior to the April 1 effective date.
The model notice issued by the Department of Labor is available here, and was issued along with a Frequently Asked Questions regarding the notice requirements available here. The notice does not need to be displayed until April 1, 2020 and most employers will want to wait to publish the notice until their FFCRA policy is ready to avoid employee confusion. The notice must be posted in a conspicuous place on the employer’s premises, which may include email, company intranet, or physically at the workplace depending upon current operations.
Please contact any of Babst Calland’s Employment and Labor attorneys if you need advice on the Families First Coronavirus Response Act and its requirements.
March 20, 2020Seeking Clarity around Governor’s Order to Close Pennsylvania Businesses that are not “Life-sustaining”
In the late afternoon of March 19, 2020, and without advanced notice, Pennsylvania Governor Tom Wolf issued an Order for all “non-life-sustaining businesses” in the Commonwealth to close their physical locations. The Order was effective at 8 p.m. last evening with enforcement to begin at 12:01 a.m. on Saturday, March 21. A copy of the Order can be found here. There are many questions that arise from the Governor’s Order, and it can be expected that further clarifications will be forthcoming from the Governor’s office. The Governor’s office has also issued a press release with additional information.
In a press conference at 2 p.m. today, the Governor stated that the guidelines are being revised based upon feedback from businesses and other stakeholders, and that the forthcoming guidelines will be in line with the federal government’s Cyberspace and Critical Infrastructure Security Agency (CISA) guidance that has identified 16 “Critical Infrastructure Sectors,” as available here. In addition, the Governor encouraged businesses to seek a waiver if they believe that they have been incorrectly categorized as “non-life-sustaining.” The waiver process is meant to “cut through red tape” and the Governor stated that decisions will issue via email.
While further guidance remains pending, this Alert will summarize the current Order and suggest methods to address confusion regarding the Order or to seek relief from its provisions.
The Order provides that “No person or entity shall operate a place of business in the Commonwealth that is not a life sustaining business regardless of whether the business is open to the members of the public.” The Order does not prevent working from home. The Order further provides specific guidance on what the Governor has decided is a “life sustaining business.” A list of businesses and industries that...
March 20, 2020The Coronavirus May be a Basis to Invoke the Force Majeure Provision of Consent Orders and Consent Decrees in Pennsylvania
On March 6, 2020, Governor Tom Wolf issued a Proclamation of Disaster Emergency throughout the Commonwealth under the Pennsylvania Emergency Management Services Code in response to the expanding COVID-19 coronavirus pandemic. On March 13, President Donald Trump declared a state of national emergency. Many other states and local governments are following suit. These government actions may be a basis to invoke the force majeure clause of consent orders and consent decrees between regulated parties and the Pennsylvania Department of Environmental Protection, other state and local environmental regulatory agencies or the U.S. Environmental Protection Agency.
The standard force majeure provision of most PADEP consent order and agreements allows deadlines in the order to be extended if circumstances beyond the reasonable control of the regulated party prevent compliance with the order. Similar provisions are often found in consent agreements with USEPA and in consent decrees approved by federal and state courts. These force majeure provisions typically require the affected party to notify the agency of the force majeure event when the party becomes aware or reasonably should have become aware of the event impeding performance. For example, the model PADEP Consent Order and Agreement requires telephone notice within five working days and written notice, in some circumstances by notarized affidavit, within 10 working days describing the reasons for the delay, the expected duration of the delay, and the efforts being taken to mitigate the effects of the event and length of the delay. This model provision states that failure to comply with the timing and notice requirements invalidates a force majeure extension.
There are compelling reasons why the coronavirus pandemic, which is unlike any event experienced in this country, is beyond the contemplated scope of agency force majeure clauses such that strict...
March 19, 2020The Families First Coronavirus Response Act
Employment & Labor Alert
The Families First Coronavirus Response Act (the “Act”) was enacted on March 18, 2020 and adds two additional types of leave connected to the coronavirus (“COVID-19”) pandemic. Employers should immediately institute policies relating to these new leaves to ensure proper compliance and to avoid violating the Family and Medical Leave Act or the Fair Labor Standards Act.
Key Provisions Related to CoverageThe new leave provisions apply to private sector employers with fewer than 500 employees and provide eligible workers with additional paid and unpaid time off over and above any existing leave already provided by their employer. Businesses that were too small to be previously subject to FMLA are now covered by these provisions. Under the Act, the Secretary of Labor is given the authority to issue regulations that would exclude health care workers and emergency responders from the Act, as well as businesses with less than 50 employees where the regulations would jeopardize the business as a going concern. Unless and until the Secretary of Labor issues such regulations, the provisions of the Act apply to all private sector employers with less than 500 employees. Any leave payments made pursuant to the Act are capped as described below at the amount of the tax credits created to reimburse employers (maximum aggregate over both leaves of $15,110 per employee). The Act is effective not later than April 2, 2020, and remains in effect until December 31, 2020. Under the Act the Department of Labor is to issue a mandatory workplace poster relating to the new leave provisions by March 25, 2020.
Emergency Paid Sick LeaveFull-time employees regardless of tenure are immediately eligible for 80 hours of paid sick leave on the Act’s effective date. Part-time employees...
March 18, 2020Business Continuity During the COVID-19 Pandemic; Leveraging AI/Machine Learning Contract Review
(by Christian Farmakis)
Dear Clients and Friends:
Clearly, in light of the COVID-19 pandemic, this is a time for reflection and a time for staying on top of our personal and professional priorities.
With the Coronavirus pandemic having a widespread effect on business continuity, supply chains and revenues, Babst Calland and its alternative legal service provider, Solvaire, are currently advising C-suite executives and managers as they seek to quickly assess their contract provisions, evaluate their exposure and make effective operational and financial risk-based decisions. Of particular concern, key suppliers may desire to invoke “force majeure”, delay or termination provisions during this time of uncertainty. Similarly, our clients may desire to invoke these same provisions to delay or terminate unessential projects.
By employing a series of AI/machine learning and other legal technologies, we can conduct accelerated and thorough searches across huge document sets revealing key information about each contract before our professional staff even begins reviewing the documents. During this time, we understand the unprecedented challenges your organization and internal teams may be facing. Our team is here to help. Solvaire has 20 years of project management and quality control experience to organize and manage contract review projects from start to finish.
We employ flexible staffing models and can quickly ramp up staffing based on deadlines and need. Our reviewers and staff are fully capable of working remotely, allowing us to comply with the latest CDC Guidelines regarding social distancing.
Projects can be customized to fit your timeline and needs. Representative contract clause extraction provisions include force majeure, material adverse effect, termination, insurance, delay, term, governing law, payments and notice information, among others. Our legal technologies can also be quickly “trained” to find critical contract provisions unique to your business or industry.
Our entire team stands ready to assist in your business continuity. Please take care...