ASSISTANCE FOR SMALL BUSINESSES
The Paycheck Protection Program prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion toward job retention and certain other expenses.

Small businesses and eligible nonprofit organizations, Veterans organizations, and Tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.

• 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

How do I apply for PPP loan? 

• Through your local SBA-approved lender. The SBA will be providing guidance on how to apply for the PPP loan and how to find a qualified lender in your area. 
•  Borrowers who have outstanding SBA loans may also want to contact their existing lenders to inquire about applying for loans under the PPP. 

 
What businesses are eligible for the PPP? 

•  Any business in operation on February 15, 2020, with no more than 500 employees. However, a business in the restaurant, foodservice, catering, and hotel industry with more than one physical location qualifies for a single loan if it employs no more than 500 employees at each physical location if they operate under the North American Industry Classification System code beginning with 72 (Accommodation and Food Services – U.S. Census Bureau). For purposes of eligibility, the SBA’s affiliate rules are waived for businesses in the hospitality and restaurant industries, and franchises approved on the SBA’s Franchise Directory.   

 
What is the PPP maximum loan amount?   

•  Each eligible business can receive the lesser of $10 million or 2.5 times the average total monthly payroll costs incurred during the one-year period before the date of loan.  For a seasonal employer, the business calculates the average total monthly payments for payroll during the 12-week period beginning February 15, 2019, or at the choice of the business, March 1, 2019, and ending June 30, 2019.  There is a cap at $10 million. 
• A business can choose an eight-week period to utilize the PPP loan during the February 15, 2020, to June 30, 2020, time period. 

 
Are there any collateral or personal guarantee requirements? 

•  No. The Act does not require collateral or personal guarantees.  

 
What can you use the loan for?   

• Payroll costs, including:  compensation to employees; payment required for group health care benefits (including insurance premiums); retirement benefits; state and local employment taxes; interest payments on mortgage obligations; other debt obligations incurred before February 15, 2020 (but not any payments or prepayments of principal); rent; and utilities.   
• Loan funds cannot be used for employee/owner compensation over $100,000; compensation of employees with a principal place of residence outside the United States; paid leave wages already covered by Phase 1 (the Families First Coronavirus Response Act); or taxes imposed or withheld under chapters 21, 22, and 24 of the IRS code. 

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How does the PPP loan forgiveness work?  

• Borrowers are eligible for loan forgiveness for the covered 8-week period, commencing from the loan origination date.  The amount of loan forgiveness is equal to the sum of the employer’s expenses, including:  payroll costs, rent payments, utility payments, and mortgage interest payments (not including any prepayment or payment of principal on a covered mortgage obligation) made during the covered 8-week period.  
•  NOTE:  The amount of loan forgiveness may be reduced if the employer reduces the number of employees as compared to the prior year, or if the employer reduces the pay of any employee by more than 25% as of the last calendar quarter. Employers who rehire workers previously laid off because of the crisis will not be penalized for having a reduced payroll for the beginning of the relevant period.  Importantly, forgiveness may also include additional wages paid to tipped workers.  
• Borrowers must apply for loan forgiveness through their lender, and produce the following: 
  •  Documentation verifying the number of Full-Time Equivalent Employees (FTEs) on payroll and pay rates for pre- and post- covered periods, including payroll tax filings reported to the IRS and state income, payroll, and unemployment insurance filings;  
  •  Documentation of rent, mortgage interest, and utility payment; 
  •  Certification that the documentation referenced above is true and correct.  

  
I’ve read the CARES Act requires businesses receiving federal assistance to be neutral in labor organizing activities.  Do labor neutrality requirements apply to my restaurant’s participation the PPP loan program?  

•  No. The certification requirements that a business will remain neutral in a union organizing effort for the term of the loan are only contained within the Economic Stabilization Fund (ESF) direct lending program. 

• Paycheck Protection Program (PPP): The CARES Act contains a key provision that provides $349 billion for small businesses through federally backed loans under a modified and expanded Small Business Administration (SBA)7(a) loan guarantee program called the Paycheck Protection Program.  The goal of the PPP is to help restaurants retain and/or rehire employees by providing an eight-week loan, equal to 2.5x an average monthly payroll, with the loan amount capped at $10 million. If the employer can retain their full-time equivalent (FTE) employees without significantly reducing salaries, the borrowing employer is eligible for 100% loan forgiveness. More details below under the “Paycheck Protection Program” section.  

 

• Economic Injury Disaster Loan (EIDL): The SBA’s EIDL program is available for certain businesses located in an area affected by a disaster – such as public health disaster – that have suffered substantial economic injury as a result of such disaster.  The CARES Act includes $10 billion to expand the SBA EIDL program to additional eligible businesses impacted by the COVID19 pandemic.  The maximum amount available to eligible small businesses is $2 million, but the actual loan amount is limited to the economic injury as determined by the SBA.  The applicant can also request an advance of not more than $10,000 within three days of when the SBA receives the applicant’s application. More details below under the “Economic Injury Disaster Loan” section.  

 

• Employee Retention Tax Credit (ERTC): The tax credit provides all businesses with a refundable payroll tax credit for 50% of wages paid by employers to employees during the COVID-19 pandemic. Employers with 100 or fewer employees may claim the credit for all employee wages, regardless of whether the employer is fully operating or partially or fully shut down.  Companies with more than 100 employees may claim the credit for employees who are on the payroll but not currently working due to the crisis. The credit is provided for the first $10,000 of compensation, including health benefits, paid to an employee for wages paid from 3/13/2020 12/31/2020.  o Employers who participate in the PPP are not eligible for ERTC.

In response to the current COVID-19 event, pursuant to La. R.S. 23:184.1, the Louisiana Workforce Commission (LWC) will begin issuing sixty (60) day blanket Employment Certificates for employers desiring to employ minors in the State of Louisiana. Employment Certificates issued due to this event shall expire sixty (60) days from the date of issuance.   Upon expiration, employers will be required to obtain Employment Certificates as required pursuant to La. R.S. 23:181 et. seq.

Employers desiring to obtain an Employment Certificate pursuant to this memorandum must submit a completed and signed “Application to Employ Minors under 18” along with proof of age to laborprograms@lwc.la.gov.  The application can be downloaded from the Louisiana Workforce Commission’s website or by copying and pasting the following web address into your web browser: http://www.laworks.net/Downloads/WFD/MinorApplicationToEmployForm.pdf. 

Incomplete applications will not be processed. Employers should allow three (3) days for processing.
When the application has been approved, the employer will be notified via email from the LWC Office of Workforce Development. The names of those minors who are approved to work pursuant to the Employment Certificate will also be attached to the email. As indicated, blanket Employment Certificates are effective for a maximum of sixty (60) days.  Blanket Employment Certificates are not transferable. Certificates are required to be kept at the minor’s work location.

Any questions or concerns regarding this memorandum should be directed to laborprograms@lwc.la.gov.

Our LRA SIF online safety video library Safety Source has set up a specific tab for COVID-19.   Under the tab, you will find links to safety videos dealing specifically with the virus and protecting employees.  

• COVID-19: Keeping Your Restaurant Safe
• COVID-19: Know Your Risk
• COVID-19: Proper Hand Washing Techniques
• COVID-19: Pandemic Flu-Facts & Prevention

To access the videos, click HERE. 
The username is LRASIF and the passkey is SAFETY.

The goal is to help operators and their employees practice safe food handling and delivery during the coronavirus pandemic.

ServSafe is offering free resources to restaurateurs focusing on takeout and delivery during the coronavirus crisis. The goal is to reinforce safe food handling and delivery practices.

For 30 years, ServSafe has been at the forefront of preparing restaurant and foodservice employees to deliver safe dining experiences for their guests while also keeping themselves safe. This mission is as important as ever during the service disruptions caused by the coronavirus.

As restaurateurs focus their businesses on takeout and delivery during the pandemic, ServSafe, the National Restaurant Association’s food-safety training and certification program, has released two new training videos to help reinforce safe food handling and safe delivery practices for all operations.

In addition to the videos, ServSafe also is offering its online Food Handler training program free through April 30. More than 3 million people have earned their ServSafe Food Handler certification. The training has helped educate line-level and front-of-the-house employees to understand food safety.

The ServSafe Takeout video highlights safety measures restaurants and foodservice employees should follow to ensure the foods and processes for preparing them for off-premises dining is safe.

The ServSafe Delivery video focuses on safety measures to help reduce risk associated with delivery of the food, including special handling precautions during the coronavirus crisis. Both are available on-demand and are free of charge. Both English and Spanish versions are available.

Sherman Brown, the Association’s executive vice president of training and certification, says the ServSafe team developed the training videos to provide guidance for restaurant employees preparing food and delivery people who transport it to the customer.

Video highlights
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ServSafe Takeout: COVID-19 Precautions focuses on:

• An overview of coronavirus, its symptoms, and details about how it’s transmitted
• Respiratory hygiene practices to reduce the spread of the virus
• Keeping guests safe through heightened cleaning and sanitizing
• Guidelines for single-use gloves
• Packaging considerations for takeout and/or curbside pickup
• Guest contact precautions during takeout
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ServSafe Delivery: COVID-19 Precautions highlights:

• An overview of coronavirus, its symptoms and how it is transmitted
• A review of the five-step handwashing process
• Respiratory hygiene practices to reduce the spread of the virus
• Packaging best practices to reduce risks of exposure and food contamination during delivery
• Cleaning and sanitizing considerations for delivery, including attention to coolers, insulated bags, and surfaces in vehicles
• Precautions and hygiene recommendations for workers regarding surface contacts during deliveries
  
  

"As restaurants are forced to change how they do business, we want to ensure safe customer experiences by extending best practices for safe food handling to takeout and delivery," Brown said.
Brown added that the ServSafe team is available to operators and their employees via phone, text, online chat, and email.

From Shannon Meade, Vice President of Public Policy and Legal Advocacy, NRA
 
As expected, the U.S. Department of Labor just issued some preliminary guidance, in the form of Questions and Answers, in advance of the implementing regulations on the Families First Coronavirus Response Act (FFCRA) a/k/a COVID-2, which takes effect April 1.  To access please click on the link below.  The Department advises that they will continue to provide compliance assistance to employers and employees on their responsibilities and rights under the FFCRA, and we will be sure to keep you updated as that information is made available.
https://www.dol.gov/agencies/whd/pandemic/ffcra-questions  
 
Also, the Department is hosting a creative opportunity for public input via a national online dialogue to provide employers and employees an innovative way to offer their perspective as the Department develops compliance assistance materials and outreach strategies related to the implementation of FFCRA.  The ideas and comments gathered from this dialogue will inform compliance assistance guidance, resources, and tools, as well as outreach approaches, that assist employers and employees in understanding their responsibilities and rights under the FFCRA.  The deadline for input is March 29, 2020.  Anyone who is interested can participate online at https://ffcra.ideascale.com now through March 29, 2020.

Prime Cost Management:

• Cost of Goods Sold (COGS)
  • Some broadliners are offering concessions like extended payables
    • if possible, reduce menu items
    • think about higher mix, easy to execute, higher margin, minimizing skews, cross utilization
    • determine prep labor reductions, food waste, and other cost reductions from these decisions
    • Correspondingly work with your GMs to reset par levels and prep schedules for lower volumes
    • Work with suppliers/distributors to anticipate any product shortages; adjust menu in advance
  • Deplete inventory, keep the minimum needed to manage your business
    • Work with distributors and suppliers to waive fees on minimum drop sizes and orders; Fewer deliveries means lower distribution costs as well
    • Remember to have enough packaging and condiments for increased off-premise business
    • Offer to donate ingredients that could be expiring to food banks or offer to employees on leave
• Negotiate with vendors for improved payment terms
• If you have several units in the same region, move inventory (particularly anything that can spoil) from fully closed units to units that remain open
• Check with broadliner if you can return excess inventory for full refund
• Labor
  • Reduce labor schedules to reflect lower volumes; consider shortening overall hours of operations to reflect only higher revenue dayparts
  • Think about day-on / day-off laboring to keep critical staff on payroll
  • Look to deploy team members in other ways (be careful of dual employment – check with legal counsel)
  • In-house delivery, window cleaning/landscaping/etc. (and cut back outsourced services for these expense line items), local marketing (shaker boards)
  • Philanthropic activities such as delivering food to those in need
• Before terminating, laying off or furloughing seek legal/HR advice and assess WARN Act impact 
  • Consider payments to furloughed staff (e.g., 25%-75%)Consider offering free meals to furloughed/terminated staff for a period of time
• Continue to monitor the LRA website and updates around Coronavirus relief bill and paid leave assistance – we are working hard to study and understand various proposals and potential fit for our partners
  • Note from a cash flow perspective, reimbursement will take time (tax credits)
• Careful of treatment of “exempt” employees – if GMs are working hourly shifts ensure they still pass the “rules test”; you may need to move them to hourly in order to comply with DOL rules – consult labor counsel
• Consider any benefits that can be postponed (competitive dining cards, etc.)
• Consider creating an employee hotline or blog to maintain open communication
  
  

Other Operating Expenses: 

• Dust off your GL and go through every single expenditure – what can be paused or canceled?  
  • For example, you don’t need audio or TV programming subscriptions if no one is dining in
  • Challenge your departments to identify cost saving opportunities
• Try to get fees waived: banks, subscriptions, etc.
• Reduce services: trash, window cleaning, linens, preventative maintenance, and others
• Utilities
  • Try paying on a credit card to extend payments (especially a cash back card)
  • Make sure all utilities are shut off for any closed units
  • Ensure unnecessary heat/ac in dining rooms is shut off
• Turn off all automatic payments (if any) 
• Use of cash will likely decrease and credit card volume will likely increase
  • Do you need less register cash?  If so, deposit excess into bank to increase liquidity.
  • Reduce or eliminate any expenses related to the management/storage of cash
  • Proactively negotiate better rates for credit card processors in anticipation of bigger volumes