The New York Unemployment Insurance program is an insurance fund that all businesses pay into.  Like most States, the employer’s financial contributions into the program are based on a calculation known as the “experience rating.”  This rating is negatively impacted by the amount of former employees who file unemployment claims and receive unemployment benefits.  Accordingly, businesses that have more former employees filing and receiving unemployment benefits pay contributions at a higher rate than employers that have fewer former employees receiving benefits.  During the current COVID-19 outbreak this means that those employers who are forced to layoff or furlough workers in an attempt to save their business will face steep increases to their Unemployment Insurance contributions for many years after this health crisis is over.  This, in turn, could hamper these businesses from being able to fully resume operations once the State lifts the stay at home restrictions. 

Many other States in the country have recognized the negative implications that their current unemployment insurance laws are having on their businesses and have taken action to address them.  At the time of this post at least sixteen (16) other States have changed their laws in some form to reduce the economic impact on a business if it is forced to layoff or furlough workers during this health crisis.  Most of these States, for example, have changed their laws either through legislation or executive order to provide that an employer’s experience rating will not be negatively affected if it is forced to layoff or furlough employees as a direct result of the COVID-19 outbreak.  Unfortunately, New York is not one of those States and I am personally unaware of any pending legislation in either the New York State Assembly or the Senate.  By failing to address this issue, New York State is in essence penalizing its businesses for something that is completely out of their control.  As a result, New York businesses will need to take into consideration what the long term effect of higher Unemployment Insurance contributions will be on their business when deciding whether layoffs or furloughs are a viable option to get them through this crisis. 

At the Law Office of Steven A. Campanaro we are here to assist businesses of all sizes navigate the constantly changing laws and regulations associated with the COVID-19 outbreak.  Due to high demand, we have recently streamlined our consultation process by implementing the ability to book telephone or video consultations online.  If your business needs legal assistance and would like to schedule a consultation, please click “Contact Us” at the top of our website to make an appointment.

WHAT THE EXEMPTION ENTAILS

When the FFCRA was passed by Congress it provided a limited exemption to small businesses from the requirement that they provide their employees with paid sick leave or expanded family and medical leave due to a child’s school closing or because a child care provider is unavailable as a result of the COVID-19 virus.  It is important to note that the exemption is limited to just this one category or circumstance of leave.  The FFCRA sets out five other categories of leave which the small business exemption does not apply (for a list of those categories click here).  Although this exemption seems limited in nature, it is nevertheless extremely important to small businesses and their employees as the issue of child care will most likely remain a problem well after New York State permits businesses and their employees to return to their place of work.  This is especially true if the State elects to keep schools closed for the remainder of the school year or if private daycare facilities close permanently due to the economic impact of the COVID-19 virus.  If an employee has children whose school or daycare facility is closed, they will be unable to return to work when the stay at home restrictions imposed by the State are lifted.

QUALIFYING FOR THE SMALL BUSINESS EXEMPTION

When the FFCRA was enacted it failed to elaborate or otherwise provide any insight as to how a small business can determine if qualifies for the exemption.  It simply stated that a small business with fewer than fifty (50) employees could claim the exemption to the childcare related paid leave requirement if it “would jeopardize the viability of the business as a going concern.”  Since its enactment, however, the United States Department of Labor (“DOL”) has published regulations to provide clarity as to how a business can determine if it qualifies for the small business exemption.

In accordance with the FFCRA and the DOL’s recently published regulations, an employer is exempt from providing mandated paid leave to an employee if:

1. The business has fewer than 50 employees; and
2. The employee is requesting leave because their child’s school or place of care is closed or child care provider is unavailable due to COVID-19 related reasons; and
3. An authorized officer of the business has documented that he or she has determined that providing paid leave to care for a child would jeopardize the viability of the business as a going concern because:
   1. Such leave would cause the small employer's expenses and financial obligations to exceed available business revenue and cause the small employer to cease operating at a minimal capacity; OR
   2. The absence of the employee or employees requesting such leave would pose a substantial risk to the financial health or operational capacity of the small employer because of their specialized skills, knowledge of the business, or responsibilities; OR
   3. The small employer cannot find enough other workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services the employee or employees requesting leave provide, and these labor or services are needed for the small employer to operate at a minimal capacity.

A complete copy of the DOL’s regulations can be found here.

HOW TO CLAIM THE SMALL BUSINESS EXEMPTION

Conspicuously missing from the DOL’s regulations are instructions on how a small business can go about claiming or applying for the exemption.  They do, however, make it clear that businesses “should not send any materials to the Department of Labor when seeking a small business exemption for paid sick leave and expanded family and medical leave.”

This was presumably added to avoid the DOL from becoming flooded with requests from small businesses seeking the exemption.

How then can a small business go about claiming an exemption?  First, it should be noted that based upon the language contained in the DOL’s regulation, the business must determine if the exemption applies on a case-by-case basis.  It should not use the criteria set out in the regulations to make a broad company policy that all requests for paid leave due to childcare issues will be denied.  Doing so will clearly result in the DOL finding the business to be in violation of the FFCRA.  Instead, when an employer receives a request for FFCRA mandated paid leave due to childcare issues it should have an authorized officer of the company determine if based on one or more of the three qualifying reasons set forth in the DOL’s regulations they are exempt from having to provide said leave.  They should also document how they made their determination and keep a copy of that record in case the employee whose request for leave was denied files a complaint with the DOL.

LEGAL ASSISTANCE WITH COMPLIANCE & VIOLATIONS

Please keep in mind that the FFCRA is a complex piece of legislation and the above is just a summary of one of its key provisions.  Our office is here to assist businesses with making sure that their current practices and procedures are in compliance with all the requirements of the FFCRA and other Federal and New York State laws.  We are also here to help any individual whose employer has unlawfully denied their request for leave or otherwise believe that their employer is intentionally failing to comply with the mandates of the law.

PAID LEAVE UNDER THE FAMILIES FIRST CORONAVIRUS RESPONSE ACT

In response to the coronavirus outbreak, the Unites States Congress passed the Families First Coronavirus Response Act (“FFCRA”) to assist individuals who were directly impacted by the COVID-19 virus.  The goal of the FFCRA was twofold: (i) provide covered employees with a source of income if they are temporarily unable to work due to the COVID-19 outbreak; and (ii) protect the jobs of those very same individuals by prohibiting employers from firing or otherwise discriminating against them.

The FFCRA sets forth six (6) circumstances when an employer must provide some type of paid leave to its employees and specifies the benefits to be provided in each of those circumstances:

1.  Employees subject to Federal, State, or local quarantine or isolation order related to COVID-19

a)  Duration of Leave:  A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

b) Calculation of Pay:  Employees taking leave shall be paid at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).

2.  Individuals advised by a health care provider to self-quarantine related to COVID-19

a)  Duration of Leave:  A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

b) Calculation of Pay:  Employees taking leave shall be paid at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).

3.  Individuals experiencing COVID-19 symptoms and are seeking a medical diagnosis

a)  Duration of Leave:  A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

b) Calculation of Pay:  Employees taking leave shall be paid at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).

4.  Individuals who are caring for an individual subject to an order described in #1 above or self-quarantine as described in #2

a)  Duration of Leave:  A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

b)  Calculation of Pay:  Employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).

5.  Individuals caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19

a) Duration of Leave:  A full-time employee is eligible for up to 12 weeks of leave at 40 hours a week, and a part-time employee is eligible for leave for the number of hours that the employee is normally scheduled to work over that period.

b)  Calculation of Pay:  For the first two weeks, employees shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate.  If the employee has been employed for thirty (30) or more days, they shall also be entitled to an additional ten (10) weeks of paid expanded family and medical leave at the same rate (e.g. 2/3 their regular rate or 2/3 the applicable minimum wage), up to $200 per day and $10,000 in the aggregate.

6.  Individuals experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury

a)  Duration of Leave:  A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

b) Calculation of Pay:   Employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).

EMPLOYERS SUBJECT TO THE FFCRA

The paid sick leave and expanded family and medical leave provisions of the FFCRA apply to certain public employers and private employers with fewer than 500 employees.  The statute, however, does exempt small businesses with fewer than fifty (50) employees from the requirement that they provide paid leave to employees due to school closings or child care unavailability if it “would jeopardize the viability of the business as a going concern.”  The law, however, fails to elaborate or otherwise provide any insight as to how a business can determine if it falls within this exemption.  How a business can determine if it falls within this exemption will be discussed in a future blog post. 

EMPLOYER NOTICE REQUIREMENTS

Employers who fall within the FFCRA are mandated to provide notice to their employees of their rights under the statute.  Said notice must be posted in “conspicuous places on the premises of the employer where notices to employees are customarily posted….” The United States Department of Labor has issued a model notice which can be found on its website (https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf).  Notwithstanding the foregoing, with a majority of non-essential employees working from home I would also recommend that all employers forward a copy of the notice to their employees either through e-mail and/or first class mail.

PROTECTING EMPLOYEE JOBS

In addition to providing paid leave, the FFCRA also attempts to protect the jobs of employees by prohibiting employers from discharging, disciplining, or otherwise discriminating against any employee who takes paid leave under the FFCRA and files a complaint or institutes a proceeding under or related to the statute.  It is therefore imperative that all businesses have established procedures in place for employees who seek leave under the FFCRA in order to prevent an employee from claiming that they were treated differently or unfairly.

ENFORCEMENT OF THE FFCRA

In order to ensure compliance with the FFCRA, the statute has an enforcement provision.  In sum, any employer who fails to provide a qualified employee with paid sick time or unlawfully terminates an employee shall be subject to the penalties and enforcement provisions set forth in §§16-17 of the Fair Labor Standards Act (which is quite serious in nature).  Moreover, any employer who fails to provide an employee with the additional ten (10) weeks of paid leave to care for a child whose school or place of care is closed is subject to the enforcement provisions of the Family and Medical Leave Act.  Notwithstanding the foregoing, the Department of Labor is providing a temporary period of non-enforcement thru April 18^th so long as the employer has acted in good faith to comply with the law.  According to the Department of Labor, “good faith” will be deemed to exist when: (i) the employer’s violations are not willful; (ii) the violations are remedied and the employee is made whole as soon as practical; and (iii) the Department receives a written commitment from the employer to comply with the FFCRA in the future.

LEGAL ASSISTANCE WITH COMPLIANCE &VIOLATIONS

 Please keep in mind that the FFCRA is a complex piece of legislation and the above is just a summary of some of its key provisions.  Our office is here to assist businesses with making sure that their current practices and procedures are in compliance with all the requirements of the FFCRA and other Federal and State laws.  We are also here to help any individual whose employer has unlawfully denied their request for leave or otherwise believe that their employer is intentionally failing to comply with the mandates of the law.

Sole Proprietorship/Partnership v. Legal Entity

The first decision you need to make is whether you should do business under a legal entity or simply as a sole proprietor (if one owner)/partnership (if two or more owners).  The biggest advantage of doing business as a sole proprietorship or partnership is that it is extremely easy to form.  Forming a sole proprietorship/partnership is as easy as going to the county clerk’s office where the business will be located and filing a Business Certificate Registration (a/k/a DBA—“doing business as”—application).  Said form is very simple to fill out and the filing fee is nominal.  For example, in Westchester County the filing fee for a Business Certificate is only $35.00 and the form itself takes no more than five minutes to complete (a copy of the form can be found here).  Immediately upon the filing of the application you can start doing business under the new business name.  This easy startup process is in stark contrast to forming a legal entity such as a corporation or limited liability company.  Forming these types of entities require legal papers to be filed with the New York State Department of State (Division of Corporations) and have filing fees that cost hundreds of dollars as well as other hidden costs (a topic to be addressed in another blog post).

The second advantage to doing business as a sole proprietorship or partnership is that there are no major state laws governing the internal operations of the business.  Again, this is different from both corporations and limited liability companies both of which are governed by lengthy and comprehensive state statutes (New York Business Corporation Law and Limited Liability Company Law respectively). 

Notwithstanding the aforementioned simplicity of starting a sole proprietorship/partnership, rarely is it the appropriate choice.  That is because sole proprietorships/partnerships do not provide the business owner with limited liability should the business ever be sued.  That means that if the business is sued and the court awards a monetary judgment against the business, the plaintiff (the party who commenced the lawsuit) can try to enforce the judgment against the business owner’s personal assets.  This includes freezing any personal bank accounts that have your name on it or even putting a lien on your home.  Legal entities such as corporations or limited liability companies, however, shield their owners with limited liability so that if the company is ever sued their personal assets are protected.  Just as the shareholders of large public corporations are protected if the company is sued (if somebody sues Uber, Inc. they can’t go after the assets of its shareholders), the shareholders of your small private corporation are also protected.

Partnership Agreements

Throughout this blog I have been treating sole proprietorships and partnerships as one and the same.  Although that is true when it comes to formation and how they are treated legally if sued, there is one additional aspect with partnerships that you should keep in mind.  When you are going into business with a partner is it imperative that you enter into a partnership agreement which addresses important issues such as what happens when a partner no longer is actively participating in the business (i.e. only one partner is doing all the work) or if a partner wants to sell his/her interest to an outside party (who the other partners might not get along with).  Think of a partnership agreement as a pre-nup which spells out the rights and obligations of the partners should there be a major dispute or divorce in the business relationship.  When you first start your business, you and your business partner(s) are in the honeymoon phase meaning it seems like you are on the same page and could easily resolve any problems that might come up.  It may, therefore, be tempting to view a partnership agreement as an unneeded expense.  Inevitably, however, some relationship may deteriorate and you and your partner(s) will find that you cannot work together.  A well thought out partnership agreement will establish the rules before there is disagreement thereby allowing for a more organized settlement of the dispute or business divorce.  This will allow the business to survive even after a partner has left.  In my experience, the lack of a partnership agreement will ultimately result in the demise of the business after the first major disagreement between the partners.

At the Law Office of Steven A. Campanaro, we are committed to helping our clients improve their lives through the bankruptcy process. We understand how emotionally draining, stressful and overwhelming debt can be. When you work with our firm, we will provide you with the support you need to feel confident and secure in your financial future.

From the moment you contact our office for your free initial consultation, you will see that we are a different type of law firm. Contact our White Plains office at (914) 686-0634 to schedule a free initial consultation about life after bankruptcy.

Tips for Improving Your Credit After Bankruptcy

Many people believe that bankruptcy destroys your credit. Instead, it is the debt problems before bankruptcy that can have the greatest effect on your credit score. Collection actions, foreclosures and inability to pay your bills on time can have a tremendous impact on your credit.

During your bankruptcy, we can provide you with the tools you need to get your credit back on track and put you on the right path to improving your credit score. There are some steps you can take, however, to improve your credit after bankruptcy, including:

• Consistently paying your bills on time: The credit reporting agencies monitor your payments and keep a record of whether or not your bills are past due. By continuing to pay your bills on time, your credit score will increase over time.
• Making a budget and sticking to it: A budget will help you see your income, your bills and how much you have to spend at any given time. By sticking to the budget, you can avoid spending beyond your means and continue to improve your credit by paying off your bills regularly.
• Monitoring your credit: You can request a copy of your credit report once a year from each of the three major credit reporting agencies, Equifax, Experian and TransUnion. By checking with one agency every four months, you can keep tabs on your credit, fix any issues and ensure that your credit continues to improve into the future.
• Putting away money for emergencies: Emergencies can be costly and throw your budget unexpectedly off track. By creating a savings account, you can prepare for the future and keep your budget as well as your credit on track.

Speak With a Bankruptcy Lawyer

You do not have to look for answers alone. We are here to help you. Our goal is to ensure that you have the life after bankruptcy that you want. Contact us today to learn more from an experienced attorney about achieving a positive financial foundation after filing for bankruptcy.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.

Bankruptcy may be the only option to dig yourself out of debt. There are several factors to take into account when considering bankruptcy. An experienced lawyer can meet with you and discuss your situation in order to help you determine your options. Contact our White Plains attorney at (914) 686-0634 to schedule a free initial consultation.

Is Chapter 7 Bankruptcy Right for Me?

If you are in debt and have no surplus income after paying your monthly bills such as rent, utilities, and food, you may want to consider filing for Chapter 7 bankruptcy. The value of all your current assets, the amount of your spouse's income and your goal for financial security in the future are just a few of the things you need to look at when making such a decision.

In determining whether Chapter 7 bankruptcy is the right option for you, we will review your debts and assets and talk about how you got into financial trouble. We will discuss and review all of your options and alternatives before determining whether Chapter 7 bankruptcy is the best approach.

Is Chapter 13 Bankruptcy Right for Me?

Compared to Chapter 7, there are many more things you need to take into consideration when deciding if Chapter 13 is an appropriate solution. Chapter 13 allows you to keep your major assets while having most of your unsecured debts discharged by paying your creditors a small percentage of what you owe through a court-approved payment plan.

This requires a sound analysis not only of your current assets, income and debt, but also of your future income and personal plans to assure fulfillment of your payment plan and financial objectives. We will provide honest and forthright guidance to determine if Chapter 13 is the appropriate debt relief option for your situation.

Explore Your Bankruptcy and Non-Bankruptcy Alternatives by Scheduling a Complimentary Consultation

Many clients face bankruptcy as the result of a financial hardship such as a job loss or unexpected medical emergency. When you are in need of debt relief, do not hesitate to explore your options by contacting us.

We will take the time to understand your unique concerns and objectives as you pursue bankruptcy options and alternatives. Our attorney will always provide honest, reliable recommendations remaining mindful of how your financial troubles arose and whether bankruptcy is the best solution.

If bankruptcy is the right option for you, we will provide sound guidance and representation through every step of your case, including but not limited to:

• Referral to a court-approved debt counseling service prior to filing to review your assets and financial disposition (this is required under the law and typically must be completed before filing for bankruptcy)
• Drafting and filing a Chapter 7 or Chapter 13 bankruptcy petition on your behalf
• Attendance at all creditor meetings and aggressively asserting your rights against creditors, including aggressively advocating for acceptance and confirmation of your payment plan for Chapter 13 matters
• Provision of counsel and guidance, and protection of your rights through to the final discharge of your debts

Affordable legal solutions for your financial and business needs • Free initial consultation • Contact Steven A. Campanaro to speak with an experienced White Plains, New York, bankruptcy attorney

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.

After the ninety (90) days have elapsed, the lender can then commence formal foreclosure proceedings by filing a Summons & Complaint with the court and serving said papers on the homeowner. Simultaneously with the Summons & Complaint, the lender will file and serve a Lis Pendens, the purpose of which is to put everybody on notice that the title of the property is in litigation. The service of these papers on the homeowner starts the clock ticking for the homeowner to prepare and serve a formal answer to the bank's foreclosure proceeding. The homeowner's answer should respond to the allegations contained in the lender's Summons & Complaint and contain any defenses they might have to the foreclosure action. The time for the homeowner to serve and file their answer is dependent on how the foreclosure papers were served on them. It is imperative that the homeowner serve and file its Answer in a timely fashion. Failure to do so could result in the homeowner waiving certain legal defenses or being held in default. If a homeowner is held in default, the foreclosure process can be accelerated by the lender by first requesting that the court appoint a referee (whose job is to calculate the total amount owed under the mortgage) and then obtaining a Judgment of Foreclosure and Sale thereby allowing the lender to auction the home.

After the Answer if filed with the court and served on the homeowner, New York law provides for a mandatory settlement conference. This is the most important part of the foreclosure proceeding as it is the homeowner's opportunity to try to settle with the mortgage holder in a semi-informal setting. The conference is overseen by a court appointed referee whose job is to make sure both parties are acting and negotiating in god faith. It is during these conferences that a majority of foreclosure actions are settled. Settlement could include mortgage modification, agreement to short sale the property, or other foreclosure alternatives such as a deed in lieu. A homeowner must be familiar with all these types of available options in order to ensure they are making a sound financial decision.

If a settlement cannot be reached, the foreclosure proceeding will then continue through the normal litigation process. This includes conducting discovery (e.g. exchanging of documents, conducting depositions), filing motions, and possibly a trial.

The foreclosure process is a complex one with many legal pitfalls. Our attorney, Steven A. Campanaro, is experienced in representing homeowners throughout every phase of foreclosure proceedings. From the filing of an Answer thru trial, we provide representation and guidance you can trust. Your home is your biggest asset and you should have an experienced attorney on your side to help you protect it. If you were served a Summons & Complaint seeking to foreclose on your home contact our office for a free consultation.