House Democrats Unveil HEROES Act, $3 Trillion Bill Responding to COVID-19 Crisis

On May 12, 2020, Democrats in the U.S. House of Representatives unveiled the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, the latest effort to respond to the ongoing coronavirus health care crisis. Among other provisions, the $3 trillion relief package would provide $1 trillion in aid to states, $75 billion for coronavirus testing and related healthcare measures, and another round of direct stimulus payments to individuals. The bill was written by the House Democratic leadership, without input from Republican lawmakers, and consists of a whopping 1,815 pages (the summary from the House Committee on Appropriations is 90 pages long). The bill is likely a dead letter in the U.S. Senate, where Republicans are in the majority, but it may represent Democrats’ initial position in subsequent debates concerning coronavirus legislation. Accordingly, employers may want to take note of some of the labor and employment law highlights of the HEROES Act as described below.

Unemployment Insurance

The HEROES Act would extend through January 31, 2021, the Coronavirus Aid, Relief, and Economic Security (CARES) Act’s Federal Pandemic Unemployment Compensation (FPUC) program, which provides displaced workers with $600 per week on top of their weekly unemployment insurance (UI) benefits. Further, the FPUC benefit would be phased out through March 31, 2021, for individuals who are already receiving regular state UI prior to the January 31, 2021, cut-off. Similarly, Pandemic Unemployment Assistance (for those workers who do not traditionally qualify for UI, such as independent contractors) and Pandemic Extended Unemployment Compensation (providing an additional 13 weeks of benefits) programs would also be extended through January 31, 2021, with the March 31, 2021, phaseout.

Workplace Safety and Health

The bill would require the U.S. Occupational Safety and Health Administration (OSHA) to issue an emergency temporary standard for certain at-risk industries within seven days of the bill’s enactment (and a permanent standard within two years of enactment). The standard would be no less protective than precautions against novel pathogens contained in any OSHA state plan, and would also require covered employers to “develop and implement a comprehensive infectious disease exposure control plan to protect workers from exposure to the SARS-CoV-2 virus that causes COVID-19.” The bill also contains whistleblower protections for workers who raise concerns relating to infectious disease in the workplace.

Paid Leave

House drafters of the HEROES Act must have buyers’ remorse over the Families First Coronavirus Response Act (FFCRA), because they make significant changes to the paid sick leave and family leave provisions that they agreed to just weeks ago. For example, the HEROES Act would make the following changes to the FFCRA:

• Extend the FFCRA’s Emergency Family and Medical Leave Expansion Act (EFMLEA) and Emergency Paid Sick Leave Act (EPSLA) benefits from December 31, 2020, to December 31, 2021
• Apply the FFCRA’s EFMLEA provisions to all employers, regardless of size
• Expand the permissible reasons for taking EFMLEA leave to allow an employee to: (1) “self-isolate because the employee [has been] diagnosed with COVID-19”; (2) “obtain a medical diagnosis or care if [the] employee is experiencing the symptoms of COVID-19”; (3) “comply with a recommendation or order by a public official with jurisdiction or a health care provider to self-isolate [because] the physical presence of the employee on the job would jeopardize the employee’s health, the health of other employees, or the health of an individual in the household of the employee”; (4) care for or assist a family member who is self-isolating; (5) care for a child whose school has closed or childcare provider is unavailable due to COVID-19; or (6) care for a family member who is an individual with a disability or a senior citizen whose place of care or direct care provider is unavailable due to COVID-19
• Provide for a full 12 weeks of paid emergency family leave that does not count toward the employee’s “regular” unpaid FMLA leave
• Eliminate the “Secretary of Labor’s authority … to exempt employees of businesses with fewer than 50 employees, or to issue regulations to exempt health care providers and emergency responders from the right to paid leave” and rescind existing regulations relating to these matters
• Suspend the FMLA’s 1,250-hour eligibility requirement and reduce the tenure eligibility requirement from 12 months to 90 days until December 31, 2022

Immigration

To ameliorate the impacts of processing delays and travel restrictions, the HEROES Act would extend various immigration deadlines, such as those related to temporary immigration status and work authorization. The bill also would ease certain immigration restrictions on immigrant doctors and healthcare workers and requires the U.S. Department of Homeland Security and U.S. Department of State to expedite the processing of nonimmigrant petitions and visa applications for medical professionals and researchers who would work to combat the coronavirus. The HEROES Act would also “[p]ermanently authorize the ‘Conrad 30’ Waiver Program, which allows states to sponsor immigrant physicians to work in medically underserved areas in exchange for a waiver of the physicians’ 2-year foreign residence requirement.”

Pension Plan Funding Relief

To address the looming multiemployer pension plan funding crisis, the HEROES Act would provide the Pension Benefit Guaranty Corporation (PBGC) with authority to partition struggling multiemployer pension plans. Under this program, plans meeting certain criteria would receive financial assistance from the PBGC to ensure solvency for 30 years, with no cuts to benefits. As for single-employer pension plans, they would be permitted to amortize funding shortfalls over 15 years, rather than the current 7 years. The HEROES Act also allows for the creation of “composite plans,” which would combine features of defined benefit and defined contribution plans.

In addition, the act would expand the CARES Act’s employee retention tax credit from 50 percent to 80 percent. For purposes of determining the credit, the bill would increase “the limit on wages taken into account per employee from $10,000 for the year to $15,000 per quarter (limited to $45,000 for the calendar year)”.

In terms of health benefits, the HEROES Act would provide full health benefit premium subsidies “through January 2021, to allow workers to maintain their employer-sponsored coverage.” The subsidies would be available to workers who are eligible for continuing health benefits under the Consolidated Omnibus Budget Reconciliation Act “due to a layoff or reduction in hours” or “who have been furloughed but are still active in their employer-sponsored plan.”

The HEROES Act represents the Democrats’ initial foray into the pending debate concerning the next congressional response to the coronavirus crisis.

Ogletree Deakins will continue to monitor and report on developments with respect to the COVID-19 pandemic and will post updates in the firm’s Coronavirus (COVID-19) Resource Center as additional information becomes available. Important information for employers is also available via the firm’s webinar programs.