On January 14, 2021, President-elect Joseph R. Biden, Jr. released his administration's plan for additional COVID-19 economic relief. The $1.9 trillion package includes a range of measures to address the continued devastation of the pandemic, including funds for increased vaccination production and delivery and COVID-19 testing, and to help schools resume in-person learning by the spring. The package also includes a number of employment-related provisions; some are directly related to the pandemic, while others reflect long-standing Democratic policy goals. This proposal builds on the $900 billion COVID-19 package passed and signed into law in late December 2020.
The plan now goes to a narrowly divided Congress, with Democrats and Republicans evenly split in the U.S. Senate, and a slim Democratic majority in the U.S. House of Representatives. While the House is able to pass significant legislation with a bare majority, many of the proposals included in the president-elect's plan will likely require the votes of at least 60 of the upper chamber's 100 members, so long as the current rules regarding Senate filibusters remain in place (it is also possible to move some bills directly relating to tax and revenue through the Senate with a simple majority vote in a process known as "budget reconciliation," although it does not seem likely many of the items contained in the proposed package would meet the necessary standard for this special treatment). We expect that the shape and contents of any package will be fiercely debated, and it is not clear which will garner sufficient support to become law.
Key provisions of Biden's proposal include:
Direct Payments to Individuals. The Biden plan proposes to send up to $1,400 per person in direct stimulus payments to individuals, phased out based on income. This $1,400 is on top of the $600 per person payments included in the December 2020 COVID relief package, bringing the total of direct payments under the two bills up to $2,000 per individual (including children).
Extension of Unemployment Insurance (UI) Benefits. The plan extends and increases additional weeks of unemployment eligibility through September 2021, and potentially beyond, and includes a federally funded $400/week UI benefit increase on top of what state systems provide. As with prior COVID-19 unemployment legislation, the proposal continues UI eligibility for self-employed and "gig" workers, who are traditionally not eligible for state UI benefits.
Extension and Expansion of Paid Leave Requirements. Biden's plan extends and expands the emergency paid sick leave and emergency paid family and medical leave requirements of last year's Families First Coronavirus Response Act (FFCRA), detailed here. Under FFCRA, employers with fewer than 500 employees were required to provide paid sick leave and family leave to workers unable to work because of various COVID-related contingencies. Employers with fewer than 50 employees were largely exempt, and the cost of providing this leave was fully funded by the federal government by way of tax credits. Under Biden's proposal, the 500-employee "cap" and 50-employee minimum would be removed, and all employers would be required to provide leave (although the federal government would continue to reimburse the costs for employers with fewer than 500 employees). The Biden package also proposes to cover health care workers and first responders (many of whom were exempted under FFCRA), and extend the program through September 30, 2021. The requirement to provide leave under FFCRA expired on December 31, 2020, although covered employers are still permitted (but not mandated) to provide leave though March 31, 2021, and obtain the refundable tax credit. Irrespective of the fate of the proposed FFCRA expansion, it is likely that proposals to require employers to provide paid leave (whether sick leave or other paid time off) will gain additional attention in Congress beyond discussion of the pandemic.
Hazard Pay. The proposal calls on employers to provide "generous" back hazard pay to frontline and other essential workers. The scope of this proposal, as well as whether and how any costs will be borne by the federal government, is not year clear.
National OSHA Standard. The package calls on Congress to authorize the Occupational Safety and Health Administration (OSHA) to adopt a national COVID-19 protection standard, with coverage including public workers (typically not covered under OSHA rules). The package also asks Congress to provide additional funding for OSHA enforcement and grant programs.
Minimum Wage. The Biden plan calls for increasing the minimum wage to $15/hour nationally, and eliminating the tipped minimum wage and sub-minimum wage for certain workers with disabilities. The proposed minimum wage increase is likely to be highly contentious; previous efforts to increase the federal minimum wage (which is currently $7.25/hour) have passed the House in the past, but have largely been dead on arrival in the Senate. It is very possible that this increase may be dropped from a COVID package, and instead debated separately on its own terms, or in connection with other labor-related matters.
As Congress begins to review and debate this and other COVID-related proposals, we expect to learn more details and specifics about these programs.
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