On April 27, 2021, President Biden signed an Executive Order entitled “Increasing the Minimum Wage for Federal Contractors” that will raise the hourly minimum wage for federal contractors to $15.00 effective January 30, 2022.  This Executive Order builds on Executive Order 13658 (“Establishing a Minimum Wage for Contractors”), issued by President Obama in 2014, which first implemented an hourly minimum wage of $10.10 for covered federal contractors.[i]

On Friday 20th March, the U.K. Government announced various support measures for UK businesses.  One of these was the Coronavirus Job Retention Scheme (the “Scheme”), which it is hoped will reduce the risk that U.K. employers promptly dismiss employees in response to the Coronavirus outbreak.  Further guidance was published on 26th March, providing some much needed detail on various aspects of the Scheme, which is expected to be operational by the end of April.

Any employer in the U.K. can access the Scheme for assistance with salary payments to those employees that would otherwise have been at risk of dismissal for redundancy and who are described for the purposes of the Scheme as “furloughed workers” (a new concept in English law).  Some questions remain, but the key details of the Scheme are:

2023 saw a number of developments concerning the interplay between sustainability considerations and competition policy. This blog post highlights the five key developments that businesses need to know when collaborating to achieve sustainable aims.

Key takeaways

  1. Authorities in the EU and UK resisted calls for introducing a sustainability safe harbour and adopted guidelines based on

Various national competition authorities (“NCAs”) are continuing to consider sustainability arguments in competition cases. However, NCAs are increasingly diverging in their approach as to whether, and to what extent, they are willing to allow sustainability considerations in the competition law framework. This blogpost highlights a few recent developments in jurisdictions on both sides of the Atlantic.

On March 30, the Lula administration officially presented its proposed new fiscal policy framework for Brazil.

Minister of Finance Fernando Haddad and Minister of Planning and Budget Simone Tebet presented the framework to the press after several rounds of negotiation within the administration and with the congressional leadership, in particular the Speaker of the House and the President of the Senate.

Key takeaways:

  1. The new framework tries to strike a balance between fiscal responsibility and social responsibility, combining fiscal adjustment measures with the preservation of budget for key social policies, in particular the conditional cash transfer to the poor, minimum wage, healthcare and income tax exemption for workers and the middle class.
  • The new framework’s ‘fiscal anchor’ is based on an annual primary budget surplus target (excluding debt interest payment), from -0.5% of GDP in 2023 to 1.0% of GDP in 2026, growing in 0.5 pp increments per year.
  • The annual primary budget surplus target will be pursued within a tolerance range between +0.25% and -0.25% of GDP of that year’s target (e.g., if the target for the year is 0.5%, the range will be from 0.25% to 0.75%). This tolerance range mechanism mirrors the existing inflation target mechanism used by the Central Bank.
  • In addition to the target, growth in spending will be pegged to revenue increase at 70% (e.g., if revenue increases BRL 10 billion, spending can increase only up to BRL 7 billion). If the annual primary budget surplus target is not achieved, the spending growth peg is reduced to 50% to slow down further spending.

Sustainability governs all policies and sectors of social and economic life. The goal of sustainable development is to meet the needs of today’s generations without compromising the self-sufficiency of future generations. Companies are called upon to innovate as economic conditions indicate a change in the direction of sustainability. Sustainability considerations and green developments have increasingly caught the attention of competition law’s enforcers. Competition authorities such as the European Commission (“Commission”), the Hellenic Competition Commission (“HCC”), the Dutch Competition Authority (“ACM”) and the German Competition Authority (“Bka”) have taken a positive stance towards accepting sustainability initiatives proposed by the private sector. How can companies balance both sustainability and competition law? In this blog post, we analyze recent developments that further explain the sustainability framework that companies have to navigate.

Sustainability governs all policies and sectors of social and economic life. The goal of sustainable development is to meet the needs of today’s generations without compromising the self-sufficiency of future generations. Companies are called upon to innovate as economic conditions indicate a change in the direction of sustainability. Sustainability considerations and green developments have increasingly caught the attention of competition law’s enforcers. Competition authorities such as the European Commission (“Commission”), the Hellenic Competition Commission (“HCC”), the Dutch Competition Authority (“ACM”) and the German Competition Authority (“Bka”) have taken a positive stance towards accepting sustainability initiatives proposed by the private sector. How can companies balance both sustainability and competition law? In this blog post, we analyze recent developments that further explain the sustainability framework that companies have to navigate.

On February 2, 2022, the European Commission adopted a Complementary Climate Delegated Act (the “CCDA”) listing specific gas and nuclear activities as “environmentally sustainable” for purposes of the EU Taxonomy Regulation, subject to strict criteria. Only certain activities that comply with strict emissions limits and other criteria detailed below may be so designated. Even so, the Commission’s decision to list nuclear and gas activities as “environmentally sustainable” is controversial and may still be blocked by EU Member States and the European Parliament through an upcoming scrutiny period, and may also be legally challenged before the EU Courts. Nevertheless there is a significant chance that the Commission’s criteria to consider the listed gas and nuclear activities as “environmentally sustainable” will enter into force by the beginning of 2023. This would allow such listed gas and nuclear activities to have access to green investors and ear-marked public funds under the EU’s Next Generation EU investment program.

In a wave of legislation designed to combat the global economic impacts of COVID-19, Congress has enacted the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Families First Coronavirus Response Act (FFCRA).

At a high level and among many other things, the Acts provide:

  • $349 billion in loan funds for small businesses and nonprofit employers, with a loan forgiveness opportunity;
  • Loan funds for larger businesses and nonprofits;
  • Increased amounts for income tax charitable deductions;
  • Employment tax and benefits relief; and
  • Expanded paid sick leave and family and medical leave.

This alert provides a brief summary of some of the key provisions of both Acts that apply to nonprofit organizations. We have also included information for organizations that are unable to pay rent and are considering whether to seek a rent abatement or deferral.

Small Business Loans

Paycheck Protection Program (PPP)

One of the core pieces of the CARES Act is the Paycheck Protection Program (“PPP”) that will generally provide loans for up to $10 million. The CARES Act explains that 75 percent of the loan proceeds must be used for payroll costs. The PPP is administered by the Small Business Administration (“SBA”) as a temporary addition to its 7(a) loan program. The CARES Act dictates that entities are eligible if they have (1) 500 or fewer employees with a principal place of residence in the United States (including full-time, part-time, or other status) or (2) fit within the SBA size standards, which could exceed 500 employees in certain industries. On April 4th, SBA clarified that because it may not have established size standards for all the industries in which nonprofits work, applicants are eligible for the PPP if they “employ not more than 500 employees or, if applicable, the SBA employee-based size standard for the industry in which the organization or business operates.”

Eligible entities could include nonprofit organizations that are organized under sections 501(c)(3) and 501(c)(19) of the Internal Revenue Code and were in operation on February 15, 2020. Faith-based organizations, such as churches, that meet the requirements of section 501(c)(3) of the Internal Revenue Code are eligible for loans under the PPP program. Other types of nonprofit organizations, such as 501(c)(6) trade associations, would not be eligible under the program.

Nonprofits will be subject to the SBA’s affiliation rules. The SBA will consider the number of employees of both an applicant and an applicant’s “affiliates” when determining loan eligibility. In general, an affiliate is another company or other legal entity that has an ownership interest in a business and the ability to control that business but the rules on affiliation are detailed and fact specific.

In addition to payroll costs, which include salaries, wages, tips, paid sick or medical leave, dismissal and separation allowances, health benefits and insurance premiums, retirement benefits, and limited state and local payroll taxes, 25 percent of the loans may be used for mortgage interest, rent, utility payments, costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums; interest payments on other debt obligations incurred before February 15, 2020; and refinancing an EIDL made between January 31, 2020 and April 3, 2020. However, as explained below, only a subset of these costs are eligible for forgiveness.

The loan amount is the lesser of $10 million or 2.5 times the average total monthly payroll costs with special rules for seasonal employers and recently formed companies. The maximum interest rate is 1 percent.

Loan proceeds can be forgiven for loans made from February 15, 2020 through June 30, 2020, to the extent that at least 75 percent of the proceeds are used in the eight weeks following the origination of the loan to fund payroll costs (including certain benefits), with the remainder used to pay mortgage interest, rent, and utilities. Payroll costs are limited to a $100,000 cap per employee. There is ambiguity as to whether the interest owed on the loan will be forgiven.