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Q: “If a company obtains a PPP loan, is the company required to make offers to bring everyone back who was previously laid off and, if so, must you document the offer for re-hire?”


May 11, 2020

Read Time

1 minute


Answered by Bill Schwartz

A: Forgiveness of your PPP loan can be affected if your average monthly FTE (full time equivalent) head count is reduced as compared against the period of time from either (i) February 15, 2019-June 30, 2019 or (ii) January 1, 2020-Feb. 29, 2020. Many borrowers under the PPP asked: “what happens if we furloughed employees and we ask them to come back and they say no, will this count against us for purposes of the FTE head count?” The SBA has issued guidance on this question by stating that if this scenario occurs, forgiveness of your loan will not be affected if you provide evidence that you made a written offer for the employee to return and you document the employee’s rejection of the offer. However, if you do not want to take advantage of this, or if you are not affected by this issue, you are not required to make offers to all former employees.

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