Resources for Reopening Businesses

MAGNET, Ohio MEP, and the Ohio Manufacturers’ Association has been hard at work finding best practices for safety, culture, technology, and reopening (or staying open) during COVID-19.  These comprehensive checklists, tools, and resources will help your business be well prepared as you ramp up back to work.  They consist of:

• Guidelines for re-opening and maintaining your operations to be efficient while meeting Ohio’s requirements
• Considerations for planning a phased re-opening of your facility to minimize disruptions to your operations
• Checklists for understanding your revised customer requirements and supplier base stability
• Frameworks around reshoring
• Evaluations of the use of appropriate technology to support social distancing, sterilization and detection needs and requirements
• Coaching and systems design considerations to address potential cultural issues related to the current environment

We are happy to go through all or any particular element with you one-on-one. Please email bkhoury@manufacturingsuccess.org to schedule your private assessment and discussion.

We are also launching two opportunities to talk with us and other manufacturers on webinars:

Webinar: How to reopen, stay safe, and plan for the future in a post-coronavirus Ohio – Manufacturing Coronavirus Readiness Toolkit introduction

Option 1: May 1, 2020 1-2 pm 
Register here for free

Option 2: May 5, 2020 4-5 pm 
Register here for free

And in case you missed how Swagelok has been preparing to be safe and stay open, we will be replaying that webinar:

Webinar replay:  How Swagelok has Managed COVID-19 as an Essential Business – Pre-recording and live Q&A

May 8, 9-10 am
Register here

Exchange for retooled and repurposed manufacturers to provide PPE is up and running

The Ohio Manufacturing Alliance to Fight COVID-19 (website here) has been hard at work helping manufacturers like yourselves retool and repurpose to make PPE.  We have had successes (such as helping make one million testing swabs and one million reusable face shields), and dozens of other companies have retooled.  We have setup the Ohio Emergency PPE Maker’s Exchange primarily for smaller purchases of PPE from retooled or repurposed manufacturers.  Please consider sharing this exchange link with anyone you know is in need of PPE, especially as reopening has begun.  These are the products of the ingenuity, hard-work, and perseverance of so many Ohio manufacturers and we should all be very proud of what we can accomplish together.

New guidelines and rules for Governor DeWine for all manufacturers

Governor DeWine has “reopened” manufacturing as of May 4.  These rules here are the main guidance required to be open.  More guidance specifics may be issued later this week.

The governor said the use of face coverings is no longer mandatory. But it remains a strong recommendation, he and Ohio Health Director Dr. Amy Acton said.

Ohio Manufacturers’ Association, (OMA)  has confirmed that face coverings has been moved from a mandated action to a “recommended best practice” under the administration’s safety guidance for manufacturers.

Mostly the new guidelines reinforce many of the things that manufacturers are already doing such as creating 6 ft distances, encouraging working from home if you can, requiring regular handwashing, staggering or limiting arrivals of employees and guests, mandating daily disinfections, and daily symptom checking. Many manufacturers continue to go above and beyond to keep their employees safe (see here for more best practices).

Based on our health and safety experts, sometimes face shields and sometimes face masks may be appropriate as face coverings.  Both will provide some protection from spreading the virus from sneezes, breathing, etc.  Neither provides full protection of course (like an N95 might).  Cotton masks may be disadvantageous in loud environments where mouth movements are important or when potential hazards involved getting masks stuck in machinery is an issue.   

Documentation to maximize your PPP loan forgiveness

Many of you have likely received your distribution from SBA of PPP funds.  If you haven’t, the second round will hopefully be your chance.  There is still a tremendous amount unknown about this grant, in particular how forgiveness will work.  New details come out every single day. Here is a good Forbes article that goes deep into some of the complexities of this grant that haven’t been worked out.

However, here are some of the top tips that we have seen regarding using and preparing for forgiveness (we make no guarantees that these will work or be required, but they are what many lawyers and other manufacturers are currently doing).  We appreciate that some of this advice might be overkill, but sometimes better safe than sorry:

1. The covered period of potential forgiveness begins on the day you get your money and lasts for 8 weeks.  See below for more considerations regarding whether to hire everyone back during this 8-weeks.
2. Establish separate ledger accounts for expenses to track that you are using PPP dollars for the allowable payroll (up to a pro-rated $100k cash compensation per employee), mortgage interest, rent, benefits, and utilities.  Allowable payroll costs include the full amount of retirement benefits, healthcare benefits paid by the employer, and employer state and local (but not federal) payroll taxes.
3. Some lawyers recommend even separating paychecks for those employees who make over $100K so that they get their >$100K portion of their salary separate from the under $100K portion – again so that it is tracked easily.  Discuss this further with your payroll service provider.
4. Save all documentation regarding how the funds are expended including invoices, cancelled checks, payment receipts, payroll reports, transcripts of accounts, etc.
5. There is a line in the bill that references that eligible forgiveness will come from “costs incurred and payment made during the covered period payroll costs.”  This presents a problem that may be fixed through further clarifications, but prepayments probably would not be allowed and neither would paying your bills after the period be allowed.  Prior to new SBA guidance being issued, this would mean that you will want to cut your last payroll checks, get your bills in and pay them all on the last day of the 8 weeks to maximize forgiveness.

Should you bring everyone back when you get your PPP money?

At one end, you could hire everyone back immediately upon receiving your money (if they aren’t already working of course).  This is expected to maximize your loan forgiveness assuming that you had the same or more full-time equivalent employees as the same time in the previous year (or Jan 1 through Feb 15 of 2020 at your discretion). 

But, based on business conditions, maybe you won’t hire everyone back and then you will have to manage the 75/25 split of payroll and other expenses.  Subject to further SBA guidance and interpretation, during the eight week period, non-payroll expenses cannot exceed 25% of the total amount of PPP-paid expenses.  To be clear, this rule is very confusing.  There is debate and contradictions currently in the rules of whether this 75% applies to what is actually paid during the 8-weeks or just what is given in the loan.  To be conservative, if you don’t hire anyone back, you may not be able to benefit from forgiveness of the payment of mortgage, utilities, rent, etc.  However, it appears you may be able to ignore this rule IF you hire everyone back before June 30^th, 2020 even if you didn’t hire them back during the 8 week period.  Obviously, you won’t get loan forgiveness for the payroll costs not paid during that 8-week period, but you potentially will get your mortgage, utilities, and rent paid for.  We will update you as the SBA issues its future guidance on these issues.

There is extra complication in bringing your employees back for the 8 weeks because you likely don’t want to hire them back and the let them go again, and some of them (the ones in Ohio making less than $50,000-60,000, depending on how many dependents are in their household) are making more money on unemployment.  You will need to consider this when you are ramping back up, at least until July 25^th when the extra federal incentive ends for everyone on unemployment.

Inspiration and pride in manufacturing

We have had the honor of continuing to publish about the amazing things happening in manufacturing around the region.  We are extremely proud of how manufacturers have been stepping up.

Greater Cleveland’s manufacturers and other businesses are retooling to fight coronavirus

Saving Lives and Securing a New Future for Ohio Manufacturing

We have created this list of practical things manufacturers need to be thinking about and do today to prepare for COVID-19.
Please, also check out our message of hope during these trying times.