How can Zenefits help with the Paycheck Protection Program (PPP)?
Guidance with respect to the Paycheck Protection Program has been evolving since the program’s start. So for clarity we’re providing you with detailed information as to how we calculate average monthly payroll.
Our calculations are based on the Treasury Department Interim Final Rule issued on April 2, 2020 and the latest SBA and Treasury answers to program related FAQs. Please note that you should follow your lenders or financial or legal advisor’s guidance, even if it differs from our calculations.
If your company was not operational for the 2019 calendar year:
- We won’t be able to automatically generate this report for you. You may follow the instructions below to pull your January and February payroll data and calculate your average monthly payroll costs.
If your company was operational for the 2019 calendar but you used a payroll provider other than Zenefits:
- We will not have the historical data for your company, so we recommend you work with your previous payroll provider to obtain this data.
If your company was operational for the 2019 calendar and you used Zenefits Payroll:
- We have provided a report prefilled with some of the full-time employee, part-time employee, intern, and company-paid temp data needed to apply and estimate forgiveness for a PPP loan as described in more detail below.
- If you currently have an employee who was previously hired as an independent contractor with earnings in the system, the report will take into account the total gross pay, including their earnings as an independent contractor. Under the PPP, independent contractor earnings may not be included in loan amount calculations and you will need to remove any independent contractor earnings for the calculation period.
- Compensation. Salary*, wage, commission, cash tips or equivalent, vacation pay, parental, family, medical, and sick leave, and allowance for dismissal or separation are added together with the aggregate sum set forth in the Gross Pay column in the Payroll Individual Earnings report.
- Group Health Insurance Contributions. Employer contributions to any group health insurance are set forth in the Employer Contribution column of the All-in-One report.
- Retirement Benefit Contributions. Employer contribution to any retirement benefits can be calculated by adding together the Company Contributions of any retirement related benefits (401k, 403b, 457, Simple IRA, and Traditional IRA) set forth in the Deductions & Contributions report.
- Payroll Taxes. Payment of state or local taxes assessed on employee compensation. This can be found by adding together all of the state unemployment tax related totals in the Payroll Details report.
- EIDL. The calculation requires inclusion of the outstanding amount of any Economic Injury Disaster Loan (EIDL) obtained by borrower between January, 31 2020 and April 2020, less the amount of any advance under an EIDL COVID-19 loan (since it does not have to be repaid). Zenefits does not maintain this type of customer information as part of its services. If you have an outstanding EIDL you must add this information into the report in order to obtain accurate results.
*Note: If you have any employees who make an annual salary of over $100K annually, we have reduced this amount by implementing the $100K earnings cap required under the program as follows:
- For each employee who makes over $100K annually , their gross pay will be capped at $100K. Example: If an employee has an annual salary of $120K, we will only add $100K to the overall gross pay amount.
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