LIEB BLOG

Legal Analysts

Showing posts with label covid-19. Show all posts
Showing posts with label covid-19. Show all posts

Thursday, January 20, 2022

NYS DOL Publishes Emergency Regulations to Implement NY HERO Act Rules

The NYS DOL published new regulations, retroactively effective to January 1, 2022, as an emergency rule to implement the New York Health and Essential Rights Act (NY HERO Act).


The regulations requires private sector employers to create an Exposure Prevention Plan to eliminate or minimize employee exposure to airborne infectious disease agents, which includes the COVID-19 virus and its variants.


The measure sets forth requirements that employers select and obtain exposure controls appropriate for the exposure risks. These controls must be included in the employer’s Exposure Prevention Plan. As to the plan, the NYS Department of Health has developed a new Model Airborne Infectious Disease Exposure Prevention Plan (Template) and various industry specific model plans (Templates) for prevention of airborne infectious disease.


Employers must enact compliant plans immediately. 




Wednesday, December 29, 2021

Employment Laws - Year End Review

As the year comes to a close, we want to remind employers of the following recent laws, regulations and guidance related to the workplace, many of which are currently in effect or take effect early next year.


1) Vaccine/Mask Mandates


  • NYC Vaccine Mandate

NYC, via an Order of the Commissioner of Health and Mental Hygiene, now requires that all employers ensure that its workers are vaccinated against COVID-19. All private sector workers had to receive their first dose of a COVID-19 vaccine by December 27, 2021 and a 2nd dose 45 days later. Employers are further required to verify and keep a record of each worker's proof of vaccination. Workers may seek a reasonable accommodation for a qualifying disability or sincerely held religious belief. Violators may be penalized $1,000 per violation.


  • OSHA (Federal) Mask Mandate

Citations (with large monetary penalties) for non-compliance with the OSHA vaccine mandate for all employers with 100+ employees is scheduled to begin on January 10, 2022. OSHA's mandate requires that qualifying employers ensure that all employees "be vaccinated or wear a protective face covering and take weekly tests." While the Sixth Circuit upheld the vaccine mandate, the U.S. Supreme Court will hear oral arguments on the vaccine mandate on January 7, 2021. Stay tuned to our blog for updates.


  • NYS Mask Mandate 

Governor Hochul's statewide mandate requiring face mask/covering at all indoor public places is currently effective until January 15, 2022 (to be re-evaluated after this date). The mandate does not apply to indoor public areas that require proof of vaccination as a condition of entry. However, a business cannot "mix and match" i.e. permit individuals who show proof of vaccination to enter mask free while permitting those who do not present proof of vaccination to enter wearing a mask. Either no one is permitted entry that cannot provide proof of vaccination or everyone must wear a mask (whether vaccinated or not).


2. New York State HERO Act

On May 5, 2021, the NY HERO Act was signed into law in order to protect employees against exposure and disease during an airborne infectious disease outbreak. The HERO Act requires employers to take certain measures to protect their employees in the event of an outbreak including implementing an exposure prevention plan. On September 6, 2021, NYS Dept. of Health designated COVID-19 as a highly contagious communicable disease, which means that employers must currently have a written airborne infectious disease policy in effect.


3. Notice of Employee Monitoring

Pursuant to a new law signed by Gov. Hochul, beginning on May 7, 2022, employers in NYS who wish to monitor or otherwise tap telephone calls, e-mails, or internet access of an employee via any electronic device or system, must give prior written notice upon hiring to all employees. Additionally, each employer must post the notice of electronic monitoring in a visible place in the office. Businesses will be subjected to fines for violations.


4. Cannabis Use in the Workplace
The Department of Labor issued guidance on Section 201-D of the NY Labor Law which prohibits an employer from discriminating against employees for using cannabis outside of the workplace on their own time. While, per the guidance, an employer may prohibit cannabis use during work hours, an employer may only discipline employees (where employee did not use cannabis during work hours) who "manifest specific articulable symptoms of impairment" due to cannabis use. For example, odor of cannabis, without more, is insufficient to discipline an employee.


5.  Whistleblower Protections

Effective January 26, 2022, employees/independent contractors will have significantly expanded whistleblower protections, pursuant to Labor Law 740, if they disclose or threaten to disclose, to a supervisor or to a public body, an activity, policy or practice of the employer, that the employee reasonably believes is in violation of law, rule or regulation or that the employee reasonably believes poses a substantial and specific danger to the public health or safety.


6. Shared Work Program

Employees, without fear of retaliation, may petition their employer, in writing in advance of a layoff or within ten (10) days after a layoff to implement a “Shared Work” program (A shared work program was formed to assist employers in avoiding layoffs and maintain trained workers during an economic downturn by allowing employees to receive partial unemployment benefits while working reduced hours).


7. Requirement to Include Minimum and Maximum Salaries for all Posted Positions

Beginning in April 2022, unless vetoed by January 14, 2022, a new law will require NYC employers to include in all job advertisements, the minimum and maximum salaries for the posted position. Positions extend to jobs, promotions, or transfer opportunities. Employers that fail to include the minimum and maximum salaries will be in violation of the NYC Human Rights Law.


8.  Mandatory Enrollment in Retirement Plan

Governor Hochul recently signed legislation that will require private sector employers who do not provide their employees with a retirement plan to automatically enroll their employees in New York State's Secure Choice Savings Plan. Employees are able to opt out of the program at any time. Stay tuned for more details as the program is developed and implemented.




Happy New Year!




Thursday, December 23, 2021

Update! New York Criminalizes Falsifying Vaccination Records

Falsifying COVID-19 vaccination records, including vaccination cards, is officially a crime in New York State, effective December 22, 2021.


The new law amends §170.00 of the Penal Law to include vaccination cards as a written instrument. For a false vaccination card to be considered a written instrument the card must include either a government logo or something suggesting it was created by a government entity; it must suggest that the card was provided to a person by a vaccine provider; and must includes a date the person received the vaccine, the type of vaccine, and a lot number.


If someone violates the new law, they can be criminally charged with tampering with public records, offering a false instrument for filing, and issuing a false certificate. In addition, when someone intentionally alters, in any manner, or destroys computer material indicating that a person did or did not receive a vaccination against COVID-19, it shall be considered the crime of computer tampering.


With the new vaccination mandates in New York City now in effect, will the criminalization of falsifying vaccination cards deter people from obtaining fake vaccination cards. Comment below and let us know.


Thursday, December 16, 2021

NYC Releases New COVID-19 Vaccine Requirements for all Private Sector Workers

NYC released new vaccine requirements, by Order of the Commissioner of Health and Mental Hygiene, mandating all private sector workers to be vaccinated by December 27th with at least 1 dose of any COVID-19 vaccine. A 2nd dose is required 45 days after a worker shows proof of vaccination for the Pfizer or Moderna vaccines.


The City’s new Order is its strictest yet. Businesses are prevented from allowing unvaccinated workers to enter the workplace. Further, businesses must verify and keep a record of each worker’s proof of vaccination by December 27th. Records may consist of physical copies of worker’s proof of vaccination; a business-created paper or electronic record displaying worker’s name, vaccination status, and date by which they can provide proof of second vaccination; or a daily record verifying that the business checked the worker’s vaccination status before the worker entered the workplace. Businesses should be prepared to make their records available for inspection and need to set their protocol ASAP so that they comply.


The Order includes a path for vaccination exceptions if a worker seeks a reasonable accommodation for medical or religious reasons. If such an accommodation is sought, employers must record the reasonable accommodations, and supporting documentation relevant thereto, for each worker under 1 of the above record keeping options. Moreover, NYC employers must familiarize themselves with the Cooperative Dialogue or they will face failure-to-accommodate lawsuits by the drove. 


Also of note is that proof of vaccination applies to both employees and non-employee workers such as independent contractors.


The mandate does not apply to people who work alone; people who enter a workplace briefly for a limited purpose; and Non-NYC resident performing artists, college or professional athletes, and anyone who accompanies them.


NYC provides a detailed memo explaining how businesses can properly comply with the guidelines.  Businesses are subject to fines of $1,000 for non-compliance, and escalating penalties thereafter if violations persist. NYC provides a link for those who wish to report fake proof of vaccination records in order to maintain compliance.



Americans with Disabilities Act Update: COVID-19 Considered a Disability for Purposes of Employment Discrimination

Thousands of Americans who have contracted COVID-19 may now qualify for disability under the Americans with Disabilities Act (ADA).


The Equal Employment Opportunity Commission (EEOC) passed new ADA guidelines to cover individuals with COVID-19 disabilities.


There are three ways a person can be deemed to have a COVID-19 disability under the ADA.

  1. A person with COVID-19 has an Actual Disability if the person’s medical condition or any of its symptoms is a "physical or mental" impairment that "substantially limits one or more major life activities." An individualized assessment is [required] to determine whether the effects of a person’s COVID-19 substantially limit a major life activity. This will always be a case-by-case determination.
  2. A person who has or had COVID-19 can be an individual with a Record of a Disability if the person has "a history of, or has been misclassified as having, an impairment that substantially limits one or more major life activities, based on an individualized assessment.”
  3. A person is Regarded as an Individual with a Disability if the person is subjected to an adverse action (e.g., being fired, not hired, or harassed) because the person has an impairment, such as COVID-19, or the employer mistakenly believes the person has [COVID-19].”

In some cases, regardless of whether an individual’s initial case of COVID-19, itself, constitutes an actual disability because the case-by-case evaluation does not result in such a determination, that individual’s COVID-19 may end up causing impairments that are themselves disabilities under the ADA.


If you meet either the “actual" or “record of” definition of disability you may be eligible for a reasonable accommodation at the workplace.


It is unlawful for employers to discriminate against employees or applicants based on a COVID-19 disability. Further, it is unlawful for employers to refuse to provide reasonable accommodation for those with COVID-19 disabilities if it does not place an undue hardship on the employer.


If you believe you’ve been the target of COVID-19 Disability Discrimination by an employer then you should seek the counsel of an attorney to determine the extent of your injuries. Your attorney can assist you filing a legal complaint with EEOC. If the employer is found to have acted unlawful according to the ADA, then your attorney can leverage your position so you are awarded compensatory damages, penal damages, penalties, and attorney fees.


Also, don't forget that state and local anti-discrimination laws have lower standards to qualify for protection so even if you don't qualify under the ADA, check your state, county, city, or town / village. 



Tuesday, December 14, 2021

New York to Criminalize Falsifying Vaccination Records

The New York State Legislature passed Bill S4516C, which criminalizes falsifying COVID-19 vaccination records including cards, and the bill awaits the Governor's signature to become effective, as law, immediately when signed. 


The Bill amends the Penal Law to include vaccination cards as a written instrument. For a false vaccination card to be considered a written instrument the card must include either a government logo or something suggesting it was created by a government entity; it must suggest that the card was provided to a person by a vaccine provider; and must includes a date the person received the vaccine, the type of vaccine, and a lot number.


The Bill also amends the Penal Law to include that when someone intentionally alters, in any manner, or destroys computer material indicating that a person did or did not receive a vaccination against COVID-19, it shall be considered the crime of computer tampering in the third degree.


The penalties for violating this new law are class A misdemeanor for tampering with public records in the second degree; class D felony for tampering with public records in the first degree; class A misdemeanor for offering a false instrument for filing in the second degree; class E felony for offering a false instrument for filing in the first degree; class E felony for issuing a false certificate; and class E felony for computer tampering in the third degree. 





Monday, December 13, 2021

Details Released for NYS Mask Mandate Including $1,000 Fines for Each Violation.

New York State's Department of Health issued new details for Governor Hochul's statewide mandate requiring face mask/covering at all indoor public places effective December 13, 2021 until January 15, 2022 (State will re-evaluate after this date), for all persons, over age two and able to medically tolerate a face covering/mask, regardless of vaccination status. Indoor public places are any indoor space that is not a private residence. 


The mandate does not apply to indoor public areas that require proof of vaccination as a condition of entry. However, a business cannot "mix and match" i.e. permit individuals who show proof of vaccination to enter mask free while permitting those who do not present proof of vaccination to enter wearing a mask. Either no one is permitted entry that cannot provide proof of vaccination or everyone must wear a mask (whether vaccinated or not).


For example, in a law office where everyone must show proof of vaccination to enter (employees, clients, vendors, etc.) masks are not required.  However, a retail store that does not require proof of vaccination to enter is required to ensure that all individuals present at the store (employees, customers, etc.) wear face coverings regardless of vaccination status.


Per the Department of Health, the following institutions must ensure everyone over the age of two, unless subject to applicable CDC exceptions, is masked (there is no proof of vaccination option): correctional facilities, detention centers, homeless shelters, transportation hubs, schools.


The new requirements are pursuant to New York State administrative rule 10 NYCRR 2.60.  A violation of any of these requirements is subject to a fine of $1,000 for each violation. Businesses should, thus, immediately ensure compliance or face potential crippling fines.

Friday, December 10, 2021

COVID-19 Vaccine Mandate for Federal Contractors Stayed by Federal Judge.

The ruling by a Georgia federal judge does not prevent employers or businesses from enforcing vaccine mandates. Rather, the Court issued a nationwide stay of President Biden's Executive Order which required all federal contractors to be fully vaccinated by January 18, 2021.


While the Judge expressed his understanding of the dangers of this public health crisis, he, nevertheless, issued the stay because he believed the Executive Order exceeds the President's authority. The Court further reasoned that the potential harm from enforcing a vaccine mandate on federal contractors (causing many federal contractors to breach their contracts when their employees refuse to get vaccinated) outweighs the harm to public health if the contractors are not vaccinated.


Biden will likely appeal this ruling to end the stay. Do you agree with the Judge's reasoning? Would this Executive Order result in a federal contractor employment crisis? Let us know in the comments below.



We'll be sure to keep you updated as this legal fight continues!


Monday, December 06, 2021

New NYC COVID-19 Vaccine Mandate will Require All Private-Sector Workers to be Vaccinated

New York City Mayor de Blasio announced, through the media, new vaccine mandate requirements for New York City’s five boroughs.  Starting December 27th all private-sector workers will be required to show proof of vaccination. This is the first vaccine mandate in the nation that applies to all private sector workers. Approximately 184,000 businesses will be affected. Mayor de Blasio called the new measures a “preemptive strike” in facing the new challenges associated with the Omicron variant, the colder weather affecting the delta variant, and holiday gatherings.


Additional measures include, requiring children ages 5-11 to show proof of one vaccine dose for indoor dining, fitness, and entertainment and requiring individuals 12 and older to show proof of two vaccine doses unless they received the Johnson & Johnson single vaccine dose. These measures are effective as of December 14th.


Mayor de Blasio called the measures universal in their enforcement and is confident that this expansion to “Key to NYC” Program will overcome any legal challenge.


Mayor de Blasio said the city’s health commissioner has put these new vaccine requirements into place. However, New York City’s Department of Health has not yet published the order detailing the requirements of the new mandate.


Issues involving the enforcement of these private-sector vaccine mandates will likely be something mayor-elect Eric Adams will have to deal with next year.


Second Circuit Holds that Requiring Teachers to Submit a Letter from a Religious Leader in Support of a Request for a Reasonable Accommodation is Unconstitutional

The 15 public school teachers who challenged New York City’s COVID-19 vaccine mandate live to fight another day in court.


The teachers have refused to comply with the City’s mandate arguing that compliance with the COVID-19 vaccine mandate is a violation of their religious rights under the First Amendment’s free exercise clause.


The Court determined that the reasonable accommodation standards in the City's vaccine mandate was unconstitutional as applied to the 15 teachers because the mandate required employees who requested a religious exemption to the COVID-19 vaccine mandate to submit a letter from a religious leader confirming the validity of the employee's religious beliefs. If the religious leader had well-documented public comments in support of taking the vaccine, the request for exemptions would be denied.


The Court reasoned as follows:


Denying an individual a religious accommodation based on someone else's publicly expressed religious views-even the leader of her faith-runs afoul of the Supreme Court's teaching that "[i]t is not within the judicial ken to question the centrality of particular beliefs or practices to a faith, or the validity of particular litigants' interpretations of those creeds."


However, the Court declined to extend protections against the mandate to all teachers stating that the mandate itself was "a reasonable exercise of the state's power to act to protect the public health."


Based on this decision, employers should only consider the employee's specific religious beliefs (in determining whether they are "sincerely held") when processing a reasonable accommodation request. Someone else's belief  - even if it is a religious leader - is irrelevant. 




Friday, November 12, 2021

Foreclosure Protection Enhanced by Federal Regulators

On November 10, 2021, Federal Regulators issued a statement that lenders will no longer be afforded leniency with complying with mandatory mortgage servicing practices.

 

As background, Federal Regulators had previously issued an April 2020 Joint Statement, in response to COVID, that they would not take supervisory or enforcement action against mortgage servicers for failing to meet certain borrower-protective timing requirements so long as the servicers made good faith efforts to provide those required notices or disclosures and took the related actions within a reasonable period.

 

Now, as of November 10, 2021, Agencies will apply their respective supervisory and enforcement authorities, to address noncompliance or violations of Regulation X’s mortgage servicing rules.

 

Borrowers, who are looking for leverage in negotiating mortgage modifications, short sales, and deed-in-lieu workouts should be brushing up on Regulation X today.

  


Thursday, November 04, 2021

OSHA Releases Details/Requirements of Employer Vaccine Mandate

The Occupational Safety and Health Administration ("OSHA") issued its long awaited emergency temporary standard requiring all private sector employers with 100 or more employees ("covered employers") to "develop, implement, and enforce a mandatory COVID-19 vaccination policy." OSHA issued separate rules for federal contractors/subcontractors and health care workers.


The OSHA rules require all covered employers to ensure their employees are vaccinated by January 4, 2022 or undergo weekly testing for COVID-19 and wear face coverings while at work (There is no testing option for health care workers).


Employers do not have to require employees to get vaccinated or be tested weekly if they: 1) report to a workplace where no other individuals are present; 2) work entirely from home; or 3) work exclusively outdoors. In addition, the rules provide for a reasonable accommodation for employees who have a disability or sincerely held religious belief (where there is no undue hardship to the employer).


The rules also require covered employers to do the following:


  • obtain and preserve records of employee vaccination/testing which must be provided to employees, employee representatives and OSHA upon request;
  • provide employees with up to four (4) hours of paid time off to receive their vaccine dose(s);
  • provide reasonable time off and paid sick leave for employees to recover from side effects experienced from receiving the vaccine;
  • require employees to notify the employer when they are diagnosed with COVID-19 and remove all employees who are positive from the workplace until they meet certain criteria;
  • require all unvaccinated employees as of December 5, 2021 to wear masks (they must be vaccinated by January 4, 2022). 
  • report all COVID-19 fatalities and hospitalizations to OSHA;

Aside from the vaccination/weekly testing requirements, all of the other rules take effect on December 5, 2021. Covered employers should, thus, immediately work with counsel to begin creating and implementing a policy in compliance with these new rules. Covered employers who fail to comply with these rules can face fines in the amount of $13,653 per violation or $136,532 per violation if the conduct is willful or repeated. 



Thursday, October 28, 2021

EEOC Provides Clarifications on Religious Exemptions to COVID-19 Vaccine Mandates

The Equal Employment Opportunity Commission ("EEOC") recently released new guidance on religious exemptions to COVID-19 vaccine mandates. The new guidance provides clarifications regarding employers' and employees' obligations, including the following:

  • In requesting a religious accommodation, an employee must specify that there is a conflict between the vaccine requirement and their sincerely held religious beliefs.
  • If an employer has an objective basis to question either the "religious nature or the sincerity of a particular belief," the employer can seek additional supporting information from the employee regarding their religious beliefs.
  • Objections to COVID-19 vaccinations based on social, political or personal preferences do not qualify as sincerely held religious beliefs.
  • In assessing whether it can deny an accommodation request based on an undue hardship, an employer should consider factors such as whether the employee: works outdoors or indoors, works in a group setting, has close contact with other individuals, as well as the number of employees seeking a similar accommodation. 
  • The employer can choose its preferred accommodation that would resolve the employee's conflict even if it is not the accommodation requested by the employee. 
Since every request requires an individual assessment of the employee's religious beliefs and potential burden to the employer, employers should seek the advice of legal counsel prior to making a determination.



Wednesday, October 13, 2021

Attorney Andrew Lieb Clarifies Accommodation Rights on Vaccine Exemptions on CBS NY

A federal judge has temporarily allowed health care workers in New York to skip mandatory #COVID19 vaccines if they apply for religious exemptions. He granted a preliminary injunction on Tuesday morning. Attorney Andrew Lieb shares his expertise on accommodation rights as opposed to blanket exemptions. 




Thursday, September 16, 2021

Podcast | Legal Breakdown and Analysis of Biden's Employment Vaccine Mandate

 The Lieb Cast answers the following questions about Biden's employment vaccine mandate in the latest podcast: 


  1. Can Biden / OSHA issue an Executive Order / Regulation mandating employment vaccines? 
  2. Can the Federal Congress issue a statute mandating employment vaccines or is that a state's rights issue?
  3. What is the precedent for an individual state to issue a vaccine mandate and would it be upheld?
  4. Does it matter if an individual state's Governor or Legislature issued an employment vaccine mandate for enforceability?
  5. How does a sincerely held religious belief against vaccines avoid employment vaccine mandates?
  6. How can employers refuse an accommodation who has a disability or sincerely held belief and requests to avoid an employment vaccine mandate?

Plus, we discuss brisket, ice cream, 9/11, Rosh Hashanah, Yom Kippur, horse dewormers, and most importantly, we break down the hiring / staffing issues faced by employers everywhere.


Link to Podcast: https://www.listentolieb.com/876124/9172946-legal-breakdown-and-analysis-of-biden-s-employment-vaccine-mandate




Wednesday, September 01, 2021

Podcast: NYC v. Montana - Polar Opposite Vaccine Mandates

Episode 208 of The Lieb Cast.


Stop complaining about governmental vaccine rules for where you work and where you go. Just live in the right place for you. We explain NYC's vaccine rules to participate in everything and Montana's new anti-discrimination law that prohibits changing opportunities based on vaccination status. 


Search "The Lieb Cast" on any podcast player. 



Friday, August 20, 2021

New Law Cuts Down Banking Overdraft Fees for its Customers

In one of his last acts as Governor for the State of New York, Gov. Cuomo signed legislation on August 19, 2021, which requires banks in NY to take action to prevent overdraft fees against its customers. 


Previously, under the NYS Banking Law, if a customer's check exceeds the funds available in the customer's checking account, that check and any subsequent checks received by the bank would be dishonored by the bank. In other words, even if there were sufficient funds to satisfy these subsequent checks, the banks would still dishonor those checks because the initial check was rejected, and therefore, the banks would be able to charge overdraft fees on each rejected check. 


This new legislation (S1465) requires banks to honor any subsequent checks presented to a bank if the customer's account has sufficient funds to cover those checks, even if the initial or prior check was dishonored due to insufficient funds in the checking account. 


The rationale behind this new legislation stems from the ongoing COVID-19 pandemic; specifically, the struggles in our economy and the struggles that many families continue to endure when it comes to paying their bills. This new legislation will ensure that banking customers will not be charged excessive overdraft fees and will allow customers to hold onto more of their money.


How big of an impact will this new legislation have on our economy going forward? 



                                   



Wednesday, July 14, 2021

New Law Extends Partial Tax Abatement Law for Certain Co-Ops and Condos

A new NYS law extends partial real property tax abatement for co-ops and condos within a city containing a population of one million or more, through the NYC fiscal year that begins in 2022.


Technically, the law amends paragraphs (a) and (b) of Real Property Tax Law 467-a (2).


Previously, the Real Property Tax Law authorized partial tax abatement for these co-ops and condos from the fiscal year commencing in 2012 through 2020.  The new law now provides a 2-year extension.


Although the COVID-19 pandemic appears to be in our rear-view mirrors, many families continue to endure hardships caused by the brutal pandemic. As a result, Governor Como continues to pass legislation related to tax abatement and/or exemptions for certain dwellings (e.g., S.6487).


How long will legislation extending tax abatement and/or exemptions for certain dwellings continue to be passed? 


Time will tell...




Wednesday, July 07, 2021

Employers Must Immediately Adopt an Airborne Infectious Disease Exposure Prevention Plan

The New York State Department of Labor has finally issued the long awaited Model Airborne Infectious Disease Exposure Prevention Plan.


As a refresher, on May 5, 2021, Governor Cuomo signed the New York Health and Essential Rights Act ("NY HERO Act") into law requiring employers to take various measures to protect employees in the event of a future airborne infectious disease outbreak. 


One of those measures was to adopt a prevention plan. Now that the NYSDOL released the model plan, employers have until August 5, 2021 to either customize and adopt the model plan or create their own plan which, at a minimum, meets the requirements of the model plan.


While employers must immediately adopt a plan, it is important to note that, per the NYSDOL website, the plan is not currently required to be in effect until the New York State Commissioner of Health designates an infectious disease as a "highly contagious communicable disease that presents a serious risk of harm to the public health." 




Friday, July 02, 2021

New Foreclosure Rule from CFPB

On June 28, 2021, the Consumer Financial Protection Bureau (CFPB) issued a final rule amending Regulation X of the Real Estate Settlement Procedures Act (RESPA) which aims to assist mortgage borrowers with a COVID-19 related hardship in seeking loss mitigation options and delaying foreclosure proceedings to encourage resolution of delinquencies through loan modification.
This Rule is going to make it harder for lenders to foreclose and cause more homeowners to enter a modification thereby avoiding foreclosure.

The Rule has 5 key parts:

  1. It imposes additional requirements before a mortgage servicer may make the first notice or filing required to commence a foreclosure proceeding due to default.
    • However, this requirement is only applicable if:
      • The borrower’s mortgage payment became more than 120 days delinquent on or after March 1, 2020; and
      • The statute of limitations applicable to the potential foreclosure action expires on or after January 1, 2022.
    • If the rule is applicable, mortgage servicers may commence a foreclosure only if:
      • The borrower has submitted a completed loss mitigation application and either:
        • The borrower is ineligible for any loss mitigation options and the borrowers’ appeal, if applicable, has been denied;
        • The borrower rejects all available options; or
        • The borrower fails to perform terms of an agreement on a loss mitigation option;
      • The subject property is abandoned as defined, under state or municipal law; or
      • The servicer has conducted specified outreach and the borrower is unresponsive to such outreach.
    • This requirement expire on January 1, 2022, and thus, mortgage servicers shall be free to commence foreclosure proceedings after such date.
  2. It provides specific limitations for loan modifications, including:
    • A modification may not cause an increase in mortgage principal and interest payments, and may not extend the life of the loan by more than 480 months from the date of the loan modification;
    • A loan modification may not charge or accrue interest on deferred payments, which are not due until the mortgage loan is refinanced, the property is sold, the loan modification matures, or the mortgage insurance is terminated (if the loan is insured by FHA);
    • Modification MUST be made available to borrowers experiencing COVID-19 related hardships;
    • Borrower’s acceptance of a permanent modification, after a trial modification plan, ends any preexisting delinquency on the mortgage; and
    • No fees may be charged in connection with a modification and all existing late charges, penalties, stop payment fees, or similar charges incurred on or after March 1, 2020, shall be waived.
  3. Imposes additional live contact early intervention obligations on servicers to discuss specific COVID-19 related relief:
    • Applies to:
      • A borrower who is not in a forbearance program; or
      • A borrower who is near the end of a forbearance program based on a COVID-19 related hardship.
      • These requirements expire on October 1, 2022.
  4. Requires the servicer to contact the borrower, within 30 days before the end of the forbearance period, if the borrower remains delinquent, and inquire if the borrower wants to complete a loss mitigation application.
  5. Defines COVID-19-related hardship to mean “a financial hardship due, directly or indirectly, to the national emergency for the COVID-19 pandemic declared in Proclamation 9994 on March 13, 2020 (beginning on March 1, 2020) and continued on February 24, 2021, in accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)).”

The Rule does not take effect until August 31, 2021. That being said, borrowers should be aware that the CFPB foreclosure moratorium expired on June 30, 2021 and the CDC foreclosure moratoriums for FHA, HUD, VA, Fannie Mae, and Freddie Mac loans ends on July 31, 2021 and to contact their mortgage servicers as soon as possible to inquire about available loss mitigation options.