Yesterday, the Families First Coronavirus Response Act (H.R. 6201) was passed into law and goes into effect on April 1, 2020, and stays in effect until December 31, 2020. If you are an employer with less than 500 employees, please read because this will apply to you.
Employers, check out our COVID-19 Resource Guide.
- requires private insurance plans to provide free COVID-19 testing;
- requires employers to provide emergency paid sick leave to workers affected by COVID-19 and expands family and medical leave; and
- provides increased funding for state unemployment insurance programs, food stamp and nutritional programs and others.
This post will focus on the emergency family and medical leave and emergency sick leave aspects of the Act, which will affect the vast majority of employers and employees across the country.
There are two provisions providing paid leave to employees forced to miss work because of the COVID-19 outbreak: an emergency expansion of the Family Medical Leave Act (FMLA) and a new federal paid sick leave law.
Emergency Family and Medical Leave Expansion Act
- FMLA Coverage is Expanded to Include Most Employers – The Act amends and expands FMLA on a temporary basis. Businesses covered by the FMLA is expanded from those with 50 or more employees to those employers with fewer than 500 employees (vast majority of businesses, including the self-employed). Any employee who has worked for the employer for at least 30 days prior to the designated leave may now be eligible to receive paid family and medical leave. The Act allows the Secretary of Labor to exclude healthcare providers and emergency responders from the definition of employees who are allowed to take such leave, and to exempt small businesses with fewer than 50 employees if the required leave would jeopardize the viability of their business. It is still to be seen whether there will be such an exemption.
- Covered Reasons for Emergency Leave – Any individual employed by the employer for at least 30 days (before the first day of leave) may take up to 12 weeks of job-protected leave to allow an employee, who is unable to work or telework, to care for the employee’s child (under 18 years of age) if the child’s school or place of care is closed or the childcare provider is unavailable due to a public health emergency. This is now the only qualifying need for Emergency FMLA. PLAIN ENGLISH: 12 weeks of job-protected leave for employees who can’t work because they have to stay home with children whose schools are closed or don’t have childcare because of COVID-19.
- Employers Must Provide Paid Leave – The leave must be paid, but the first 10 days of Emergency FMLA may be unpaid. During this 10-day period, an employee may elect to substitute any accrued paid leave (like vacation or sick leave) to cover some or all of the 10-day unpaid period. After the 10-day period, the employer generally must pay full-time employees at two-thirds the employee’s regular rate for the number of hours the employee would otherwise be normally scheduled. Maximum paid leave is $200 per day up to a total of $10,000 per employee.
- Calculating Paid Leave for Non-Full Time Employees – Employees who work a part-time or irregular schedule are entitled to be paid based on the average number of hours the employee worked for the six months prior to taking Emergency FMLA. Employees who have worked for less than six months prior to leave are entitled to the employee’s reasonable expectation at hiring of the average number of hours the employee would normally be scheduled to work.
- Job Restoration Upon Return from Leave – Employers with 25 or more employees must return any employee who has taken Emergency FMLA to the same or equivalent position upon the return to work. However, employers with fewer than 25 employees are generally excluded from this requirement if the employee’s position no longer exists following the Emergency FMLA leave due to an economic downturn or other circumstances caused by a public health emergency during the period of Emergency FMLA. This exclusion is subject to the employer making reasonable attempts to return the employee to an equivalent position and requires an employer to make efforts to return the employee to work for up to a year following the employee’s leave.
Emergency Paid Sick Leave Act
- Covered Reasons for Paid Sick Leave – Employers must provide employees who are unable to work (or telework) with paid sick leave if the employee is:
- subject to a federal, state or local quarantine or isolation order related to COVID-19;
- advised by a health care provider to self-quarantine due to COVID-19 concerns;
- experiencing COVID-19 symptoms and seeking medical diagnosis;
- caring for an individual (not only limited to family members) subject to a federal, state or local quarantine or isolation order or advised by a health care provider to self-quarantine due to COVID-19 concerns;
- caring for the employee’s child if the child’s school or place of care is closed or the child’s care provider is unavailable due to public health emergency; or
- experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor
- Covered Employers – This provision applies to employers with fewer than 500 employees.
- Amount of Paid Sick Leave Benefit –
- Full-time employees – regardless of the employee’s duration of employment prior to leave, are entitled to 80 hours of paid sick leave at the employee’s regular rate (or two-thirds the employee’s regular rate if the leave is for qualifying reasons 4, 5, or 6 listed above [i.e. caring for others rather than being sick or personally quarantined]). There is an exception for employers who are healthcare providers or emergency responders at their election.
- Part-time employees – a number of hours equal to the average number of hours the employee worked in the prior 2-week period.
- Cap on Paid Sick Leave Wages –Paid sick leave wages are limited to $511 per day up to $5,110 total per employee for their own use and to $200 per day up to $2,000 total to care for others and any other substantially similar condition.
- Carryover and Interaction with Other Paid Leave – This paid sick leave will not carry over to the following year. Employers must provide these benefits in addition to any existing paid leave benefits. In other words, employees are entitled to exhaust all available emergency paid leave provided by this Act before they are required to use any otherwise available leave benefits their employer may offer.
Tax Credits For Paid Sick And Paid Family And Medical Leave
The Act provides for a refundable tax credit to employers for 100% of the qualified sick leave wages paid to their employees (described above). These tax credits would be provided on a quarterly basis and are allowed against the employer’s Social Security taxes.
Further Guidance from the Department of Labor
The Department of Labor issued guidance related to the details of the FFCRA, especially the paid leave portions. Everyone is encouraged to review those FAQs.
- Understand your obligations and create a plan for compliance.
- Obtain the employee notice from the Department of Labor, which will be available in the next week, and post it on your premises (if employees are still coming in) and/or circulate it to employees working remotely.
We will continue to monitor this rapidly developing situation and provide updates as appropriate.