As of March 19, 2020
On March 18, 2020, the President signed into law the Families First Coronavirus Response Act (“FFCRA” or “Act”). Key provisions of FFCRA include the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act. The following is a brief summary of the FFCRA, which may be amended. Therefore, you should consult with legal counsel to ensure that you are applying the most up-to-date law.
- The FFCRA is temporary
- Coverage: Employers with fewer than 500 employees and Government employers employing at least one employee.
- Effective Date: No later than April 2, 2020 and will sunset on December 31, 2020.
Emergency Paid Sick Leave Act is a new law that provides two weeks of paid leave for employees out of work due to being directly affected by COVID-19 when the employee is unable to work (or telework) because:
- The employee is subject to a Federal, state or local quarantine or isolation order related to COVID-19.
- The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
- The employee is caring for an individual who is subject to an order as required by paragraph 1 or has been advised as described in paragraph 2.
- The employee is caring for a son or daughter if the school or place of care has been closed, or unavailable, due to COVID-19 precautions.
- The employee is experiencing any other substantially similar condition as defined by the Federal government.
Exception to Coverage: A health care provider or an emergency responder may be excluded from this paid leave.
Amount of Paid Leave: For full-time employees the paid leave entitlement is 80 hours. For part-time employees, it is the average hours worked over a two (2) week period. Employees taking leave for themselves (under paragraphs 1, 2 or 3 above) must be paid at least their normal pay rate or the applicable minimum wage, whichever is greater, but the sick leave required cannot exceed $511 per day or $5,110 in the aggregate. For care of family members (under paragraphs 4, 5, or 6 above), the required compensation is 2/3 of the employee’s regular rate of pay and cannot exceed $200 per day or $2,000 in the aggregate. There cannot be any carryover from one year to the next.
Availability of Leave: Emergency paid sick leave is immediately available for use by an employee for one of the permitted purposes regardless of how long the employee has been employed.
- An employee cannot be required to find a replacement employee to cover the hours during which the employee is on paid sick leave.
- An employee cannot be required to use the employer provided sick leave before emergency sick leave.
Exemption: The Department of Labor has the authority to exempt small businesses with fewer than 50 employees if the imposition of the paid sick leave requirement would jeopardize the viability of the business as a going concern.
Emergency Family and Medical Leave Expansion Act adds a Qualifying Need Related to a Public Health Emergency as a reason for a Family and Medical Leave Act (“FMLA”) of up to 12 weeks of mostly paid leave. A Public Health Emergency means an emergency with respect to COVID-19 declared by a Federal, state, or local authority. The Act is applicable to:
- Employees who have been employed for at least 30 calendar days and who are unable to work (or telework) due to a need for leave to care for the employee’s son or daughter under 18 years if the school or place of care has been closed, or the child care provider is unavailable due to a public health emergency, or
- Employers with fewer than 500 employees.
- 10 days of unpaid leave during which the employee may substitute accrued vacation, personal, medical or sick leave for the unpaid leave.
- Paid leave for subsequent days calculated as 2/3 of the employee’s regular rate of pay for the number of hours the employee would otherwise be scheduled to work up to a maximum of $200 per day and $10,000 in the aggregate.
- The Act provides the method for calculation of paid leave for employees with varying schedules.
Restoration to position:
- Following an FMLA leave, an employee must be restored to his/her prior position.
- The requirement to restore the employee to his/her job at the conclusion of a Public Health Emergency Family Leave does not apply to an employee of an employer with less than 25 employees:
- If the position held by the employee when the leave commenced no longer exists due to economic conditions or other changes in operating conditions of the employer that affect employment and are caused by a public health emergency during the period of leave, and
- if the employer makes reasonable efforts to restore the employee to a position equivalent to the position the employee held when the leave commenced with equivalent employment benefits, pay, and other terms and conditions of employment.
- If reasonable efforts to restore the employee to a position fail, the employer is expected to make reasonable efforts to contact the employee if an equivalent position becomes available within a year beginning on the earlier of the date on which the need for the public health emergency concludes or the date that is 12 weeks after the date on which the employee’s Public Health Emergency Leave commenced.
There are some special rules applicable to employment under multi-employer bargaining agreements and health care providers and emergency responders.
Employer Credits for Paid Sick and Family and Medical Leave
- Wages required to be paid as emergency sick leave or emergency family leave will not be subject to the 6.2% social security payroll tax typically paid by employers on employees’ wages.
- Non-government employers are allowed a refundable payroll tax credit equal to 100% of qualified paid sick leave or emergency family leave wages paid by the employer for each calendar quarter.
- Treasury will be issuing rules regarding a credit for qualified health plan expenses.
- There are a number of rules regarding qualification and collection of the credit which should be reviewed by the employer.
Additional Employer Responsibilities
- Posting of notice prepared by the Department of Labor
- Prohibition against discrimination in discharge, discipline or in any other manner because the employee took a leave or has filed any complaint, instituted any proceeding, or testified under the Act.
Note: The purpose of this summary is to give a general overview of the new Families first Coronavirus Response Act. It is not intended as legal advice with regard to any particular employer’s situation. There remain a number of questions regarding how the Act will be interpreted and applied, which may be addressed in the coming days. In addition, there continue to be a number of amendments being proposed which may be enacted. Please refer any questions to your legal counsel.
Stoneman, Chandler & Miller LLP can help you address these recent developments. If you have any questions on the above, please do not hesitate to contact us.
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