Not so HR-y, HR.
Families-First Coronavirus Response Act -> The New Law Made Simple
UPDATED AS OF APRIL 6, 2020.
There’s a new law that has been passed in response to COVID-19: Families-First Coronavirus Response Act.
In short, what does this mean? Be prepared to provide “Emergency Paid Sick Leave” and “Emergency FMLA (Family Medical Leave Act) Expansion” effective 4/1/2020 which will last to 12/31/2020.
Here’s the gist of it…and I did my best to simplify it as much as possible...
What size employers does this affect?
- Employers with 500 or fewer employees*
*Employers with less than 50 employees are eligible for an exemption. Please see the exemption qualifications at the end of this article.
There are two parts:
- Emergency Paid Sick Leave Act
- Emergency FMLA Expansion Act
Part One: Emergency Paid Sick Leave Act
Who is eligible?
All employees of employers with fewer than 500 employees, regardless of how long they have been with their employer, are eligible for this paid sick leave.
An eligible employee may take paid sick leave if he/she is unable to work (including telework) if the employee:
- is subject to a federal, state, or local quarantine or isolation due to COVID-19;
- was advised by a health care provider to self-quarantine due to concerns related to COVID-19 (self-imposed quarantine doesn’t count);
- is experiencing the symptoms of COVID-19 and seeking a medical diagnosis;
- is caring for an individual who is either subject to a federal, state, or local quarantine or isolation due to COVID-19 or has been advised to self-quarantine due to concerns related to COVID-19;
- is caring for their child whose school has been closed or place of care is unavailable due to COVID-19 precautions; or
- is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretaries of Treasury and Labor.
Paid Sick Leave Benefit:
- Full-Time employees get 80 hours of sick pay
- Part-Time employees get the equivalent number of hours they would have worked in a two week period.*
- For reasons 1-3 above, eligible employees get paid at their regular rate but no more than $511/day and $5110 total.
- For reasons 4-6, eligible employees get paid at ⅔ their regular rate but no more than $200/day and $2000 total.
- Paid Sick Leave does not carry over
- Employers can get reimbursement for wages paid to employees taking this emergency paid sick leave through tax credits that have to do with the employer’s portion for Social Security taxes.
- Employers cannot require employees to use other PTO or sick pay prior to using this benefit.
*There is the clarification from the DOL on how to count part-time hours at the end of this article.
Part Two: Emergency FMLA Expansion Act
The Families First Coronavirus Response Act also includes the Emergency Family and Medical Leave Expansion Act (the “FMLA Expansion Act”). It provides eligible employees who have children whose schools or place of care has closed due to COVID-19.
Who is eligible?
All employees of employers with fewer than 500 employees, who have worked at least 30 days with that employer, are eligible.
Emergency FMLA Expansion Benefit
- An eligible employee may take up to 12 weeks of leave if he/she is unable to work (including telework) because the employee must care for his/her child (under 18 years of age) whose school or place of care has closed due to the emergency COVID-19 public health.
- The first 10 days of leave are unpaid but the employee may take accrued paid sick leave and/or vacation during this unpaid period.
- After the initial 10 day period, the employee is entitled to receive from the employer ⅔ of his/her normal wages for the number of hours he/she would be regularly scheduled to work up to a max of $200 per day and $10,000 total.
Job Protection Under Emergency FMLA Expansion
- Employers who have 25 or more employees must reinstate an employee returning from this leave to the same or equivalent position.
- Employers who have less than 25 employees, the employee is entitled to the position held by the employee when the leave started unless the position does not exist due to economic conditions or other conditions caused by the public health emergency.
- Either way, the employer must make reasonable efforts to restore the employee to the equivalent position up to a year after.
Putting those two together (Emergency Paid Sick Leave & Emergency FMLA Expansion)
- A full-time eligible employee who cannot work due to the closure of their child’s school or place of care will be entitled to:
- --80 hours of Federal Paid Sick Leave
- --Up to 12 weeks of job-protected Emergency FMLA leave with the first 10 days paid as Federal Paid Sick Leave at their full rate but not more than $200 per day and $2000 total (PTO, vacation, sick pay already existing not included) per employee
- --Then the rest of the remaining days paid by the employer at ⅔ of their regular pay at a maximum of $200 per day and $10,000 total per employee
- A full-time eligible employee unable to work due to reasons under the Paid Sick Leave Act OTHER than a child’s school or childcare closure (again see items 1-3 above) will be entitled to:
- --80 hours (10 days) of Federal Paid Sick Leave paid by the employer at the full regular rate up to a maximum entitlement of $511 per day but not more than $5,110 per employee
Quarantine will not trigger the Emergency FMLA leave provisions (only the sick pay), although there may be traditional, unpaid FMLA leave rights available, as well as unemployment insurance.
Tax Credits per the IRS Guidelines
Employers will be provided refundable tax credits against their part of Social Security Taxes for 100% of the qualified sick leave and wages paid for this Act.
Per the IRS Guidelines Question 44:
An Eligible Employer will substantiate eligibility for the sick leave or family leave credits if the employer receives a written request for such leave from the employee in which the employee provides:
- The employee’s name;
- The date or dates for which leave is requested;
- A statement of the COVID-19 related reason the employee is requesting leave and written support for such reason; and
- A statement that the employee is unable to work, including by means of telework, for such reason.
In the case of a leave request based on a quarantine order or self-quarantine advice, the statement from the employee should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine, and, if the person subject to quarantine or advised to self-quarantine is not the employee, that person’s name and relation to the employee.
In the case of a leave request based on a school closing or child care provider unavailability, the statement from the employee should include the name and age of the child (or children) to be cared for, the name of the school that has closed or place of care that is unavailable, and a representation that no other person will be providing care for the child during the period for which the employee is receiving family medical leave and, with respect to the employee’s inability to work or telework because of a need to provide care for a child older than fourteen during daylight hours, a statement that special circumstances exist requiring the employee to provide care.
Again, note this goes into effect on April 1, 2020. If you have questions regarding this please do not hesitate to reach out.
If you’d like to read the Act in its entirety (there’s more than what applies to employers) go here.
In helpfulness and good health,
Small Business Exemption Guidelines
Per the Department of Labor’s Q&A Sheet Questions #58 and #59:
#58 When does the small business exemption apply to exclude a small business from the provisions of the Emergency Paid Sick Leave Act and Emergency Family and Medical Leave Expansion Act?
An employer, including a religious or nonprofit organization, with fewer than 50 employees (small business) is exempt from providing (a) paid sick leave due to school or place of care closures or child care provider unavailability for COVID-19 related reasons and (b) expanded family and medical leave due to school or place of care closures or child care provider unavailability for COVID-19 related reasons when doing so would jeopardize the viability of the small business as a going concern. A small business may claim this exemption if an authorized officer of the business has determined that:
- The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
- The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities;
- or There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
#59 If I am a small business with fewer than 50 employees, am I exempt from the requirements to provide paid sick leave or expanded family and medical leave?
A small business is exempt from certain paid sick leave and expanded family and medical leave requirements if providing an employee such leave would jeopardize the viability of the business as a going concern. This means a small business is exempt from mandated paid sick leave or expanded family and medical leave requirements only if the:
- employer employs fewer than 50 employees;
- leave is requested because the child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons;
- and an authorized officer of the business has determined that at least one of the three conditions described in Question 58 is satisfied.
The Department encourages employers and employees to collaborate to reach the best solution for maintaining the business and ensuring employee safety.
How to count part-time hours Department of Labor’s Q&A Sheet:
How do I count hours worked by a part-time employee for purposes of paid sick leave or expanded family and medical leave?A part-time employee is entitled to leave for his or her average number of work hours in a two-week period. Therefore, you calculate hours of leave based on the number of hours the employee is normally scheduled to work. If the normal hours scheduled are unknown, or if the part-time employee’s schedule varies, you may use a six-month average to calculate the average daily hours. Such a part-time employee may take paid sick leave for this number of hours per day for up to a two-week period, and may take expanded family and medical leave for the same number of hours per day up to ten weeks after that.
If this calculation cannot be made because the employee has not been employed for at least six months, use the number of hours that you and your employee agreed that the employee would work upon hiring. And if there is no such agreement, you may calculate the appropriate number of hours of leave based on the average hours per day the employee was scheduled to work over the entire term of his or her employment.