What Employers Need to Know about the Families First Coronavirus Response Act
As a response to the COVID 19 pandemic, a new law was passed to address employee leave time that may need to be taken in light of potential illness, quarantine and school closures. The new law is called the Families First Coronavirus Response Act and will be effective April 2, 2020 and will sunset December 31, 2020.
This law does not apply to private companies with 500 or more employees. Companies with less than 500 employees may exclude health care providers and first responders from the benefit. In addition, the Department of Labor can exclude businesses with fewer than 50 employees if complying with the law would jeopardize a business as a going concern. It is unclear at this point exactly how these exclusions will work.
There are two components to the new law: 1) paid sick leave and 2) emergency leave which expands the leave already provided under the Family Medical Leave Act (FMLA).
Paid Sick Leave:
An eligible employer must provide eligible employees who cannot work or telework an additional 80 hours of paid sick leave in one of six situations. Three of the situations apply to circumstances that directly affect the employee. The other three situations apply to circumstances where the employee is caring for someone else.
The three situations where an employee could take paid sick leave that directly affect the employee: 1) the employee is subject to a federal, state or local quarantine or isolation order, 2) the employee is advised by a health care provider to self-quarantine, or 3) the employee is experiencing symptoms related to COVID 19 and is seeking a medical diagnosis. In these situations, full time employees are entitled to receive paid sick leave at the employee’s regular rate of pay up to a maximum of $511 per day, with a maximum of $5,110.
Employees also would be eligible to obtain paid sick leave if they are caring for someone else under the following circumstances: 1) caring for someone subject to an isolation order (described above) or caring for someone advised by their health care provider to self-quarantine, 2) caring for their son or daughter if their school or day care provider is closed due to COVID 19 or 3) any other substantially similar condition specified by the Secretary of Health and Human Services. In this set of circumstances, a full time employee is entitled to receive paid sick at 2/3 of the employee’s regular rate of pay up to a maximum of $200 per day, with a total of $2,000.
Part time employees are granted leave equivalent to their average hours worked during the prior two week period.
Employers will be required to post a notice about paid sick leave, which is to be made available by the Secretary of Labor no later than March 26, 2020.
Emergency Family Medical Leave Act (EFMLA):
For employees who have worked for the employer for at least 30 calendar days and who are unable to work or telework, the EFMLA has been created to allow leave time for employees who cannot work because the employee is caring for their son or daughter if their school or day care provider is closed due to COVID 19. The EFMLA leave is up to 12 weeks. The first two weeks of leave are paid in accordance with the Paid Sick Leave provisions. The remainder of the 12 week period is paid by the employer at 2/3 of the employee’s regular rate of pay up to a maximum of $200 per day, with a maximum of $10,000.
Employers will be provided refundable tax credits against their employer portion of payroll taxes for 100% of the paid sick leave and EFMLA wages paid in accordance with the Act.
These sweeping new laws are continuing to be refined. Employers can expect further guidance in the coming days.