On March 18, 2020, President Donald J. Trump signed legislation that expands employee
benefits and protections related to COVID-19.
The escalating coronavirus (COVID-19) pandemic has prompted additional emergency relief legislation to pass - the Families First Coronavirus Response Act (Families First Act). The Families First Act creates expanded employee benefits and protections related to COVID-19, including a new federal paid sick leave law, an emergency expansion of the Family and Medical Leave Act (FMLA) and expanded unemployment insurance provisions.
Employers in the United States should be aware of the newly enacted legislation which imposes obligations on many employers to provide temporary paid family and sick leave to employees directly impacted by the COVID-19 pandemic.
Emergency Paid Sick Leave (Effective on April 2 until December 31, 2020.)
Covered Employees: All employees.
Covered Employers: Employers with fewer than 500 employees.
Amount of Leave:
Full time employees: 80 hours of paid leave
Calculated at their regular rate of pay (as calculated by the FLSA) or the minimum wage, whichever is greater.
Part-time employees: Average number of hours worked over a two-week period.
If employee works a variable schedule, it is the average number of hours they worked per day over the previous six months. If the employee has not worked this long, it is the reasonable expectation of the employee at the time of hire of the average number of hours per day the employee would normally be scheduled.
The leave is available for immediate use by the employee when the law takes effect, regardless of how long the employee was employed, i.e., it does not need to be accrued like most paid leave. The leave is also provided in addition to any existing paid leave previously provided by employers.
Employers must provide this emergency paid sick time when the employee is unable to work (or telework/remote work) because the employee is:
1) Subject to a federal, state or local quarantine or isolation order related to COVID-19;
2) Advised by a health care provider to self-quarantine due to concerns related to COVID-19;
3) Experiencing symptoms of COVID-19 and seeking a medical diagnosis;
4) Caring for an individual who is subject to a government quarantine or a self-quarantine advised by a health care provider (reasons 1 and 2 above);
5) Caring for their child if the child’s school or place of care has been closed, or the child-care
provider is unavailable due to COVID-19 precautions; or
6) Experiencing any other “substantially similar condition” specified by the Secretary of Health and Human Services.
Employees must be paid at their regular rate for reasons 1–3 above, except that pay cannot exceed $511 per day and $5,110 in the aggregate. When employees are taking paid sick leave to care for someone else, or the employee is experiencing any other “substantially similar condition,” i.e., reasons 4–6 above, then employers can pay employees two-thirds their regular rate, except that pay cannot exceed $200 per day and $2,000 in the aggregate in those circumstances.
Employers will be required to post the emergency paid sick leave requirements notices for
employees. The Secretary of Labor is developing a model notice that employers may use.
The Act also provides quarterly tax credits for employers required to pay sick leave under these conditions. The credits are allowed against the employers’ portion of Social Security taxes.
The Act cannot not diminish the rights or benefits of employees provided under any other Federal, State, or local law, collective bargaining agreement, or existing employer policy.
Employers are not required to pay out any unused Emergency Paid Sick Leave at the end of employment.
Emergency Family and Medical Leave Expansion Act (Effective on April 2 until December 31, 2020.)
The Families First Act also temporarily provides emergency FMLA leave for a “qualified need related to public health emergency.” Unlike regular FMLA, the emergency leave provides for paid leave requirements. Like FMLA, the emergency FMLA is protected, meaning an
employer must return the employee to the same or equivalent position upon their return.
Eligible employees: An employee who has been employed for at least 30 calendar days.
Covered employers: An employer with fewer than 500 employees.
Qualified reasons for paid FMLA leave: When the employee is unable to work (or telework) due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable, due to a public health emergency (with respect to a COVID-19 declared by a Federal, State, or local authority), the employee may take up to 12 weeks of leave.
Amount of paid leave:
First 10 days may be unpaid (Employees may elect to substitute vacation, personal leave or paid sick leave during this time.)
After first 10 days, must be paid at no less than two-thirds of the employee’s regular rate of pay (as determined by the FLSA) and the number of hours the employee would normally be scheduled to work for up to 12 weeks.
Paid leave shall not exceed $200 per day and $10,000 in the aggregate.
Reinstatement rights: Employees are entitled to reinstatement to the same position or an equivalent position, unless the employer employs fewer than 25 employees. In that case, the employer must make reasonable efforts to provide the employee with a position or an equivalent position for 1 year after the “public health emergency concludes” or 12 weeks after commencement of the leave, whichever is earlier.
Exclusions: The Secretary of Labor has authority to issue regulations for good cause to exclude certain health care providers and emergency responders, and to exempt small businesses with few than 50 employees if requirements would “jeopardize the viability of the business as a going concern.”
Note: An employers with fewer than 25 employees are exempted if the position does not exist due to economic conditions or other changes in operating conditions that affect employment and are caused by a public health emergency. However, the employer must make reasonable efforts to restore the employee to an equivalent position, and, if those efforts fail, the employer must make reasonable efforts to contact the employee if an equivalent position opens within a year.
The Act provides payroll tax credits granted to employers to offset the costs associated with these employer provided mandates.
In this uncertain, unprecedented time employers can expect continuous evolutions at all levels of government over the coming weeks and months. Rothmeyer | Rothmeyer is ready to assist you with addressing these ongoing developments.