Yesterday Congress fully passed, and the President signed into law, the Families First Coronavirus Response Act (“FFCRA”) designed to provide relief and assistance to American families affected by COVID-19. FFCRA goes into effect beginning on April 2, 2020 through December 31, 2020. FFCRA temporarily expands the Family Medical Leave Act (“FMLA”), provides paid sick leave to those affected, expands unemployment benefits, and provides tax credits to help businesses pay for the emergency temporary benefits that must now be offered to affected employees.
The following is a summary of portions of FFCRA that likely affect your business.
- Every workplace with fewer than 500 employees is now covered by Emergency FMLA. Previously any workplace with 50 or more employees was covered by traditional FMLA. Now, essentially all workplaces/employers are covered by Emergency FMLA. Emergency FMLA is temporary and will expire on December 31, 2020.
- Eligibility requirements for employees to use Emergency FMLA have been lowered to any employee that has worked 30 or more days for a covered employer.
- Any eligible employee that works for a covered employer under Emergency FMLA may take up to 12 weeks of PAID job-protected leave to allow the employee to care for the employee’s child if the child’s school or place of care (including if the childcare provider is unavailable) has been closed due to a public emergency.
- The first 10 days of Emergency FMLA leave may be unpaid, but an employee may elect to substitute any accrued paid time off, including vacation or sick leave, to cover some or all of the 10-day unpaid period. After the initial 10-day period, the employer must pay two-thirds (2/3s) the employee’s regular rate of pay for the number of hours the employee otherwise would have been scheduled.
- FFCRA limits this pay entitlement to $200 per day and $10,000 in the aggregate per employee.
- The definition of ‘Parent’ has been expanded to include parent-in-law of the employee, a parent of a domestic partner of the employee, and a legal guardian or other person who served as the employee’s parent (also known as in loco parentis) when the employee was a child.
- Small businesses with fewer than 50 employees are exempt from Emergency FMLA IF the required leave would jeopardize the viability of their business. This is not a simple exemption to claim. YOU MUST CONSULT WITH LEGAL COUNSEL BEFORE ATTEMPTING TO CLAIM THIS EXEMPTION.
Emergency Paid Sick Leave
- All employers with fewer than 500 employees must provide all employees (regardless of tenure) with 80 hours of paid sick leave at the employee’s regular rate of pay. Part-time employees will receive a pro-rated amount equal to the number of hours the employee works, on average, over a two-week period.
- Emergency Paid Sick Leave is in addition to any paid sick leave benefits the employee previously had.
- Employees may use Emergency Paid Sick Leave to:
- comply with a requirement or recommendation to quarantine due to exposure to, or symptoms of, coronavirus;
- self-isolate because the employee is diagnosed with coronavirus;
- obtain a diagnosis or care because the employee is exhibiting symptoms of coronavirus;
- care for or assist an at-risk family member who is self-isolating due to a diagnosis, who is exhibiting symptoms of coronavirus and needs to obtain medical care, or who is adhering to requirement or recommendation to quarantine due to a exposure to, or symptoms of, coronavirus (first 2 weeks of Emergency FMLA leave);
- take care of the employee’s child if the child’s school or place of care has been closed due to the COVID-19 coronavirus (including if the childcare provider is unavailable); and/or
- treat 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.
- Emergency 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.
- Emergency Paid Sick Leave does not carry over from year to year.
- Employers may not change paid sick leave policies currently in place.
- The federal government has allocated $1 Billion in grants to assist states in implement and paying for unemployment benefits.
- This section provides a series of refundable tax credits for employers who are required to provide the Emergency Paid Sick Leave and Emergency Paid Family and Medical Leave described above. These tax credits are allowed against the tax imposed by Internal Revenue Code Section 3111(a), which deals with the employer portion of Social Security taxes. While this limits application of the tax credit, employers will be reimbursed if their costs for qualified sick leave or qualified family leave wages exceed the taxes they would owe.
- Specifically, employers are entitled to a refundable tax credit equal to 100% of the qualified sick leave wages paid by employers for each calendar quarter in adherence with the Emergency Paid Sick Leave Act. The qualified sick leave wages are capped at $511 per day ($200 per day if the leave is for caring for a family member or child) for up to 10 days per employee in each calendar quarter.
- See your tax professional for more information on FFCRA tax credits and how this affects your business.
We recommend that covered employers adopt and implement a Temporary Emergency Coronavirus Leave policy that complies with FFCRA. A sample policy is below. This law was barely passed last night and we are still working with industry partners to fully understand the impact of FFCRA. The Secretary of Labor has been granted authority to issue regulations and create exceptions. We are staying on top of these new laws and will keep you informed as new information becomes available.
Please do not hesitate to reach out to us if you have any questions on FFCRA or for assistance with any employment or business matter. We are currently not accepting in office meetings but we are fully available at firstname.lastname@example.org (Marla Merhab Robinson) (714 321-2495) and email@example.com (Kurtis R. Urien) (559-473-7703).
Effective April 2, 2020 through December 31, 2020 the Company will implement the following Temporary Emergency Coronavirus Leave Policy in addition to the Company’s existing policies on leaves of absences and related benefits. This policy applies to all employees.
Emergency Family Medical Leave Act (“EFMLA”)
All employees are eligible to take job protected (subject to certain specific limited exceptions) leave to care for the employee’s child if the child’s school or place of care (including if the childcare provider is unavailable) has been closed due to a public emergency. Employees may take up to 12 weeks EFMLA leave. The first 10 days of EFMLA leave are unpaid, but employees may elect to use EPSL (discussed below) or any other accrued time off benefit during the initial 10-day period. After the initial 10-day period, employees are entitled to receive two-thirds of the employee’s regular rate of pay. EFMLA pay is limited to $200 per day and $10,000 in the aggregate per employee.
Emergency Paid Sick Leave (“EPSL”)
Full-time employees are eligible for 80 hours of EPSL. Part-time employees will receive a pro-rated amount equal to the number of hours the employee works, on average, over a two-week period. Upon request, EPSL may be used in connection with specific circumstances related to COVID-19:
- The employee is subject to a federal, State, or local quarantine or isolation order related to COVID-19.
- The employee is 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 described in (1) or has been advised as described in (2), above.
- The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter is closed, or the childcare provider of such son or daughter is unavailable, due to COVID-19 precautions.
- The employee is 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.
Employees may use paid time off under this policy without exhausting other accrued paid time off. Pay under this policy will be paid at the employee’s regular rate of pay. Payment is capped at $511 per day and an aggregate of $5,110. Unused EPSL will not be paid out upon termination and will not roll over to the following year.
Nothing in this policy changes, alters, or modifies the at-will nature of your employment relationship with the Company. The Company reserves the right to change this policy at any time. Please see your supervisor or Human Resources if you have any questions.