On March 18, 2020, Congress passed the Families First Coronavirus Response Act (“FFCRA”), which President Trump is expected to sign into law. The final version differs significantly from the earlier House version, which was passed on March 14. The text of the final version can be found here. The Department of Labor has announced that the law will go into effect on April 1, 2020. It will expire on December 31, 2020. The following is a summary of the major provisions affecting employers.
A New Category of FMLA Leave. The FFCRA creates a new category of leave under the Family and Medical Leave Act (FMLA): leave for a “qualifying need related to a public health emergency.” This new category applies to employers with fewer than 500 employees and to employees who have worked 30 days or more for their employer; thus, many businesses and employees who are not otherwise covered by FMLA are subject to this new category of FMLA. Further, this new category of FMLA requires paid leave.
- A “qualifying need related to a public health emergency” is defined as when the employee is unable to work or telework due to a need for leave to care for his/her son or daughter under the age of 18 if the child’s school or place of care has been closed, or the childcare provider is unavailable, due to a government-declared public health emergency with respect to COVID-19.
- The first 10 days of leave is unpaid. The employee may elect, but cannot be compelled, to use available paid leave.
- After the first 10 days of leave, the FMLA leave for a public health emergency is paid. The employer must provide paid leave at two-thirds the employee’s regular rate of pay for the number of hours the employee would be normally scheduled to work, up to a maximum of $200 per day and $10,000 in the aggregate.
- This new category of FMLA does not increase the FMLA allowance of 12 weeks. Thus, if an employee has already used FMLA for another covered reason, that usage would reduce the amount of FMLA available to him or her for a public health emergency.
- The Department of Labor may issue regulations to exempt small businesses with fewer than 50 employees if these requirements would jeopardize the viability of the business as a going concern. Small businesses with fewer than 50 employees are not subject to a civil action by an employee related to this new FMLA and those with fewer than 25 employees may be exempt, under certain conditions, from restoring a returning employee to his/her position.
Emergency Paid Sick Leave Act. This provision of the FFCRA requires employers with fewer than 500 employees to provide all employees (regardless of how long they’ve been with the employer) up to 80 hours (or a proportional amount for part-time employees) of emergency paid sick leave (EPSL) if 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 Law provider to self-quarantine due to concerns related to COVID-19;
- The employee is experiencing COVID-19 symptoms and is 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);
- The employee is caring for a son or daughter because the child’s school has been closed or the childcare provider 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.”
For conditions 1, 2, or 3, EPSL is paid at the employee’s regular rate of pay, up to a maximum of $511 per day and $5,110 in the aggregate. For conditions 4, 5, or 6, EPSL is paid at two-thirds the employee’s regular rate of pay, up to a maximum of $200 per day and $2,000 in the aggregate. EPSL is in addition to any other paid leave the employer provides; the employee can choose whether to use EPSL or other employer-provided paid leave first. There is no carryover of EPSL beyond the end of 2020. Employers will be required to post a notice to employees about EPSL once the Department of Labor makes a model notice available.
Tax Credits for Paid FMLA and EPSL. Of course, these changes are a huge burden on businesses, which are already struggling due to the coronavirus. The FFCRA provides a refundable tax credit against payroll taxes for 100% of qualified EPSL or paid FMLA leave paid by an employer for that quarter.
Employers may elect to exclude employees who are healthcare providers or emergency responders from both the new FMLA leave category and from EPSL.
There are many nuances to this law and much remains unclear. We expect further guidance from the Department of Labor.
The labor and employment law attorneys at Vandeventer Black LLP are available to assist you in navigating this new law and addressing other issues brought on by the coronavirus pandemic.
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