On Wednesday, March 18, 2020, President Trump signed the Families First Coronavirus Response Act (“FFCRA”), which will go into effect by no later than April 2, 2020. The FFCRA creates two new forms of paid leave benefits for employees impacted by the COVID-19 or “Coronavirus” pandemic: (1) emergency paid sick leave, and (2) expansion of the Family Medical Leave Act. Both of these two portions of the FFCRA expire on December 31, 2020.
All employers with fewer than 500 employees will be required to provide and pay for the cost of these benefits, and employers will be reimbursed through tax credits.
Employers must provide all employees (no matter how long they have been employed) with up to 80 hours of paid sick leave for full-time employees or, for part-time employees , a number of hours equal to the number of hours that such employee works, on average, over a 2-week period if they are unable to work or telework for any of the following reasons:
This new paid sick leave is in addition to any existing paid leave policies employers have in place, and employees are allowed to use FFCRA paid sick leave before using any other paid leave they may have available to them (e.g., vacation, PTO, or California paid sick time).
If an employee uses FFCRA paid sick leave for reasons 1, 2, or 3 listed above, the employee must be paid their regular rate of pay, up to a maximum of $511 per day or $5,110 in the aggregate. If an employee uses COVID-19 paid sick leave for reasons 4, 5, or 6 above, they must be paid at least 2/3rds of their regular rate of pay, up to a maximum of $200 per day or $2,000 in the aggregate.
As mentioned above, the FFCRA paid sick leave is set to expire on December 31, 2020. Unused paid sick leave will not carry over from year to year and will not be paid out at the end of employment.
The FFCRA tasks the Secretary of Labor to publish a model notice regarding this paid sick leave law within 7 days of the FFCRA being enacted, which employers will be required to post in the workplace.
Also through December 31, 2020, the Family and Medical Leave Act (“FMLA”) will be temporarily expanded to allow employees leave of up to 12 weeks to be used for a “qualifying need” related to an emergency with respect to COVID-19, as declared by federal, state, or local authorities.
A “qualifying need” occurs when an employee is unable to work or telework due to the need to care for their child whose school has been closed, or whose child provider is unavailable, due to COVID-19 concerns. Employees are eligible for the expanded FMLA leave if they have been employed for at least 30 calendar days.
The first 2 weeks of leave under this temporary provision may be unpaid. Thereafter, the employer must provide paid leave for up to 10 weeks. An employee may (but cannot be required to) use accrued vacation or sick leave during the initial unpaid two weeks. Thereafter, the employee must be paid at least 2/3rds of the employee’s regular rate of pay, up to a maximum of $200 per day or $10,000 in the aggregate.
Employees are entitled to reinstatement to the same or equivalent position upon exhausting their FMLA leave under this provision, except no reinstatement is required if the employer has fewer than 25 employees, and the following conditions are met:
This expanded FMLA provision does not impact the existing provisions of the FMLA and are specific to address the COVID-19 pandemic.
Employers of health care providers and emergency responders are permitted to exclude employees from this law.
The Secretary of Labor has the authority under the FFCRA to issue regulations exempting small businesses with fewer than 50 employees from these new paid leaves when the imposition would jeopardize the viability of the business as a going concern. No such exemption has been issued as of yet.
Employers who pay benefits under the FFCRA are eligible to receive tax credits. We encourage you to consult your tax professional regarding these credits.
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