The Families First Coronavirus Response Act has been enacted and signed into law and will be effective no later than April 2, 2020. Congress failed to explain what “no later than” means in this context, though the Secretary of the Treasury is authorized to select the date on which the tax credits shall begin. This is an updated e-alert from the one we issued last night.
FAMILY AND MEDICAL LEAVE: The Emergency Family and Medical Leave Expansion Act expands the existing leave provided by the Family and Medical Leave Act of 1993 to provide employees of employers with fewer than 500 employees who have been on the job for at least 30 days the right to take job protected FMLA leave for certain childcare related issues during this public health emergency. The House originally provided job protected leave for more types of absence but those did not survive the Senate. The law will now provide eligible employees with the right to take up to 12 weeks of job-protected leave under the Family and Medical Leave Act to be used if 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.
The first two weeks of this leave may be unpaid but an employee can elect to use other available forms of paid time off, including vacation, personal days and sick leave, during this period. After the first two weeks, an employee using this new emergency category of leave is entitled to be paid not be less than two-thirds of the employee’s regular rate of pay multiplied by the number of hours the employee otherwise is normally scheduled to work. In the case of an employee whose schedule varies from week to week, the employer must use the average number of hours that the employee was scheduled per day over the 6-month period ending on the date on which the employee takes the FMLA leave, including hours for which the employee took any leave of any type. If the employee did not work over the six-month period, then the employer must use the reasonable expectation of the employee, at the time of hiring, of the average number of hours per day that the employee would normally be scheduled to work. In no event shall such paid leave for each employee exceed $200 per day and $10,000 in the aggregate.
In any case in which the need for this type of leave is foreseeable, an employee shall provide the employer with such notice of leave as is practicable.
Employees who take FMLA leave because they need to care for children home due to the closure of school or childcare have a right of reinstatement. The government exempted employers with fewer than twenty-five employees from this reinstatement requirement if economic conditions or other changes in operating conditions of the employer caused by this public health emergency result in the elimination of the employee’s job. However, even employers with fewer than 25 employees must make reasonable efforts to restore the employee to an equivalent position. If one does not exist, the employer must contact the employee if an equivalent position becomes available within one year.
As previously reported to our clients, the House originally tried to expand the definition of parent. However, in subsequent revisions of the legislation the expanded definition was removed, leaving the existing definition of parent contained in the FMLA:
- The term “parent” means the biological parent of an employee or an individual who stood in loco parentis to an employee when the employee was a son or daughter.
The definition of son or daughter also remains the same:
- Son or daughter means a biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis.
This expanded emergency leave is in effect until December 31, 2020. Please note that while this law expands the protections of the FMLA it does not replace the existing FMLA, which remains in effect.
PAID SICK LEAVE: Separate from the FMLA requirements outlined above, employees of covered employers are also entitled to two weeks of paid sick leave for coronavirus related absences. Unlike the expanded FMLA leave above, all employees are eligible for this sick leave, even employees who have not yet worked thirty days. Full-time employees are entitled to 80 hours of paid sick leave and part-time employees are entitled to the typical number of hours that they work in a two-week period. The sick time is available when:
(1) The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
(3) The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
(4) The employee is caring for an individual who is subject to an order as described in subparagraph (1) or has been advised as described in subparagraph (2).
(5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the childcare provider of such son or daughter is unavailable, due to COVID-19 precautions.
(6) 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 absent for reasons 1-3 are eligible to receive the employee’s regular rate of pay up to $511 per day and $5,110 in the aggregate. Employees absent for reasons 4-6 are entitled to no less than 2/3rds of their regular rate of pay up to $200 per day and $2,000 in the aggregate.
Importantly, employers may not require an employee to use any paid leave that the employee accrued in accordance with the employer’s regular paid leave policies. However, the employee may elect to use such available leave.
Employers will be entitled to a tax credit equal to 100 percent of qualified paid sick leave and qualified paid FMLA leave. The tax credit is allowed against the employer’s portion of Social Security taxes. If the credit exceeds the employer’s total liability for the employer share of Social Security, the excess credit is refundable to the employer.
The Secretary of Labor has the right to exempt certain health care providers as well as small businesses with fewer than 50 employees from the expanded FMLA requirements when the imposition of such requirements would jeopardize the viability of the business as a going concern.
Within seven days after the enactment of this law, The Department of Labor will publish a model notice to employees for employers to use. In addition, the law provides that the Secretary of Labor shall issue guidelines to assist employers in calculating the amount of sick time under the law.
This provision will also expire on December 31, 2020.