by Greg Currey
Late on Wednesday, March 18, 2020, the Senate passed a modified version of the Families First Coronavirus Response Act, which was quickly signed into law by President Trump. To help employers comply with the new law, we’ve prepared the following Q&A about the new law’s requirements.
Q: How much additional paid leave am I required to provide?
A: The new law has two separate components – one component provides additional paid sick leave for employees and a second component for additional family leave for employees who require extended leave due to childcare issues related to school or daycare closures.
The first component of additional paid sick leave requires that employers with fewer than 500 employees immediately provide eighty (80) hours of paid sick leave for full-time employees through the end of the year for a qualifying need. Employers with fewer than 50 employees can apply for an exemption from the extended family leave provisions of the Act in accordance with regulations that will be issued by the DOL. In addition employers of health care providers may choose to exempt health care providers from the requirements of the Act.
Part-time employees are eligible for an estimated number of typical hours over a two-week period. The “typical hours” are calculated by averaging a part-time employee’s hours per week over the preceding six-month period. Please note that this leave is in addition to any paid leave already offered by the employer. Employers are prohibited from modifying their leave policies to reduce their benefits following the enactment of this legislation.
Qualifying needs include:
- The employee is subject to a federal, state, or local quarantine or isolation due to COVID-19;
- A health care provider advised the employee to self-quarantine due to concerns related to COVID-19 (self-imposed quarantine without medical advice does not qualify under the Act);
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
- The employee is caring for an individual (not limited to family members, although there is a stray reference to family members elsewhere in the Act, so stay tuned) who is either subject to a federal, state, or local quarantine or isolation due to COVID-19 or has been advised to self-quarantine due to concerns related to COVID-19;
- The employee is caring for the employee’s child whose school has been closed or place of care is unavailable due to COVID-19 precautions; or
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretaries of Treasury and Labor. The precise meaning of this sixth reason will be clarified by the Secretary of Health and Human Services.
The above qualifying needs only apply where the employee cannot otherwise perform their job while complying with the physician’s directive or caring for a family member or child. If an employee can telework or work through some other arrangement, they would not have a qualifying need.
The second component provides for up to twelve (12) weeks of paid family leave for employees who are unable to work due to school or daycare closures. To be eligible, employees must have worked for the employer for at least thirty days.
Q: How much do we pay?
A: Employers are required to pay employees their normal wages or the minimum wage at the federal/state/local level, whichever is highest. Sick-leave pay is capped at $511 per day, up to $5,110 in total, per employee for the employee’s own health-related absence. Sick leave pay for care of a family member is capped at $200 per day, up to $2,000 in total. Family leave pay is 2/3 of the employee’s normal wages, capped at $200 per day, up to $10,000 in total.
Q: Do I have to provide paid leave to part-time employees?
A: Yes, if you do not already provide paid leave to part-time employees, you are required to provide part-time employees with paid sick leave under the law. Part-time employees are eligible for an estimated number of typical hours over a two-week period. The “typical hours” are calculated by averaging a part-time employee’s hours per week over the preceding six-month period.
Q: Who pays for the leave?
A: Employers are required to directly pay employees for any leave time and then are reimbursed by the federal government in two ways. First, employers will be able to claim a credit towards any payroll tax expenses. If the amount paid to employees exceeds the employer’s payroll tax liability, the Department of the Treasury will develop a form for employers to submit for reimbursement by the Department of the Treasury.
Q: If I have to close my business or lay off employees due to lack of work, do I have to provide affected employees with paid leave?
A: No, lack of work due to a business closure is not considered a qualifying need. Employees who are laid off or whose hours are drastically reduced should be directed to file for unemployment benefits.
Q: I run a small business and may have to reduce my workforce during the extended family leave period. Am I required to keep employees’ jobs open for them?
A: No, employers with fewer than 25 employees are not required to reinstate employees if their positions no longer exist due to operational changes necessitated by COVID-19.
Q: I heard about stimulus checks for employees – when will they be getting those?
A: The Families First Coronavirus Response Act does not provide for stimulus payments. Negotiations related to economic stimulus are ongoing in Congress. Once final action has been taken, we will post an update accordingly.
Visit our COVID-19 Resource Page for more updates.