On March 18, the Families First Coronavirus Response Act (the “Act”) was passed and signed into law. The Act, which applies to employers with fewer than 500 employees, provides for employer-paid for leave for workers who need to take time off of work due to events caused by the outbreak of COVID-19 in the United States. There are two paid leave provisions of the Act: the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act. The law goes into effect on April 1 and will completely expire on Dec. 31.
The Emergency Paid Sick Leave Act
The Emergency Paid Sick Leave Act generally requires that covered employers provide employees with two weeks of paid sick leave at the employees’ regular pay rate (subject to caps) if the employee is unable to work (or telework) because: (1) the employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19; (2) the employee has been directed by a healthcare provider to self-quarantine due to concerns related to COVID-19 infection; or (3) the employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis
Full-time employees are entitled to up to 80 hours of paid leave, while part-time employees are eligible for leave equal to the number of hours that the employee works on average over a two-week period. Paid leave under the Emergency Paid Sick Leave Act must be granted in addition to any paid leave benefits the employer already provides, and must be made available for immediate use to employees, regardless of the length of the employees’ employment. Unlike the current Family and Medical Leave Act law, employers also cannot require employees to exhaust other paid leave benefits before using the benefits provided under the Emergency Paid Sick Leave Act if they want to save their vacation or personal time off (PTO).
Employers cannot fire, discipline, or otherwise discriminate against any employee for taking leave under the Emergency Paid Sick Leave Act, or for filing a complaint related to the Act.
The Emergency Family and Medical Leave Expansion Act
This section of the Act amends the already existing federal Family and Medical Leave Act (“FMLA”), and provides covered employees with the ability to take up to 12 weeks of job-protected leave if the employees have a “qualifying need related to a public health emergency.” A “qualifying need” is defined as including when an employee cannot work (or telework) “due to a need for leave to care for [the employee’s child or children] under 18 years of age… if the school or place of care has been closed, or the child care provider of [that child or those children] is unavailable” due to an event caused by COVID-19. This section applies only to the need to care for a minor child, and employees cannot use this portion of the Act to obtain paid leave to care for other relatives or individuals who may be affected by COVID-19, like spouses or parents.
Covered employers can require covered employees to use other paid leave benefits for the first 14 days of leave (or to take unpaid leave for 14 days if other benefits are not available). After 14 days of leave, however, covered employers must provide employees paid leave for each day of leave taken thereafter for up to 12 weeks (subject to pay caps). Covered employers must pay leave at a rate of two-thirds of the employee’s regular pay rate for the number of hours the employee would otherwise be normally scheduled to work. Employees are only eligible for this benefit if they have worked for the covered employer for at least 30 days.
Which Employers are Covered?
The Act only applies to private employers with fewer than 500 employees in the United States (not including international employees), to certain public employers, and to certain self-employed individuals. In addition, both paid leave laws allow employers with fewer than 50 employees to apply to the Secretary of Labor for a hardship exemption.
Tax Credits to Covered Employers
Employers covered by the Act will qualify for direct reimbursement through tax credits of all qualifying wages paid to employees. Employers will also be allowed to take tax credits for the amount of their qualified health plan expenses that may be properly allocated to COVID-19 related leaves.
The new law is incredibly complex and because it is so new, much is unknown as to how it will apply to real-world situations. More information is available on the Department of Labor’s website, at https://www.dol.gov/coronavirus.
Additionally, many local law firms have stepped up communication to help clients navigate the legal and business challenges that many companies are facing in response to the epidemic. For instance, our law firm has launched a Coronavirus Resource Center, providing timely perspectives. These are certainly challenging and unprecedented times but we will navigate the storm together and come out stronger in the end. May you all stay safe and healthy.
