Families First Coronavirus Response Act – What Do Employers Need to Know?

This information provides a general summary of newly enacted federal legislation affecting the workplace.

EFFECTIVE DATE

The Families First Coronavirus Response Act (“FFCRA”) was signed into law by President Trump on March 18, 2020. In short, the FFCRA was enacted in response to the continuing coronavirus pandemic (“COVID-19”), which has now affected all 50 states, the District of Columbia, Puerto Rico, Guam, and the U.S. Virgin Islands. The two most significant provisions for employers – expansion of the Family and Medical Leave Act (“FMLA”) and a new Emergency Paid Sick Leave Act (“EPSLA”) – are discussed more fully below.

These temporary provisions take effect within 15 days of passage and will expire on December 31, 2020.

EMPLOYERS COVERED

The amendments to the FMLA and the newly enacted EPSLA apply to employers with fewer than 500 employees, including government employers. Limited exceptions are available for: (1) certain healthcare providers and emergency responders; and (2) small businesses with fewer than 50 employees where the impositions of these requirements would jeopardize the business.

FAMILY AND MEDICAL LEAVE EXPANSION

Employees Eligible

Employees who have worked for more than 30 days will now be eligible to receive up to 12 weeks of job-protected leave under the FMLA for certain COVID-19-related absences, including inability to work (or telework) due to a need for leave to care for their minor child if the school or place of care they attend has been closed, or if their child care provider is unavailable due to a public health emergency, namely, emergency with respect to COVID-19 declared by either a local, state, or federal authority.

Paid by Employer, Subject to Tax Credits

Please note that, unlike existing FMLA leave, this COVID-19-related FMLA leave is paid.

Employers to whom the amendments apply must offer their employees the option of using (but cannot require use of) paid sick leave or other accrued paid time off for the first two weeks of this leave.
After the initial two weeks, the remaining 10 weeks are paid by the employer at a rate of at least two-thirds of their usual rate of pay, not to exceed $200 per day and $10,000 in the aggregate.

Job Protection

The new law requires employers to protect the jobs of those employees who use FMLA leave. The requirement to restore employees to their employment may not apply to businesses with fewer than 25 employees if the employee takes COVID-19-related leave, and if the following conditions are met:

  • The position held by the employee when the leave commenced no longer exists due to economic conditions or other changes in the operating condition of the employer that either affect employment or are caused by the COVID-19 pandemic;
  • The employer makes reasonable effort to restore the employee to an equivalent position, with equivalent benefits and conditions of employment, that the employee held before taking leave; and
  • If the employer’s reasonable efforts fail, the employer makes reasonable efforts to advise the employee of the availability of an equivalent position within a one-year period from the date that the employee no longer requires leave or 12 weeks following commencement of leave, whichever is earlier.

EMERGENCY PAID SICK LEAVE ACT

The new Emergency Paid Sick Leave Act (“EPSLA”) provides paid sick leave to employees impacted by the COVID-19 pandemic, regardless of the length of their tenure with their employer.

Employees Eligible

Employees who work full-time are entitled to receive 80 hours of paid sick time, and employees who work part-time are entitled to receive paid sick time equal to the number of hours that the employee works, on average, over a 2-week period. The entire 80 hours is available immediately, as there is no accrual period. Paid sick time is provided for such time that the employee is unable to work (or telework) due to a need for leave because:

  • The employee is subject to a local, state, or federal quarantine or isolation order related to COVID-19;
  • The employee has been advised by a health care provider to self-quarantine due to COVID-19;
  • The employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis;
  • The employee is caring for an individual who is subject to a local, state, or federal quarantine order or who has been advised by a health care provider to self-quarantine;
  • The employee is caring for his or her child if the child’s school has been closed, or if the child’s care provider is not available due to COVID-19 precautions; or
  • The employee is experiencing any other substantially similar conditions specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

Amount of Pay by Employer

Paid sick time must not be less than the greater of the employee’s regular rate of pay; the minimum wage rate in effect under Section 6(a)(1) of the FLSA; or the minimum wage rate in effect for such employee in the state or locality, whichever is greater, in which the employee is employed.

  • Where an employee is receiving paid sick time for caring for family members, paid sick time is equal to two-thirds of that employee’s regular compensation.
  • Paid sick time is not to exceed $511 per day ($5,110 in the aggregate) for those employees either subject to local, state, or federal quarantine; advised by a health care provider to self-quarantine; or who are experiencing symptoms of COVID-19 and seeking medical diagnosis.
  • Paid sick time is not to exceed $200 per day ($2,000 in the aggregate) for those employees caring for an individual subject to local, state, or federal quarantine or self-quarantine; caring for a child who has had their school closed or where a child care provider is not available due to COVID-19 precautions; or who are experiencing any other substantially similar condition specified by the United States Secretary of Health and Human Services.

No Carry Over

The paid sick time afforded by the EPSLA cannot be carried over from one year to the next. Moreover, a business may terminate paid sick time when the employee on sick leave begins their next scheduled work shift.

Prohibitions

Employers are prohibited from engaging in the following actions relating to EPSLA paid sick leave:

  • An employer may not condition paid sick time on the affected employee’s searching for or finding a replacement to cover their hours during the time which the employee is using sick time.
  • An employer may not require an employee to use other paid sick time before the employee uses the paid sick time available under the EPSLA.
  • An employer may not discharge, discipline, or in any other manner discriminate or retaliate against an employee who takes leave in accordance with the EPSLA.
  • An employer may not discharge, discipline, or in any other manner discriminate or retaliate against an employee who has filed a complaint or initiated any proceeding under or related to the EPSLA, including any proceeding that seeks enforcement of the EPSLA, or has testified or is about to testify in any such proceeding.

Posting Requirement

Employers must post notice, in a conspicuous area of the workplace where similar notices are customarily posted, of the conditions and requirements stipulated in the EPSLA. The form of required notice will be provided by the relevant federal authority within 7 days of the passage of the law.

Penalties

In the event that an employer violates the paid sick time provision of the EPSLA, the employer is considered to have failed to pay minimum wage in violation of Section 6 of the Fair Labor Standards Act of 1938 (“FLSA”), and the employer will be subject to penalties in Section 16 and Section 17 of the FLSA.

Where an employer violates the unlawful termination provisions of the EPSLA, the employer is considered to have violated Section 15(a)(3) of the FLSA, and the employer will be subject to penalties in Section 16 and Section 16 of the FLSA.

Relationship to Other Law and Benefits

No provisions of the EPSLA diminishes the rights or benefits that employees would otherwise be entitled to under any other local, state, or federal law, collective bargaining agreement, or existing policy of the employer.

Requirements on Separation

Employers are not required to pay out any remaining paid sick time under the EPSLA upon the employee’s resignation, termination, retirement, or separation from employment.

This alert focuses on the employment law-related provisions of the FFCRA. It bears noting that the new law also contains multiple tax-related provisions that, among other things, provide tax credits to employers who pay benefits under the FFCRA.

In addition, the IRS has issued a notice extending for three months the deadline for paying 2019 federal income taxes, and 2020 federal estimated taxes, by certain individual and corporate taxpayers, but does not extend the deadline for filing federal tax returns.

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