THE FAMILIES FIRST CORONAVIRUS RESPONSE ACT
Considering the Covid-19 Pandemic, Congress passed the Families First Coronavirus Response Act (the “Act”) which was signed into law on March 18, 2020. The Act contains provisions of law applicable to employers and employees with the purpose of aiding business and workers cope. A few pertinent provisions for employers and employees are: the Emergency Family and Medical Leave Expansion Act, the Emergency Paid Sick Leave Act, and Tax Credits for Paid Sick and Paid Family and Medical Leave.
Emergency Family and Medical Leave Expansion Act (“EFMLEA”)
The Act contains an amendment to the Family and Medical Leave Act (“FMLA”). Any employer with 500 or fewer employees must provide leave to an eligible employee under this provision, with certain exceptions.* As opposed to the general work requirement under the FMLA, an eligible employee under this amendment must have been employed for at least 30 calendar days by the employer.
A need for leave qualifies under the Act if the employee is unable to work (or telework) ONLY due to a need 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. A Public Health Emergency is an emergency with respect to COVID-19 declared by a Federal, State, or local authority.
The first 10 days for which an employee takes leave may consist of unpaid leave. An employer shall provide paid leave for each day of leave under this Section that an employee takes after taking leave under such section for 10 days. An employee may elect to substitute any accrued vacation leave, personal leave, or medical or sick leave for unpaid leave under the Public Health Emergency Leave section, but may not be required to do so.
Paid leave shall be calculated based on:
- An amount this is not less than two-thirds of an employee’s regular rate of pay; and
- The number of hours the employee would otherwise be normally scheduled to work (or the number of hours calculated under the varying schedule hours calculation.
In no event shall such paid leave exceed $200 per day an $10,000 in the aggregate.
The Department of Labor has the authority to issue regulations to exempt small businesses with fewer than 50 employees from the requirements of this Public Health Emergency section if the business meets certain conditions.
For employers not previously covered by the Family Medical Leave, here is a helpful tip sheet from the Department of Labor regarding the FMLA required notices and postings here. We expect additional notices and guidance to be published by the Department of Labor related to this amendment to the FMLA and will update this post when available.
It is crucial to note that while the FMLA generally is still applicable to those employees who may contract Covid-19 or be subject to quarantine related to concerns of having been exposed to the virus, this amendment DOES NOT provide for paid leave. The ONLY paid leave provided by this section of the Act is that related to providing care for a child.
Emergency Paid Sick Leave Act (“EPSLA”)
An employer shall provide to each employee employed by the employer paid sick time to the extent that the employee is unable to work (or telework) due to the need for leave because:
- The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
- The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
- The employee is caring for an individual who is subject to an order as described in paragraph 1 or has been advised as described in paragraph 2.
- 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.
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of Treasury and Secretary of Labor.
This Section of the Act applies to all employees regardless of how long the employee has been employed by employer. However, an employer of an employee who is a health care provider or an emergency responder may elect to exclude those employees from the Act.
Entitlement to Paid Sick Leave:
- For a full-time employee – 80 hours
- For a part-time employee, a number of hours equal to the number of hours that such employee works, on average, over a 2-week period.
The sick pay is calculated based on the employee’s required compensation, except that in no event shall such paid sick time exceed –
- $511 per day and $5,110 in the aggregate for use described in Qualifying Employees paragraphs 1-3; and
- $200 per day and $2,000 in the aggregate for use described in Qualifying Employees paragraph 4-6.
“Required Compensation” means the greater of (1) the employee’s regular rate of pay; (2) the minimum wage in the State of Arkansas.
Prohibited Acts by Employers:
Conjoined Leave: An employer may not require the employee, as a condition of providing the paid sick leave, search for or find a replacement employee to cover the hours during which the employee is using paid sick time. An employer may not require an employee to use other paid leave provided by the employer to the employee before the employee uses the paid sick time provided in this Act. The leave entitlement under this Act is in addition to any leave entitlement granted by any policies of the employer.
Retaliation: An employer further may not discharge, discipline, or in any other manner discriminate against any employee who: (1) takes leave under the Emergency Paid Leave Act of 2020; or (2) has filed any complaint or instituted or caused to be instituted any proceeding under or related to the Emergency Paid Leave Act of 2020 (including a proceeding that seeks enforcement of this Act), or has testified or is about to testify to any such proceeding.
Tax Credits for Paid Sick and Paid Family and Medical Leave
For employers who pay those employees under the Act for family leave or sick leave, tax credits are allowed against the employer portion of Social Security taxes. Employers will be reimbursed their costs for qualified sick leave or qualified family leave wages if the wages exceed the payroll taxes they would otherwise owe.
Employers are entitled to a refundable tax credit equal to 100% of the qualified sick leave wages paid by employers for each calendar quarter in adherence with the EPSLA and EFMLEA.
- The EPSLA credit applies for up to 10 days per employee in each calendar quarter and for each employee is equal to the lesser of the amount of his leave pay or either:
- $511 per day while the employee is receiving paid sick leave to care for themselves, or
- $200 if the sick leave is to care for a family member or child whose school is closed
- The EFMLEA credit for each employee is the amount of his leave pay limited to $200 per day with a maximum of $10,000 total per calendar quarter.
Only those employers required to offer Emergency FLMA or Emergency Paid Sick Leave may receive these credits. Credit is not received if the employer is also receiving the credit for paid family and medical leave for another qualifying reason.
If you are self-employed, there are comparable credits available. The Act provides 100% of self-employed individual’s sick-leave equivalent amount, or 67% of the individual’s sick-leave equivalent amount if they are taking care of a sick family member, or taking care of a child following the child’s school closing for up to 10 days. The sick-leave equivalent amount is the lesser of the individual’s average daily self-employment income or either (1) $511/day to care for the self-employed individual, or (2) $200/day to care for a sick family member or child following a school closing, paid under the EPSLA.
Self-employed individuals can also receive a credit for as many as 50 days multiplied by the lesser of $200 or 67% of their average self-employment income paid under the EMFLEA.
Remember, we are here for you. When you need information about the Act, such as how it applies to you, whether you qualify as a covered employer employee, or otherwise covered individual, how to apply for an exemption, how to calculate an employee’s required compensation, how to calculate varying schedule or worked hours, or how the tax credits will apply, please reach out to our firm at 479-621-0006 or email email@example.com. One of our attorneys will be glad to assist you. In the meantime, we hope you and your family are well.