Publication

March 19, 2020Client Alert

Employee Leave Under the Families First Coronavirus Response Act: What Employers Need to Know

On March 18, 2020, the President signed the Families First Coronavirus Response Act (FFCRA) into law. Among its many features, the FFCRA creates three new components of federal leave for employees of employers with fewer than 500 employees and governmental employers[1] in response to the coronavirus:

  1. Up to 80 hours of additional paid sick leave for the coronavirus emergency (“Emergency Paid Sick Leave”);
  2. Additional Family and Medical Leave Act (FMLA) protections during the coronavirus emergency; and
  3. A reimbursement mechanism through a tax credit.

[1] These provisions do not apply to large employers (500+ employees), except for governmental employers.

 
  Time Provided Paid Eligible Reason for Leave When Available for Use
Emergency Paid Sick Leave 80 hours for full-time employees and a pro-rata amount for part-time employees Yes, at full or 2/3 regular salary depending on the reason for leave Personal health conditions related to COVID-19, care for an individual related to COVID-19, childcare, or illnesses similar to COVID-19 Effective April 1, 2020
Extended FMLA Leave 12 weeks Yes, at 2/3 regular salary (after 10 days) Childcare for a child under 18 years of age

Effective April 1, 2020

Current employees with 30 days of employment - immediately on April 1, 2020

New employees - once employed for 30 days

Temporary Paid Sick Leave During Coronavirus Emergency

Employers with fewer than 500 employees and governmental employers (regardless of the number of employees) must provide employees with paid sick time sufficient for an employee to be away from work continuously for 10 days. Full-time employees would receive 80 hours of Emergency Paid Sick Leave, and part-time employees would receive a pro-rata portion of Emergency Paid Sick Leave. The FFCRA allows healthcare providers or emergency responders to elect to exclude those employees from the Emergency Paid Sick Leave provisions. The Emergency Paid Sick Leave of the FFCRA is effective on April 1, 2020 and runs through December 31, 2020. 

A.  Emergency Paid Sick Leave can be used for any of the following scenarios:

  • Absence where the employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
  • Absence where the employee has been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19;
  • Absence because the employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  • Absence to care for an individual where:
    • The individual is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
    • The individual has been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19;
  • Absence to care for a child because the child’s school or place of care has been closed or the childcare provider is unavailable due to COVID-19; or
  • The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services, in consultation with the Treasury and Labor Secretaries.

B.  The rate of pay will depend upon the reason for the employee’s absence. 

  • For absences based upon the employee’s Covid-19 condition, sick leave will be paid at the employee’s regular rate or $511 per day, whichever is less. 
  • For absences based upon a family member’s situation, childcare, or an illness similar to Covid-19, sick leave will be paid at 2/3 of the employee’s regular rate or $200 per day, whichever is less. 

C.  Use of leave and notice requirements.

Employees must be allowed to use this Emergency Paid Sick Leave before using any other paid leave benefits. There is no advance notice requirement in the law (notice can be required after the first date leave is used) nor a required certification methodology. Employees do not need to find a replacement when using this leave.

Employers will be required to post a notice regarding this benefit, which will issue shortly from the Department of Labor. Failing to provide the leave where required is a violation of the Fair Labor Standards Act.

Paid Public Health Extended FMLA Leave Protection

The FFCRA amends the federal Family and Medical Leave Act to provide significant additional leave to employees working for employers with fewer than 500 employees and all governmental employers (regardless of employee count), for the current public health emergency. The Secretary of Labor can issue regulations for good cause to exclude certain healthcare providers and emergency responders and to exempt businesses with fewer than 50 employees when compliance with this law would jeopardize the viability of the business. This Extended FMLA Leave provision of the FFCRA becomes effective on April 1, 2020 and runs through December 31, 2020. 

A.  Qualifying reasons for leave.

For the current coronavirus public health emergency, FMLA leave is extended to allow an employee to take leave where the employee is unable to work (or telework) due to the need to care for a son or daughter (under 18 years of age) where the school or place of care has closed, or the regular childcare provider is unavailable, due to a public health emergency being declared by a federal, state, or local authority.

The Extended FMLA Leave must be provided in circumstances where FMLA leave normally would not be required, such as:

  • Employers with one to 499 employees instead of more than 50 employees would have to provide protected leave; 
  • Employees who have worked 30 days instead of 12 months will be eligible for leave.

An employee is required to provide notice of the need for leave, when foreseeable and practicable.

B.  The first 10 days of extended FMLA leave is not paid.

For employers subject to this provision, the Extended FMLA Leave provision also provides for a paid leave component. During the first 10 days of leave for a public health emergency reason, the employee’s leave is unpaid (but the employee may elect to substitute paid leave). The employer must not require substitution of paid leave in the first 10-day period. 

C.  The remainder of extended FMLA leave is paid at 2/3 of the regular salary.

After the first 10-day period, the employer shall provide paid leave. The amount of paid leave shall be calculated as the employee’s normal number of hours times 2/3 the employee’s regular rate of pay or $200 per day, whichever is less. Paid leave for variable-hour employees is based upon either an average looking back the prior six months or what the employee would have worked (if the employee did not work during such period). 

D.  Most employees on extended FMLA leave have job protection.

FMLA restoration rights apply to employers with 25 or more employees. For employers with fewer than 25 employees, restoration rights do not apply for Extended FMLA Leave if the position held when the leave commenced no longer exists due to economic or operating conditions of the employer, so long as a good-faith effort is made to try to restore the employee to an equivalent position. 

Employers of healthcare provider and emergency responder employees may elect to exclude such employees from the FMLA protections of the FFCRA.

E.  What do I need to do about FMLA now?

  • Employers subject to the FMLA will need to provide notices and documentation to comply with individuals requesting leave under the new provisions. For employers that have more than 50 employees and who already have a policy, policy amendments should be adopted.
  • Employers who have not previously engaged in FMLA compliance will want to familiarize themselves with the law.
  • Employers of healthcare providers and emergency responders will need to determine if they will opt out of the law. 

Tax Credits for Paid Leave

A private employer providing paid leave as discussed above is eligible for reimbursement through a tax credit. Governmental employers do not appear to be eligible for reimbursement. Such reimbursement mechanism appears to run through the IRS on an employer’s quarterly tax returns. We address this portion of the FFCRA in a separate alert, which can be found here.

The FFCRA is a federal law and does not necessarily impact the various state laws that may address similar issues. 

Employers subject to the FFCRA will need to adjust practices, and likely payroll functions, rather quickly. Michael Best is holding a webinar to address this at 1:00 p.m. CT on Monday, March 23. Click here to register for our upcoming webinar: The Families First Coronavirus Response Act: What Employers Need To Know. For any questions on the above, please reach out to your Michael Best attorney.

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