Underwood Law Firm Client Alert – Families First Coronavirus Response Act

UNDERWOOD LAW FIRM CLIENT ALERT

FAMILIES FIRST CORONAVIRUS RESPONSE ACT

On March 18, 2020, the President signed into law the Families First Coronavirus Response Act. The Act contains a number of important employment-related provisions, which are summarized below. These provisions will take effect on April 2, 2020 and will remain in effect through the end of 2020.

Emergency Paid Sick Leave:  The Emergency Paid Sick Leave requirements apply to private employers with fewer than 500 employees. Employers of 50 or less may apply to the Department of Labor for an exemption if complying with requirements would jeopardize the viability of the business as a going concern.

Emergency Paid Sick Leave is available to all current employees, regardless of the length of their service, their full-time/part-time status, and/or their exemption status. Employees may take Emergency Paid Sick Leave in any of the following circumstances:

  1. The employee is subject to a Federal, State, or local quarantine related to COVID‑19;
  2. The employee is advised by a health care provider to self-quarantine due to COVID-19;
  3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  4. The employee is caring for an individual who is subject to a quarantine or advised to self-quarantine (as described in sections (1) and (2));
  5. The employee is caring for a son or daughter if the school or place of care has been closed due to COVID-19, or if the child’s caretaker is unavailable due to COVID-19; or
  6. The employee is experiencing any other conditions specified by the Secretary of Health and Human Services (unless the employee is a health care provider or emergency responder, in which case the employer can exempt the employee from this sub-section). 

The amount of pay received by employees depends on their status and their reason for taking leave:

  • Full-time employees are entitled to 80 hours of emergency paid sick leave.
  • Part‑time employees are entitled to the average number of hours worked in a two-week period.
  • For employees who take Emergency Paid Sick Leave for a reason directly related to the employee’s own exposure or concern (reasons 1-3 described above), the employee is entitled to be paid at the employee’s regular rate of pay, not to exceed $511 per day and $5,110 in the aggregate.
  • For employees who take Emergency Paid Sick Leave for a reason relating to for others or other conditions specified by the Government (reasons 4-6 described above), the employee is entitled to be paid at two-thirds the employee’s regular rate of pay, with a cap of $200 a day and $2,000 in the aggregate.

The DOL is expected to issue further guidance on calculating rate of pay before the Act becomes effective on April 2, 2020. 

The Act makes clear that Emergency Paid Sick Leave does not replace paid leave available to employees under other laws or current company policies. Emergency Paid Sick Leave is to be provided in addition to any other such paid leave.

Emergency Family and Medical Leave:  The Emergency Family and Medical Leave (“Emergency FMLA”) provisions essentially expand FMLA coverage during this period of pandemic. Its requirements also apply to private employers with fewer than 500 employees, though again, employers with fewer than 50 employees can request an exemption from the Department of Labor if complying would jeopardize the viability of the business as a going concern.  To be eligible for benefits, employees must have been employed with the employer for at least 30 calendar days. Health care providers or emergency responders may be excluded from the definition of employees eligible for such benefits. 

Eligible employees may take up to 12 weeks of job-protected leave to allow an employee, who is unable to work or telework, to care for the employee’s minor child (under 18 years of age) if the child’s school or place of care is closed or the childcare provider is unavailable due to COVID-19. The first 10 days of Emergency FMLA leave are unpaid. The rest of the days taken must be paid for full-time employees at two-thirds the employee’s regular rate of pay, up to $200 per day and $10,000 in the aggregate. Employees who work a part-time or irregular schedule are entitled to be paid based on the average number of hours the employee worked for the six months prior to taking Emergency FMLA. The employee can elect to use any available, accrued vacation, sick leave, or other PTO during the first 10 days of unpaid leave. 

As with regular FMLA, employees who take Emergency FMLA generally should be restored to their prior or equivalent job position upon return from leave. However, employers with fewer than 25 employees are generally excluded from this requirement if the employee’s position no longer exists following the Emergency FMLA leave due to an economic downtown or other circumstances caused COVID-19. To be eligible for this exclusion, the employer must make reasonable attempts to return the employee to an equivalent position, and it must make efforts to return the employee to work for up to a year following the employee’s leave.

Tax Credits for Emergency PSL and Paid Emergency FMLA: Employers are entitled to a refundable tax credit equal to 100% of the qualified wages paid to employees under these provisions. If the tax credit exceeds the amount of employment taxes the employer owes for any relevant quarter, the employer will be entitled to a refund of the excess tax credit.

The attorneys at Underwood Law Firm are available to answer questions regarding these changes.  Please reach out to your contact at Underwood.

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