Topic Employee Benefits,

What does the “Families First Coronavirus Response Act” Mean for Your Employees?

What does the “Families First Coronavirus Response Act” Mean for Your Employees?

The recently-passed HR 6021 bill, also known as the "Families First Coronavirus Act," has established a new set of requirements for employers with regards to the current coronavirus crisis as it sweeps across the United States. The relevant sections to most employers will include the temporary expansion to the Family And Medical Leave Act and Emergency Paid Sick Leave for employees impacted by COVID-19.

Enhancements to the Family And Medical Leave Act

HR 6021 has made several critical changes to the Family And Medical Leave Act, many of which have a significant impact on how you handle health-related leave for your employees. The provisions that have changed as a result of COVID-19 include:

12 weeks of job-protected leave offered by employers with less than 500 employees. Ten of those weeks must be paid leave according to the provisions of the act. In order to qualify for this leave, employees must have worked for the employer for at least 30 days. Under the previous FMLA coverage, employees had to have worked for the company for at least 12 months in order to qualify for leave.

Qualifying needs have changed. In addition to the existing provisions, qualifying needs include employees who cannot work or telework because they must care for a child under 18 years. This applies if:

  • The child's school, including primary and secondary schools, has closed
  • The child care provider of the worker's son or daughter is unavailable due to the current public health emergency

Employees can choose between several options for leave, based on their sick and vacation time. The first ten days for which an employee takes leave can be:

  • Unpaid leave
  • Accrued vacation or personal leave
  • Emergency paid sick leave
  • Accrued sick leave

After the initial 10 days, the employer must provide paid leave based on at least 2/3 of the employee's regular rate of pay. Payment should be based on the number of hours the employee would normally be scheduled to work. Employees can receive, under this provision, no more than $200 per day or $10,000 total during the leave period.

Employers have fifteen days after the bill is enacted to meet these provisions for their employees and ensure that their employees have the protections they need to care for their families throughout the current public health crisis.

Temporary Paid Sick Leave Program

Under HR 6021, employers must provide their full-time employees with emergency paid sick leave if that employee needs to use that leave due to COVID-19. Employees can take advantage of this emergency paid sick leave if:

  • The employee is quarantined or faces an isolation order due to COVID-19
  • The employee is advised to self-quarantine by a healthcare provider
  • The employee has symptoms of COVID-19 and is seeking a medical diagnosis
  • The employee must provide care for an individual who is quarantined or needs to self-quarantine because of concerns related to COVID-19
  • The employee must care for a child who cannot use their usual childcare due to COVID-19 precautions

Under the temporary paid sick leave program:

Full-time employees are entitled to 80 hours of paid leave. This paid leave is calculated based on the employee's regular pay rate or minimum wage, whichever is higher. If leaving to care for a family member or child, the employee can receive 2/3 of the regular rate of pay. The maximum required sick pay per employee is $511 per day or $5,110 total, while maximum payment for employees who leave to care for sick family members is $200 per day or $2000 total.

Part-time employees are entitled to "a number of hours equal to the number of hours that such employee works, on average, over a two-week period." Part-time employees are subject to the same limitations with regards to payments as full-time employees.

In the case of both full and part-time employees, required paid leave ends when the employee is scheduled to return to work. When the need ends and the employee can return to work, employers need no longer pay sick leave.

Employees are not entitled to paid sick leave if they are able to telecommute. Employees who can continue to work from home can be required to continue those obligations, so long as they are not too ill to work or caring for a family member who requires more attention than they can provide while discharging their job responsibilities.

Who Pays for Your Employees' Emergency Sick Leave and Emergency Family And Medical Leave?

The government is funding employees' emergency sick leave and emergency FMLA through payroll tax credits. These tax credits are designed to provide dollar-for-dollar relief for employers whose employees need emergency medical leave due to coronavirus concerns.

Exceptions have been carved out for employers with fewer than 50 employees or fewer than 25 employees. Under these provisions:

  • Employers with fewer than 50 employees can receive an exemption if paid FMLA leave under these provisions would "jeopardize the viability of the business"
  • Employers with 25 or fewer employees must reinstate employees after the FMLA period ends, unless the employer is experiencing significant economic hardship and cannot afford to bring that employee back on. Employers may need to apply for these exemptions.

Unfortunately, the bill does not currently say how to apply for these exemptions. As a result, employers may need to wait until some of these policies are clearer before receiving the exemptions they need to continue operations throughout the current public health crisis.

As further guidance comes in from the IRS and the federal government, we will continue to keep you updated about the latest provisions and policies. We’ll continue to help employers through this time of need by providing timely, current information about the current crisis and how it impacts your business.