Families First Coronavirus Response Act
The Families First Coronavirus Response Act attempts to ease the burden on families whose lives have been uprooted by the COVID-19 pandemic through paid sick and family leave:
Emergency Family and Medical Leave Expansion
The bill temporarily enhances aspects of the FMLA to cover those whose lives have been affected by COVID-19. The important eligibility changes are, as follows:
- The scope of the FMLA has been altered so that it applies to the employees of any employer who has less than 500 employees at any point during the year.
- Employee eligibility has been altered so that any employee who has been employed for at least 30 days for an employer is eligible to participate.
In addition to eligibility changes, the new FMLA language enhances the benefit offerings of the previously-unpaid federal leave program:
- The first 10 days an employee takes under this new FMLA may be unpaid leave (which an employee may substitute for any accrued paid leave) but any FMLA taken after the initial 10 days must be paid.
- Pay calculation is: at least 2/3 of regular rate of pay multiplied by the number of hours the employee would normally be scheduled to work during days off. The maximum amount is $200 per day and $10,000 total.
- Job restoration has remained intact, but with some important caveats. An employer of less than 25 employees need not restore an employee to the same position if the position no longer exists due to the public emergency period AND reasonable efforts have been made for at least 1 year after the end of the pandemic to place the employee in a similar position.
In addition to the eligibility changes, the new FMLA language adds certain qualifying events related to COVID-19 to its list of allowable uses:
- An employee may use FMLA for “a qualifying need related to a public health emergency.” This means that employees who must look after minor children (as a result of COVID-19) whose school and/or child care facility has shut down may use FMLA to do so. No party needs to show any symptoms of COVID-19 to be eligible.
This is a temporary FMLA expansion and is set to be phased out on December 31, 2020.
Emergency Paid Sick Leave
In addition to the changes made to the FMLA, Congress has also passed a new form of federal Emergency Paid Sick Leave. Full-time employees are allowed 80 hours of sick time, while part-time employees are allowed a number of hours equal to the average number of hours he or she works in two weeks. The employee may use this leave for the following reasons:
- The employee has a quarantine/isolation order related to COVID-19 from the federal, state, or municipal government.
- The employee is caring for an individual who is under a similar a quarantine/isolation order related to COVID-19 from the federal, state, or municipal government.
- The employee has self-quarantined under the advice of a health care provider due to concerns regarding COVID-19.
- The employee is seeking a medical diagnosis due to COVID-19 symptoms.
- The employee is caring for a child because his/her school or child care provider is unavailable due to concerns over COVID-19.
- The employee is experiencing symptoms similar to COVID-19 (as determined by the Secretary of Health and Human Services).
Employees will be paid their regular rate of pay for all time missed, up to $511 per day ($5,110 in total) for all absences above that are bolded and up to $200 per day ($2,000 in total) for the other absences.
Employees are entitled to this leave immediately, regardless of how long they have been working for the employer. An employer may not require an employee to exhaust other forms of leave to be eligible for this leave. This leave is temporary and will end with the employee’s next shift following the end of the COVID-19 pandemic (employee will forfeit all accrued time).
Tax Credits for Employers
The law provides a payroll tax credit for the required Paid Leave imposed under this law. The tax credit is equivalent to 100% of the family leave wages paid by the employer, up to $200 per day (per employee) and $10,000 total (per employee). This amount is increased to $511 per day if wages are being paid pursuant to the equivalent Emergency Paid Sick Leave detailed above. The first calendar quarter, the employer may claim a credit for up to 10 days per employee. For subsequent quarters, the employee may only claim the credit for a maximum of 10 days minus all days claimed in previous quarters.
An employer may claim a larger amount of tax credit if that employer offers a qualifying group health plan. The employer may claim a credit on the amount the employer pays for the employee health care coverage, if such payments are made on a pro rata basis among covered employees and pro rate on the basis of periods of coverage.
These credits will be available each calendar quarter through the end of 2020.