The Families First Coronavirus Response Act will go into effect on April 2, 2020 with an end date of December 31, 2020. The main provisions applicable to employers and employees are the (1) Emergency Family Medical Leave Expansion Act and (2) Emergency Paid Sick Leave Act.
- Emergency Family Medical Leave Expansion Act
- Applicable to employers with 500 or fewer employees
- For an employee to be eligible:
- Must have been employed with employer for thirty (30) days
- Leave is needed to care for a child whose school or childcare facility is closed due to COVID-19
- Employee is entitled to twelve (12) weeks of leave
- First two weeks of leave are unpaid
- Employee can choose to use employer-provided paid time off or paid sick leave but employer cannot require employee to do so.
- The remaining ten (10) weeks are paid at a rate not less than two-thirds the employee’s usual rate of pay.
- First two weeks of leave are unpaid
- Leave under this act is job-protected. Employee must be returned to their job upon return from leave.
- The amount of paid leave is capped at $200 per day or $10,000 in the aggregate.
- The bill authorizes the Secretary of Labor to issue regulations exempting (1) certain health care providers and emergency responders from taking leave under the bill and (2) small businesses with fewer than 50 employees from the requirements of the bill if it would jeopardize the viability of the business.
- We will monitor any regulations issued by the Secretary of Labor and update this summary as necessary.
- Emergency Paid Sick Leave Act
- Applicable to private employers with 500 or fewer employees and public agencies with one or more employees.
- Full-time employees, regardless of length of employment, are entitled to two weeks (80 hours) of paid sick leave.
- Paid sick leave can be used for the following reasons:
- 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.
- The employee is experiencing symptoms of coronavirus and is seeking a medical diagnosis or has been diagnosed with COVID-19.
- The employee is caring for an individual who is subject to a quarantine order or has been advised by a health care provider to self-quarantine.
- The employee is caring for child whose school or childcare provider is closed due to COVID-19
- Employers must compensate employees at their regular rate of pay.
- Part-time employees are entitled to the number of hours of paid sick time equal to the number of hours they work, on average, over a two-week period.
- Paid sick leave is capped at $511 per day and $5,110 in the aggregate for employees who are quarantined or isolated due to COVID-19 or are experiencing symptoms of COVID-19 and seeking a medical diagnosis. The amount of paid sick time is also capped at $200 per day and $2,000 in the aggregate per employee for an employee who is: (i) taking care of an individual subject to a quarantine order or who has been advised by a health care provider to self-quarantine; (ii) caring for the employee’s child if the child’s school or place of care has been closed due to the coronavirus or if the child care provider for the child is unavailable; or (iii) experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.
TAX CREDITS
The bill provides for a series of refundable tax credits for employers providing paid emergency sick leave or paid FMLA. The credits are as follows:
- A refundable tax credit for employers equal to 100 percent of qualified family leave wages required to be paid by the Emergency Family Medical Leave Expansion Act that are paid by an employer for each calendar quarter. The tax credit is allowed against the tax imposed by section 3111(a) (the employer portion of Social Security taxes). The amount of qualified family leave wages taken into account for each employee is capped at $200 per day and $10,000 for all calendar quarters. If the credit exceeds the employer’s total liability under section 3111(a) for all employees for any calendar quarter, the excess credit is refundable to the employer.
- A refundable tax credit for employers equal to 100 percent of qualified paid sick leave wages required to be paid by the Emergency Paid Sick Leave Act that are paid by an employer for each calendar quarter. The tax credit is allowed against the tax imposed by section 3111(a) of the Internal Revenue Code (the employer portion of Social Security taxes).