On April 1, 2020, an important federal law goes into effect to provide relief during the COVID-19 pandemic.
The Families First Coronavirus Response Act (FFCRA) provides new employment leave options and requirements for some private and public sector employers and employees. The FFCRA requires certain employers to provide their employees with paid and partially paid sick leave and family medical leave related to COVID-19. This act will be in effect from April 1, 2020 – December 31, 2020.
The following are some key things to keep in mind as this regulation comes into play:
(1) The FFCRA is being rolled out by the Department of Labor and is ever changing.
The FFCRA is a hot topic right now around news and social media. However, it is being regulated and rolled out by the United States Department of Labor (“DOL”). Therefore, your best resource as an employer or employee on the provisions of this act is the DOL’s website. This website has a plethora of information and guidance, including questions and answers for both employers and employees. As is becoming a normal occurrence with COVID-19 regulations, there are constant changes and additional guidance being provided nearly everyday. Therefore, employers and employees should check back to the DOL website often for updates. The Department of Labor also has Facebook and Twitter accounts with up-to-date releases.
(2) THE FFCRA APPLIES TO “COVERED EMPLOYERS” ONLY
The FFCRA governs “covered employers” including:
a. Private employers engaged in “commerce” with fewer than 500 employees.
b. Certain Public employers.
For purposes of counting employees, an employer counts the employees at the time the employee’s leave is requested. This means if Employee X requests leave, his or her employer would count how many employees are working at the time. If at a later time the employer laid off employees due to reduction in work and Employee Y requests leave, the number is recounted. Employers count both full time and part time employees. Independent contractors under the Fair Labor Standards Act are not considered employees for purposes of the 500 employee threshold. Please note there are certain requirements for joint employers, subsidiaries, and affiliates so it is best to check with legal counsel on the appropriate count in these situations.
Healthcare and First Responder Potential Exclusion: The FFCRA carves out a potential exception for health care providers and first responders. If your place of employment is in one these fields, the employer can elect to be excluded from the requirements of this act. The term “healthcare providers” is interpreted broadly: doctor’s offices, hospitals, health care centers, clinics, post-secondary educational institutions offering health care instruction, local health departments, nursing facilities, retirement facilities, nursing homes, home health care providers, facilities that perform laboratory or medical testing, pharmacies, or other similar institutions.
(3) THERE ARE TWO TYPES OF LEAVE UNDER THE FFCRA.
Under the FFCRA there are two types of leave to which employees of covered employers may be entitled to:
1. Emergency Sick Leave
2. Emergency FMLA Leave (EFMLA)
EMERGENCY SICK LEAVE:
A. What it provides:
All employees (from day one of employment) are entitled to up to 80 hours of paid or partially paid leave for individuals affected by Coronavirus or caring for someone related to COVID-19.
B. Who qualifies for sick leave?
Any Employee who is unable to work (or telework) because:
- 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 due to concerns related to COVID-19.
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
- The employee is caring for an individual who is subject to an order as described above or has been advised by a health care provider as described above.
- The employee is caring for a son or daughter if the child’s school or daycare has been closed or the child’s child care provider is unavailable due to COVID-19 precautions.
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor. (Currently the DOL has issued no “substantially similar conditions”)
C. When is an employee “unable to work”?
An employee is unable to work if the employer has work and one of the reasons above prevents the employee from “being able to perform that work either under normal circumstances at your normal worksite or by means of telework”.
The telework policies may allow an employee to work a certain number of hours but perhaps outside the normally scheduled hours (for instance early in the morning or late at night). If the employee is able to work within this schedule, leave is not necessary unless a COVID-19 qualifying reason prevents them from working that schedule.
D. This leave is not applicable to business closings, furloughs, or reduced hours.
If the employer closes for any period of time, no matter how short the duration, employees are not entitled to this sick leave during the closure.
If employees are furloughed or hours are reduced for lack of work or a downturn in business, they are not entitled to take emergency paid sick leave for any hours that they do not work due to the furlough or reduction in hours.
F. The amount of entitled sick pay:
Full time: 80 hours (max)
Part time: Number of hours employee worked on average for 2 weeks
The Department of Labor has defined full time as 40 hours a week. Therefore, if your business considers full time to be 35 hours a week this would be considered part time under these rules.
G. The Rate of Pay:
1. “Regular Rate”;
2. FLSA Minimum Wage ($7.25 hour); or
3. State or local minimum wage
Click HERE for information on how to calculate the regular rate.
H. The pay rate depends on the basis for the leave:
An employee is entitled to two weeks (80 hours) of paid sick leave at the employee’s regular rate of pay where the employee is unable to work because the employee is quarantined, and/or experiencing COVID-19 symptoms and seeking a medical diagnosis.
An employee is entitled to two weeks (80 hours) of paid sick leave at two-thirds the employee’s regular rate of pay because the employee is unable to work because of a bona fide need to care for an individual subject to quarantine, or care for a child under 18 years of age whose school or child care provider is closed or unavailable for reasons related to COVID-19.
I. Maximum pay:
The maximum pay rate depends on the reason for the leave:
$511.00 per day, 80 hours (For sick leave for employee); or
$200.00 per day, 80 hours (For sick leave caring for someone who is subject to quarantine, or caring for a child (under 18 years of age) whose school or child care provider is closed or unavailable due to COVID-19)
Click HERE for more specific information on maximum pay rates.
J. Emergency Sick Leave is in addition to the other leave provided:
The sick leave provided by the FFCRA is in addition to any other leave the employer provides, such as sick time, vacation days, PTO etc. Employees may use this emergency sick leave before exhausting other leave and cannot be required to use other leave before this sick leave
K. How leave is requested:
Employers are encouraged to have a leave policy in place for employees to request leave. Consider telework currently happening at your employment and allow for leave to be requested by email. Employees should check with their employers regarding particular policies on requesting leave. Employers should post the DOL poster and email to teleworkers.
L. Employers may request documentation to support the leave, but specifics are currently unknown:
The DOL provides that employers can request documentation “as provided by the IRS” to support and determine leave requests. However, to date the IRS has not provided guidance on the documentation that may be requested. Refer to the DOL and IRS websites for additional information in the next coming days.
M. End Date:
The end date for this leave is December 31, 2020. There is no payout on termination and no carry over past this date.
EMERGENCY FMLA LEAVE TO CARE FOR CHILD (EFMLA)
A. What is it?
Employees (who have been employed at least 30 days) may be entitled to up to an additional 10 weeks paid of FMLA leave with 2/3 pay if they need to care for a child whose school or childcare is closed due to COVID-19.
B. Small business exception
Small businesses that employ less than 50 employees may qualify for an exemption to this leave if they can show that providing the same “would jeopardize the viability of the business as a going concern”. It is the employer’s burden to prove the exemption.
A small business may claim this exemption if an authorized officer of the business has determined that:
- The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
- The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
- There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
C. Qualifying Reason for EFMLA
Employees are entitled to EFMLA if they are unable to work (or telework) due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable, due to a public health emergency.
D. No leave entitlement if business closes, furloughs, or reduces hours:
If a business closes for any period of time, no matter how short the duration, employees are not entitled to leave during this time.
If employees are furloughed or hours are reduced for lack of work or a downturn in business they are not entitled to take EFMLA leave for any hours that they do not work due to the furlough or reduction in hours.
E. Amount of Leave – Intermittent Leave
10 weeks of additional leave (total of 12 weeks when added with sick leave above)
FMLA leave may be taken in certain circumstances on an intermittent basis to care for a child whose school or daycare or whose childcare provider is unavailable if the employer and employee agree. More information on intermittent leave is available on the DOL website.
F. Rate of pay
2/3 of regular rate or applicable minimum wage.
An employee can choose to supplement their wages with available paid time off, but the employer cannot require that to be done.
G. Maximum Pay for the 10 weeks paid
$200.00 maximum per day.
H. How does an employee request leave?
When the need for leave under the Act is foreseeable the employee must provide as much notice as practicable. Employers are encouraged to consult with legal or HR professionals and draft a leave policy.
I. Documentation may be requested to prove leave:
Documentation may be required under IRS forms and instructions. To date the IRS has not issued these instructions. Please refer to the IRS and DOL websites for further guidance.
(4) EMPLOYERS WILL RECEIVE TAX CREDITS FOR PAYMENTS MADE UNDER FFCRA:
Employers qualify for dollar-for-dollar reimbursements through tax credits for all qualifying wages paid under the FFCRA (up to the cap amounts) provided to employees, including costs of group health plan expenses. Please consult with your tax professional for further infomration and for the documentation to keep to obtain the credit.
(5) “GOOD FAITH” GRACE PERIOD:
Because the Coronavirus pandemic is fluid and ever-changing, the DOL has issued a statement giving employers time to act in good faith in providing the leave under this act without enforcement, click here for further information.
(6) EDUCATION AND GUIDANCE
Employers and Employees are encouraged to keep close tabs on the DOL websites to best understand the requirements of this act. Visit HERE for the latest information, questions and answers, and leave rights and requirements for both employers and employees.
Families First Coronavirus Response Act: Questions and Answers: CLICK HERE
By: Amanda M. Richards
This blog post is for information purposes only and does not constitute legal advice. These regulations are subject to change and the DOL website should be consulted for recent changes. Please visit with your legal professional for questions or specific details of your employment.