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March 24, 2020

The Families First Coronavirus Response Act (“FFCRA”) was signed into law by President Trump on March 18, 2020.   The FFCRA requires certain employers to provide their employees with paid sick or family leave for specified reasons related to COVID-19, and it expands the Family and Medical Leave Act (“FMLA”).  The Act also provides a tax credit to employers based on the paid leave that they were required to issue to their employees.

The FFCRA will take effect on April 2, 2020, and it will sunset on December 31, 2020.  The FFCRA includes two significant sections—the Emergency Paid Sick Leave Act (“EPSLA”) and the Emergency Family and Medical Leave Expansion Act (“EFMLA”).  The paid leave requirements of the FFCRA are to be administered and enforced by the Department of Labor’s Wage and Hour Division.

Applicability of FFRCA:

The EPSLA and EFMLA provisions of the FFCRA apply to certain public employers, and private employers with fewer than 500 employees.  In the past, employees must have completed 12 months and 1,250 hours with the company to be eligible for the FMLA.  However, EFMLA now includes leave rights and protections for workers employed for at least 30 calendar days.  Additionally, while FMLA applied to companies with 50 or more employees, the EFMLA applies to businesses that have employed fewer than 500 employees.  Unlike the FMLA, which generally requires employers restore workers to their original or a similarly situated position upon their return from leave, the EFMLA exempts some small businesses from job protection during or after the leave.  Employers with less than 25 staff members generally are not required to provide job protection if the employee’s position no longer exists following the EFMLA leave due to an economic downtown or if the employee’s position no longer exists following the EFMLA leave due to other circumstances caused by a public health emergency during the period of emergency FMLA.

Most employees of the federal government are covered by Title II of the Family and Medical Leave Act, which was not amended by the FFCRA, and are therefore not covered by the expanded family and medical leave provisions. However, federal employees covered by Title II of the Family and Medical Leave Act are covered by the paid sick leave provision.

Potential Exemption of Businesses Employing Fewer Than Fifty Employees:

The Department of Labor may “exempt small businesses with fewer than 50 employees from the requirements of section 102(a)(1)(F) when the imposition of such requirements would jeopardize the viability of the business as a going concern.” However, at this time, it is unclear how a small business can request an exemption and for which guidelines under the legislation the exemption will apply.  The regulations expected to address this exemption are to be published in April 2020.

The FFCRA also includes terms that provide an employer with a refundable tax credit against payroll taxes for each calendar quarter in an amount equal to 100 percent of the qualified sick leave wages that the employer pays with respect to that calendar quarter.

Under the FFCRA, an employee qualifies for paid sick time if the employee is unable to work (or unable to telework) due to a need for leave because the employee:

  1. is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
  2. has been advised by a health care provider to self-quarantine related to COVID-19;
  3. is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
  4. is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
  5. is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19; or
  6. is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.

Under the FFCRA, an employee qualifies for expanded family leave if the employee is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19.

Duration of Leave:

For reasons (1)-(4) and (6): A full-time employee is eligible for 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

For reason (5): A full-time employee is eligible for up to 12 weeks of leave (two weeks of paid sick leave followed by up to 10 weeks of paid expanded family & medical leave) at 40 hours a week, and a part-time employee is eligible for leave for the number of hours that the employee is normally scheduled to work over that period.

Calculation of Pay:

For leave reasons (1), (2), or (3): employees taking leave are entitled to pay at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).For leave reasons (4) or (6): employees taking leave are entitled to pay at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).

For leave reason (5): employees taking leave are entitled to pay at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $12,000 in the aggregate (over a 12-week period).

It is important to note that FFCRA states that the employers are not required to provide paid leave during the employee’s initial 10 days of Emergency Leave. Employees may elect to use accrued paid time off during the initial 10-day period, but employers may not require such use.