Families First Coronavirus Response Act

In Simple(r) Terms

President Trump signed the anticipated Families First Coronavirus Response Act (FFCRA) into law. While the act touches on diverse topics (food availability, SNAP, unemployment), we're guessing you're most interested in how it applies to YOUR workforce.

The law breaks down into two main components: emergency paid sick leave and FMLA expansion. Lastly, there are tax credits for providing these benefits.

**See Updates at Bottom**

Emergency Paid Sick Leave:

  • Employers with less than 500 employees must comply.

  • Employees are eligible for this benefit, regardless of duration of employment.

  • Benefit can be claimed if one of the following occur:

    • Employee is subject to quarantine or isolation order as related to COVID 19

    • Employee has been advised by a health professional to self-quarantine due to concerns related to COVID 19

    • Employee is experiencing symptoms of COVID 19 and seeking medical diagnosis

    • Employee is caring for an individual who is subject to an isolation order

    • Employee is caring for their own child as a result of school or daycare closures related to COVID 19

    • "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." We literally have no idea what this means.

  • Payment will be for the duration of:

    • 80 hours at full rate for full time employees, to the maximum of $511 per day or a total of $5,110.

    • Number of hours worked on average over the past two weeks for part time employees, to the maximum of $200 per day or a total of $2,000.

  • Sick leave can be terminated if the public health emergency ends.

  • Employers CANNOT require employees taking sick leave to cover their hours/shift.

  • Employers will be required to display a notice outlining the available emergency sick pay prominently for employees. The feds intend to release a model notice within 7 days.

  • Employers who fail to pay this benefit will be considered as failing minimum wage benefit of FLSA, and penalized as such.

  • Employers can request physician documentation, as needed. We recommend following your current policy.

FMLA Expansion:

  • Employers with greater than 50 employees (for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year) must comply.

  • Employees are eligible for FMLA benefits after only 30 days of employment.

  • Employees may take expanded FMLA leave if they are responsible for caring for their child (under the age of 18) while their school or daycare is closed due to COVID 19 concerns.

  • The first 10 days of FMLA are unpaid. Employees can elect to take accrued PTO during this time.***

  • After the first two weeks (10 working days), employees are entitled to two-third of their wages, to a maximum of $200 per day or to a total of $10,000. Pay can be taken over a 12 week period.

  • If their daily pay rate is not clear, employers shall take the average of the employee's hours over the last 6 months to determine the two-thirds payment.

Employers with less than 50 employees (for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year) may be exempt from both FMLA expansion AND emergency paid sick leave if the paid benefits could jeopardize the viability of business. Will there be an exemption application? Will there be a blanket exemption for all employers under 50? Who knows! The federal government has not provided any further guidance as of yet (3/19). We update as we get more information.

TAX CREDITS:

  • Paid Emergency Sick Leave/FMLA:

    • Tax credit will be applied to the employers 2020 payroll taxes as equal to 100% of paid sick leave/FMLA leave to employees.

    • If the tax credit is larger than the payroll taxes owed, the employer will be issued a tax refund.

  • Healthcare Tax Credit:

    • Employers are welcome to claim a tax credit to assist them in paying for the employer portion of healthcare premiums while the employee is away on sick leave.

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THE BOTTOM LINE:


  • Expanded FMLA and emergency sick pay do not necessarily apply if your company has less than 50 employees.

  • If your company has over 500 employees, only expanded FMLA applies.

  • Many employees will likely take the emergency sick pay benefit for two weeks, and then switch to expanded FMLA, as one covers the "unpaid benefit time" (first ten days) for the other.

The FFCRA takes affect starting April 2nd, and will conclude on December 31st, 2020. While we provide our best interpretation of the law, many areas remain unclear as written. We will continue to update this bulletin as more information is released.


**UPDATES:**

The Department of Labor (DOL) has released three new documents providing additional clarification on the FFCRA: