We realize that the COVID-19 pandemic is impacting each of us in various ways and things are changing so rapidly that is difficult to stay on top of everything.
Congress passed the Families First Coronavirus Response Act (FFCRA) on March 18, 2020. FFCRA is effective on April 1, 2020 and there are two key provisions that apply to businesses with less than 500 employees – Employers will be required to offer emergency paid sick leave and emergency paid family medical leave. There are potential exemptions for small employers with under 50 employees (see the section below titled “Small Employer Exemption”). The Dept of Labor (DOL) just issued the FFCRA guidelines pertaining to the new law for your review. This is where you can obtain the required posting notices and access FAQs about the act.
The Emergency Paid Sick Leave Act
The act mandates employers to provide up to 80 hours of paid sick leave to full-time employees who are unable to work or telework for reasons noted below. An employee’s sick time rate of pay is based on the employee’s normal earnings up to the cap (in bold) as follows:
- At 100% of the employee’s regular rate of pay when:
- The employee is subject to a federal, state, or local quarantine or isolation order ($511/day)
- The employee has been advised by a health provider to self-quarantine ($511/day)
- The employee is experiencing symptoms and seeking a diagnosis ($511/day)
- At two-thirds the employee’s regular rate of pay when:
- The employee is caring for a person subject to an order to quarantine or was advised to quarantine ($200/day)
- The employee is caring for a son or daughter under the age of 18 due to a school or care provider closure or unavailability ($200/day)
- The employee is experiencing any other substantially similar condition ($200/day)
The newly mandated paid sick time is in addition to any leave currently provided by employers. An employee may use the leave immediately and an employer may not require an employee to use other paid leave before using the emergency paid sick time. The sick time leave benefit expires when the need for leave expires.
The Emergency Family and Medical Leave Expansion Act
The act expands existing provisions of the Family and Medical Leave Act (FMLA) to provide unpaid and paid job protected leave. The FMLA now includes a “Qualifying Need Related to a Public Health Emergency” for employees who cannot work or telework due to the need to care for a son or daughter under the age of 18 whose school or place of care has closed, or because their care provider is unavailable. The expanded provision of FMLA extends to employers who would not normally be required to offer FMLA due to company size.
The first 10 days of leave may be unpaid or an employee may elect to use Emergency Paid Sick Leave (see section above) or other employer-provided leave such as PTO, vacation leave, sick leave, or personal leave. If needed for a coronavirus-related childcare purpose, the remaining 10 weeks of leave must be paid at 2/3 the regular rate of pay, but not exceed $200 per day and $10,000 in the total.
Tax Credit
Employers are entitled to a refundable tax credit against the employer’s portion of Social Security taxes for 100% of the wages paid each calendar quarter to provide emergency paid sick leave and emergency paid family and medical leave to its employees.
Employees will also be reimbursed if their costs for emergency paid sick leave and emergency paid family and medical leave wages exceed the taxes they would owe. The IRS will be providing the form to request the reimbursement.
Your payroll provider will be adding additional codes to their system to properly record the FFCRA paid time. For our clients who we provide payroll administration services, PayNW is currently working on adding the codes to their system.
Small Employer Exception
Small businesses with fewer than 50 employees may request an exemption from the requirement to provide paid sick leave and expanded family and medical leave due to school closings or childcare unavailability if the leave requirements would jeopardize the viability of the business as a going concern.
The DOL has addressed the exemption in their FAQ #4. It indicates that if a small business wants to elect an exemption, they should document why their business with fewer than 50 employees meets the criteria set forth by the DOL which it will be addressing in more detail in forthcoming regulations.
Posting Requirements
Businesses are required to post the attached notice in their workplace. Employee Rights COVID-19
This should be posted in the same areas that you have your other required postings, which is typically the breakroom or other common employee gathering location.
