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Coronavirus Paid Leave Laws Pass, Set To Become Effective Within 15 Days
3/23/20
Coronavirus Paid Leave Laws Pass, Set To Become Effective Within 15 Days
By: Justin Boron
The President yesterday evening signed The Families First Coronavirus Response Act into law after Congress passed it with overwhelming bipartisan support. The legislation drastically alters medical and sick leave requirements by requiring employers to pay employees during certain kinds of absences related to the Coronavirus crisis.
The House’s March 16, 2020 version of the bill cleared the Senate without amendment. You can find the bill here and our initial analysis here. In this update, we are providing an outline of issues that could come up for an employer considering a leave request under these new laws. The law is set to take effect within 15 days, and the Secretary of Labor is required to issue guidelines to assist employers in calculating the amount of paid sick time during that time period. We will update you when the Secretary provides further guidance.
The House’s March 16, 2020 version of the bill cleared the Senate without amendment. You can find the bill here and our initial analysis here. In this update, we are providing an outline of issues that could come up for an employer considering a leave request under these new laws. The law is set to take effect within 15 days, and the Secretary of Labor is required to issue guidelines to assist employers in calculating the amount of paid sick time during that time period. We will update you when the Secretary provides further guidance.
- Emergency Family and Medical Leave Expansion Act.
The Emergency Family Medical Leave Expansion Act adds a basis for FMLA leave related to employees whose children’s schools closed due to an emergency order. At the outset, it is important to note that the pre-existing, FMLA leave bases remain in place, so employers will need to apply their pre-existing FMLA policies to leave requests and consider whether the employee would qualify under the non-Coronavirus bases for FMLA leave, which can be found here.
The following issues are likely to arise when an employer receives an emergency family medical leave request:
The following issues are likely to arise when an employer receives an emergency family medical leave request:
- Have you employed less than 500 employees? (See 29 CFR 825.105 for the FMLA’s general rules on counting employees for coverage, available here). If so, the employer is covered under the FML Expansion Act.[1]
Exception: If you employ fewer than 50 employees, the FML Expansion Act requires your compliance, but you are immune from civil liability for violations of it.[2]
- Is the employee eligible? The employee has been employed 30 days by the employer,[3] and the employee cannot work or telework; the employee has a childcare need; and the child’s school or daycare is closed due to an emergency declared by federal, state, or local authority for Coronavirus (or childcare provider is unavailable).[4] If so, then the eligibility requirements for employees will be met.
Exception: If you are an employer of a “health care provider,” then you may elect to exclude an employee from application of the new emergency FMLA leave provisions.[5] For the definition of health care provider, see 29 CFR 825.102 available here.
- The FML Expansion Act does not address certification but the definition of “qualifying need related to a public health emergency” makes the request verifiable based on publicly available information.
- If each element above is met, then the employer must provide:
- An initial 10 days of unpaid leave during which the employee may elect to use PTO or sick pay provided under the Emergency Paid Sick Leave Act.
- After the initial 10 days, 10 weeks and four days of paid leave at 2/3 of employee’s regular rate of pay and the number of hours the employee is regularly scheduled to work, but this paid leave will be no more than $200 per day and $10,000 in the aggregate.[6] See section 110 (b)(2)(C) for employee’s with variable schedules.
Exception: Employers that have multi-employer collective bargaining agreements are addressed specially in Section 3103 of the FML Expansion Act.
- At the end of the 12-week FMLA emergency leave, the employee’s right to be restored to the employee’s position is the same as under pre-existing FMLA rules unless the employer has less than 25 employees and meets certain economic hardship requirements in section 110(d) of the FMLA, as amended.
- Emergency Paid Sick Leave Act
The Emergency Paid Sick Leave Act requires emergency paid sick leave for certain Coronavirus related absences that is in addition to any PTO that the employer already provides. It is important to note that the FML Expansion Act is not co-extensive with the Emergency Sick Leave Act, so sick pay requests will need to be evaluated separately from emergency family leave requests.
The following issues are likely to arise when an employer considers an emergency sick leave request:
- Is the employer subject to the Emergency Paid Sick Leave Act? A private employer is a “covered employer” if it is engaged in commerce and employs less than 500 employees. A public agency or entity other than a private employer is a “covered employer” if it employs one or more employees. It includes an employer acting directly or indirectly in the interest of employer and any successor-in-interest companies.[7]
- Is the employee eligible? An employee 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;
- has been advised by a health care provider to self-quarantine due to concerns related to COVID–19;
- is experiencing symptoms of COVID–19 and seeking a medical diagnosis;
- is caring for an individual who is subject to a governmental quarantine order or who has been advised by a health care provider to self-quarantine;
- is caring for a son or daughter of the employee if the school or place of care of the son or daughter has been closed, or the childcare provider of such son or daughter is unavailable, due to COVID–19 precautions; OR
- 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.[8]
Note that the definition of an employee of a public agency has special requirements under 29 U.S.C. 203(e)(2). The definition also includes other types of government employees specified in Section 5110 of the Emergency Sick Leave Act.
Exception: If you are an employer of a “health care provider,” then you may elect to exclude an employee from application of the Emergency Paid Sick Leave provisions.[9] For the definition of health care provider, see 29 CFR 825.102 available here.
Exception: Employers that have multi-employer collective bargaining agreements are addressed specially in Section 5106 of the Emergency Paid Sick Leave Act.
Exception: If you are an employer of a “health care provider,” then you may elect to exclude an employee from application of the Emergency Paid Sick Leave provisions.[9] For the definition of health care provider, see 29 CFR 825.102 available here.
Exception: Employers that have multi-employer collective bargaining agreements are addressed specially in Section 5106 of the Emergency Paid Sick Leave Act.
- If the first two elements are met, the employer must provide paid sick time in addition to paid leave provided by the employer as follows:
- For full-time employees, 80 hours
- For part-time employees, a number of hours equal to the number of hours that such employee works, on average, over a 2-week period,
The sick leave must be paid in the following amounts:
- The highest amount based on (i) the regular rate of pay as defined by the FLSA or (ii) minimum wage in effect for the federal, state, and locality for an employee who is
- is subject to a Federal, State, or local quarantine or isolation order related to COVID–19;
- has been advised by a health care provider to self-quarantine due to concerns related to COVID–19; OR
- is experiencing symptoms of COVID–19 and seeking a medical diagnosis.
But the amount cannot exceed $511 per day and $5,110 in the aggregate for an employee using paid leave for these reasons.
- Two-thirds of the highest amount based on (i) the regular rate of pay as defined by the FLSA or (ii) minimum wage in effect for the federal, state, and locality for an employee who is
- is caring for an individual who is subject to a governmental quarantine order or who has been advised by a health care provider to self-quarantine;
- is caring for a son or daughter of the employee if the school or place of care of the son or daughter has been closed, or the childcare provider of such son or daughter is unavailable, due to COVID–19 precautions; OR
- 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.
But the amount cannot exceed $200 per day and $2,000 in the aggregate for an employee using leave for these reasons.[10]
Note that an employee may elect to use this sick time before other PTO and sick leave provided by the employer. Also, the employer may not require the employee to use other PTO and sick leave before the emergency sick leave under the new law.[11]
Note that an employee may elect to use this sick time before other PTO and sick leave provided by the employer. Also, the employer may not require the employee to use other PTO and sick leave before the emergency sick leave under the new law.[11]
- Paid sick time terminates beginning with the employee’s next scheduled workshift immediately following the termination of the need for emergency paid sick time under the new law.[12]
Note that the employee must use paid sick time during 2020, and it does not carry over to next year. Additionally, the employer is not required to pay the employee for unused emergency sick time if employment ends.[13]
If an employer fails to provide the emergency sick leave required by the new law or who terminates an employee for taking the emergency sick leave, the employer is subject to civil liability and penalties under the FLSA.[14]
- Tax Credits For Paid Emergency Leave Under The FML Expansion Act And The Emergency Sick Leave Act
For each calendar quarter, an employer is entitled to a tax credit against the employer-paid excise taxes on payroll in Section 3111(a) or Section 3221(a) of the Internal Revenue Code of 1986 for the full amount of the amounts required to be paid under the FML Expansion Act or the Emergency Paid Sick Leave Act.
But there are caveats to how and the amount of the credits that may be taken that could result in the full value of the credit not being applied until the employer files its tax return. The new tax credit law requires the Secretary of Labor to issue regulations for implementation of the tax credits.
But there are caveats to how and the amount of the credits that may be taken that could result in the full value of the credit not being applied until the employer files its tax return. The new tax credit law requires the Secretary of Labor to issue regulations for implementation of the tax credits.
**DISCLAIMER: The attorneys at Freeman Mathis & Gary, LLP (“FMG”) have been working hard to produce educational content to address issues arising from the concern over COVID-19. The webinars and our written material have produced many questions. Some we have been able to answer, but many we cannot without a specific legal engagement. We can only give legal advice to clients. Please be aware that your attendance at one of our webinars or receipt of our written material does not establish an attorney-client relationship between you and FMG. An attorney-client relationship will not exist unless and until an FMG partner expressly and explicitly states IN WRITING that FMG will undertake an attorney-client relationship with you, after ascertaining that the firm does not have any legal conflicts of interest. As a result, you should not transmit any personal or confidential information to FMG unless we have entered into a formal written agreement with you.
We will continue to produce education content for the public, but we must point out that none of our webinars, articles, blog posts, or other similar material constitutes legal advice, does not create an attorney client relationship and you cannot rely on it as such. We hope you will continue to take advantage of the conferences and materials that may pertain to your work or interests.**
We will continue to produce education content for the public, but we must point out that none of our webinars, articles, blog posts, or other similar material constitutes legal advice, does not create an attorney client relationship and you cannot rely on it as such. We hope you will continue to take advantage of the conferences and materials that may pertain to your work or interests.**
[1] Sections 101(4)(A)(i), 110(a)(1)(B) of the FMLA.
[2] Section 3104 of the FML Expansion Act.
[3] Sections 101(4)(A)(i), 110(a)(1)(A) of the FMLA.
[4] Section 3102 of the FML Expansion Act.
[5] Section 3105 of FML Expansion Act.
[6] Section 110(b) of the FMLA, as amended.
[7] Section 5110(2) of the Emergency Paid Sick Leave Act.
[8] Section 5102(a) of the Emergency Paid Sick Leave Act.
[9] Section 5102(a) of the Emergency Paid Sick Leave Act.
[10] Section 5110(5) of the Emergency Paid Sick Leave Act.
[11] Section 5102(e) of the Emergency Paid Sick Leave Act.
[12] Section 5102(c) of the Emergency Paid Sick Leave Act.
[13] Section 5102(b) of the Emergency Paid Sick Leave Act.
[14] Section 5105) of the Emergency Paid Sick Leave Act.
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