On March 18, 2020, Congress passed and the President signed into law H.R. 6201, “The Families First Coronavirus Response Act.” Employers should immediately familiarize themselves with and prepare to implement the following provisions, which will go into effect no later than April 2, 2020. In the interim, we expect the Secretary of Labor will promulgate regulations implementing the new laws and will share that information on our website.
As always, the attorneys at Kinkead & Stilz are here to address any questions you may have about this new law and any other concerns that arise as we together face these uncertain times.
Emergency Paid Sick Leave Act
Summary: The Emergency Paid Sick Leave Act (“EPSLA”) provides two weeks of paid leave to employees who are unable to work due to the Coronavirus, COVID-19. The amount of the benefit is greater for the employee’s own illness than other covered reasons. While employers must pay the benefits up front, they are reimbursed through refundable tax credits.
What employers are covered by the EPSLA? The EPSLA applies to businesses with fewer than 500 employees. Companies with fewer than 50 employees may obtain an exemption from the Secretary of Labor if compliance would jeopardize their viability.
What employees are entitled to leave under the EPSLA? All employees, regardless of length of employment, are eligible for emergency paid sick leave. However, an employer of a health care provider or first responder may exclude such employees from receiving leave under the EPSLA.
What situations qualify for leave under the EPSLA? The EPSLA provides for paid leave if an employee is unable to work (including telework) for one of the following reasons:
1. To comply with a federal, state, or local quarantine or isolation order related to COVID-19;
2. To comply with a health care provider’s instruction to self-quarantine due to COVID-19 concerns;
3. To obtain a medical diagnosis if the employee is experiencing symptoms of COVID-19;
4. To care for or assist another individual (not limited to family members) who is subject to a Coronavirus-related federal, state, or local quarantine or isolation order or has been advised by a health care provider to self-quarantine due to COVID-19 concerns;
5. To care for a child under 18 if the child’s school or place of care has been closed, or the child care provider is not available, due to COVID-19; or
6. The employee is experiencing a substantially similar condition, as specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.
What are the leave benefits under the EPSLA? For leave under reasons 1, 2, and 3 (the employee’s own Coronavirus-related condition), leave benefits are paid at the employee’s regular rate of pay, up to $511 per day and $5,110 total per employee. Leave under reasons 4, 5, and 6 is limited to two thirds of the employee’s regular rate of pay, up to $200 per day and $2,000 total per employee.
Full-time employees are entitled to 80 hours of EPSLA leave. Part-time employees are entitled to leave for number of hours they work on average over a two-week period. For employees with variable hours, the amount of leave is based on the average number of hours worked per day, including hours for which the employee took leave, over the past six-month period, or the reasonably expected daily work hours at the time of hire.
Leave under the EPSLA is in addition to other leave provided by policy. EPSLA leave does not carry over from one year to the next, and it is not paid out upon termination. Employers may not require employees to use other paid leave before using emergency paid sick leave under the Act.
How is the EPSLA leave funded? Employers initially pay for the leave, but both the wages paid and the employer’s contribution to the employee’s health insurance premiums during the leave period, subject to the per diem and aggregate limits set forth above, will be fully reimbursed by the federal government through refundable tax credits counted against employers’ quarterly payroll tax. If the employer’s costs more than offset their tax liability, they will receive a refund from the IRS.
Emergency Family and Medical Leave Expansion Act
Summary: The Emergency Family and Medical Leave Expansion Act (EFMLEA) requires all employers with fewer than 500 employees to provide up to 12 weeks of job-protected leave to employees who are unable to work due to the need to care for a child whose school or child care provider is unavailable because of a public health emergency related to COVID-19. While the first 10 days of such leave are unpaid, the remaining 10 weeks must be paid at two thirds of the employee’s regular rate of pay. Leave paid by an employer under the EFMLEA is reimbursed through refundable tax credits.
What employers are covered by the EFMLEA? The EFMLEA applies to businesses with fewer than 500 employees. Companies with fewer than 50 employees may obtain an exemption from the Secretary of Labor if compliance would jeopardize their viability.
What employees are entitled to leave under the EFMLEA? Only employees who have been employed by the employer for at least 30 days are eligible for EFMLEA leave. However, an employer of a health care provider or emergency responder may exclude such employees from receiving leave under the EFMLEA.
What situations qualify for EFMLEA leave? The EFMLEA provides for paid leave if an employee is unable to work (including telework) due to the need to care for a child under 18 if the child’s school or place of care has been closed, or the child care provider is not available, because of a Coronavirus-related public health emergency.
What are the leave benefits under the EFMLEA? Under the EFMLEA, an employee is entitled to twelve weeks of leave. The first 10 days may be unpaid; the employee may substitute available paid leave (e.g., vacation, personal, or sick leave, including leave provided under the EPSLA), but the employer may not require such substitution. For the remainder of the covered leave, the employee is entitled to receive two thirds of his or her regular rate of pay, up to $200 per day and $10,000 in the aggregate for any employee, for the number of hours he or she otherwise would normally be scheduled to work. For employees with variable hours, the amount of leave is based on the average number of hours worked per day, including hours for which the employee took leave, over the past six-month period, or the reasonably expected daily work hours at the time of hire.
Is EFMLEA leave job protected? In general, yes. However, there is an exception for companies with fewer than 25 employees if the employee’s position no longer exists due to economic conditions or operational changes caused by COVID-19. In that event, the employer must make reasonable efforts to restore the employee to a comparable position with equivalent terms and conditions of employment, and if those efforts fail, the employer must make reasonable efforts for one year after the employee’s 12-week leave period or qualifying need ends, whichever is earlier, to contact the employee if an equivalent position becomes available.
How is EFMLEA leave funded? Employers initially pay for the leave, but both the wages paid and the employer’s contribution to the employee’s health insurance premiums during the leave period, subject to the per diem and aggregate limits set forth above, will be fully reimbursed by the federal government through refundable tax credits counted against employers’ quarterly payroll tax. If the employer’s costs more than offset their tax liability, they will receive a refund from the IRS.