Understanding and responding to the business and legal impacts of COVID-19

Summary of the Families First Coronavirus Response Act -March 19, 2020

Effective Date: Leave requirements are in effect April 2 – December 31, 2020

Covered Employers: All employers with less than 500 employees are covered, even those with fewer than 50 employees

Emergency Paid Sick Leave: Employees are eligible for up to two weeks of paid sick time if an employee is unable to work (or telework) for any of the following reasons:

  • Employee is under quarantine or self-isolation as directed by a government authority or health care provider or is experiencing symptoms and seeking a diagnosis
    • Sick time is paid at regular rate of pay, but not to exceed $511 per day and $5,110 total
  • Employee is caring for someone under quarantine or experiencing symptoms
    • Sick time is paid at two-thirds regular rate of pay, but not to exceed $200 per day and $2,000 total
  • Employee is caring for a child whose school or daycare has been closed or because the regular childcare provider is unavailable due to COVID-19 protections
    • Sick time is paid at two-thirds regular rate of pay, but not to exceed $200 per day and $2,000 total

Employers may not require an employee to use any other paid leave available to the employee if the employee needs leave for any of these reasons. An employee can choose to take this type of leave first before tapping other paid PTO.

Emergency Family and Medical Leave: An employee who has worked for an employer for at least 30 days is eligible for up to 12 weeks of emergency family and medical leave if the employee is unable to work (or telework) because they need to care for a child whose school or daycare has been closed or whose regular childcare provider is unable due to a COVID-19 public health emergency

  • First 10 days may be unpaid, but an employee may elect to use accrued PTO
  • Remainder is paid at a rate of two-thirds the employee’s regular rate of pay, subject to a cap of $200 per day or $10,000 total
  • Employees generally entitled to restoration in equivalent position with equivalent pay/benefits
    • Restoration requirement does not apply to employers with 25 or fewer employees where the position no longer exists and the employer could not find an equivalent position after reasonable effort

 

Payroll Tax Credit: Employers are provided a refundable tax credit against federal payroll taxes worth 100% of the emergency paid sick leave and emergency family and medical leave paid by an employer for each calendar quarter through the end of 2020. The credit is capped at the amounts set forth above with respect to each employee based upon the type of leave and the reason for it. The amount of paid sick leave credit cannot exceed the total employer payroll tax obligations on all wages for all employers for that calendar. The tax credit may also be increased to include amounts for certain increased qualified health plan expenses for employees on leave.

Business Closures and Furloughs: It appears this law does not provide for any type of leave in the event a business closes or suspends operations or the employee is fully furloughed.


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