The Families First Coronavirus
On March 18, 2020, the Families First
Coronavirus Response Act was passed and will go into effect
on April 2, 2020. The law is an economic stimulus plan aimed
at addressing the impact of the COVID-19 outbreak on Americans
and introducing paid sick leave and an expanded family and
medical leave to the nation’s
There are two provisions which provide leave to employees
forced to miss work because of the COVID-19 outbreak: an emergency
expansion of the Family Medical Leave Act (FMLA), and a new federal
paid sick leave law.
Emergency Family and Medical Leave Expansion
- Expanded Coverage and Eligibility – The
Act significantly amends and expands FMLA on a temporary basis.
The current employee threshold for FMLA coverage would change
from only covering employers with 50 or more employees to instead
covering those employers with fewer than 500 employees. It
also lowers the eligibility requirement such that any employee
who has worked for the employer for at least 30 days prior
to the designated leave may be eligible to receive paid family
and medical leave. As a result, thousands of employers not
previously subject to the FMLA may be required to provide job-protected
leave to employees for a COVID-19 coronavirus-designated reason.
However, the Act now includes language allowing the Secretary
of Labor to exempt small businesses with fewer than 50 employees
if the required leave would jeopardize the viability of their
- Reasons for Emergency Leave – Any individual
employed by the employer for at least 30 days (before the first
day of leave) may take up to 12 weeks of job-protected leave
to allow an employee, who is unable to work or, to care for the
child (under 18 years of age) if the child’s school or
place of care is closed or the childcare provider is unavailable
due to a public health emergency. This is now the only qualifying
need for Emergency FMLA Paid Leave.
- The first 10 days of Emergency
FMLA may be unpaid. During this 10-day period, an employee
may elect to substitute any accrued paid leave (like vacation
or sick leave) to cover some or all of the 10-day unpaid period.
After the 10-day period, the employer generally must pay full-time
employees at two-thirds the employee’s
regular rate for the number of hours the employee would otherwise
be normally scheduled. The Act now limits this pay entitlement
to $200 per day and $10,000 in the aggregate per employee.
Pay for Non-Full Time Employees – Employees
who work a part-time or irregular schedule are entitled to be
paid based on the average number of hours the employee worked
for the six months prior to taking Emergency FMLA. Employees
who have worked for less than six months prior to leave are entitled
to the employee’s reasonable expectation at hiring of
the average number of hours the employee would normally be
scheduled to work.
- Job Restoration – Employers with 25 or more employees
will have the same obligation as under traditional FMLA to return
any employee who has taken Emergency FMLA to the same or equivalent
position upon the return to work. However, employers with fewer
than 25 employees are generally excluded from this requirement
if the employee’s position no longer exists following the
Emergency FMLA leave due to an economic downtown or other circumstances
caused by a public health emergency during the period of Emergency
FMLA. This exclusion is subject to the employer making reasonable
attempts to return the employee to an equivalent position and
requires an employer to make efforts to return the employee to
work for up to a year following the employee’s leave.
Date of Expiration – This
program will remain in effect until December 31, 2020.
Emergency Paid Sick Leave Act
Reasons for Paid Sick Leave –This Act
allows an eligible employee to take paid sick leave because the
- subject to a federal, state or local quarantine
or isolation order related to COVID-19;
- advised by a health care
provider to self-quarantine due to COVID-19 concerns;
COVID-19 symptoms and seeking medical diagnosis;
- caring for an
individual subject to a federal, state or local quarantine
or isolation order or advised by a health care provider to
self-quarantine due to COVID-19 concerns;
- caring for the employee’s child
if the child’s
school or place of care is closed or the child’s care
provider is unavailable due to public health emergency; or
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.
Of note, caring for another who is subject to an isolation
order or advised to self-quarantine as described above is not
limited to just family members.
Eligibility – This provision requires
employers with fewer than 500 employees to provide full-time
employees (regardless of the employee’s duration of employment
prior to leave) with 80 hours of paid sick leave at the employee’s
regular rate (or two-thirds the employee’s regular rate
to care for qualifying reasons 4, 5, or 6 listed above).
Cap on Paid Sick Leave Wages –Paid sick
leave wages are limited to $511 per day up to $5,110 total per
employee for their own use and to $200 per day up to $2,000 total
to care for others and any other substantially similar condition.
and Interaction with Other Paid Leave – This
paid sick leave will not carry over to the following year and
may be in addition to any paid sick leave currently provided
Calculating Rate of Pay – Employees who
work a part-time or irregular schedule are entitled to be paid
based on the average number of hours the employee worked for
the six months prior to taking paid sick leave. Employees who
have worked for less than six months prior to leave are entitled
to the average number of hours the employee would normally be
scheduled to work over a two-week period.
Effective Date and Expiration – This
program remain in effect until December 31, 2020.
Tax Credits for Paid Sick And Paid Family And Medical Leave
section provides a series of refundable tax credits for employers
who are required to provide the Emergency Paid Sick Leave and
Emergency Paid Family and Medical Leave described above. These
tax credits are allowed against the employer portion of Social
Security taxes. While this limits application of the tax credit,
employers will be reimbursed if their costs for qualified sick
leave or qualified family leave wages exceed the taxes they would
Specifically, employers are entitled to a refundable
tax credit equal to 100% of the qualified sick leave wages paid
by employers for each calendar quarter in adherence with the
Emergency Paid Sick Leave Act. The qualified sick leave wages
are capped at $511 per day ($200 per day if the leave is for
caring for a family member or child) for up to 10 days per employee
in each calendar quarter.
Similarly, employers are entitled to
a refundable tax credit equal to 100% of the qualified family
leave wages paid by employers for each calendar quarter in accordance
with the Emergency Family and Medical Leave Expansion Act. The
qualified family leave wages are capped at $200 per day for each
individual up to $10,000 total per calendar quarter. Only those
employers who are required to offer Emergency FMLA and Emergency
Paid Sick Leave may receive these credits.
As you can see, this is a very complicated and extensive law.
It is imperative that affected employers fully understand and
are in compliance by the effective date of April 2, 2020.
A company’s best defense against
the potential expense and aggravation related to federal or state
law violations is to proactively review and revise as needed
all Human Resources policies, handbooks, hiring procedures, compensation,
benefits, training programs, communications tools and other functions.
The professionals of PHHR are ready to assist your organization
with this type of training as well as to maintain compliance
with the latest state and federal mandates.
Paul Hilton Human Resources Consulting works with our clients to insure that all required documentation is correct and sufficient to successfully defend against a claim to any unemployment compensation commission.
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