Families First Coronavirus Response Act Comm 2020.03.18

(Information accurate as of March 18th, 2020)
It is our hope at MACKEY to continue bringing value-added conversations to our clients and prospects as it relates to an ever-changing business climate that we are in.  Today’s commentary addresses concerns businesses have related to mandates under the soon-to-be passed legislation known as Families First Coronavirus Response Act, that expands requirements around paid sick time for employees to care for themselves or family members affected by COVID-19.  As of March 17th, 2020, The House of Representatives has passed the Bill and the Senate is poised to take up the matter immediately.

As a small business owner here is what you need to know:

  1. You are now subject to FMLA compliance for the Coronavirus Response only
  2. You will be required to pay sick leave of at least 2/3rds the employee’s salary
  3. You will receive a tax credit back for the sick leave paid each calendar quarter (April, July, October, January)
  4. The Department of Labor has the ability to exempt small businesses if they can show this would cause financial hardship

The US Chamber of Commerce,  Inc.com & Littler.com have great summaries on the bill.

A summary of the Sick Leave provisions are provided below:

SICK LEAVE

An employer shall provide to each employee employed by the employer paid sick time to the extent that the employee is unable to work (or telework) due to a need for leave because:

  • The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
  • The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
  • The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
  • The employee is caring for a son or daughter of such 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.
  • The employee is experiencing any other substantially similar condition to COVID-19, except that an employer of an employee who is a health care provider or an emergency responder may elect to exclude such employee from the application of such leave.

The amount of hours of paid sick time to which an employee is entitled shall be 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.
  • Paid sick time under this Act shall not carry over from 1 year to the next.
  • Paid sick time provided to an employee under this Act shall cease beginning with the employee’s next scheduled workshift following the return of child to school or childcare or recovery from COVID-19 and underlying conditions..
  • An employer may not require, as a condition of providing paid sick time under this Act, that the employee involved search for or find a replacement employee to cover the hours during which the employee is using paid sick time.
  • The paid sick time under the Act shall be available for immediate use by the employee for the purposes described, regardless of how long the employee has been employed by an employer.
  • An employee may first use the paid sick time for the 10 day period
  • An employer may not require an employee to use other paid leave provided by the employer to the employee before the employee uses the paid sick time under the Act.
  • Each employer shall post and keep posted, in conspicuous places on the premises of the employer where notices to employees are customarily posted, a notice, to be prepared or approved by the Secretary of Labor, of the requirements described in this Act will be available not later than 7 days after the date of enactment of this Act.
  • It shall be unlawful for any employer to discharge, discipline, or in any other manner discriminate against any employee who takes leave in accordance with this Act; and has filed any complaint or instituted or caused to be instituted any proceeding under or related to this Act (including a proceeding that seeks

TAX CREDIT

The Bill provides a tax credit to cover the costs.  The credit is applied to the tax the company or nonprofit normally pays for each employee’s Social Security.  This is the 6.2 percent tax employers pay on each employee’s salary.   If sick leave ends up costing more than the Social Security bill, the U.S. government will send the employer a check to cover the remaining costs.  The Bill caps the amount of paid sick leave at $511 per day and $5,110 in the aggregate for an employee’s own illness or quarantine, and $200 per day and $2,000 in the aggregate for any other qualifying reason.

TIME PERIOD

The Act, and the requirements under this Act, shall take effect no later than 15 days after the date of enactment of this Act.  The Act, and the requirements under this Act, shall expire on December 31, 2020.