On March 18, 2020, the U.S. Senate passed the Families First Coronavirus Response Act (the "Act"), by a vote of 90-8, and President Donald Trump signed the Act into law. 
 
The Act provides eligible workers with guaranteed paid Sick Leave and expanded Family and Medical (FMLA) Leave in specific circumstances. Employers will initially pay for the Sick and expanded FMLA leave, but eligible employers will be 100% reimbursed by the federal government through quarterly tax credits that offset the employers' payroll tax.  The Act will be effective in 15 days, on April 2, 2020.  Here are the critical provisions:
 
PAID SICK LEAVE
 
Under the Act, employers with fewer than 500 employees must provide full-time employees with 10 days (80 hours) of paid leave (for part-time employees, hours equal to the number of hours the employee works on average over a two-week period) if they are "unable to telework" and are:
  • Subject to a government quarantine or isolation order related to COVID-19 issued by a federal, state, or local law due to exposure or symptoms;
  • Have been advised by healthcare providers to self-quarantine due to COVID-19 due to exposure or symptoms;
  • Are experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  • Caring for an individual subject to a federal, state, or local quarantine or isolation order or advised to self-quarantine due to COVID-19 concerns;
  • Caring for their child as a result of childcare or school closures or if the childcare provider is unavailable due to COVID-19 precautions; or
  • Experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.
Paid Sick Leave is available for immediate use (upon the effective date of the Act) regardless of how long the employee has been employed. There is a cap:  employees will be eligible for 100% of their normal salary, to a $511 cap/day and $5,110 in the aggregate (total), if the employee is sick or quarantined; and two-thirds of their regular pay, to $200 cap/day and $2,000 in aggregate, if the employee is caring for someone else. 
 
If hourly nonexempt, employers must compensate employees for any paid sick time they take at the higher rate of: (i) their regular rate of pay, (ii) the federal minimum wage, or (iii) the local minimum wage.
 
What about employers with existing leave policies? 
The paid Sick Leave allotment provided for in the emergency legislation is in addition to whatever sick leave is already offered by employers (including state or local Sick Leave requirements).  An employer may not require an employee to use other paid leave provided by the employer before the employee uses the paid Sick Leave under the Act. Nothing expressly prohibits employers from prospectively changing their leave programs (e.g., vacation accruals) after the Act goes into effect.
 
PAID FMLA BENEFIT / EMERGENCY FMLA
 
Pursuant to the Act, employers with fewer than 500 employees will be required to provide up to 12 workweeks of paid FMLA leave, at two-thirds of an employee's pay (for the number of hours the employee otherwise would have been scheduled).  After a 10-day waiting period, employees are paid at two-thirds of their regular rate.  Employees may use accrued personal or sick leave during the first 10 days (80 hours), or the first 2 weeks of the 12 week period.
 
This emergency FMLA leave is for employees who are:
 
Employed for at least 30 days; and
  • Who are caring for children under the age of 18 whose schools or daycares are closed or whose childcare provider is unavailable due to the COVID-19 public health emergency declared by a federal, state, or local official. (This is the only reason that this form of leave is permissible.)
 For Paid FMLA, there is also a cap- This paid FMLA benefit is capped at $200 a day and $10,000 in total.
 
Employers with 25 or more employees will have the same obligations under FMLA to return the employee to the same or equivalent position upon return, but those with fewer than 25 employees under specific conditions do not have to restore employees to their previous positions. Employers cannot force workers to use employer-provided paid time off before receiving this benefit, but employees can choose to use accrued paid time off, such as sick or vacation time, to cover the unpaid 10-day waiting period if paid Sick Leave does not apply.
 
POTENTIAL EXEMPTIONS
 
The Act provides the U.S. Department of Labor with the authority to create regulations that can exempt businesses with fewer than 50 employees from these requirements when the imposition of the requirements would jeopardize the viability of the business as a going concern. Healthcare providers such as hospitals and nursing homes are also exempt from this new law.  The DOL has not issued such regulations yet; but, hopefully soon.
 
Note, there are no obligations on employers with 500 or more employees . . . yet.
 
NOTICES AND EFFECTIVE DATE
 
A model notice will be made available by the Secretary of Labor within 7 days of the Act's enactment for employers to post to meet the Act's posting requirements.
 
The Act is effective no later than April 2, 2020 and expires on December 31, 2020.
 
QUESTIONS
 
The final text of the Act is found here
 
https://www.congress.gov/bill/116th-congress/house-bill/6201/text.
If you have any questions, please contact us.  Don't worry - we are here to help!
► Back to News & Resources