In response to the COVID-19 pandemic, the Families First Coronavirus Response Act (H.R. 6201) was signed by the President on March 18, 2020.  This Act includes requirements for employers relating to paid sick time and family leave and is effective beginning April 2, 2020 through December 31, 2020.  Employers must provide two weeks of paid sick leave to full-time employees who need leave in response to COVID-19 as well as twelve weeks of leave and job protection for employees under the Family and Medical Leave Act (FMLA) who meet certain criteria relating to COVID-19.

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides stimulus to individuals and businesses impacted for the coronavirus pandemic. Click here for answers to frequently asked questions about the CARES Act.

 

 Emergency Paid Sick Leave Act – FAQs

Who is eligible?

Employers with fewer than 500 employees.  There may be certain exemptions for employers with fewer than 50 employees should the Act jeopardize the business’s viability.  Eligible employees include those defined by the Fair Labor Standards Act (FLSA).

What is the effective date?

Both the proposed FMLA changes and the proposed paid sick leave take effect not later than 15 days after enactment, April 2, 2020 and would remain in place until the end of 2020.

What are qualified reasons for taking paid sick leave under the Act?

An employee may be eligible for the paid sick leave if work is unable to be performed remotely and

• The employee is subject to a federal, state or local quarantine due to COVID-19 (eligible employees will receive paid sick leave at their regular rate, except that in no event shall the amount paid exceed $511 per day and $5,110 in total);
• The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19 (eligible employees will receive paid sick leave at their regular rate, except that in no event shall the amount paid exceed $511 per day and $5,110 in total);
• The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis (eligible employees will receive paid sick leave at their regular rate, except that in no event shall the amount paid exceed $511 per day and $5,110 in total);
• The employee is caring for an individual who is either subject to a federal, state or local quarantine or isolation due to COVID-19 or has been advised to self-quarantine due to concerns related to COVID-19 (eligible employees will receive paid sick leave at two-thirds of their regular rate, except that in no event shall the amount paid exceed $200 per day and $2,000 total);
• The employee is caring for their child whose school has been closed or place of care is unavailable due to COVID-19 precautions (eligible employees will receive paid sick leave at two-thirds of their regular rate, except that in no event shall the amount paid exceed $200 per day and $2,000 total); or
• The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretaries of Treasury and Labor (eligible employees will receive paid sick leave at two-thirds of their regular rate, except that in no event shall the amount paid exceed $200 per day and $2,000 total).

What is the amount of paid sick leave to be provided to eligible employees?

Full-time employees are entitled to 80 hours of paid sick leave.  Part-time employees are entitled the average number of hours that employee works over a two-week period.

Who pays for the sick time or leave?

Employers must pay the benefits, but they will receive a tax credit for doing so.

Additional information for employers:

• Paid sick leave under the Act is in addition to any paid time off currently provided.
• Employers may not require employees to use their current paid leave prior to using the paid sick leave under the Act.
• Employees are not required to provide notice to the employer prior to using the paid sick leave, however, the employee is required to follow reasonable notice procedures after the first day the employee is sick in order to continue receiving the paid sick time.
• The Secretary of Labor may exclude from these requirements employers with fewer than 50 employees based on hardship or for employers of health care providers and emergency responders. The process to request an exclusion was not defined.
• The Department of Labor (DOL) has put together a Q & A Sheet to answer additional employer questions. https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

 

Emergency Family and Medical Leave Expansion Act – FAQs

Who is eligible?

Employers with fewer than 500 employees.  There may be certain exemptions for employers with fewer than 50 employees should the Act jeopardize the business’s viability.  Eligible employees include those who have been employed with a private employer at least 30 calendar days before the leave is requested as well as all government employees.

What is the effective date?

Both the proposed FMLA changes and the proposed paid sick leave take effect not later than 15 days after enactment, April 1, 2020 and would remain in place until the end of 2020.

What are qualified reasons for taking paid sick leave under the Act?

An eligible employee may take up to twelve weeks of leave if work is unable to be performed remotely and the employee must care for their child who is under the age of 18 and whose school or place of care has closed because of the COVID-19 public health emergency.

What is the amount of leave to be provided to eligible employees?

Qualifying employees may take up to twelve weeks of leave.  The first 10 days of leave are unpaid, following the 10 days, the employee is entitled to receive two-thirds of their normal wages for the number of hours they would be regularly scheduled to work (up to a maximum of $200 per day and $10,000 total).  Employees may use any paid time off accrued during the initial two-week period.

Additional Information for Employers:

• For employers employing 25 or more employees, the employer must make reasonable efforts to restore the employee to an equivalent position following the employee’s leave. A narrow exception exists for positions that no longer exist due to economic conditions or changes in operations caused by a public health emergency.
• The COVID-19 FMLA leave, which counts towards an employee’s total FMLA leave allotment, applies to any employee who has been working for his/her employer for at least 30 days and provides leave for a “qualifying need relating to a public health emergency.
• A “qualifying need” means the employee is unable to work (or telework) due to a need to care for the employee’s son or daughter whose school or place of care is closed, or whose childcare provider is unavailable, due to a public health emergency.
• Like the first version of the House Bill, the final version still provides a payroll tax credits to employers for paid leave and emergency unemployment assistance. These tax credits are refundable and therefore ultimately 100% of the financial burden of providing this assistance will be funded by the federal government.  To the extent the mandate causes a liquidity hardship for the employer Treasury is creating a process to advance the benefit of the credits to the employer.
• The Department of Labor (DOL) has put together a Q & A Sheet to answer additional employer questions. https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

 

Employers Facing Layoffs – FAQs

What factors must employers consider when conducting layoffs?

 Any employer covered by the Worker Adjustment and Retraining Notification (WARN) Act has an obligation to provide notice of a plant closing or mass layoff in certain situations.  “Covered” employers include those with 100 or more full-time employees.

How much notice must be provided to employees under the WARN Act?

Employers must provide at least 60 calendar days of notice prior to plant closing or mass layoff.

Additional information for employers:

• It is unclear whether COVID-19 would provide an exception to the WARN Act and, in such cases where a layoff is under consideration, employers should seek guidance from an employment attorney.

 

Coronavirus Aid, Relief and Economic Security (CARES) Act FAQs

What has changed with the unemployment benefit offerings?

The Act enhances unemployment benefits by expanding eligibility and offering recipients an additional $600 a week—beyond what state unemployment programs pay—for four months.

Is there an extension to unemployment benefits?

For individuals who remain unemployed after state employment benefits are no longer available, the Act will provide a 13-week extension of unemployment benefits through December 31, 2020.

Which employees are eligible?

Employees are eligible if they meet the following criteria:

• Not eligible for regular compensation or extended benefits under federal and state law; and
• Unable to work for reasons related to the impacts of COVID-19 on the individual, the individual’s family, the individual’s place of work, movement restrictions, etc.

With reduced production, how can I afford to keep my employees?

The CARES Act provides eligible employers a refundable credit against payroll tax liability equal to 50% of the first $10,000 in wages per employee (including value of health plan benefits). Eligible employers must have carried on a trade or business during 2020 and satisfy one of two tests:

• Have business operations fully or partially suspended operations due to orders from a governmental entity limiting commerce, travel, or group meetings; or
• Experience a year-over-year reduction in gross receipts of at least 50% – until gross receipts exceed 80% year-over-year.

For employers with more than 100 full-time employees, only employees who are currently not providing services for the employer due to COVID-19 causes are eligible for the credit. The employee retention credit is effective for wages paid after March 12, 2020, and before January 1, 2021.

The CARES Act amends the Small Business Act to create a new Business Loan Program category. For the period from February 15, 2020 to June 30, 2020, the law allows the Small Business Administration to provide 100% federally backed loans up to a maximum amount to eligible businesses to help pay operational costs like payroll, rent, health benefits, insurance premiums, utilities, etc. subject to certain conditions.

 

Government Resources for Employers

 Occupational Safety and Health Administration https://www.osha.gov/SLTC/covid-19/standards.html
Employers may be responsible for recording cases of COVID-19 if a worker is infected as a result of performing their work-related duties.

Equal Employment Opportunity Commission (EEOC) https://www.eeoc.gov/eeoc/newsroom/wysk/wysk_ada_rehabilitaion_act_coronavirus.cfm
Addresses anti-discrimination laws and the requirement to provide reasonable accommodations as applicable.

U.S. Department of Commerce https://nvlpubs.nist.gov/nistpubs/SpecialPublications/NIST.SP.800-46r2.pdf
Provides a guide to employers to answer security questions regarding work from home arrangements for their employees.

Centers for Disease Control and Prevention https://www.cdc.gov/coronavirus/2019-ncov/community/guidance-business-response.html
Guidance for employers to help prevent workplace exposures to COVID-19.

 

We want to partner with you for the good of your people and our community. If you would like to discuss any of these new regulations and the new business model we are all in, please reach out to our team and one of our consultants will be in touch with you. Contact our team at  AskHRSG@mcmhrsg.com.

 

 

You should consider consulting your legal counsel regarding these matters as well as any union contract considerations. Nothing in this document should be construed as providing tax advice.  Please consult with your own professional tax advisor.  In addition, this document represents the information that we have up to the date the presentation was made and cannot be relied upon for additional updates beyond that date.