FAQ's about Families First Coronavirus Response Act

Posted in Blog on March 24, 2020

UPDATED 3/24/20

Our Director of Talent Initiatives, Mandy Cooper, put together the below information to answer employer questions she’s been getting about the new Families First Coronavirus Response Act. The act has direct implications for small- to mid-sized employers who are now responsible for paying two weeks of wages to qualified employees. The act also expands Family Leave Medical Act (FMLA) to include those who have to stay home due to childcare issues.

Related: Essential workers connect to emergency child care

 

Families First Coronavirus Response Act:  
What Employers Need to Know About New Emergency Sick Leave and FMLA Expansion
 
Over the last two weeks, the federal and state government have raced to provide support and relief to both and employers and employees in the midst of the coronavirus pandemic. The Families First Coronavirus Response Act is the main mechanism for distributing funds. However, there have been many questions as to implementation of this act for employers. 
 
NEW: The DOL and the IRS have started to release additional clarifications and guidelines for employers:
 

 
The following information is meant as an overview of the current federal resources available. It is not meant to take the place of legal advice.
 
H.R. 6201 Families First Coronavirus Response Act (FFCRA) Public Law: 116-127 as of 3/18/2020
 
FFCRA – Emergency Paid Sick Leave
 
Employers Affected: Applies to companies who employers with fewer than 500 employees
 
Exception 1: Small businesses with fewer than 50 employees may be exempt when “imposition of the paid sick leave requirements would jeopardize the viability of the business as a going concern.”
 
Employee Eligibility: All employees regardless of their tenure
 
Qualifying Reasons:
  1. Employee is subject to a federal, state or local quarantine or isolation due to COVID-19
Note: As of 3/24/20, we do not know whether Governor Whitmer’s Executive Order 2020-21 automatically qualifies non-essential employees for paid sick leave under this qualifying reason. We are waiting on further clarification from the DOL. and IRS.
  1. A health care provider advised the employee to self-quarantine due to concerns related to COVID-19 (self-imposed w/out medical advice does not qualify)
  2. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis
  3. The employee is caring for an individual who is 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
  4. The employee is caring for their child whose school has been closed or place of care is unavailable due to COVID-19 precautions
  5. The employee is experiencing any other condition substantially similar to the coronavirus, as specified by the U.S. Department of Health and Human Services (HHS)
Benefit:  
  • Full-time employees receive 80 hours of paid sick leave.  
  • Part-time employees receive the equivalent of the number of hours they would work, on average, during a two-week period based on the number of hours the employee was scheduled per day over the six-month prior period.
Note: If part-time employee did not work in the preceding six-month period, the paid leave rate should equal the “reasonable expectation” of the employee at the time of hiring w/respect to avg. number of hours per day that the employee would be scheduled to work.
Rate:
  • Employees who take paid sick leave for Qualifying Reasons 1, 2 or 3 will be paid at their regular pay rate or at the federal, state or local minimum wage, whichever is greater. The paid sick leave rate may not exceed $511 per day, or $5,110 aggregate.
  • Employees who take paid sick leave for reasons 4, 5 or 6 will be paid at two-thirds their regular rate.The paid sick leave rate may not exceed $200 per day or $2,000 in aggregate.
Additional Employer Notes:
  • An employer may not require an employee to use other paid leave provided by the employer before using the paid sick time provided
  • An employer may require the employee to follow “reasonable notice procedures” in order to continue receiving paid sick time.
  • Employers shall post and keep posted, in conspicuous places, notice of the emergency paid leave requirements. 
  • Employees who work under a multiemployer collective agreement and whose employers pay into a multiemployer plan are provided with leave for coronavirus-related reasons.
  • Employers may not discriminate against, discharge or discipline employees who take paid sick leave. Nor may they require employees to find a replacement to cover their hours.
  • Takes effect on April 2, 2020 and remains effective through Dec. 31, 2020. It cannot be retroactively applied.
Employer Tax Credits:
  • Employers will be reimbursed for the full amount within three months in the form of a payroll tax credit. The reimbursement will also cover the employer’s contribution to health insurance premiums during the leave.
  • The amount is fully refundable. This means that if the amount the employers pay workers who take leave is larger than what they owe in taxes, the government will reimburse the employer with a check for the remainder.
  • Employers may not receive the tax credit if they are also receiving a credit for paid family and medical leave under the 2017 Tax Cuts and Jobs Act. Employers would instead have to include the credit in their gross income.
  • Credits may not be earned retroactively. Paid sick time prior to effective date is not eligible. 
FFRCA - EMERGENCY EXPANSION OF FMLA
NOTE: Emergency expansion of FMLA does NOT replace existing FMLA guidelines and regulations. It expands them to include employees who need to provide childcare.
Employers Affected: Applies to companies who employer fewer than 500 employees
Exception: Small businesses with fewer than 50 employees may be exempt when “FMLA sick leave requirements would jeopardize the viability of the business as a going concern.”
Employee Eligibility: Employees who have worked for at least 30 days 
Qualifying Reason: Expansion applies to new childcare entitlement only. Does not change standard FMLA requirements.
Benefit: 
  • Employee may take up to 12 weeks of leave if he/she is unable to work (including telework) b/c the employee must care for his/her child who is under 18 years of age and whose school or place of care has closed due to the COVID-19 public health emergency
  • During the initial 10-days, employee may use Emergency Paid Sick Leave for qualifying reasons (Or use existing sick time/vacation time; or take unpaid)
  • After 10-day period, employee receives 2/3rds of normal wages for the number of hours he/she would regularly be scheduled to work, up to maximum of $200 per day and $10,000 total 
Employer Tax Credits:
  • Provided refundable tax credits against their employer portion of social security taxes for 100% of the family leave wages paid in accordance with Act.