The Senate passed the Families First Coronavirus Response Act Wednesday and President Trump signed it hours later. The law becomes effective April 2, 2020 and expires on December 31, 2020. The law contains many provisions that are going to be difficult for small businesses specific to paid family and sick leave. In addition the act provides free coronavirus testing, makes changes to Unemployment Insurance, strengthens food security initiatives and increases Medicaid funding.
Paid Family and Medical Leave The final version was changed by the Senate and includes employees of employers with less than 500 employees, who have been on the job for at least 30 days. The new law requires 12 weeks of paid family and medical leave for these employees unable to work (or telework), due to caring for a child if the child's school or place of care has been closed, or is unavailable, due to the coronavirus. Please note: The Act authorizes the Secretary of Labor to exclude certain health care providers and emergency responders from providing extended Family and Medical Leave as well as small businesses with fewer than 50 employees if providing the leave "would jeopardize the viability of the business."
- The first 10 days of the leave may be unpaid-employees may choose to use any accrued paid time off, including vacation and sick leave to cover this initial 10-day period.
- If the employee's leave extends past these 10 days, the employee will be paid not less than two-thirds of the employee's regular rate of pay for the regular hours worked. This is capped at $200.00 per day and $10,000.00 in the aggregate.
- Employers will receive a payroll tax credit for the qualified sick leave wages paid out by the employer, subject to caps based on the reason for the leave and daily maximums.
- Employers are required to restore employees to their same or similar position unless the following conditions are met: The employer has fewer than 25 employees; The position held no longer exists due to economic or other operating conditions that affect employment and are caused by the public health condition; The employer attempts to restore the employee to a similar position; The attempts to restore to a similar position fail, and the employer contacts the employee if such a position becomes available.
Paid Sick Leave Employers with fewer than 500 employees are also required to provide two weeks of paid sick leave to their employees. Paid sick leave can be used for the following reasons:
(1) The employee is subject to a Federal, State, or local quarantine or isolation order related to coronavirus;
(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to coronavirus;
(3) The employee is experiencing coronavirus symptoms and seeking a medical diagnosis;
(4) The employee is caring for an individual who is subject to an order as described in reason (1) or has been advised as described in reason (2).
(5) 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 the coronavirus.
(6) The employee is experiencing 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.
- Employees who go on paid sick leave for reasons (1), (2), or (3) will be paid at their regular rate of pay. Employees who use their leave for reasons (4), (5), or (6) will be paid at two-thirds the employee's regular rate of pay. In no event, however, shall the paid sick leave exceed $511.00 per day and $5,110.00 in the aggregate for reasons (1), (2), or (3), or $200.00 per day and $2,000.00 in the aggregate for reasons (4), (5), or (6).
- Full-time employees are entitled to two weeks (80 hours) and part-time employees are entitled to the typical number of hours they work in a typical two-week period.
- Employers cannot require employees to use other paid leave provided by the employer before using Paid Sick Leave under the Families First Coronavirus Response Act. Employers with existing sick leave policies must provide paid sick leave under the Families First Coronavirus Response Act in addition to the existing leave available.
- Employers can receive a payroll tax credit for the qualified sick leave wages paid out by the employer, subject to caps based on the reason for the leave and both daily and quarterly maximums.
COVID-19 Testing Requires all private insurers to provide FREE coverage for COVID-19 testing, including the cost of a provider, urgent care, and emergency room visits in order to receive testing.
Unemployment Insurance Provides adequate funding for unemployment compensation for eligible individuals. The one-week waiting period for unemployment compensation will remain up to the states, but the Act will provide for temporary federal matching for the first week for those states with no waiting week.