COVID-19 Update: Federal Relief Bill

March 19, 2020 | Kenneth A. Novikoff | Brian S. Conneely | John K. Diviney | Tamika Hardy | Keegan B. Sapp | Employment & Labor

President Trump on March 18, 2020, signed the Families First Coronavirus Response Act (COVID-19 Bill) to provide emergency relief to businesses and employees in response to the coronavirus pandemic. The COVID-19 Bill will become effective no later than 15 days from March 18, 2020 (or on April 2, 2020). Businesses with fewer than 500 employees will be required to provide paid sick leave for employees impacted by the COVID-19 virus. The amount of wages paid to an eligible employee and length of job-protected leave will depend on the employee’s need for leave.

Paid Sick Leave

The COVID-19 Bill will require all employers with fewer than 500 employees to provide an additional 10 days (80 hours) of paid sick leave for eligible employees who are unable to work (or telework) due to a need for leave. Part-time employees are entitled to the number of hours equal to the number of hours that such employee works, on average, over a two-week period. COVID-19 leave cannot diminish an employee’s paid time-off benefits under an employer’s sponsored policy, suggesting that COVID-19 leave is in addition to employer’s paid time-off policy.

  1. Eligible employees will be entitled to 80 hours of paid sick leave if:
  2. The employee is subject to a federal, state or local quarantine or isolation order related to COVID-19;
  3. The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
  4. The employee is experiencing symptoms of COVID-19 and seeking medical diagnosis;
  5. The employee is caring for an individual who is subject to an order as described in subparagraph (1) or has been advised as described in paragraph (2);
  6. The employee is caring for the employee’s son or daughter, if the child’s school or child care facility has been closed or the child’s care provider is unavailable due to COVID-19 precautions; or
  7. The employee is experiencing any other substantially similar condition specified by Health and Human Services in consultation with the Department of the Treasury and the Department of Labor.

An employer cannot request that an employee take any unused paid time off available under the employer’s policy prior to using paid time off under the COVID-19 Bill. The wages owed under COVID-19 vary depending on whether the reason the employee seeks to take sick leave (i.e., for the employee’s own illness/quarantine or to care for someone else affected by the COVID-19 virus).

An employee seeking paid sick leave under the COVID-19 Bill for their own illness or order of quarantine/isolation is entitled to their regular rate of pay not to exceed $511 a day. Alternatively, an employee seeking paid leave to care for another impacted by the COVID-19 virus, including caring for a dependent child due to a school closure, is entitled to their regular rate of pay not to exceed $200 a day.

Any employer who retaliates or discriminates against an employee for taking leave pursuant to the COVID-19 Bill or fails to pay an employee that is otherwise eligible under the COVID-19 Bill will be subject to violations under the Fair Labor Standard Act and Title VII of Civil Rights Act of 1964.

These provisions will sunset on December 31, 2020.

FMLA Expansion Act

The COVID-19 Bill also amends the Family Medical Leave Act (FMLA) to include both paid and unpaid job-protected leave for employees who have worked for the employer for at least 30 days and needs the leave to care for a dependent child due to a school closure.

The expanded FMLA provides job-protected leave only for employees who are unable to work (or telework) due to a need to care for a minor child if the child’s school or place of child care has been closed or caretaker is unavailable due to a public health emergency. The first 10 days of emergency FMLA leave can be unpaid and an employee can opt to substitute accrued vacation, personal or sick leave during this time, but cannot require an employee to do so.

For the remaining 10 weeks, an employer must pay two-thirds the employee’s regular rate of pay not to exceed $200 per day. This emergency FMLA leave is job-protected, and an employer must restore the employee to his or her prior positions at the end of his or her FMLA leave benefits. Employers with fewer than 25 employees may be exempt under the COVID-19 emergency FMLA benefits if the employee’s position no longer exists following leave due to operational changes occasioned by a public health emergency (e.g., a dramatic downturn in business caused by the COVID-19 pandemic).

These provisions will sunset on December 31, 2020.

Exclusion

The COVID-19 Bill provides certain, limited exclusions for health care providers and emergency responders from the definition of employees who are allowed to take such leave, and exempts small businesses (defined as those with fewer than 50 employees) if the required leave would jeopardize the viability of their business. The COVID-19 Bill also expressly provides that employers may exclude employees who are health care providers or emergency responders from this emergency FMLA entitlement.

Tax Credits and Other Efforts

The COVID-19 Bill includes refundable tax credits for employers that are required to offer emergency FMLA or paid sick leave, including self-employed individuals. Note that these credits are only available to those employers that are required to offer these benefits under the COVID-19 Bill, and these new credits are not generally extended to employers not subject to the new mandates under the bill.

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