The U.S. Senate passed the Families First Coronavirus Response Act (“FFCRA”), and shortly after, President Donald Trump signed it into law. The Act will take effect no later than 15 days after its enactment. It will remain in effect until it expires under a sunset provision on December 31, 2020. This final version of the bill has some key differences from the one passed earlier in the U.S. House. But like the House bill, the final legislation does not apply to employers of 500 or more.

The FFCRA provides for expanded, paid FMLA as well as paid leave. Here are several key provisions that will have a significant impact on covered employers.

FMLA Leave for Childcare During COVID-19 Epidemic

The FFCRA amends the Family & Medical Leave Act (FMLA) to provide paid FMLA leave when an employee cannot report to work or telework because the employee must care for a son or daughter under the age of 18 whose school or place of care has been closed or whose child care provider is unavailable because of a public health emergency. A child care provider is any provider who receives compensation for providing child services on a regular basis.

The FFCRA further amends the FMLA as follows:

  • For COVID-19 related leave, the term “eligible employee” is expanded to include anyone who has been employed for at least 30 days; and
  • The FFCRA modifies the employer threshold for COVID-19 related leave from “50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding year” to “fewer than 500 employees.”

Although FMLA leave is generally unpaid, leave taken to care for a child under the FFCRA is paid leave after the first 10 days of leave. An employee may elect to substitute any accrued vacation leave, personal leave, or medical or sick leave (including COVID-19 sick leave described below) for the initial 10 days that would otherwise be unpaid. After this 10-day period, an employer must provide paid leave for each day of FMLA leave taken for the qualifying COVID-19 related purpose.

An employee who takes FMLA leave under the FFCRA Amendment must be paid at least two-thirds of the employee’s regular rate of pay at the number of hours the employee would otherwise normally be scheduled to work. For employees who work a varied weekly schedule, the most recent six months of employment can be used as a basis, including any leave taken during that period. If the employee did not work for at least six months in the period immediately preceding leave, the employer should use the employee’s expectation of scheduled hours at the time of his or her hiring.

Emergency FMLA leave taken under the FFCRA Amendment may not exceed $200 per day per employee or $10,000 in the aggregate.

Employment Restoration

Employers with at least 25 employees must restore an employee who takes COVID-19-related FMLA to an equivalent position. Employers who employ fewer than 25 employees are not obligated to restore the employee to the same position if the employee’s job no longer exists due to economic conditions or other changes in operating conditions of the employer.

If the employee cannot be restored to employment upon returning from leave, the employer must contact and rehire the employee if an equivalent position becomes available within one year. A year is measured from the earlier of (i) the date on which the qualifying need related to a public health emergency concludes or (ii) the date that is 12 weeks after the date on which the employee’s leave commences.

Exemption from Emergency FMLA Requirements

The FFCRA’s emergency FMLA requirements provide an additional layer of protection for small businesses with fewer than 50 employees. The Secretary of Labor can exempt these businesses from the emergency FMLA requirement if offering the leave would jeopardize the viability of the business.

COVID 19 Related Paid Sick Leave

The FFCRA also requires private employers with fewer than 500 employees (and all public employers/agencies) to provide full-time employees with two weeks (80 hours) of paid sick leave and part-time employees with paid leave equal to the average number of hours worked by the employee over a two-week period. This paid sick leave may be used when an employee is unable to work or telework because:

  • the employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
  • the employee has been advised by a health care provider to self-quarantine because of COVID-19 related concerns;
  • the employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  • the employee is caring for an individual who is subject to a quarantine or isolation order or an individual advised by a health care provider to self-quarantine due to a COVID-19 related concern;
  • the employee is caring for a child if the child’s school is closed or the child’s childcare provider is unavailable; or
  • the employee is experiencing any substantially similar condition :

If the employer offers its own paid sick leave program, its employees may first use paid sick time provided under the FFCRA before exhausting any other paid leave and may not be forced to first exhaust paid leave under the employer’s paid leave plan. The paid time off required by the FFCRA is also separate from and in addition to any PTO required by state or Local laws.

Employees taking paid sick leave are entitled to take leave at the greater of: (1) their regular rate of pay; (2) the minimum wage rate in effect under federal law; or (3) the minimum wage rate in the state or locality in which the employee is employed.

Paid sick leave may be capped at $511 per day per employee ($5,110 aggregate) for leave taken because the employee is experiencing symptoms of COVID-19 takes time off to obtain a medical diagnosis or when the employee is ordered to isolate or quarantine and unable to work because of COVID-19. Pay may be capped at $200 per day per employee ($2,000 aggregate) for leave taken to care for a child, another individual, or for any substantially similar condition.

Keep in mind that emergency FMLA leave taken under FFCRA may be unpaid for the first 10 days but that an employee may exhaust other paid leave to fill the gap. Assuming an employee is out on emergency FMLA leave, the employee could supplement the first 10 days of unpaid FMLA leave by using paid sick leave provided under FFCRA for a qualifying purpose.

Prohibited Acts

The FFCRA forbids employers from discharging, disciplining, or otherwise discriminating against any employee who exercises or attempts to access their rights under the paid leave law of the FFCRA.

Employers who violate employee rights will be considered to have failed to pay minimum wages in violation of section 6 of the Fair Labor Standards Act of 1938 and subject to penalties outlined in sections 16 and 17 of the FLSA (29 U.S.C. 216 and 217).

Exemption from Paid Sick Leave Obligations

The Secretary of Labor has the authority to issue regulations to exempt small businesses with fewer than 50 employees from the paid sick leave requirements when the imposition of those requirements would jeopardize the viability of the business.

Tax Credits

United States Capitol building, Washington, DC, at dusk, with lights reflected in reflecting pool

One-hundred percent of the emergency FMLA and paid sick leave wages will be reimbursable via payroll tax. credits Specific conditions for obtaining these reimbursements are forthcoming from the Treasury Department.