BY CLAUDIA ST. JOHN, SPHR, SHRM-SCP

On March 18, 2020, President Trump signed the Families First Coronavirus Response Act into law. It took effect April 2, 2020. There are many provisions to this bill not covered in this analysis, such as the offering of free testing and food aid as well as adding $1 billion to state unemployment funds. There are also many aspects of this law that require further information and clarity. Our effort here is to provide interpretation of the law’s provisions as they relate to employers as best we know them at this point (March 20, 2020).

The Families First Coronavirus Response Act creates two separate Acts – the Emergency Paid Sick Leave Act and the Emergency Family and Medical Expansion Act, both of which apply to employers with fewer than 500 employees.

EMERGENCY PAID SICK LEAVE ACT

The Emergency Paid Sick Leave Act requires employers with fewer than 500 employees to provide up to two weeks of paid sick leave to full-time and part-time employees in addition to their current existing and banked sick leave, regardless of how long they worked for the company. It covers employees who, as a result of this pandemic, are unable to work, either in the workplace or remotely.

The Act:

> Requires employers to provide two weeks (up to 80 hours) of paid sick leave (up to $511 per day based on regular wages or $5,110 total) for employees who:
o Are being tested or treated for or have been diagnosed with COVID-19.
o Who have been told by a doctor or government official to stay home because of exposure to or showing symptoms of COVID-19 (mandatory quarantine or self-quarantine).

> Requires employers to provide two weeks (up to 80 hours) of paid leave (up to 2/3 of regular pay up to $200 per day or $2,000 total) for employees who have children whose school or daycare provider is closed or have family members affected by coronavirus.

Employer-provided Emergency Sick Leave pay will be fully reimbursed by the federal government through the end of 2020 through refundable quarterly tax credits to offset Social Security payroll taxes. Federally reimbursed paid sick time is capped at $5,110 plus employer-paid or supported health insurance costs per employee (for those being tested, treated or diagnosed with COVID-19 or those with symptoms or exposure to COVID-19), or $2,200 plus health insurance costs per employee (for those caring for children out of school or tending to family members affected by coronavirus).

Employers with fewer than 50 employees may apply for hardship waivers and may apply to have funds advanced to them.

According to the Act, the Secretary of Labor has the right to exempt businesses with fewer than 50 employees, along with healthcare providers, emergency responders and other related companies, if paying sick time would cause a hardship.

At this point, we do not know how “hardship” is defined or what the process is for obtaining a waiver or exemption entails.

Employer responsibilities:

> Post notice of requirements (to be available from the Secretary of Labor by March 25, 2020).

> Offer all eligible employees paid sick time according to their situation.

> Do not require eligible employees to use other paid time off until Emergency Paid Sick Leave is exhausted.

> Apply for a waiver or request for advanced funds if your situation warrants it.

> Apply for tax credit each quarter to cover covered amounts (up to $511 per day and/or $200 per day per covered employee). Credit may also be received for the portion of the employer’s expenses paid or incurred to provide and maintain group health insurance during this emergency sick leave.

EMERGENCY FAMILY AND MEDICAL EXPANSION ACT

The Families First Coronavirus Response Act also created the Emergency Family and Medical Expansion Act. This Act amends the existing Family and Medical Leave Act (FMLA) to provide job- and benefit-protection for absences related to COVID-19 pandemic for employees who have been employed for at least 30 days and who are unable to work in the workplace or remotely (telework) due to the need to care for a minor child if the child’s school or place of child care has been closed. The provisions of this act apply only to those unable to work due the need to care for a child out of school or daycare.

The Act has the following provisions:

The first 10 days of Emergency Leave is unpaid but employees may elect to use available paid time off (vacation, sick, etc.).

After the first 10 days, employers must provide paid leave of 2/3 regular wages up to $200 per day, not to exceed $10,000 total for those tending to children out of school or daycare.

This emergency paid sick leave will be fully reimbursed by the federal government through the end of 2020 through refundable quarterly tax credits to offset Social Security payroll taxes. Federally reimbursed emergency leave is capped at ($10,000 per covered employee) plus expenses paid or incurred to provide or maintain a group health plan during the paid sick time.

Employers with 25 or more employees must restore employees to same or equivalent position without loss of benefits.

Employers with fewer than 25 employees do not need to restore to the equivalent position if all of the following apply:

1. The position held by the employee no longer exists due to economic conditions or changes impacting the employer’s operations and are related to the public health emergency.

2. The employer makes a reasonable effort to restore the employee to the equivalent position; and

3. If the employer is unable to restore the employee to the equivalent position, the employer makes reasonable efforts to reach out to the employee if an equivalent position becomes available within one (1) year of when the public health emergency concludes or 12 weeks after the employee’s leave commences, whichever is earlier.

The Secretary of Labor has the right to exempt businesses with fewer than 50 employees from providing these protections if providing this protection would cause a hardship.

Employer responsibilities:

> Offer all eligible employees Emergency Family and Medical Leave.

> Do not require eligible employees to use other paid time off.

> Apply for tax credit each quarter to cover covered amounts (up to $200 per day per covered employee).

> Credit may also be received for the portion of the employer’s expenses paid or incurred to provide and maintain group health insurance during this emergency sick leave.
Recommended Actions

There are still many provisions that are not finalized in these laws. We recommend that you evaluate your responsibilities under new legislation based on your size and industry. Contact Affinity HR Group if you require assistance with this effort. As soon as possible, provide employees with the proper notice of eligibility or ineligibility. Let employees know their coverage options as soon as possible. As soon as you realize them, you should apply for waivers and/or credits if necessary.

As always in times of crisis, communicate regularly with your employees about their situation as well as the company’s situation given the challenging environment and changing circumstances. Lack of information dramatically impacts the ill effects of anxiety and despair during times of great uncertainty.

Claudia St. John is President of Affinity HR Group, Inc., ICA’s affiliated human resources partner. Affinity HR Group specializes in providing human resources assistance to associations such as ICA and their member companies. To learn more, visit www.affinityhrgroup.com.