Employment Provisions within the Families First Coronavirus Response Act
As the coronavirus outbreak continues to wreak havoc on markets and industries in the U.S. and around the world, businesses are now confronting significant and unique challenges. Successful navigation of these challenges will require thoughtful and comprehensive planning.
On Friday, March 13, 2020, the United States House of Representatives passed H.R. 6201 titled the Families First Coronavirus Response Act (the “Act”). This bill is one of what appears will be a number of pieces of federal legislation coming from Washington designed to deal with the unprecedented events triggered by the outbreak of COVID-19. Readers must understand that the bill passed on Friday is not yet law and still requires passage by the Senate and signature by the President. The Senate is scheduled to take up the bill this on Monday afternoon March 16, 2020. Until the Senate passes the bill and any changes are reconciled with the H.R. 6201, and the President signs it, it could be changed or modified significantly.
Furthermore, Speaker of the House Nancy Pelosi and Treasury Secretary Steven Mnuchin have stated H.R. 6201 will likely need technical corrections. Contained within the Act are two sections dealing with employee leave rights. Each has its own name, the Emergency Family Medical Leave Expansion Act (“EFMLEA”) and the Emergency Paid Sick Leave Act (“EPSLA”). Both of these laws would not become effective for 15 days after enactment providing employers some limited time to plan for compliance. The current bill is only a temporary relief measure and both the expanded Family and Medical Leave and the paid sick pay provisions expire on December 31, 2020.
The EFMLEA is an amendment to the Family and Medical Leave Act of 1993 (“FMLA”). As a refresher, the current FMLA provides employees with up to twelve weeks of unpaid leave if they or an immediate family member has a “serious health condition” or for the birth or adoption of a child. The current law applies only to employers with fifty or more employees and to be eligible for FMLA leave you must have worked for the employer for at least one year.
EFMLEA expands the coverage of the FMLA in its various definitions. First, it covers only employers with less than 500 employees although the Secretary of Labor shall have the authority to issue regulations to exempt employers with less than 50 employees from the paid leave provisions of the EFMLEA when compliance would jeopardize the business as a viable concern. Second, it greatly expands who is an eligible employee because EFMLEA applies to employees after only working for their covered employer for only 30 calendar days. The reasons for leave under the new law go well beyond a “serious health condition” under the original FMLA and covers absences from work for the following situations:
- To adhere to a requirement or recommendation to quarantine due to exposure to or due to symptoms of coronavirus;
- To care for an at-risk family member who is adhering to a requirement or recommendation to quarantine due to exposure to or symptoms of coronavirus; and
- To care for a child of an employee if the child’s school or place of care has been closed, or the child-care provider is unavailable, due to a public health emergency due to coronavirus.
The first 14 days of EFMLEA leave is unpaid. However, employees may use earned any available paid time off but unlike the FMLA the employer cannot mandate the use of available paid time off if the employee elects not to use it. After 14 days, employers must provide the employee paid leave of not less 2/3 of the employee’s (Fair Labor Standards Act) regular rate times his/her usual schedule of weekly hours for the up to remaining 10 weeks of leave. This provision includes employees who work under a multiemployer collective bargaining agreement and whose employers pay into a multiemployer plan receive this leave.
Similarly, the EPSLA also covers employers with fewer than 500 employees. Sick leave pay is available leave to employees who regardless of tenure:
- Quarantine or self-isolate because they might be sick
- Who seek a diagnosis or for preventive care due to coronavirus
- To care for a family member is quarantined or self-isolating because they have or may have coronavirus
- To care for a child whose school has closed or whose childcare provider is unavailable due to the coronavirus.
The rate of sick pay is the employee’s (FLSA) regular rate unless leave is for an eligible family member and then it is two-thirds the employee’s (FLSA) regular rate. Full-time employees are entitled to 2 weeks (80 hours) of sick pay and part-time employees are entitled to the typical number of hours that they work in a typical two-week period. This paid sick leave is in addition to any paid sick leave already offered by an employer and employers cannot eliminate their current benefits based on the EPSLA. Additionally, employers cannot (1) require an employee to first use already provided employer benefits before seeking EPLSA, (2) require an employee to find a replacement, or (3) fire an employee for taking benefits under EPLSA.
The Secretary of Labor is directed to create and issue posters to be posted by employers about EPSLA.
EPSLA also ensures employees who work under a multiemployer collective agreement and whose employers pay into a multiemployer plan are provided with paid leave through those plans.
Finally, in order to defray the costs, employers may take a tax credit applied to the employer portion of the Social Security payroll tax for both paid sick leave and family leave wages subject to certain caps. The bill also prohibits an employer from taking double credit for each leave. Like virtually every other employment law, these two contain anti-retaliation provisions designed to protect employees who seek to use these befits. Employers need to pay careful attention to developments over the next few days and even weeks as much may change.
Please note that this is a general summary of a bill that has not yet been enacted. For more information about recommended steps, please contact your Foley relationship partner. For additional web-based resources available to assist you in monitoring the spread of the coronavirus on a global basis, you may wish to visit the CDC and the World Health Organization.