These are difficult times for US businesses and employees. In response to fears of a declining economy, Congress passed emergency legislation, which President Trump signed into law. The Families First Coronavirus Response Act (FFCRA) has several provisions regarding employer expanded family and medical leave requirements which impact businesses with fewer than 500 employees. This has left many small businesses scrambling to enact these emergency leave provisions prior to the April 1, 2020 effective date. The information below is meant to bring some clarity to these emergency leave requirements and how it may affect your small business.
FFCRA requires employers to provide two weeks of expanded family and medical leave to qualified employees. Below are the two different pay tiers and the accompanying requirements for each.
- These qualified employees must be paid for two weeks of pay at their regular rate of pay, not to exceed $511 per day, or a total of $5,110 over a two-week period. A part time employee must be paid for the average amount of hours that they work over a two-week period:
- Have been employed at least 30 days
- Are unable to work because they are quarantined (pursuant to Federal, State, or local government order or advice of a health care provider) and/or are experiencing COVID-19 symptoms and are awaiting medical diagnosis
- These qualified employees must be paid for two weeks at two-thirds their regular rate of pay, or two-thirds minimum wage, whichever is higher, not to exceed $200 per day or a total of $2,000 over a two-week period:
- Have been employed at least 30 days.
- Are unable to work because they are caring for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider) or are caring for a child whose school or day care is closed because of reasons related to COVID-19.
FFCRA requires employers to provide an additional 10 weeks of expanded family and medical leave to qualified employees at two-thirds their regular rate of pay after they have already used their two weeks of sick pay listed above.
These qualified employees must be paid out at two-thirds the employees’ regular rate of pay:
- Have been employed at least 30 days.
- Are unable to work because they are caring for a child whose school or childcare is closed or unavailable because of reasons related to COVID-19.
A full-time employee is paid this leave at 40 hours a week, a part-time employee is paid this leave for the number of hours they are normally scheduled to work over that period.
Who pays for this leave?
The employer pays for this leave, however payroll tax credits are available as a dollar for dollar reimbursement for all qualifying wages paid under FFCRA. Be sure that you are tracking the amounts you are paying out for the FFCRA leave so that you are able to claim the payroll tax credit.
I already provide sick pay for my employees. Can they just use that sick pay?
Unfortunately no, you must provide an additional 80 hours for employees to use specifically if they are sick with COVID-19, if they are caring for someone who is sick with COVID-19, if they are waiting to be tested for COVID-19, if they are caring for a child whose school or day care was closed or if they are quarantined due to health care provider or government orders.
Can I obtain an exemption from the FFCRA?
Small businesses with fewer than 50 employees may qualify for an exemption from the requirement to provide leave if the leave requirements would jeopardize the viability of the business. However, it is advised that you are extremely careful in claiming the exemption. There is little information about how the DOL will be monitoring who is or is not qualified for an exemption. It is best if you try to take out a small business disaster loan to cover these costs prior to declaring you are exempt. Click the link https://mailchi.mp/25c79d582521/guess-who-4360750?fbclid=IwAR330G2e6CZkCe1L4p6Hy_ZZIj8qhwXoxXDnanT8G-OEACP6OWfoyjgtMgg for more information on the small business disaster loan.
Do I have to hold the employee’s job while they are taking leave?
Yes, like FMLA you must hold the employee’s job while they are taking leave. You may not discipline an employee for taking leave.
Does expanded family and medical leave carry forward to the next year?
No, it does not, this leave expires as of December 31, 2020.
Can an employee elect to substitute any vacation leave, personal leave or medical/sick leave for the first two weeks?
Yes, if an employee wants to use other leave first, they may.
Please see your payroll processor for specific questions on this. If you have any employees that are receiving either the 2 weeks of PTO or the 10 weeks of expanded leave please be sure to communicate that to your payroll processor so they are able to appropriately allocate those payments in payroll.