19 March 2020

President Trump Signs Law Providing Emergency Paid Sick Leave and Emergency FMLA Leave for Absences Related to COVID-19

***Information and guidance in client updates was up to date at time of publication. During the pandemic, information and guidance has been changing rapidly. If you have any questions about the information contained in a client update, please contact the author(s) or your Miller Johnson attorney.***

President Trump just signed the Families First Coronavirus Response Act into law.  This is phase two of federal legislative efforts to blunt the economic impact of the COVID-19 pandemic.   Most significantly for employers, the new Act: (1) creates paid emergency sick leave for employees and families impacted by COVID-19; and (2) amends the FMLA to provide additional leave for COVID-19 qualifying reasons.  The Act takes effect on April 2, 2020.

Miller Johnson will host a client webinar on the new law next Monday, March 23.  We will discuss details, cover strategies for compliance, and answer your questions.  In the meantime, here is a short summary of the new leave requirements.

Emergency Paid Sick Leave

Who is Covered? All employers with fewer than 500 employees and public agencies.  The Department of Labor may elect to exempt employers with fewer than 50 employees if coverage would jeopardize the employer’s ongoing viability.  Healthcare providers and emergency responders may be excluded by their employers.

Which Employees Are Eligible for Paid Sick Leave?  All full-time and part-time employees, regardless of how long they have been employed.

How Much Paid Leave Can Employees Take? Full-time employees can take up to 2 weeks (80 hours) of paid leave at their regular rate.  Part-time employees can take paid leave equal to the average number of hours that the employee works over a 2-week period.  Employees cannot be required to use other paid time off before using Emergency Paid Sick Leave.

For What Reasons Can Employees Use This Paid Leave?  This leave is available when an employee:

  • is subject to a government quarantine or isolation order for COVID-19;
  • has been advised by a health care provider to self-quarantine for COVID-19;
  • is experiencing symptoms of COVID-19 and is seeking a medical diagnosis;
  • is caring for an individual subject to a COVID-19 quarantine or isolation order; or
  • is caring for their child because the child’s school or place of care has been closed, or the child care provider for the child is unavailable, due to COVID-19 reasons.

Public Health Emergency FMLA Leave

Who is Covered?  All employers with fewer than 500 employees.  The DOL may offer exemptions for employers with fewer than 50 employees, healthcare providers, and first responders.

Which Employees Are Eligible for Emergency FMLA? Individuals employed for at least 30 days.

How Much Leave Can Affected Employees Take?  Eligible employees can take up to 12 weeks of FMLA leave for qualifying COVID-19 reasons.

What Are the Reasons that Employees Can Use Emergency FMLA Leave?  The employee is unable to work (or telework) because they need to care for their minor child whose school or place of care has been closed, or whose child care provider is unavailable, due to a COVID-19 emergency declared by a Federal, State, or local authority.

Is This Leave Paid or Unpaid?  The first 10 days can be unpaid.  (But employees might be entitled to Emergency Paid Sick Leave for those days, as described above.)  For leave after the first 10 days, employees are entitled to 2/3 of their regular pay, not to exceed $200 per day or $10,000 total.  Employees are permitted to substitute paid leave to cover unpaid time but cannot be required to do so.

Offsets to Employer Costs

The Act offers employers tax relief for amounts paid to employees under both of these programs.  An emergency paid sick leave quarterly payroll tax credit may be claimed by employers equal to 100 percent of the amount of sick leave wages paid. This credit is capped at $511 per day ($5,110 total) if an employee is taking time off to care for themselves or $200 per day ($2,000 total) if the employee is caring for an individual who is quarantined or exhibiting symptoms of COVID-19 or if caring for a minor child whose school is closed. The credit is refundable to the extent it exceeds the amount owed by the employer payroll tax.  For those employers who provide public health emergency FMLA leave wages, a separate payroll tax provision allows a 100% credit against the employer’s share of the payroll tax for each employee, capped at $200 per day ($10,000 total) per employee. This credit is also refundable to the extent it exceeds the amount owed by the employer in payroll tax.