The coronavirus is sweeping through the nation and impacting businesses everywhere, testing companies’ resilience and the welfare of the workforce. In these unprecedented times, laws are swiftly being passed to provide support to those affected.
The Families First Coronavirus Response Act (FFCRA) was signed into law on March 18, 2020. FFCRA expands the Family Medical Leave Act (FMLA) and creates limited Paid Sick Leave (PSL) in relation to the coronavirus, with amendments for clarity on some stipulations. The Act goes into effect beginning April 1, 2020 and expires December 31, 2020.
Who is Impacted?
The law applies to small businesses with 500 or fewer employees, with the possibility of an exemption for companies of 50 or fewer employees whose business would likely be jeopardized by complying with the new law.
How does an employee qualify for paid leave?
There are several ways an employee who is unable to work (or unable to telework) qualifies for the paid leave. The law’s protection applies to those who are symptomatic or under an isolation order, caring for someone who is symptomatic or under an isolation order, and those affected by displaced children they now have to provide care for that they otherwise wouldn’t, due to the coronavirus.
Here’s the detailed breakdown from National Association of Professional Employer Organizations (NAPEO) to know if your employees qualify:
They are subject to a federal, state, or local quarantine or isolation order related to COVID-19
They have been advised by a healthcare provider to self-quarantine related to COVID-19
They are experiencing COVID-19 symptoms and seeking a medical diagnosis
They are caring for an individual subject to an order described in (1) or self-quarantine as described in (2)
They are caring for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19
They are experiencing any other substantially similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury
They are caring for a child displaced from their school or place of care due to COVID-19
Duration of Leave and Pay
The duration of leave and compensation allocated varies based on whether the employee is taking FLMA or PSL, full-time or part-time, and the reason for utilizing the leave.
Generally, the Act provides that employees of covered employers are eligible for:
Two weeks (up to 80 hours) of paid sick leave at the employee’s regular rate of pay where the employee is unable to work because the employee is quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis; or
Two weeks (up to 80 hours) of paid sick leave at two-thirds the employee’s regular rate of pay because the employee is unable to work because of a bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or to care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor; and
Up to an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay where an employee, who has been employed for at least 30 calendar days, is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.
While the paid leave makes up the majority of the bill, there are a couple of other key takeaways. In order to help support employers funding the paid leave benefits, businesses are provided a refundable tax credit to ensure they’re able to comply with the law. Additionally, the Act states group health plans, health insurers, and government programs are to provide free coronavirus testing.
Understanding and maintaining knowledge on the laws is laborious and some companies may not know what resources are available or what they should do next. Our PEO team is here to help you navigate the waters through tremulous times like these. If you have a question, please contact us at 866-792-2736.
This material is provided for information only. It is not intended as legal or tax advice. You should consult your legal counsel or tax advisor for advice specific to your business situation.
This article has been partially adapted from: