What Small Businesses Need to Know about Required COVID Leave
By Rachel Luna
The Families First Coronavirus Response Act (FFCRA), provides new federally mandated leave requirements that generally apply to all public and private employers with fewer than 500 employees. The new leave, Paid Sick Leave (PSL) and Expanded Family and Medical Leave (Expanded FMLA), must be provided from April 1, 2020, through December 31, 2020, and each covered employer must post, in a conspicuous place on its premises, a notice of the FFCRA’s requirements.
I recently joined Kenny Rahmeyer’s Business of Business podcast to discuss the ins and outs of the new paid sick leave laws. You can listen to it here.
Paid Sick Leave gives eligible employees up to two weeks of paid leave.
Eligibility. All employees of covered employers, regardless of how long they have worked for the employer, are eligible for PSL if the employee is unable to work due to a need for leave because the employee:
1. is subject to a Federal, State, or local quarantine or isolation order related to COVID-19, has been advised by a health care provider to self-quarantine related to COVID-19, and/or is experiencing COVID-19 symptoms and is seeking a medical diagnosis (collectively Self-Care Reasons); and/or
2. is caring for an individual subject to: (a) a government quarantine or isolation order; or (b) a self-quarantine recommendation by a health care provider (in either case as further described in bullet 1 above) and/or is caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19; and/or is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury (collectively Other Reasons).
Amount of Leave. Employees are eligible for up to two weeks of PSL, which means: (1) up to 80 hours for a full-time employee; and (2) generally, up to the number of hours that the employee works on average over a two-week period for a part-time employee.
Calculation of Pay. Employees taking PSL for Self-Care Reasons must be paid at either their average regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period). Employees taking PSL for Other Reasons are entitled to pay at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).
Expanded FMLA gives eligible employees up to 12 weeks of leave, including ten weeks of paid leave.
Eligibility. Employees of covered employers, who have been employed by the employer for at least 30 calendar days, are eligible for Expanded FMLA if the employee is unable to work because the employee is caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19.
Amount of Leave. Employees are eligible for up to 12 weeks of Expanded FMLA, which means: (1) up to 12 weeks of leave at 40 hours per week for a full-time employee; and (2) generally, up to 12 weeks of leave at the number of hours per day that the employee is normally scheduled to work for a part-time employee.
Calculation of Pay. Employees taking Expanded FMLA are entitled to pay after a two-week period of unpaid Expanded FMLA (Unpaid Period). After the Unpaid Period, employees taking Expanded FMLA are entitled to pay at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $10,000 in the aggregate (over a ten-week period). An employee may elect to take any accrued vacation leave, personal leave, or medical or sick leave (including PSL) during the Unpaid Period.
Are there any exceptions?
Yes. Small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or childcare unavailability if the leave requirements would jeopardize the viability of the business as a going concern. Additionally, employers are not required to provide PSL or Expanded FMLA to any of their employees that are health care providers and/or emergency responders.
Employers will be reimbursed for PSL and Expanded FMLA if it is properly documented.
Covered employers qualify for dollar-for-dollar reimbursement, through tax credits, for all qualifying wages paid to employees taking properly documented PSL and/or Expanded FMLA (up to the appropriate per diem and aggregate payment caps). Applicable tax credits also extend to amounts paid or incurred to maintain health insurance coverage.
Ensuring Compliance.
To help address employee and employer questions related to PSL and Expanded FMLA, the Department of Labor has issued many support documents, including new applicable regulations, fact sheets for employees and employers, as well as a lengthy, and regularly updated, Q&A webpage. Guidance related to PSL and Expanded FMLA continues to evolve, and unfortunately, unanswered questions remain. Accordingly, it is critical for small business leaders to seek help from their human resources team and/or attorney in implementing this leave to ensure compliance with federal law.
This update is for informational purposes only and does not provide legal advice. Every legal situation is different and must be independently analyzed by an attorney. Please consult with an attorney for specific guidance.
About Luna Law, PLLC
Luna Law, PLLC, provides a wide array of legal services to small businesses, from the creation of corporate entities and contract negotiation to employment counseling, risk mitigation, and compliance with local, state, and federal regulations. Contact the firm for a consultation or visit RachelLunaLaw.com for more information.