Yesterday evening, President Trump signed an emergency bill, the Families First Coronavirus Response Act, expanding the family and medical leave provisions under federal law. The act provides for Emergency Leave related to caring for children as well as additional paid sick time for all employees. The highlights of the law are outlined below.
Effective Date: Takes effect on April 2, 2020 and is set to terminate on December 31, 2020.
Broad Coverage: Impacts private employers that employ less than 500 employees.
COVID-19 Paid Sick Time:
- Hours: Requires employers to immediately make available to all employees eighty (80) hours of sick time to be used for COVID -19 related absences from work (quarantine, experiencing symptoms, caring for someone etc.).
- Rate: Rate of pay for the sick time depends on the reason.
- If leave is because of quarantine or experiencing COVID-19 symptoms, sick hours should be paid at normal pay rate.
- If leave is to care for someone or other COVID-19 related circumstances, sick hours are paid at 2/3 normal pay rate.
- Maximum of $511 per day and a total $5,110 total per employee for leave related to experiencing symptoms or quarantine. Otherwise, maximum of $200 per day and a total $2,000 per employee.
Carry-Over: Sick time does not carry over until next year.
Other Leave: Sick time is in addition to other time available through Employer’s benefits program.
Emergency Leave:
- Leave: Amends FMLA to provide eligible employees up to twelve (12) weeks of leave if the employee is unable to work or telework because he/she needs to care for a child under the age of 18 as a result of school/daycare closing. This is the only eligible reason for Emergency Leave.
- Exemption: Healthcare providers and emergency responders are exempt from emergency leave provisions.
- Paid Leave: Provides that the first ten (10) days of emergency leave are unpaid. Thereafter, Employer is required to pay employee 2/3 employee’s regular rate of pay. Entitlement is limited to $200 a day per employee and not to exceed $10,000 per employee.
Covered Employer: Expands FMLA coverage to now include businesses with less than 50 employees. However, businesses with under 50 employees can be exempt if required leave would jeopardize the viability of their business.
Eligible Employee: Expands FMLA coverage to include employees who have worked at least 30 days prior to leave (as opposed to current 12 months).
Job Restoration: Requires employers with 25 or more employees to return employee to the same or equivalent position upon the return to work. Employers with 25 or less employees are generally excluded from this provision.
Refundable Tax Credits: Employers will receive a tax credit which will be applied to the Employers 6.2% employer portion of the Social Security tax, as follows:
- The credit for paid sick time for each employee will be for wages up to $511 per day per employee for leave related to experiencing symptoms or quarantine, otherwise $200 per day per employee. The credit is limited to 10 days of wages per employee, per quarter.
- The credit for family leave will be for wages up to $200 per day per employee, and $10,000 in the aggregate for all calendar quarters.
- To the extent an employer’s portion of the Social Security tax for all employees is less than that amounts of the sick leave credit and the family leave credit allowable, the excess will be refundable credit.
- There are similar provisions for self-employed taxpayers.
If you have any questions, please contact labor and employment attorney Anne Chapman at achapman@blalockwalters.com or tax law attorney Jenifer Schembri at jschembri@blalockwalters.com or call 941.748.0100.
Anne W. Chapman Esq., Labor & Employment Law
Jenifer S. Schembri, Esq., Florida Board Certified in Tax Law
