House Passes Families First Coronavirus Response Act
Date: March 16, 2020
On March 13, the House of Representatives passed the Families First Coronavirus Response Act. The bill contains a number of provisions, including two provisions which alter employer leave policies. In addition to providing expanded leave benefits and coverage for certain employees, the bill also includes expanded definitions, including definitions for “family member” and “parent,” that go beyond what employers typically cover for Family and Medical Leave Act (FMLA)-related absences. At present, the bill provides for an effective date 15 days after enactment. We are providing you with this summary of some of its current terms and will issue an additional update if and when the bill is passed by the Senate and signed by the president.
Emergency Family and Medical Leave Act Expansion
This amendment will expire on December 31, 2020. The amendment expands coverage to any employee who has been employed for 30 days, and applies, when a public health emergency has been declared as with the coronavirus, to employers with fewer than 500 employees. Additional legislation may be forthcoming for employers with more than 500 employees.
The amendment would provide leave to a covered employee in three circumstances:
- To comply with a recommendation or order of a public health official or health care provider that the employee’s physical presence on the job would: (1) jeopardize the health of others because of (A) his or her exposure to the coronavirus or (B) his or her exhibition of symptoms consistent with coronavirus, and (2) the employee cannot perform his or her job and also comply with the order or recommendation;
- To care for a family member under the same circumstances described above; or
- To care for a child due to the closure of the child’s school or day care.
The amendment provides that the first 14 days of such leave is unpaid. However, the employee can choose to first utilize any vacation, personal leave, medical leave or sick leave to which they may be entitled. On the other hand, the employer cannot require that the employee takes such leave first. After 14 days, the employer must provide paid leave at 2/3 the employee’s regular rate of pay.
An employer subject to a multi-employer bargaining agreement may fulfill its obligation to provide partial-paid FMLA leave by making contributions to a multi-employer fund, plan or program (hereinafter collectively “fund”) based on the paid leave each of its employees is entitled to under the bill while working under the multi-employer collective bargaining agreement (CBA), provided that the fund enables employees to secure pay from such fund based on hours they have worked under the multi-employer CBA for paid leave taken because of a qualifying need related to a “public health emergency,” defined by the bill to mean “an emergency with respect to the coronavirus declared by a Federal, state, or local authority.”
The amendment also contains a provision that the employee must be restored to an equivalent position upon returning from leave. Employers with fewer than 25 employees may be exempt from that requirement if each of the following requirements are met:
- The original position no longer exists due to economic conditions;
- The employer attempts to place the employee in a similar position; and
- If a similar position is no longer available, the employer contacts the employee in the event a similar position does become available.
The bill provides the Secretary of Labor the discretion to issue regulations exempting health care providers and first responders from its provisions.
Emergency Paid Sick Leave Act
In addition to the FMLA expansion, there is a separate Emergency Paid Sick Leave Act. This act is also applicable to private employers with fewer than 500 employees and employees are immediately eligible. Additional legislation may be forthcoming for employers with more than 500 employees.
Under this act, paid sick leave is limited to 80 hours for full-time employees. It would also be available to part time employees based upon an average number of hours worked over the prior two weeks.
Paid sick leave would be available for an employee under the following circumstances:
- The employee self-isolates because of exposure to coronavirus or is diagnosed with coronavirus;
- The employee is seeking a medical diagnosis related to the coronavirus or is experiencing symptoms of coronavirus;
- The employee is complying with an order by a public health official or recommendation of a health care provider under the circumstances outlined in (1) or (2) above;
- The employee is caring for or assisting a family member under the above circumstances; or
- The employee is caring for a child whose school or day care has been closed because of the coronavirus.
Notably, if the employer already has a leave plan that provides for paid leave, this leave is to be in addition to that leave already provided. Leave provided under this act will not carry over from one year to the next. This bill also includes a posting requirement.
An employer is prohibited from discharging, disciplining, or in any manner discriminating against any employee who takes leaves in accordance with this act.
The bill also provides additional funding to states for unemployment compensation funding and provides tax deductions for paid leave with certain limitations.
Employers required to provide paid sick leave or emergency FMLA to their employees would be eligible for a corresponding tax credit under the bill through the end of 2020. The tax credit would be allowed against the employer’s payroll tax liability up to $200 per day if the employee is caring for someone else or $511 per day if the employee is sick or quarantined, subject to the maximum number of days of required sick pay or emergency FMLA, and would be refundable. Employers already receiving tax credits for paid family and medical leave under the Tax Cuts and Jobs Act would not be eligible. Tax credits would also be available to self-employed taxpayers against their self-employment tax liability.
We will be hosting a webinar this week on issues related to this bill and employee leave; invitations will be sent via e-mail.
FOR MORE INFORMATION
For more information, please contact:
Nancy M. Barnes
Deborah S. Brenneman
M. Scott Young
or any a member of our Labor & Employment group.
We have assembled a firmwide multidisciplinary task force to address clients’ business and legal concerns and needs related to the COVID-19 pandemic. Please see our COVID?19 Task Force web page for additional information and resources.
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