On March 18, 2020, the Families First Coronavirus Response Act (FFCRA) was signed into law. The law became effective on April 1, 2020. By its terms, the requirements of the FFCRA will expire on December 31, 2020. The specific provisions of the FFCRA can be found here. The Act contains two important provisions for employers with less than 500 employees: The Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act.
The Emergency Paid Sick Leave Act (EPSLA)
The EPSLA provisions of the FFCRA require private employers with less than 500 employees to provide paid sick leave for employees having to take time off for certain Coronavirus related reasons.
Covered Employers: The provisions of the EPSLA apply to private employers with less than 500 employees. In counting the number of employees to determine if the law applies to them, employers should include both full and part time employees, employees who are on leave, temporary employees and day laborers supplied by a temp agency. Independent contractors, however, are not included in this count.
Covered Employees: The paid sick leave requirements of the EPSLA apply to all employees, whether they are part time, full time, hourly or salaried employees, and regardless of how long they have been employed by their employer.
Required Sick Leave: Under the EPSLA, covered employers must give their employees paid sick leave as follows:
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:
1. The employee is subject to federal, state or local quarantine or isolation order(s) related to the Coronavirus;
2. The employee has been advised by a health-care provider to self-quarantine due to concerns related to the Coronavirus; or
3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
Two weeks, (up to 80 hours) of paid sick leave at two-thirds of the employee’s regular rate of pay where the employee is unable to work because:
4. The employee is caring for an individual who is subject to a quarantine order, or has been advised to self-quarantine;
5. The employee is caring for a child whose school or daycare has been closed, or their child care provider is unavailable, due to Coronavirus precautions; or
6. The employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretary of the Treasury and the Secretary of Labor.
Except for reason number 5 above, to be discussed below, part time employees are eligible for leave in the amount of the number of hours they work on average over a two-week period.
An employee is not entitled to paid sick leave if they are able to telework. Thus, an employee who is subject to a quarantine order or has to self-quarantine, is not entitled to paid sick leave if he/she can still work from home.
If an employee has available vacation or sick leave time, the employee may first use the paid sick time available to him/her under the EPSLA. Section 5102(e)(2)(B) of the FFCRA also provides that “[a]n employer may not require an employee to use other paid leave provided by the employer to the employee before the employee uses the paid sick time” granted under the FFCRA.
Regular Rate of Pay: If an employee takes leave for reason 1, 2 or 3, above, the employee shall be paid at either their regular rate of pay, or the applicable minimum wage, whichever is higher, but no more than $511 per day and $5,110 total (i.e. over a two week period).
If an employee takes leave for reason 4, or 6, above, they are entitled to 2/3 their regular rate of pay, or 2/3 the applicable minimum wage, whichever is higher, but no more than $200 per day and $2,000 total. These same limitations on pay are further reinforced under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27, 2020.
If an employee’s pay fluctuates, such as employees who receive commission, their regular rate is calculated based on the average weekly pay received over the past six months, including any wages, tips and commissions. If they have worked for less than six months, their average is calculated based on however much time they have worked to date.
Emergency Family and Medical Leave Act
The EFMLA is part of the FFCRA and expands the provisions of the Family Medical and Leave Act. Under these provisions, private employers with less than 500 employees must provide employees 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 is unable to work due to a bona fide need for leave to care for a child whose school or daycare is closed, or whose childcare provider is unavailable due to Coronavirus concerns. This requirement only applies to employees who have been employed with the employer for at least 30 days. The CARES Act amends this provision to include rehired employees, defined as “an employee who was laid off by that employer not earlier than March 1, 2020, had worked for the employer for not less than 30 of the last 60 calendar days prior to the employee’s layoff, and was rehired by the employer.”
Employees taking extended family leave for this reason (also reason 5 above), may be entitled to both the two weeks of paid leave under the EPSLA, and an additional 10 weeks of paid leave under the EFMLA, for a total of 12 weeks. Employees taking such leave must be paid 2/3 their regular rate, or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $12,000 in total (i.e. over a 12 week period – 2 weeks of paid sick leave plus 10 weeks of family and medical leave). Finally, the rate of pay for part time employees taking leave for this reason, (whether sick leave or family and medical leave), is calculated based on the number of hours that the employee is normally scheduled to work over that period.
Other Protective Provisions:
Employees returning from leave under these provisions must be given their job back or a “nearly equivalent” position. Also, employers may not discharge, discipline or otherwise discriminate (i.e. retaliate) against any employee who lawfully takes paid sick leave or expanded family and medical leave under the FFCRA, or who files a complaint or other proceeding related to this Act.
Possible Limited Exception for Small Business:
The Act does direct the DOL to issue regulations exempting businesses with 50 or fewer workers from the requirements of the FFCRA to provide paid leave for employees caring for a child due to school or daycare closing, or because a child care provider is unavailable, due to Coronavirus precautions, to the extent these requirements will jeopardize their business. The DOL currently recommends that businesses need to document why these requirements may jeopardize their business.
Employers covered by the law can seek reimbursement of any qualifying wages they pay under the FFCRA through tax credits. Employers can also seek tax credits for amounts paid or incurred to maintain health insurance coverage for employees on leave under the FFCRA. The CARES Act makes some modifications to this provision of the FFCRA. Detailed FAQs about these tax credits can be found at the IRS’s website.
Notice to Employees:
The DOL has created a poster notice of the FFCRA requirements, which can be obtained at the DOL’s Wage and Hour Division, and must be placed in a conspicuous place at the workplace. For businesses now shutdown where employees are working from home, the employer can satisfy this requirement by emailing or direct mailing the notice to its employees, or placing it on an employee information internal or external website. The DOL has also released a set of Frequently Asked Questions regarding the notice requirements of the FFCRA.
On March 24, the DOL issued a memo to its field staff stating that the DOL will not bring enforcement actions through April 17, 2020, provided that the employer has made “reasonable, good faith efforts to comply with the Act.” The DOL defines “reasonable, good faith efforts” to mean that: 1) the employer remedies any violations, including making any affected employees whole as soon as practicable; 2) any violations were not “willful”; and 3) the employer provides the DOL with a written commitment to comply with the Act.
For more information, the US DOL has issued detailed fact sheets for both employers and employees regarding the provisions of these laws. The DOL has also issued a set of Questions and Answers pertaining to compliance with the various provisions of the FFCRA. Keep in mind, however, that democratic lawmakers have contested some of the DOL’s guidelines as adding in details not found in the FFCRA, which tend to favor employers. For example, the DOL’s guidelines allow employers to demand certification from employees of their reasons for seeking paid leave. The guidelines also provide that in order to qualify for leave, employers must have work available for the employee, and that employees may not take leave intermittently, unless the employer agrees. Democratic lawmakers assert that the text of the FFCRA does not support the DOL’s position. Thus, while the DOL’s website provides general guidelines, it is still important to contact legal counsel who can look at the letter of the law and properly advise your company on how to best move forward.
Other Applicable Laws:
Keep in mind that there may be other applicable laws that supplement these paid sick leave requirements. On April 16, for example, California Governor, Gavin Newsom, issued an executive order, providing supplemental paid sick leave for food sector workers, with up to 80 hours for full time workers, and the normal number of hours worked over a two week period for part time employees.
Some local governing bodies have issued their own paid sick leave, and other employment related ordinances that may also apply. San Francisco, for example, has its own minimum wage ordinance, requiring a $15.59 per hour minimum wage. It also has a paid sick leave ordinance, requiring paid sick leave at the rate of 1 hour for every 30 hours worked, up to 72 hours for employers with 10 or more employees and 40 hours for workers with less than 10 employees. The City of San Jose passed an emergency Covid-19 paid sick leave requirement for employees of essential businesses that remain open, requiring up to 80 hours of paid sick leave for full time employees. For part time essential employees, they are entitled to their average number of hours worked over a two week period.
Thus, as always, depending on the location of your business, be sure you are clear as to whether there are additional state laws or local ordinances that apply.
*Marwa Elzankaly is of Counsel to McManis Faulkner. This is an updated version of her blog, first published in her weekly business newsletter.