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How the Families First Coronavirus Response Act would impact employers
By Amy Blaisdell on March 16, 2020 at 10:20 AM

Over the Weekend: The U.S. House of Representatives (with President Trump’s “full support”) passed legislation that would:  (1) Extend paid leave related to the coronavirus, (2) Expand the FMLA to provide paid leave to employees for coronavirus-related reasons, and (3) Expand the availability of unemployment funds. This legislation still requires U.S. Senate approval.

In the early morning hours of March 14, 2020, the U.S. House of Representatives passed H.R. 6201, the Families First Coronavirus Response Act (the “Act”), which President Trump has stated has his “full support.” If passed by the Senate, and signed by the President, employers will have some answers to their questions regarding how to manage their work force in this unprecedented time.

Questions remain in terms of next steps and timing. Some technical issues in the drafting of the House legislation require the bill to be passed a second time. The House recessed after passing the original bill, creating potential issues related to its re-passage. Assuming the technical issues are fixed and the bill goes back to the Senate, the Senate has no timetable for taking up the bill. Before the House bill was passed, the Senate locked in a schedule on issues related to FISA and was supposed to begin debate on that issue this week. Senate procedures require a vote to change that schedule to focus on the COVID-19 legislation. Further, assuming the Senate turns its attention to the COVID-19 bill, some members of the Senate have publicly suggested that passage of the bill in its current form is unlikely, and anticipated the Senate would have revisions to the House version.

This blog provides a detailed summary of the current House legislation. Again, the legislation has not yet been voted on by the Senate. However, this summary provides an overview of the issues under consideration by Congress. All employers, but particularly those who have already adopted “coronavirus-specific policies” should be aware of these developments, as the policies may need to be amended if and when the final legislation is passed by the Senate and signed by the President.

For assistance please contact our Employment & Labor Practice Group.

What are the key parts of the Act impacting employers and employees?
The Act would enact:

  1. the Emergency Paid Sick Leave Act, and
  2. the Emergency Family and Medical Leave Expansion Act (“FMLA Expansion Act”), which provides for paid leave for a broader group of employees than are normally eligible for FMLA; and
  3. the Emergency Unemployment Insurance Stabilization and Access Act of 2020 (“Emergency Unemployment Insurance Act”).

What are the key provisions of the Emergency Paid Sick Leave Act?

The Emergency Paid Sick Leave Act would require an employer to provide to an employee employed by an employer paid sick leave to use for reasons related to the coronavirus. In turn, the legislation would provide tax credits for the paid leave.

Which employers would be covered? Government employers and private employers with fewer than 500 employees.

For what purposes can sick leave be taken?

  1. To self-isolate because the employee is diagnosed with coronavirus.
  2. To obtain a medical diagnosis or care if the employee is exhibiting symptoms of coronavirus.
  3. To comply with a recommendation with a public health official or healthcare provider on the basis that the physical presence of the employee on the job would jeopardize the health of others (for specified reasons);
  4. To care for or assist a family member of the employee who needs assistance because the employee is self-isolating, needs to obtain medical care because they are experiencing symptoms of coronavirus or if a public official or healthcare provider makes a determination that the presence of the family member would jeopardize the health of others; and
  5. To care for the child of the employee if the child’s school or place of care has been closed or the child care provider is unavailable due to coronavirus.

How much paid leave is available? If leave is taken for categories 1 through 3 above, then it is limited to 80 hours (two weeks) at the employee’s regular rate. If leave is taken under categories 4 through 5, then the leave is compensated at two-thirds of the employee’s regular rate. Part-time employees would be entitled to leave equivalent to the number of hours worked in two week period.

Does paid sick leave carry over? Leave under the Act would not carry over from one year to the next and would cease beginning on the next pay period following expiration of the need for paid sick time.

Is the leave provided under the Act in addition to existing policies? Yes. The Emergency Paid Sick Leave Act states that if an employer “provides paid leave on the day before the date of the enactment,” the paid sick leave available to employees under this Act is “in addition to such paid leave.” Additionally, the employer would not be permitted to change paid leave provisions “on or after such date of enactment” to avoid this requirement.

Accordingly, employers who have been thoughtful in announcing coronavirus-specific paid leave policies to date should take a close look at those policies now. One option might be to revise those policies to provide that they will remain in effect only until President Trump signs the Families First Coronavirus Response Act or another similar law and thereafter the policy will be superseded by the federal legislation.

Of course, some employers are subject to state paid sick leave laws/ordinances. Employers that have paid sick leave policies that are required by state law/ordinances should note that any paid leave provided pursuant to their policies before the Emergency Paid Sick Leave Act goes into effect cannot be credited against the employees' federal Emergency Paid Sick Leave Entitlement.

What posting obligations are expected? Employers would be required to post a notice to be prepared by the Secretary of Labor within seven days after commencement of the Act.

What protection do employees have for exercising their rights? The Emergency Paid Sick Leave Act would prohibit an employer from discharging, disciplining or discriminating against any employee who takes leave or files any complaint relating to the Act.

How would the law apply to employers who are signatories to multi-employer collective bargaining agreements? An employer who is a signatory to a multi-employer collective bargaining agreement may, satisfy its obligations under the Act by making contributions to a multiemployer fund, plan or program based on the hours of paid sick time each employee is entitled to under the Emergency Paid Sick Leave Act.

What tax credit would be available? Subject to certain daily and quarterly limits, the Act would allow a tax credit equal to 100 percent of the qualified sick leave wages paid by the employer for each calendar quarter.

What are the key provisions of the FMLA Expansion Act?

Eligible Employees – An employee would eligible if he/she has been employed for at least 30 calendar days. Please note that normal 12-month and 1,250 hours requirement for eligibility do not apply! Thus, employees would be eligible for paid leave under the FMLA Expansion Act even though they are not eligible for FMLA for any other purpose.

Covered Employers – An employer would be covered if it has fewer than 500 employees.

Purposes of Leave – Leave would be available for a “Qualifying Need Related to a Public Health Emergency,” meaning that leave is taken for one of three reasons:

  1. To comply with a recommendation or order by a public health official having jurisdiction or a health care provider on the basis that:
    1. the physical presence of the employee on the job would jeopardize the health of others because of –
      1. the exposure of the employee to coronavirus; or
      2. exhibition of symptoms of coronavirus by the employee; and
    2. the employee is unable to both perform the functions of the position of such employee and comply with such recommendation or order.
  2. To care for a family member of an eligible employee with respect to which a public health official having jurisdiction or a health care provider makes a determination that the presence of the family member in the community would jeopardize the health of other individuals in community because of:
    1. the exposure of such family member to coronavirus; or
    2. exhibition of symptoms of coronavirus by such family member. (Family member means the employee’s parent, employee’s spouse, employee’s sibling, next of kin of the employee or person for whom the employee is next of kin, employee’s son or daughter, grandparent or grandchild of the employee.)
  3. To care for the son or daughter of such employee (under 18 years of age) if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable due to a public health emergency. (A child care provider is one who receives compensation for providing child care services on a regular basis. A school means elementary school or secondary education.)

Compensation During Leave

  • For the first 14 days of leave under the FMLA Expansion Act, the leave would be unpaid. During that time, the employee could substitute any accrued vacation leave, personal leave or medical or sick leave for unpaid leave (including leave under the Emergency Paid Sick Leave Act) discussed above. However an employer could not require the employee to substitute paid leave for unpaid leave.
  • Thereafter, the employer would have to provide paid leave for each day of the leave that an employee took at a rate that is not less than two-thirds of the employee’s regular rate of pay under the Fair Labor Standards Act (“FLSA”). An employee’s ordinary schedule would be used to calculate pay, provided that if an employee’s schedule varies from week-to-week, then the legislation sets forth an alternative calculation.

Amount of Leave Available – The Act does not expand the standard 12- week per 12-month requirement. Thus, the paid FMLA leave would be capped at 12 weeks. Note: There is an open question as to what occurs if an employee has already used FMLA for a non-coronavirus reason. The legislation does not address this, but the intent of the legislation is clearly to provide unprecedented support for employees. It would seem to be an unintended consequence that an employee who has already taken FMLA leave for a non-coronavirus reason would have to forego paid coronavirus leave under the FMLA Expansion Act.

Notice – As is customary under the FMLA, the legislation would require that the employee provide notice of the need for leave as soon as practicable.

Certification – Similarly, as with other FMLA leaves, an employer could require that a request for leave be supported by complete and sufficient certification. However, the FMLA Expansion Act would require employers to permit employees to provide required documentation not less than three weeks after the employee takes leave.

Restoration to Position – The FMLA Expansion Act would also require restoration to the employee’s position unless the employer employs fewer than 25 employees and meets additional criteria, namely, that if the employee’s position has been eliminated after expiration of the FMLA leave of absence because of an economic downturn or other operating conditions that effect employment caused by a public health emergency (e.g. COVID-19) during the period of leave (subject to certain conditions, including, but not limited to reasonable attempts to return the employee to an equivalent position.).

 What are the key provisions of the Emergency Unemployment Insurance Act?

The Act provides for the making of emergency administration grants in fiscal year 2020 to the accounts of the states in the Unemployment Trust Fund.

Our Employment & Labor Practice Group is continuing to monitor these developments and is available to answer your coronavirus questions.

Link to COVID-19 Resources page

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