*[3/25 Ed. Note: The Department of Labor has since advanced the effective date of the provisions outlined below to April 1, 2020.]
On March 18, the President signed into law the Families First Coronavirus Response Act (the “Act”). Among other things, the Act establishes paid sick leave (under a new law, known as the Emergency Paid Sick Leave Act) and temporarily expands the existing federal Family and Medical Leave Act of 1993 (the “FMLA”). Notably, the Emergency Paid Sick Leave Act and FMLA expansions only apply to employers with fewer than 500 employees and government employers. In addition, the leave provisions in the Act focus on the current coronavirus emergency, and do not address leave requirements for any future pandemics.
The Act provides tax credits for employers offering qualified paid sick leave and paid family leave wages (subject to certain caps and limitations) to offset the cost of providing the paid leave. The Treasury Department likely will issue additional regulations on the subject.
In addition to the paid leave requirements, the Act also requires employer-sponsored group health plans to provide coverage for COVID-19 testing at no cost to participants, a measure that many employers have already taken voluntarily.
Emergency Paid Sick Leave.
The Emergency Paid Sick Leave Act takes effect no later than *April 2, 2020, and expires on December 31, 2020. Employers have no continuing legal obligation under the new law following its sunset on December 31.
The paid sick leave law requires covered employers to provide up to 80 hours of paid sick leave to full-time employees. Part-time employees are entitled to leave based on the average number of hours the part-time employee works.
Usage. Employers must provide paid sick time to the extent that an employee is unable to work (or telework) due to a need for leave because:
- The employee is subject to a federal, state or local quarantine or isolation order related to COVID-19.
- The employee has been advised by a health care provider to self-quarantine due to COVID-19 concerns.
- The employee is experiencing symptoms of COVID-19 and seeking medical diagnosis.
- The employee is caring for an individual subject to a quarantine or isolation order, or who has been advised to self-quarantine.
- The employee is caring for a child whose school or place of care has been closed, or the child care provider is unavailable due to COVID-19 precautions.
- The employee is experiencing any other substantially similar condition specified by Health and Human Services (“HHS”) in consultation with the Department of Treasury and Department of Labor.
Business closures or shutdowns are not covered reasons for paid sick leave.
Eligibility. Employees are entitled to use of the paid sick time (upon the effective date), regardless of their length of employment. Employers who are health care providers or emergency responders may elect to exclude their employees from application of the Emergency Paid Sick Leave Act.
Pay Requirements. Total paid leave (at the employee’s regular rate of pay) is capped at $511 per day and $5,110 in the aggregate (per employee) for leave due to reasons described in items 1 through 3, above. Total paid leave is capped at $200 per day and $2,000 in the aggregate (per employee) for employees taking leave for reasons described in items 4 through 6, above. Employees using paid sick time for items 4 through 6 above are only entitled to two-thirds of their regular rate of pay, subject to the cap.
There is no requirement to pay employees for unused paid sick time upon termination or other separation from employment.
Other Employer Leave Policies. Employers must permit employees to use the new paid sick time before any other leave provided by the employer.
Small Employer Exception. The Department of Labor has the authority to exempt small businesses with fewer than 50 employees from compliance when “imposition of [the paid sick leave requirements] would jeopardize the viability of the business as a going concern.”
Employer Prohibitions and Penalties. Employers are prohibited from discriminating or retaliating against an employee for taking paid sick leave or for attempting to assert sick leave rights. FLSA penalties will be imposed against any employer who violates the Emergency Paid Sick Leave Act.
Multiemployer CBAs. The Act affords paid sick leave to those employees who work under a multiemployer collective bargaining agreement (“CBA”) and whose employers pay into a multiemployer plan. Employers who are signatories to such agreements may fulfill their obligations under the new law by making contributions to the multiemployer fund, plan or program based on the hours of paid sick time to which each employee is entitled under the law while working under the respective CBA.
Employer Notice Requirements. Employers are required to post a notice – to be published by the Department of Labor – in a conspicuous place in the workplace.
Relationship to other Leave Laws and Agreements. Employers still must comply with any other federal, state or local leave laws to which they are subject, as well as any CBA or existing employer policy. The Emergency Paid Sick Leave Act does not supersede or preempt any other law.
Temporary Expansion of the FMLA.
Like the Emergency Paid Sick Leave Act, the FMLA expansion is only effective through December 31, 2020. It also takes effect no later than April 2, 2020.
Usage. The FMLA expansion requires covered employers to provide up to 12 weeks of protected leave (“Emergency Leave”) to eligible employees who are unable to work (or telework) because of the need to care for a child under 18 years of age due to closure of school or the child’s place of care, or if the child care provider is unavailable due to the coronavirus.
The final version of the FMLA expansion is much narrower than the initial version passed in the House, that provided numerous additional categories of protected leave categories.
Eligibility. The Act eases FMLA’s eligibility requirements and requires employers to provide Emergency Leave to any employee who has been employed for at least 30 calendar days. The Act allows the Department of Labor and/or employers of health care providers and emergency responders to exclude such categories of employees from eligibility.
Pay Requirements. Employers are not required to provide paid FMLA leave during the employee’s initial 10 days of Emergency Leave. Employees may elect to use accrued paid time off during the initial 10-day period, but employers may not require such use. Following expiration of the 10-day period, employers are required to pay an employee two-thirds of his or her regular rate of pay, based on the number of hours the employee would otherwise be normally scheduled to work. Total paid leave is capped at $200 per day and $10,000 in the aggregate for each employee.
Small Employer Exception. The Act provides the Department of Labor with the authority to exempt small businesses with fewer than 50 employees from compliance when “imposition of [the FMLA expansion] would jeopardize the viability of the business as a going concern.”
Reinstatement Rights. Generally, the FMLA’s reinstatement rights apply to Emergency Leave. However, the Act creates a hardship exception for smaller employers with less than 25 employees.
Multiemployer CBAs. Employers who are signatories to a multiemployer CBA may fulfill their obligations under the FMLA expansion by making contributions to a multiemployer fund, plan or program, provided the fund, plan or program enables employees to secure pay based on hours worked under the CBA for Emergency Leave.
Coverage Mandate for COVID-19 Testing.
The Act also requires employer-sponsored group health plans to provide coverage for COVID-19 testing at no cost to plan participants.
COVID-19 testing for this purpose includes items and services furnished during a provider visit (including a telehealth visit), urgent care center visit, or emergency room visit, if the visit results in an order for or administration of COVID-19 testing. The coverage mandate does not apply to health care services for treatment after COVID-19 has been diagnosed.