In an effort to slow the progression of the coronavirus (COVID-19) in the United States and mitigate its economic impact, on Wednesday, March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act (FFCRA).
What’s in the Families First Coronavirus Response Act?
The law includes several provisions focused on enabling free coronavirus testing, expanding paid leave, giving more protections to health care workers, and providing additional funding for Medicaid, unemployment benefits and food assistance programs. This blog post will focus primarily on coronavirus testing and paid leave.
Free Coronavirus Testing
FFCRA requires group health plans and health insurers offering group or individual health insurance coverage (including grandfathered health plans under ACA) to cover coronavirus testing without any cost-sharing, such as deductibles, copayments and coinsurance. Also, the testing cannot be subject to prior authorization or any other medical management requirements. Government programs, such as Medicare and Medicaid, will cover the coronavirus testing free of charge and without cost-sharing as well.
New Paid Leave
The Families First Coronavirus Response Act creates two new paid leave programs that take effect on April 1, 2020 and expire on December 31, 2020. The new paid leave provisions apply to all government employers and private-sector employers with fewer than 500 workers. In addition, it includes a series of tax credits that help offset the cost to employers of the new paid leave programs.
Emergency Paid Sick Leave
FFCRA requires that two weeks of paid sick leave be available immediately to all employees for reasons related to COVID-19. The two weeks are defined as 80 work hours for full-time employees. For part-time employees, the two weeks are defined as the number of hours that a given employee typically works in two weeks. If part-time employees have schedules that vary from week to week, the number of hours is the average number of hours that the employee was scheduled to work per day over the six-month period before the sick leave. If the part-time employee did not work during that period, the number of hours of emergency sick leave is the average number of hours per day the employee would reasonably have expected to be scheduled to work when he or she was hired.
The qualifying reasons include:
- Quarantine ordered by the government
- Self-quarantine advised by health care provider
- Personal symptoms of COVID-19 and seeking a medical diagnosis
- Caring for someone (not necessarily a family member) who is quarantined by government order or under advice from a health care provider due to COVID-19
- Caring for a son or daughter whose school or place of child care has been closed, or because the employee’s child care provider is unavailable due to coronavirus precautions.
- Employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.
Employees are entitled to their full regular rate of pay (equal to or above minimum wage) if the leave is required for their own coronavirus illness (the first three qualifying reasons above) up to a limit of $511 per day and $5,110 total. If employees are on leave to care for others (fourth or fifth reason listed above) or for the last reason listed above, the required pay is two-thirds of their regular rate of pay (equal to or above minimum wage) up to $200 per day and $2,000 total.
Employees whose employers contribute to a multiemployer plan are entitled to paid sick leave, provided that the multiemployer plan enables employees to secure pay from the plan based on hours they have worked under the multiemployer collective bargaining agreement. If an employer already provides paid sick leave, the new paid sick time (for a public health emergency declaration) specified under this bill must be offered in addition to their existing paid leave, and the employer may not change existing policies to avoid paid sick leave obligations. Also, an employer cannot require that employees use other paid time off — such as vacation, personal days or PTO banks—before using the new emergency paid leave. In addition, emergency paid sick leave cannot be carried over from one year into the next and it is not paid out at termination of employment.
Employers must post a public notice informing employees of their rights to emergency paid sick leave. The Department of Labor (DOL) will provide a model notice within seven days.
[Free Member Webcast: Coronavirus in the Workplace: U.S. Regulatory Considerations | Available on Demand]
Emergency Family and Medical Leave
In addition to emergency paid sick leave, the Families First Coronavirus Response Act expands Family and Medical Leave Act (FMLA) provisions to require 12 weeks of job-protected public health emergency leave. The first ten days of leave could be unpaid and employees could, but would not have to, use other forms of accrued paid leave, such as vacation, personal leave or sick leave during that time. After the first ten days, employers must pay workers at least two-thirds of their regular rate of pay up to $200 per day and no more than $10,000 total. For employees with varying schedules, FFCRA provides that the paid leave will be equal to the average number of hours per day that the employee was scheduled to work over the previous six-month period. If the employee did not work during that period, the number of hours of emergency family and medical leave is the average number of hours per day the employee would reasonably have expected to be scheduled to work when he or she was hired. An employee is entitled to this emergency leave after working for an employer for at least 30 calendar days.
Emergency family and medical leave is available when an employee is unable to work because his or her minor child’s school, daycare, or other place of child care has been closed or is unavailable due to a public health emergency.
The expanded FMLA emergency leave also applies to multiemployer plans in the same way that emergency paid sick leave does. The Families First Coronavirus Response Act would allow the DOL to issue regulations related to emergency family and medical leave to exclude certain health care workers and emergency responders and to exempt small businesses with fewer than 50 employees if these requirements would jeopardize the viability of their business. There’s also an exception for employers with fewer than 25 employees concerning the job protection aspect of the bill. The employer is not required to protect jobs if employees go on emergency leave and their job doesn’t exist when they are able to return because the business has experienced an economic downturn or other changes due to the public health emergency. To qualify for this exemption, the employer would also have to make reasonable efforts to restore the employees to equivalent jobs for up to a year after the leave.
Tax Credits for Paid Leave
A refundable payroll tax credit will be available to employers that provide paid emergency sick leave or paid emergency family and medical leave through 2020 as follows:
- For paid emergency sick leave, the tax credit for employers is 100% of wages paid up to $511 per employee per day for all employees taking leave for their own prevention, care or treatment of the coronavirus. If the leave is due to caring for someone else or because of a child’s school closing, the cap is $200 per employee per day.
- For paid emergency family and medical leave, the tax credit is 100% of wages paid up to $200 per employee per day and no more than $10,000 total per employee.
Learn More About Coronavirus and the Workplace
For additional information on coronavirus and the workplace, visit these resources:
- The International Foundation Coronavirus (COVID-19) Resources page
- Related reading from Word on Benefits:
- Free Member Webcasts:
- Coronavirus in the Workplace: U.S. Regulatory Considerations | Available on Demand
- Coronavirus and International Business Travel: What Employers Need to Know | Available on Demand
Kelli Kolsrud, CEBS
Director, Information Services and Publications at the International Foundation
Donna Malliett, CEBS
Thank you for the great summary, Kelli!
I admit I did chuckle when I read, “Employers must post a public notice informing employees of their rights to emergency paid sick leave.” I work in an office environment and we are all working from home. If I post the notice in the office, no one will see it. 🙂
Kelli Kolsrud, CEBS
Hi Donna,
Yes, that is amusing. Obviously, it will probably need to be an electronic posting these days.
I looked at the wording in the law again and it says, “Each employer shall post and keep posted, in conspicuous places on the premises of the employer where notices to employees are customarily posted, a notice…”
Thanks for replying!
Brenda Meehl
I thought I had read that public employers with at least 1 employee are also subject to this, but don’t see it in your blog. Is this correct?
Kelli Kolsrud, CEBS
Hi Brenda,
Yes, you are absolutely correct. For emergency paid sick leave, the new law says that private entities that employ fewer than 500 employees are subject to the provisions, as well as public agencies or any other entities that are not private entities that employ one or more employees.
As for the emergency family and medical leave, the new law refers to the existing framework of FMLA. FMLA applies to private-sector employers, with 50 or more employees in 20 or more workweeks in the current or preceding calendar year, but the new law expands that definition to include all employers with fewer than 500 employees. As for public sector employers, FMLA applies to public agencies, including local, state, or Federal government agencies, regardless of the number of employees they employ. The new law contains no changes to that definition, so it appears that the emergency family and medical leave provisions also apply to all government employers, no matter their number of employees.
Anissa Lindgren
Am I correct that employers with more than 500 employees who provide paid leave benefits related to COVID-19 will NOT be eligible for any tax credits? (Since they are not required by the law to provide the benefits?)
Kelli Kolsrud, CEBS
Hi Anissa,
Yes, the paid leave features of the law, including the tax credits, apply only to employers with fewer than 500 employees.
Cathy Graham
Great, comprehensive article. Very helpful.
Kelli Kolsrud, CEBS
Thank you, Cathy. I’m pleased that it is helpful.
Katherine
My organization has many PRN (casual) employees, and roughly 150 full and part-time. Do PRN employees count in the 500?
Kelli Kolsrud, CEBS
Hi Katherine,
We did some research on that and didn’t really find an answer addressing how to count the 500 employees. Hopefully, the government will release guidance that addresses that.
It appears that the law defines part-time employees to include those workers with varying schedules to be eligible for both types of emergency leave. We’ve just updated the blog post to reflect that. “For part-time employees, the two weeks are defined as the number of hours that a given employee typically works in two weeks. If part-time employees have schedules that vary from week to week, the number of hours is the average number of hours that the employee was scheduled to work per day over the six-month period before the sick leave. If the part-time employee did not work during that period, the number of hours of emergency sick leave is the average number of hours per day the employee would reasonably have expected to be scheduled to work when he or she was hired.” There is similar language for the emergency family and medical leave.
Christy
This is the situation that I am also in..I am a prn employee for a home health agency. My patients have been cut dramatically or they want me to travel long distances to see patients. Which I am refusing to do. Also, I have a son that’s home and requires teaching due to the schools being closed. And on top of all that my husband lost his job due to the outbreak. We are in a bind and I am the primary bread winner at this point. I spoke with my employers about possibly filing for unemployment due to lack of work in my area and having to teach my son. I don’t want to lose my job…but I’m not receiving the money I need for us to live. They stated that I could work but it would be driving long distances. Do I need to quit my job to get this unemployment under the CARE act? Can I continue to work when they have work for me and still receive unemployment? I have filed and sent an email to my employer stating the hardship but I’m afraid they are not going to be happy about this. Do I qualify for assistance at this point? Any suggestions on what I should do?
Anna
Is the maximum that the employee receives the $511 per day or is that the maximum tax credit a company receives? Can companies opt to pay their employee their full salary still, but only receive the maximum credit?
Kelli Kolsrud, CEBS
Hi Anna,
It appears that the answer to your first question is “both.” The version of the bill that was enacted into law included a cap for required pay for the emergency leave and for the tax credits. Usually, an employer can choose to be more generous. However, I don’t think the tax credit would increase.
Donna Swingley
I have a question for my daughter in law that lives in In.
We thought she was exposed to the Corona-virus in late March 2020.
She called her employer to advise them that her spouse had been told she had strep throat and pink eye, she also had a low grade fever. Her employer said she must stay home for 14 days and would have to use her PTO and sick leave to ensure she receive her regular 40 hour work week pay check. She did that, she had no choice.
Now her employer is saying she needs to pay back all of the PTO and sick leave she received while in forced stay at home orders.
She was never tested for Covid-19, nor was my daughter.
Is this legal, can her employer really take back the PTO and sick leave monies they paid to her?