On March 18, 2020, Congress and the President enacted the Families First Coronavirus Response Act, effective as of April 2, 2020 until December 31, 2020. The Act has multiple parts and obligates certain employers to provide additional paid sick leave and paid leave pursuant to the Family Medical Leave Act (“FMLA”) to any employees who are unable to work for reasons related to the coronavirus (COVID-19) pandemic. This leave time is above and beyond employers’ existing sick leave policies.
Emergency Paid Sick Leave
First, the Emergency Paid Sick Leave Act (ESLA) imposes an obligation on employers with fewer than 500 employees to provide 10 days of paid sick leave to all of their employees regardless of how long the employee has been in the job. In order to be entitled to paid ESLA sick leave, the employee must be subject to one of the following situations related to COVID-19:
- Compelled to quarantine or isolate by a federal, state or local order;
- Self-quarantining on advice from a medical provider;
- Experiencing symptoms commonly associated with COVID-19 and under medical evaluation for same;
- Being a responsible caregiver for someone who falls within category (1) or (2) above;
- Being a responsible caregiver for a child whose school or daycare is closed; or
- Experiencing any “substantially similar healthcare condition” as defined or specified by the Secretary of Health and Human Services.
If an employee is suffering from category (1), (2) or (3), the employer must pay the employee’s regular salary rate, but no more than $511 a day. If an employee is instead unable to work for the reasons listed in category (4), (5) or (6), the employee must be paid two-thirds (2/3) of his or her employee’s regular rate of pay, up to a maximum of $200 per day. Part-time employees unable to work for any of the above reasons must be paid as well, and this payment is based on whether the part-time employee works regular hours or instead has a fluctuating schedule.
Employers must provide ESLA leave time first for any coronavirus-related absence. Employers are prohibited from requiring employees to first use or exhaust their paid time off, such as sick, vacation or personal time.
Emergency Family and Medical Leave Expansion Act for Childcare
Another section of the Act is the Emergency Family and Medical Leave Expansion Act (EFMLEA). This requires employers with fewer than 500 employees to provide their employees with job-protected leave for up to twelve (12) weeks. This applies to any employee who has been employed for at least thirty (30) days and who must be absent from work due to the need to care for a dependent child where school and daycare are unavailable.
Employees who qualify for EFMLEA leave can take a maximum of twelve (12) weeks of leave time. The first two weeks are unpaid, but the remaining ten weeks require the employer to pay two-thirds of the employee’s regular salary, up to $200 per day.
Prohibition Against Retaliation
Retaliation is prohibited against employees who exercise their rights and attempt to claim any benefits they are entitled to under the Act.
Exemptions for Small Employers
“Small” employers may request exemptions from the Secretary of Labor. In particular, businesses with less than fifty (50) employees may be granted leave to refrain from paying for sick or family leave if such payments would jeopardize the viability of the business. Additionally, employers with less than twenty-five (25) employees will not have to guarantee an equivalent position to any employees who request EFMLEA leave upon their return to work.
Employer Tax Credits
To at least partially offset the increased financial burdens of complying with the leave time requirements in the Act, employers are granted a range of tax credits for all leave time required to be paid.
Specifically, employers will be allowed to claim a credit against the employer’s portion of the social security taxes for all sick and family leave wages paid under the Act, except that any such credit cannot exceed a total of $10,000 per employee. Any excess credits are refundable.
Anticipated Further Guidance for Employers
The Secretary of Labor has two weeks from March 18 to issue guidelines pertaining to the calculation of amounts to be paid and overall compliance with the Act. The Secretary of Treasury also has two weeks from March 18 to issue guidelines pertaining to the claiming and calculation of tax credits.
Compliance with the Families First Coronavirus Response Act is mandatory and subjects employers to significant additional expenses in a worrying economic climate.
If are a business owner or an employee who has questions regarding the rights granted and the obligations imposed by the Families First Coronavirus Response Act, please contact our office for an appointment at 973-256-0456.
For the most updated information regarding the Coronavirus, please visit the CDC website at https://www.cdc.gov/coronavirus/2019-ncov/index.html.
Additionally, you can contact the New Jersey Department of Health through the Coronavirus Hotline at 1-800-222-1222, or through the Department’s website at https://www.nj.gov/health.