And the Beat Goes On . . . IRS Info on the COVID-19 Tax Credit; DOL Issues Temporary Regulations

Posted on: April 2, 2020 0

by Marti Cardi, Esq – Vice President Product Compliance

April 2, 2020

 

And the beat goes on, the beat goes on
Drums keep pounding a rhythm to the brain
La de da de de, la de da de da*

Sonny & Cher

Bet that song will be in your brain all day now – you’re welcome! 


We are getting pounded daily with new guidance on the Families First Coronavirus Response Act (FFCRA).  Here’s the drumbeat from the last couple of days – FFCRA tax credits guidance and Department of Labor temporary regulations (124 pages!) explaining the Emergency Paid Sick Leave Act (EPSL) and the Emergency Family and Medical Leave Expansion Act (EFMLA).  (For our prior COVID-19 posts you can just scroll down in this blog.  But remember, things keep changing so always look here for the latest!)

DOL Temporary FFCRA Regulations

I have to admit, I have not yet read all 124 pages of the temporary regulations and won’t try to summarize them yet.  That will be part of my fun weekend.  It will be an easy way to keep appropriate social distance!  But the regs have arrived and you can enjoy them yourself here.

COVID-19-Related Tax Credits

First, a refresher. The FFCRA is applicable to employers with fewer than 500 employees. The act requires covered employers to provide paid leave through two separate provisions: (i) the EPSL, which entitles workers to up to 80 hours of paid sick time when they are unable to work for certain reasons related to COVID-19, and (ii) the EFMLA, which entitles workers to certain paid family and medical leave when their child’s school is closed or daycare is unavailable due to COVID-19.

Covered employers can claim tax credits for wages paid as required by EPSL and EFMLA. These tax credits also include any qualified health plan expenses and the employer’s share of Medicare tax on the FFCRA wages paid.  Details on how to claim the tax credit are available in the IRS guidance.  Be sure to share it with your tax advisor (I’ll bet they already have it)!

Documentation is Really Important!  Kind employers may be inclined to take an employee’s word for the reason they need paid leave under EPSL and/or EFMLA, but doing so may be kissing the 100% tax credit goodbye. You can’t get the tax credit without some pretty detailed documentation.  The following information is found in Questions 44 and 45 of the IRS guidance:

For all paid leave reasons, the employee must make a WRITTEN request for paid leave that includes:

  1. The employee’s name;
  2. The date or dates for which leave is requested;
  3. A statement of the COVID-19 related reason the employee is requesting leave and written support
    for such reason; and
  4. A statement that the employee is unable to work, including by means of telework, for such reason.

And:

In the case of a leave request based on a quarantine order or self-quarantine advice for the employee or a family member, the written statement from the employee should include:

  1. The name of the governmental entity ordering quarantine or the name of the health care professional
    advising self-quarantine; and,
  2. If the person subject to quarantine or advised to self-quarantine is not the employee, that person’s
    name and relation to the employee.

In the case of a leave request based on a school closing or child care provider unavailability, the written statement from the employee should include:

  1. The name and age of the child (or children) to be cared for;
  2. The name of the school that has closed or place of care that is unavailable; and
  3. A representation that no other person will be providing care for the child during the period for which
    the employee is receiving family medical leave; and
  4. With respect to the employee’s inability to work or telework because of a need to provide care for a
    child older than fourteen during daylight hours, a statement that special circumstances exist requiring
    the employee to provide care.

In other words, an employee cannot get paid EPSL or EFMLA during a school closure or unavailability of day care due to COVID-19 if someone else is providing care to the child(ren) during the time for which the employee is claiming paid leave. Does this mean that if one parent is home due to a business closure, the other parent cannot take paid leave to care for the child?  It would seem so, and that seems fair. There is no guidance as to what would constitute special circumstances that make an employee unable to telework even though his children are over 14. Special needs come to mind. Or, “My child is a pyromaniac and must be watched at all times!” (Another song reference – any Def Leppard fans out there?)

And the beat goes on!  In addition to the above documentation, the employer must create and maintain records that include the following information:

  • Documentation to show how the employer determined the amount of EPSL an EFMLA wages paid to
    employees that are eligible for the credit, including records of work, telework and qualified sick leave
    and qualified family leave.
  • Documentation to show how the employer determined the amount of health plan expenses being claimed.
  • Copies of any completed Forms 7200, Advance of Employer Credits Due To COVID-19, that the
    employer submitted to the IRS.
  • Copies of the completed Forms 941, Employer’s Quarterly Federal Tax Return, that the employer submitted
    to the IRS (or, for employers that use third party payers to meet their employment tax obligations,
    records of information provided to the third party payer regarding the employer’s entitlement to the
    credit claimed on Form 941).

Matrix Can Help!

Where else can you get COVID-19 leave news, insightful interpretations and the occasional music throwback? Sure, everyone says “We’re all in this together,” but admit it – it’s more fun together with us. Stay informed, stay loose and reach out to your Matrix or Reliance Standard account manager for help making your program make sense. 

 

*The Beat Goes On written by Sonny Bono. © Warner Chappell Music, Inc.

The DOL on a Roll – More FFRCA Q&As Issued

Posted on: March 31, 2020 0

by Marti Cardi, Esq – Vice President Product Compliance

March 31, 2020

 

In the fast-paced COVID-19 world, the U.S. Department of Labor (DOL) has issued more Questions and Answers about the Families First Corona Virus Reponses Act (FFCRA).  And not only are we now up to 59 questions (a good indicator of how tough it is to understand the FFCRA), but in the latest issue the DOL went back and revised some of the answers given just the day before!!  You can find the current full set of Q&As, the gift that keeps on giving, here.

This discussion includes material revisions to DOL answers previously provided in earlier versions of the Q&A, and coverage of Questions 15 through 59.  For even more information, see my post about the act itself as passed, and this post with analysis of the first 14 questions. (How cute that seems now – it seems like just yesterday!)   

Even though this is a lengthy post, persist! And I encourage employers to read the actual Q&As for more details on topics of interest to them. 

As used here, EPSL refers to the Emergency Paid Sick Leave Act and its benefits.  EFMLA refers to the Emergency Family and Medical Leave Expansion Act and its benefits.

Documentation (Questions 15-16):  Employers, don’t be lax on the documentation requirements if you want to get those tax credits.  An employer must obtain appropriate documentation for an employee’s paid leave (whether sick leave or EFMLA) if the employer intends to claim a tax credit under the FFCRA for such payments.  Unfortunately, the DOL provides little guidance regarding what is sufficient documentation, punting instead to the IRS.  (“You should consult Internal Revenue Service (IRS) applicable forms, instructions, and information for the procedures that must be followed to claim a tax credit, including any needed substantiation to be retained to support the credit.”)   As of this writing the IRS has yet to  publish any such materials.

There is a little more help with respect to documentation for paid leave under EFMLA, which covers only leaves necessitated by the employee’s child’s school closure or unavailability of child care due to COVID-19.  Employers may require documentation for this leave reason “to the extent permitted under the certification rules for conventional FMLA leave requests,” whatever that means! But the DOL does provide examples, such as a notice that has been posted on a government, school, or day care website, or published in a newspaper; or an email from an employee or official of the school, place of care, or child care provider. 

An employer is not required to provide EPSL or paid EFMLA leave if materials sufficient to support the applicable tax credit have not been provided by the employee.

Telework (Questions 17-19).  If an employer offers and an employee is able to work from home, then the employee is not entitled to EPSL or EFMLA leave and benefits. The answer to Question 19 states, “Of course, to the extent you are able to telework while caring for your child, EPSL and expanded family and medical leave is not available. Thus, it appears that if an employee declines telework arrangements although he is able to work from home (at least during normal work hours) he is not entitled to the FFCRA pay benefits. This might arise, for example, when the employee is staying home due to a school closure but the employee’s child is old enough to care for himself at home during the day; or when the employee is quarantined but has not developed COVID-19.

Intermittent leave (Questions 20-22).  A telework employee can take intermittent leave under both EPSL and EFMLA in any increment as long as the employer and employee agree (a new concept that we wish applied to regular FMLA intermittent leave!).  

For work at the employee’s usual worksite, the availability of intermittent leave is more limited. EPSL must be taken in full-day increments, and cannot be used intermittently at all if, for example, the employee (or a family member) is under quarantine or is experiencing COVID-19 symptoms and seeking medical diagnosis. Intermittent leave is available, if the employer and employee agree, for both EPSL and EFMLA when the need for leave is due to a child’s school or day care closure.

Once started, the employee must continue using EPSL until the reason no longer exists or the employee exhausts the EPSL allotment. However, if the employee no longer has a qualifying reason for taking EPSL before she exhausts her allotment, she may take any remaining EPSL at a later time, until December 31, 2020, if another qualifying reason occurs.

Closed worksites, furlough, reduced hours, and FFCRA benefits (Questions 23-28).  It appears that the closure of a worksite – for whatever reason – trumps (ahem!) the right to EPSL or enhanced FMLA. That is, even if an employee is experiencing a situation that would entitle her to paid leave and/or FMLA protections, those are not available once the business closes because the employee is no longer missing work due to the covered reason. In other words, there is no work to take leave from. The same applies if an employee is furloughed. The employer must pay for any qualifying leave taken while the business was open or before the furlough, but not more than that. Similarly, if an employer orders reduced hours, the employee cannot claim FFCRA benefits for the missed work hours because the employee is not prevented from working due to a FFCRA-qualifying reason.

Coordination with other paid leave policies, laws, and CBAs (Questions 31-34, 46).  If an employer offers paid leave benefits (such as vacation, PTO, sick leave, etc.) the employee gets to choose which benefit to use – one from the employer’s existing policies or a benefit under the FFCRA. They cannot be used concurrently unless the employer agrees to allow the employee to supplement or top off FFCRA benefits with company paid leave benefits, up to the employee’s normal earnings. Whether to use such benefits, if offered by the employer, is up to the employee.  

EPSL is in addition to other leave mandated by any federal, state, or local law. The employer must comply with both separately. The same goes for leave provided by a collective bargaining agreement.

An employer may elect to pay employees more than the amount required under the FFCRA, whether by allowing the employee to supplement FFCRA payments with existing paid leave or by simply paying more than the FFCRA requires. However, the employer will not receive tax credit for any excess amounts paid.

“Son or daughter” (Question 40).  Both EPSL and EFMLA provide job-protected, paid leave when an employee needs to care for a “son or daughter” due to the closure of the child’s school or the unavailability of child care due to COVID-19. The DOL has clarified that both laws include not only a child under age 18, but also one 18 years or older who (1) has a mental or physical disability, and (2) is incapable of self-care because of that disability. This resolves an inconsistency between the two laws. For additional information on requirements relating to an adult son or daughter, see the DOL’s FMLA Fact Sheet #28K.

Job protection (Question 43).  Both EPSL and EFMLA entitle the employee after leave to be restored to the same or equivalent position. However, as with regular FMLA, an employee is not protected from employment actions that would have affected the worker’s employment regardless of leave. The DOL uses the example of a layoff that would have occurred whether or not the employee took leave. In reality, this also applies if an employee is terminated for cause that has nothing to do with the employee’s covered leave or request for leave. The “key employee” provision of the FMLA is also still applicable.

In addition, there is an exemption to the job restoration requirement for employers with fewer than 25 employees if the position was eliminated for reasons related to COVID-19 and the employer makes reasonable efforts to restore the employee to an equivalent position for the next 12 months. 

Interaction of EPSL and FMLA (Questions 44-47).  The EPSL and FMLA of any type are separate entitlements. If the employee’s reason for taking EPSL coincides with the EFMLA reason, the two run concurrently and the employee is entitled to the benefits of both.  Example:

  • An employee’s child’s school closes due to COVID-19. The employee can take EPSL to
    receive paid time off for the first 80 hours/2 weeks.  If the employee has been working for
    the employer for at least 30 days, the employee is also entitled to EFMLA protections
    during the first 10 days of leave and the EFMLA pay benefits that commence after 10 days.

On the other hand, EPSL used for other covered reasons, such as the employee’s or family member’s quarantine, does not count as FMLA and does not reduce the employee’s FMLA entitlement.  One possible exception is where the employee or a family member is showing symptoms of COVID-19 and is seeking a medical diagnosis. In that case, EPSL would be available and the employee’s or family member’s condition might ultimately satisfy the definition of serious health condition under the FMLA and qualify for coverage by both – but not the 2/3 pay provisions of EFMLA.

The EFMLA provisions do not increase the amount of FMLA leave an employee is entitled to.  The total entitlement for all leave reasons combined remains at 12 weeks in a 12-month period.  And, remember that FMLA for school closures ends on December 31, 2020. 

Part time” and “full time” under FFCRA (Questions 48-49).  Under the EPSL, full-time employees are entitled to up to 80 hours of paid leave and part-time employees are entitled to pay for the number of hours they typically work in a 2-week period. EPSL does not define full time and part time. The DOL now tells us that a full-time employee is normally scheduled to work 40 or more hours per week, and a part-time employee is normally scheduled to work fewer than 40 hours per week. 

In contrast, the Emergency Family and Medical Leave Expansion Act does not distinguish between full- and part-time employees; but the number of hours an employee normally works each week will affect the amount of pay the employee is eligible to receive.

Applicability of FFCRA to public employers/employees (Questions 52-54).  OK, I don’t have much to say here.  My head is spinning from reading 54 questions and answers so far. The answers to whether EPSL and EFMLA apply to public sector workers are different. EPSL?  “Generally, yes.”  EFMLA?  “It depends.”  So I recommend anyone affected by this issue read Questions 52 and 53, which offer a lot of detail. 

Who is a “health care provider”?  (Questions 55-56).  We have two answers to this question. First, a “health care provider” (HCP), as the term is used to determine who can tell an employee to self-quarantine due to COVID-19, means a licensed doctor of medicine, nurse practitioner, or other HCP permitted to issue an FMLA certification.

Second, both EPSL and EFMLA allow an employer to exempt HCPs from coverage. For this purpose, the term includes anyone employed at any doctor’s office, hospital . . . clinic . . . medical school . . . nursing facility . . . pharmacy . . . including any permanent or temporary facility . . .   You get the idea – the list is very extensive and I have left out many examples, so read Question 56 if this is important to you. 

Who is an “emergency responder”?  (Question 57).  Both EPSL and EFMLA allow an employer to exempt emergency responders from coverage. For this purpose, the term includes “an employee who is necessary for the provision of transport, care, health care, comfort, and nutrition of such patients, or whose services are otherwise needed to limit the spread of COVID-19.”  Examples include national guard, law enforcement officers, various types of emergency personnel, and 911 operators. The DOL provides many more examples in Question 57. 

Small business exemption (Questions 58-59).  An employer with fewer than 50 employees is exempt from providing EPSL and EFMLA when doing so would jeopardize the viability of the small business as a going concern, but ONLY as to school/child care closures or unavailability due to COVID-19.  There is no exemption for the other 5 reasons for EPSL (see our prior blog post here for the list). 

The exemption is available only if:

  • The business has fewer than 50 employees;
  • Leave is requested because of the employee’s son or daughter’s school/child care closure
    or unavailability due to COVID-19; and
  • An authorized officer of the business has determined that at least one of the following
    three conditions exists:
    • The provision of leave would result in the small business’s expenses and financial
      obligations exceeding available business revenues and cause the small business to
      cease operating at a minimal capacity; or 
    • The absence of the employee or employees requesting leave would entail a substantial
      risk to the financial health or operational capabilities of the small business because of
      their specialized skills, knowledge of the business, or responsibilities; or  
    • There are not sufficient workers who are able, willing, and qualified, and who will be
      available at the time and place needed, to perform the labor or services provided by
      the employee or employees requesting leave and these labor or services are needed
      for the small business to operate at a minimal capacity.

WHEW! Is anyone else ready for a cold beverage? We’re done – at least for now – but please remember to check back frequently for updates, as things are changing in this COVID-19 world by the hour.

Matrix Can Help!

At Matrix we don’t just track all this state and federal legislation on a daily (hourly?) basis – we prepare to jump into action!  We are constantly updating our leave administration practices and staff training to apply each new COVID-19-related provision as fast as they come out of the oven, still warm and chewy. So reach out to your account manager with specific questions and check back with us early and often.

Families First Coronavirus Response Act – Details, DOL and More, Oh My!

Posted on: March 26, 2020 0

by Marti Cardi, Esq – Vice President Product Compliance

March 26, 2020

With record speed for a governmental agency, the U.S. Department of Labor (DOL) has issued a respectable amount of information to help employers understand the brand spankin’ new Families First Coronavirus Response Act (FFCRA) enacted on March 18.  Among other things, the Act:

  • Expands the Family and Medical Leave Act to provide job-protected
    leave when an employee is unable to work (or telework) due to a
    need to care for the employee’s child under age 18 if the child’s
    school or place of care has been closed or the child care provider
    is unavailable due to COVID-19.
  • Provides paid sick leave for 6 qualifying reasons related to COVID-19.

We provided more details on the FFCRA in our blog post hereIn addition, in collaboration with our sister company Reliance Standard, we have prepared an extensive set of Frequently Asked Questions. Thanks to my colleagues Kim Dunn and Nuri Noaz at RSL for their great work on the FAQs.

Here’s a quick look at new materials provided by the DOL as of yesterday, together with some surprise answers to questions.

FFCRA Questions and Answers

The DOL issued a Q&A guidance late on March 24, 2020.  Here’s a summary of what it covers:

Effective April 1.  The FFCRA provides that it will be effective “not later than 15 days after the date of enactment.”  Most of the world counted on the calendar and assumed this would mean April 2, 2020.  April Fool’s!  The DOL has identified April 1, 2020, as the effective date.  Go figure!

Size of Employer.  The FMLA expansion and paid sick leave provisions apply only to private employers with fewer than 500 employees.  In the Q&A the DOL has explained how to count employees to determine coverage:

  • The point of measurement is at the time an employee’s requested leave is to be taken.
    For employers hovering near that 500 threshold, this means that coverage (and whether
    to provide the leave) could change day by day as the employer’s headcount fluctuates
    over and under 500.
  • The count of employees includes full-time and part-time employees, employees on leave,
    temporary employees jointly employed two employers (regardless of whose payroll the
    employee is on), and day laborers supplied by a temp agency. Independent contractors
    do not count (but remember it is very hard to establish a true independent contractor
    arrangement).
  • Typically a corporation will be considered a single employer. However, the rules regarding
    joint employers and integrated employers apply.  You can find these rules explained in
    the FMLA regulations here.

Public sector employers of any size appear to be covered but the Q&A states that additional FAQs on public employers will be forthcoming.

Paid Sick Leave – Hours and Rate of Pay.  This benefit is available for all employees of employers with fewer than 500 employees, but the amount of leave depends on whether the employee is full time or part time (80 hours for full time and the equivalent of 2 weeks’ work for part time).  Neither of these terms is yet defined.  The Q&A addresses how to calculate the employee’s rate of pay and the employee’s hours of work (including for an employee with a variable schedule).

A welcome clarification is that the Act provides a one-time-only allotment of paid sick leave, not 80 hours/2 weeks per covered event.  And, 80 hours means 80 hours.  An employee who typically works 50 hours per week can take 50 hours of paid sick leave in one week but then will have only 30 hours in the next week.  Still not clear is whether the paid sick leave can be used intermittently and/or at separate times for different covered events, up to the total maximum.

Applicability of Both Benefits.  If an employee needs leave due to a school closure or daycare, they may be eligible for both the enhanced FMLA leave and pay (after 30 days of employment) and the paid sick leave (immediately upon employment).  Because the first 10 days of FMLA for this reason is unpaid the employee can use the paid sick leave entitlement for that period, after which time the pay benefits of the enhanced FMLA would kick in.

Not Retroactive.  The Act does not apply retroactively.   The employer must give employees all of the leave and pay benefits required by the Act from April 1 on.  Anything provided by the employer before that date does not satisfy its obligations (and also won’t qualify for the tax benefits).

Required Employer Notices

Each covered employer must post a notice of the FFCRA requirements in a conspicuous place on its premises. For remote workers, an employer may satisfy this requirement by emailing or direct mailing this notice to employees, or posting this notice on an employee information internal or external website.  The DOL issued the approved notice form on March 25.  Here it is, along with a related FAQ:  Employee Rights: Paid Sick Leave and Expanded Family and Medical Leave under The Families First Coronavirus Response Act (FFCRA)

More to Come!

The DOL is authorized by the Act to issue certain regulations relating to both the expanded FMLA provisions and the paid sick leave, but no due date or deadline is provided.  Regulations will cover at least the possible exemptions for health care providers and emergency responders, the small business exemption for crew with fewer than 50 employees if compliance would jeopardize the viability of the business as a going concern, and other regulations as necessary to carry out the paid sick leave provisions and ensure consistency between those and the expanded FMLA provisions.

For all things DOL and COVID-19-related, checkout the DOL’s ever-expanding pandemic website here.

Matrix Can Help!  

Is it me, or does this seem to be drifting into something resembling the “new normal?” While it still feels a bit like the first time on a scary roller coaster, we are taking it in, figuring it out and helping each other – the way you’d hope. Keep checking back, and if you have specific questions we have armed our account managers with up to the moment answers that are refreshed daily. Just ask, and we at Matrix and Reliance Standard will do our best to keep you and your employees stay safe and informed.

 

Families First Coronavirus Response Act – It’s Final and Here’s What It Requires

Posted on: March 20, 2020 0

by Marti Cardi, Esq – Vice President Product Compliance

March 20, 2020

 

The President has signed the Families First Coronavirus Response Act  (FFCRA), originally introduced in the House as H.R. 6201.  The final version is significantly scaled back from the original. There are still 2 significant sections related to employee absences: expansion of FMLA coverage for school and day care closures, and paid sick leave for a multitude of reasons. Here is a recap of the provisions as passed that will go into effect on April 2, 2020.

EMERGENCY FAMILY AND MEDICAL LEAVE EXPANSION ACT

Effective dates.  Effective on April 2, 2020; sunsets on December 31, 2020 (unless extended, of course).

Employee eligibility.  Applies to employees who have worked for 30 calendar days for the employer from whom they request leave. The DOL is authorized to draft regulations excluding certain health care providers and emergency responders from eligibility.

Covered employers.  Applies to employers with fewer than 500 employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year.”

  • So, if an employer has 500+ employees and then drops below 500, coverage is not immediate but
    would take a total of 20 weeks at the under-500 level. Those weeks do not need to be consecutive,
    but total within the current calendar year.
  • Likewise, if an employer has under 500 employees now and is covered, then increases to 500 or more
    employees, it will take 20 weeks total at that level in 2020 before the employer moves out from under
    coverage.

There are no limitations regarding number of employees at a work site. 

The Act has a provision authorizing the U.S. Department of Labor to issue regulations to exempt small business (fewer than 50 employees) from the requirements of the FFCRA “when the imposition of such requirements would jeopardize the viability of the business as a going concern.”  It remains to be seen whether the DOL will be able to implement such regulations before the April 2 effective date.

Covered leave reason and duration.  The law adds FMLA job-protected time off ONLY to care for a son or daughter under 18 whose school or place of care has been closed or the child care provider for the son or daughter is unavailable due to a public health emergency specifically relating to COVID-19. However, leave is not available unless the employee is “unable to work (or telework) due to a need for leave.”  This additional leave type is included within the existing FMLA 12-week total. The Act is silent regarding intermittent leave usage; most likely, intermittent usage is permissible. 

“Son or daughter” is not specifically defined in the FFCRA so presumably the usual FMLA definition applies (a biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis) except, as noted above, coverage is limited to closures for a son or daughter under 18.

“School” is defined as an elementary or secondary school. “Child care provider” means a provider who receives compensation for providing child care services on a regular basis.

Paid FMLA time.  The first 10 days of FMLA leave are unpaid, although the employee can elect to use accrued vacation leave, personal leave, or medical or sick leave.  (And, see the provisions relating to paid sick leave below.)  After that, the FMLA time is paid at 2/3 the employee’s usual rate of pay for each day of leave, but with caps of $200 per day and $10,000 total per employee.  FFCRA contains a provision for calculating pay for an employee with a variable schedule. 

Notice requirements.  Employees must give employers such advance notice of the need for leave as is practicable. There is no specific notice requirement from employers to employees; assume that all the usual FMLA notices (posting, rights and responsibilities, eligibility, etc.) will be fully applicable.

Job protections.  Generally, employees will be entitled to the usual FMLA job protections (reinstatement to same or equivalent position) after COVID-19-related leave. Employers with fewer than 25 employees may be excused from job restoration requirements if the situation meets certain conditions, including that the job has been eliminated due to factors related to COVID-19 and the employer makes efforts to restore the employee to an equivalent position for a period of 12 months following the end of the employee’s leave.

Multi-Employer Bargaining Agreements.  Employers who are part of a multi-employer collective bargaining agreement may satisfy their obligations under the FFCRA by paying amounts employees are entitled to into the multi-employer fund, as long as employees are able to access the fund for appropriate FFCRA payments.

EMERGENCY PAID SICK LEAVE ACT

Effective dates.  Effective on April 2, 2020; sunsets on December 31, 2020 (unless extended).

Eligible employees.  There are no eligibility requirements. Employees can take this paid sick time immediately upon its effective date.

Covered employers.  Again, applies to employers with fewer than 500 employees.  See the discussion above on how this is calculated.

Covered leave reasons. An employee may use paid sick leave to the extent that the employee is unable to work (or telework) due to a need for leave because:

  1. The employee is subject to a federal, state, or local quarantine or isolation order related
    to COVID-19.
  2. The employee has been advised by a health care provider to self-quarantine due to concerns
    related to COVID-19.
  3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
  4. The employee is caring for an individual who is subject to an order as described in paragraph (1)
    or has been advised as described in paragraph (2). Note there appears to be no limit on who
    this “individual” may be, and no requirement that it be a family member.
  5. The employee is caring for a son or daughter of such employee if the school or place of care
    of the son or daughter has been closed, or the child care provider of such son or daughter
    is unavailable, due to COVID-19 precautions. “Son or daughter” is not specifically limited to
    those under age 18 but is expected to be interpreted consistently with the FMLA Expansion Act.
  6. The 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.

NOTE:  An employer of an employee who is a health care provider or emergency responder may elect to exclude such employee from the application of this leave requirement.

Amount of time off and pay. The amount of paid time off available is 80 hours for full-time employees; and the average number of hours typically worked over a 2-week period for part-time employees. Leave for reasons (1), (2) and (3) is paid at the greater of the employee’s full pay or federal, state, or local minimum wage, but now capped at $511 per day or $5,110 total. Leave for reasons (4), (5), and (6) is at 2/3 pay, now capped at $200 per day or $2,000 total.

Interaction with employer’s other paid leave policies.  The employee may use paid sick leave provided under FFCRA first, then other employer-provided paid leave as needed. The employer cannot require sequence of usage otherwise.

Notices.  After the first workday (or portion thereof) an employee receives paid sick time under this Act, an employer may require the employee to follow reasonable notice procedures in order to continue receiving such paid sick time. Employers must post a notice of employee rights in conspicuous places on the employer’s premises. The DOL must provide a model notice for this purpose within 7 days after enactment, or by March 25. 

Employer Tax Credits for Paid Leave.  I don’t pretend to be a tax expert so please consult your own attorney or accountant on this. Generally, though, it appears the FFCRA includes provisions for 100% tax credits for amounts employers pay under the new law, including both the FMLA paid leave and the paid sick leave requirements. The tax credits go against Social Security taxes owed by the employer. If this does not yield 100% credit for amounts paid, the excess is refundable to the employer.

IS IT FRIDAY YET?

Remember when the days were long, the nights were warm and the government leave programs didn’t come two at a time? That was cool. But here we are, and there are more piling up behind this. Rest assured we will continue working overtime to keep you informed. And our account managers are working overtime, too, so that we can help employers stay safe while they figure out how to keep their employees safe. Have a question? Reach out. Have the weekend off? Take it. Relax, and be thankful; and I will talk to you soon – very soon!