H.R. 6201 – Families First Coronavirus Response Act
Impact on Businesses – Summary
I. LEAVE PROVISIONS
A. Public Health Emergency Leave (Division C)
- FMLA framework – employees have right to take up to 12 weeks job-protected leave
- Eligible Employee’s may take leave if unable to work or telework b/c they must care for a minor child whose school or care provider is closed or unavailable due to a CV emergency declared by Fed, State, or local authority
- What is an Eligible Employee:
- works for a private employer with fewer than 500 employees
- works for Gov’t employer
- been on the job for at least 30 days
- Businesses with less than 50 employees can be exempted by Sec. of Labor if requirements would jeopardize the viability of the business
- Employers who are Health Care Providers or Emergency Responders may elect to exclude their employees from coverage under paid health emergency leave provisions
- Leave Benefits:
- First 10 days May be Unpaid – employees can use or employers can require an employee to use or substitute accrued paid leave (vacation, personal, sick)
- After 10 days, employer required to provide paid leave at not less than 2/3 of employee’s regular rate of pay up to $200 per day or $10,000 in total
- For hourly employees whose schedules vary, to extent exact hours cannot be determined, paid leave rate should equal average number of hours scheduled for employee each day over preceding 6 month period; if employee did not work in the preceding 6 mo. period, then “reasonable expectation” of the employee at the time of hiring with respect to the average number of hours per day that the employee would be scheduled to work
- Job Restoration:
- Generally, employees entitled to job restoration or equivalent position with employer following leave
- Public Health Emergency Leave limitation:
-For employers with fewer than 25 employees, employer does NOT need to return employee to the position or equivalent position if:
-The position does not exist due to changes in the employer’s economic or operating condition that affect employment and were caused by the CV emergency;
-The employer makes “reasonable efforts” to restore the employee to an equivalent position; and
-If these efforts fail, the employer makes an additional reasonable effort to contact the employee if an equivalent position becomes available. The “contact period” is the one-year window beginning on the earlier of (a) the date on which the employee no longer needs to take leave to care for the child or (b) 12 weeks after the employee’s paid leave commences.
- Effective Date and Expiration – April 3, 2020 – December 31, 2020
B. Emergency Paid Sick Leave (Division E)
- Eligible E’s – employee is unable to work or telework because the E:
- is subject to a Federal, State, or local quarantine or isolation order related to CV;
- has been advised by a health care provider to self-quarantine due to concerns related to CV;
- is experiencing symptoms of CV and is seeking a medical diagnosis;
- is caring for an individual who is subject to a quarantine or isolation order or advised to self-quarantine by a health care provider;
- is caring for a child whose school or care provider is closed or unavailable due to CV precautions; and
- is experiencing any other condition substantially similar to CV, as specified by the U.S. Department of Health and Human Services (HHS).
Duration of employment not relevant- doesn’t matter length of service w/employer
- Applicable Employers:
- Private sector employers with fewer than 500 employees, government employers, and all other non-private entity employers with more than one employee
- The Secretary of Labor the authority to exempt small businesses with fewer than 50 employees from the bill’s paid leave requirements if those requirements would jeopardize the viability of the business.
- Employers who are health care providers or emergency responders may elect to exclude their employees from the public health emergency leave provisions of the bill.
-Once CV emergency ends employer can terminate paid sick leave
- Two weeks of paid sick time – 80 hours for FTE; PTE, same calculation as for Public Health Emergency Leave
- At regular rate or at Fed, State or local minimum wage, up to $511 per day, $5,110 in aggregate, for leave used in connection with the E’s quarantine or isolation order, HCP ordered self-quarantine, or experiencing CV symptoms and waiting for diagnosis
- Up to $200/day or $2000 in aggregate if leave taken to care for child or substantially similar illness
- Sec. of Labor to issue guidelines to assist employers with calculation by April 2nd
- Employer may not require employee to use other paid leave provided by employer prior to using this Emergency Paid Sick Leave
- Notice requirements
- Employee can be required to follow reasonable notice procedures once paid sick leave taken
- Employer to post Notice of Emergency Paid Sick Leave Requirements; Sec. Labor to provide model notice by 3/25
- Prohibitions and Enforcement
- Employers may not discharge, discipline, or discriminate against any employee who (a) takes paid sick leave or (b) has filed a complaint or proceeding or testified in any such proceeding related to the benefits and protections provided by H.R. 6201.
- Employers may not require, as a condition of providing paid sick time, that an employee search for a find a replacement employee to cover the hours during which the employee is using paid sick time.
- Employers who violate the paid sick leave requirements or retaliation prohibitions of H.R. 6201 shall be subject to civil penalties under the Fair Labor Standards Act.
- Same effective dates as Public Health Emergency Leave
II. EMPLOYER TAX CREDITS
- Payroll Tax Credits -a refundable tax credit worth 100 percent of qualified public health emergency leave wages and qualified paid sick leave wages paid by an employer for each calendar quarter through the end of 2020. The tax credit is allowed against the tax imposed under the employer portion of Social Security and Railroad Retirement payroll taxes.
- the public health emergency leave and paid sick leave credits would be increased to include amounts employers pay for the employee’s health plan coverage while they are on leave. Specifically, the bill allows for the credit amounts to be increased by the amount of the employer’s group health plan expenses that are “properly allocated” to the qualified emergency leave and sick leave wages – Comment – this is all likely for your accountant to figure out
- Excess credit is refundable – The amount of the paid sick leave credit that is allowed for any calendar quarter cannot exceed the total employer payroll tax obligations on all wages for all employees. If the amount of the credit that would otherwise be allowed is so limited, the amount of the limitation is refundable to the employer. Note: Treasury Dept. might issue guidance on obtaining tax credits in advance
III. UNEMPLOYMENT INSURANCE RELATED
- Appropriation of funds for states who want to establish work-sharing programs that permit employers to reduce employee hours rather than laying them off. Under such programs, employees would receive partial unemployment benefits to offset the wage loss
- $1 billion in emergency administration grants to states in the Unemployment Trust Fund. States are directed to demonstrate steps toward easing eligibility requirements and expand access to unemployment compensation for claimants directly impacted by COVID-19
IV. OTHER COMMUNITY BENEFITS
- $400 million for local food banks
- $250 million for food to home bound seniors
- No cost or cost-sharing for CV testing
- Funds for WIC recipients who have lost job as a result of CV
- Funds to allow states to provide electronic benefit transfers for food assistance for families with children who receive free or reduced-price lunch