New Federal Sick Leave Law
Enacted on March 18, 2020, the Families First Coronavirus Response Act (FFCRA) requires employers with fewer than 500 employees to provide paid sick and family leave to employees affected by COVID-19. These businesses will receive corresponding employment tax credits.
The Department of Labor (“DOL”) has begun to issue guidance for employers and employees. Some information about the FFCRA is below. For more information, see the DOL’s FAQs.
Exceptions for Employers with Fewer than 50 Employees
The law authorizes the DOL to issue regulations for the exemption of small businesses in certain limited circumstances.
Currently, the DOL says that a small business is exempt from these leave requirements only if (a) it employs fewer than 50 employees; (b) leave is requested because the employee’s child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and (c) an authorized officer of the business has determined that at least one of the following three conditions is satisfied:
1. The provision of paid sick leave or expanded family and medical 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;
2. The absence of the employee(s) requesting paid sick leave or expanded family and medical 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
3. 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 paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
Time Period
The leave provisions of the FFCRA take effect on April 1, 2020, and end on December 31, 2020. Leave taken before April 1 is not covered by FFCRA, and employers won’t be eligible for tax credits for any paid leave provided prior to that date.
Amount of Emergency Paid Leave
The FFCRA entitles eligible full-time employees to take emergency paid sick leave of up to 80 hours. Part-time employees are eligible for leave hours equal to the average hours worked over a two-week period.
Employee Eligibility for Paid Family Leave
Employees who have been employed for at least thirty (30) days are eligible to take this leave.
Documentation Required for Leave
To qualify for the tax credit, an employer must have each employee using this leave substantiate eligibility.
The employer should require employees to make a written request for the leave, and that request should include: the employee’s name; the date(s) for which leave is requested; a statement of the COVID-19 related reason the employee is requesting leave and written support for such reason; and a statement that the employee is unable to work, including by means of telework, for such reason.
Additional information is required for leave requests based on a quarantine order, self-quarantine advice, school closing, or child care provider unavailability.
More information is available at the IRS’s website.
Required Notice Posting
All covered employers must post the DOL notice describing employee rights. This poster is available here.
For employees who are teleworking, employers can satisfy the posting requirement by emailing or direct mailing the notice to current employees or by posting the notice on an internal or external employee information website.
SBA Loans
The SBA has a new loan program, the Paycheck Protection Program, to help businesses keep their workforce employed during the COVID-19 crisis.
SBA will forgive these loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
The Paycheck Protection Program will be available through June 30, 2020. For more information, see the SBA website.
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Please feel free to contact us if you have any questions about the employment-law aspects of the COVID-19 pandemic.
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