New mandatory paid leave for employees experiencing COVID-19 related disruptions

Article written by Ian Speir 

On Wednesday, March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act. The law takes effect on April 2, 2020. It contains two separate provisions that require small and mid-size employers to provide paid family leave and paid sick leave to employees experiencing disruptions related to COVID-19.

One part of the new law is the “Emergency Family and Medical Leave Expansion Act” or the “Emergency FMLA.” The Emergency FMLA applies to every employer with fewer than 500 employees, thus impacting millions of small and mid-size businesses and nonprofits across the United States. Here are the key provisions:

  • An employee who has been employed for at least 30 days is entitled to take up to 12 weeks of job-protected leave if the employee is unable to work or telework due to the need to care for a child whose school or place of care has closed, or whose child care provider is unavailable, due to the COVID-19 crisis.

  • The first 10 days of leave may be unpaid, although the employee has the option to substitute other forms of paid leave (e.g., PTO) during these first 10 days.

  • Thereafter, the leave must be paid. The payment is calculated based on the number of hours the employee would normally be scheduled to work and an amount that is not less than two-thirds of the employee’s regular rate of pay. (Special rules apply if the employee’s schedule varies from week to week.) But the paid leave amount will not exceed $200 per day or $10,000 “in the aggregate.”

  • After the leave is complete, the employee is entitled to be restored to her same or an equivalent position. But small employers with fewer than 25 employees need not comply with this requirement if an employee’s position no longer exists due to economic or other conditions caused by the COVID-19 crisis.

  • In addition, the Department of Labor has authority to exempt employers with fewer than 50 employees if these new requirements “would jeopardize the viability of the business as a going concern.”

A second part of the new law is the “Emergency Paid Sick Leave Act,” which likewise applies to all employers with fewer than 500 employees. Here are the key provisions:

  • The employer must provide paid sick leave if an employee is unable to work or telework because (s)he is sick or has been quarantined due to COVID-19, is experiencing symptoms of COVID-19 and seeking medical attention, is caring for an individual who meets these conditions, or is caring for a child in the event of a school closure or an unavailable child care provider as a result of the COVID-19 crisis.

  • Full-time employees are entitled to 80 hours of paid sick leave, and part-time employees are entitled to paid leave equal to the average number of hours they work over a two-week period. But if leave is taken to care for a quarantined individual or a child, the payment is calculated at two-thirds of the employee’s regular rate of pay. And regardless of the reason for leave, the payment will not exceed (a) $511 per day and $5,110 in the aggregate where the employee is sick or quarantined, or (b) $200 per day and $2,000 in the aggregate where the employee must care for an individual or child.

  • An employee may elect to first use paid sick leave under the new law, before taking other forms of paid leave. The employer cannot require otherwise. So, for employers who already provide paid sick leave or other forms of paid leave, paid sick leave under the new law is in addition to the employer’s other forms of leave.

  • The employer cannot require the employee to find a replacement before taking paid sick leave under the new law. The leave does not carry over from year to year.

Additional guidance and required workplace posters are expected from the Department of Labor in the coming weeks.

To alleviate the financial burden of these new requirements, the Families First Coronavirus Response Act also gives employers a payroll tax credit to cover the costs of paid sick leave and family leave.

As always, consult with an attorney regarding your specific circumstances. The attorneys and other professionals at Nussbaum Speir Gleason are available and standing by to assist you with these and other legal questions through this extraordinary time.

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