New Federal Leave Laws Affect Small Businesses
The recently enacted Families First Coronavirus Response Act creates unprecedented obligations on employers, including small businesses who have not previously been subject to federal laws regarding employee leave. Following is a brief summary of the implications of the Act, summarized by the employee situation that would implicate the Act’s requirements.
All the new provisions technically take effect April 1, 2020.
Emergency Paid Sick Leave is available to any public employee, or any employee of a private company with less than 500 employees.
If an employee needs to be absent due to the employee’s own COVID-19: Every employee is to receive 80 hours of paid sick leave at their regular rate of pay (up to $511/day and a cumulative total of $5,110) if the employee is unable to work because he/she is subject to a government quarantine or isolation order; has been advised by a health care provider to self-quarantine; or is experiencing COVID-19 symptoms and seeking medical diagnosis. This sick leave is in addition to what the employee already has accrued/available AND is to be used FIRST. The employee cannot be required to use their accrued/available leave first. There is no waiting or probationary period for this leave – an employee is entiteld to it upon hire. Also, this leave is available for all employees (full time, part time, temporary), but it may be pro-rated for part-time employees. This leave can be taken at any time before December 31, 2020 and is not “accrued” in the sense that it has to be paid out at separation.
If an employee is absent because they are needed to care for someone else affected by COVID: Every employee is to receive 80 hours of paid sick leave at 2/3 their regular rate of pay (up to $200/day and a cumulative total of $2,000) if the employee unable to work because he/she is caring for an individual who is subject to a government quarantine or isolation order; caring for a son or daughter whose school or day care is unavailable due to coronavirus precautions; or is absent due to “substantially similar conditions as declared by” US HHS. This sick leave is in addition to whatever the employee already has accrued/available AND is to be used FIRST. The employee cannot be required to use their accrued/available leave first. There is no waiting or probationary period for this leave – an employee is entitled to it upon hire. Also, this leave is available for all employees (full time, part time, temporary), but it may be pro-rated for part time employees. This leave can be taken at any time before December 31, 2020 and is not “accrued” in the sense that it has to be paid out at separation.
FMLA is newly required for smaller employers, and is available to employees who have only worked 30 days with an employer.
If the Employee is absent beyond 80 hours because the school/day care of their minor child is closed or unavailable due to the COVID public health emergency: If the employee has to have worked for the employer for at least 30 days, the employee is entitled to the standard 12 weeks of FMLA, but it is PAID beginning on the 10th day, at 2/3 the employee’s regular rate (up to $200/day and a max cumulative total of $10,000). The first 10 days can be covered by the employee’s other accrued/available leave (likely, the emergency paid sick leave described above). Like the emergency paid leave, the new coronavirus FMLA is available any time between now and December 31, 2020.
For larger employers, an employee might also have FMLA for his/her own diagnosis or caring for others; however, all the typical FMLA rules will apply in those situations.
Both Emergency Paid Leave and the FMLA provisions have language that is aimed at helping ease the financial burden for employers, in the form of credits/refunds on Social Security taxes that should be available within 3 months.
As a good friend and client said yesterday: this is like building an airplane while we are flying it. As always, there will be questions about how the Act applies in any given situation. Please contact Mandi Montgomery Smith if you need help navigating the new leave requirements, or any other employment questions your business is confronting. As always, the attorneys at TimberlakeSmith are available to counsel and assist clients in the rapidly evolving dilemmas facing our large and small businesses and our communities.
