FFCRA: What Employers Need to Know

May 1, 2020

Effective April 1, 2020, the Families First Coronavirus Response Act (FFCRA or Act) requires small to mid-size employers to provide employees with paid sick leave or expanded family and medical leave for COVID-19 related reasons.i  This article highlights aspects particularly relevant to employers in implementing the new law.

FFCRA: Are We a Covered Employer?

The provisions generally apply to certain public sector employers and private sector employers with fewer than 500 employees. The Department of Labor (DOL) specifies that full-time and part-time employees count toward the 500-employee threshold.

FFCRA: Employee Notice… What is Required?

Covered employers must post a notice of the FFCRA requirements in a conspicuous place. If a portion of employees are working remotely, notice may be provided by email, direct mail, or by posting on an internal or external website. The DOL has provided a poster that is free to download and use for the notice requirement.ii

FFCRA: Emergency Paid Sick Leave (EPSL)

EPSL requires up to 80 hours of paid sick leave to full-time employees (pro-rata rules apply to part-time employees). All employees are covered by the new law, there is no length of service requirement. Covered employers are required to provide EPSL on top of any other existing paid leave program.

EPSL: When do Employees Qualify for Leave?

Covered employees that cannot work or telework are eligible for paid sick leave for the following reasons:

1. Employee subject to a Federal, State, or local quarantine or isolation order related to coronavirus. According to DOL, quarantine or isolation orders include a broad range of governmental orders, including orders that advise some or all citizens to shelter in place, stay at home, quarantine, or otherwise restrict their own mobility.
2. Employee has been advised by a health care provider to self-quarantine due to coronavirus. The advice to self-quarantine must be based on the health care provider’s belief that the employee has COVID-19, may have COVID-19, or is particularly vulnerable to COVID-19, and self-quarantining must prevent the employee from work or telework.
3. Employee is experiencing symptoms of coronavirus. According to DOL guidelines, an employee may not take paid sick leave to self-quarantine without seeking a medical diagnosis.
4. Employee is caring for an individual who is subject to an order described in (1) or has been advised as described in (2). This qualifying reason applies only if but for a need to care for an individual, the employee would be able to perform work. The employee must have a genuine need to care for the individual. The individual must be an immediate family member, roommate, or a similar person with whom the employee has a relationship that creates an expectation that the employee would care for the person.
5. Employee is caring for their child because the school is closed or childcare provider is unavailable due to coronavirus. Generally, an employee does not need to take such leave if another suitable individual— such as a co-parent, co-guardian, or the usual childcare provider—is available to provide care. Child is interpreted as under 18 years of age or children age 18 or older who are incapable of self-care because of a mental or physical disability.
6. Employee is experiencing a similar condition specified by Secretary of Health and Human Services.

EPSL: Are There Any Limits?

For reasons 1-3 listed above, employers are required to pay employees their full wages, with a cap at $511 per day and $5,110 in total. For reasons 4-6 listed above, employers are required to pay employees two-thirds of their wages, with a cap at $200 per day and $2,000 in total.

FFCRA: Emergency Family and Medical Leave Expansion Act (EFMLEA)

EFMLEA covers employees who are unable to work (or telework) because the employee is caring for their child because the school is closed or childcare provider is unavailable. Child is interpreted as under 18 years of age or children age 18 or older who are incapable of self-care because of a mental or physical disability. Eligible employee is defined as an employee who has been employed for at least 30 calendar days.

EFMLEA: What is the Length of Leave?

Total leave is up to twelve (12) weeks. The initial ten days of the leave may be unpaid and an employee may use EPSL, vacation, or other paid time off. Employers must pay the remaining leave at a rate not less than two-thirds of the employee’s regular rate of pay, up to $200/day and $10,000 in total.

FFCRA: Employee Exclusions

Under certain circumstances, a covered employer may elect to exclude health care provider and/or emergency responder employees from FFCRA leave.

FFCRA: Small Business Exemption

Small businesses with less than 50 employees may request an exemption if compliance with providing childcare-related paid sick leave and expanded family and medical leave would jeopardize the viability of the business going forward.iii Criteria that should be examined:

1. Would such leave cause the employer’s expenses and financial obligations to exceed available business revenue and result in the inability to operate at a minimal capacity;
2. Would the absence of the employee(s) requesting such leave pose a substantial risk to the employer’s financial health or operational capacity because of their specialized skills, knowledge of the business, or responsibilities; or
3. Would the employer lack the ability to find enough other workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services the employee(s) requesting leave provide, and these labor or services are needed to operate at a minimal capacity.

Employers must document the facts and circumstances that meet the criteria to justify the exemption. Do NOT send documentation to DOL; but rather retain such records.

FFCRA: Tax Credits

Covered private sector employers qualify for tax credits for qualifying wages paid under the FFCRA. Qualifying wages are those paid to an employee who takes leave under the Act for a qualifying reason, up to the appropriate per diem and aggregate payment caps. The IRS has issued guidance on calculating tax credits.iv

FFCRA: Record Keeping

Create FFCRA policies and a process to request EPSL or EFMLEA. Retain all documentation for four (4) years, regardless of whether leave was granted or denied.

FFCRA: Key Takeaways

COVID-19 continues to be a rapidly evolving situation and the FFCRA includes complexities beyond the scope of this article. The DOL focused on compliance assistance through April 17th. The focus now turns toward enforcement.

Feeling Confused? Contact us for a free and confidential consultation to ensure proper implementation of the requirements of the new law.

For more insight on important workplace topics, read our previous blog post here!

i. FFCRA provisions are effective April 1, 2020 through December 31, 2020. Review DOL guidance at https://www.dol.gov/agencies/whd/pandemic
ii. https://www.dol.gov/agencies/whd/posters
iii. FFCRA Q&A, q.4, 58, 59; https://www.dol.gov/agencies/whd/pandemic/ffcra-questions
iv. https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs