FAQs on Families First Coronavirus Response Act (FFCRA)

The Families First Coronavirus Response Act (FFCRA) was signed by the President on March 18, 2020 and goes into effect on April 1, 2020. We have put together the following information to help answer some of your questions.

What is the purpose of the Families First Coronavirus Response Act (FFCRA)?

It requires certain employers to provide employees with paid sick leave or expanded family and medical leave for specified reasons related to COVID-19. The legislation will enable employers to keep their workers on payroll, while at the same time ensuring that workers are not forced to choose between their paychecks and the public health measures needed to combat the virus.

What is the effective date of the Families First Coronavirus Response Act (FFCRA), which includes the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act?

The FFCRA’s paid leave provisions are effective on April 1, 2020, and apply to leave taken between April 1, 2020, and December 31, 2020.

For an employee to be eligible to receive paid leave, they must be on the employer’s payroll as of April 1, 2020.

Who are Applicable Employers?

The paid sick leave and expanded family and medical leave provisions of the FFCRA apply to certain public employers, and private employers with fewer than 500 employees.

Who are Eligible Employees?

An employee must have worked for the employer for at least 30 calendar days. This is determined if the employer had the employee on its payroll for the 30 calendar days immediately prior to the day their leave would begin. For example, if the employee wants to take leave on April 1, 2020, they would need to have been on their employer’s payroll as of March 2, 2020.

If the employee has been working for a company as a temporary employee, and the company subsequently hires the employee on a full-time basis, they may count any days previously worked as a temporary employee toward this 30-day eligibility period.

An employer of an employee who is a health care provider or emergency responder may elect to exclude such an employee.

What are the guidelines for the Emergency Paid Sick Leave Act?

Employees of covered employers are eligible for:

• Two weeks (up to 80 hours) of paid sick leave at the employee’s regular rate of pay, up to $511/day and $5,110 over the benefit period, where the employee is unable to work because the employee is quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis; or
• Two weeks (up to 80 hours) of paid sick leave at two-thirds the employee’s regular rate of pay, up to $200/day and $2,000 over the benefit period, where the employee is unable to work because of a bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or to care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor.

What are the guidelines for the Emergency Family and Medical Leave Expansion Act?

Employees of covered employers are eligible for:

• Up to an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay, up to $200/day and $10,000 over the benefit period, where an employee, who has been employed for at least 30 calendar days, is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.
• Note: the entire duration of the leave is 12 weeks. The first 10 workdays taken may be unpaid, but the employee may use other paid leave during that period, including the Emergency Paid Sick Leave or PTO, if available.

My company has under 50 employees total, how can I obtain an exemption from the Department of Labor?

Small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or child care unavailability if the leave requirements would jeopardize the viability of the business as a going concern.  According to the FAQs published by the IRS as of March 31, 2020, “A small business may claim this exemption if an authorized officer of the business has determined that:

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 or employees 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.”

Can you explain how the Tax Credits for Paid Sick and Paid Family and Medical Leave will work?

Per IRS Notice 2020-22, eligible employers who pay qualifying sick or child care leave will be able to retain an amount of the payroll taxes equal to the amount of qualifying sick and child care leave that they paid, rather than deposit them with the IRS.  Under this guidance, employers will be able to retain the following types of payroll taxes: withheld federal income taxes, the employee share of Social Security and Medicare taxes, and the employer share of Social Security and Medicare taxes with respect to all employees. If these payroll taxes are insufficient to cover the amounts paid by employers for the qualified sick and child care leave, they will be able to file a request for an accelerated payment from the IRS, which the IRS expects to be able to process within two weeks.

Where do I get a copy of the FFCRA notice of Employee Rights and what are the posting requirements?

The DOL’s Wage and Hour Division has a copy of the notice here on the their website.  Employers subject to FFCRA are required to post the notice in a conspicuous place at their premises where all employees can view it.  Because many employees are not currently reporting to offices, this requirement can be satisfied through email distribution to all employees, or by posting the notice on an employee information internal or external website accessible to all employees.  It needs to be posted or distributed by April 1, 2020.

We expect more guidance on this new Act in the coming days.  Please reach out to us if you want to discuss how these opportunities apply to your business specifically.