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House Passes Families First Coronavirus Response Act House Passes Families First Coronavirus Response Act

House Passes Families First Coronavirus Response Act

NOTE: This bill was revised by the House of Representatives on March 16, 2020 and passed by the Senate on March 18. President Trump has now signed the bill into law. Click here for our updated article.

On Friday, March 13, 2020, the House of Representatives Passed H.R. 6201, titled the Families First Coronavirus Response Act. The bill is expected to be considered by the Senate early in the week of March 16, 2020. President Trump has expressed his support for the bill.
 
In its current form, the bill (among other things) requires that private employers with fewer than 500 employees and all public employers provide essentially two weeks of emergency paid sick leave (in addition to any other form of sick leave or paid time off already available) and that they provide FMLA leave for certain absences related to the novel Coronavirus (named COVID-19). The FMLA leave is unpaid for the first 14 days and paid at a rate of 2/3 of the employee's wages after that period. Covered employers will have access to tax credits related to this additional paid leave. 
 
A summary of these provisions, which is not intended to capture every nuance and detail, is provided below. Although the bill is not law (and we are seeing some opposition by Senators already), employers may want to take these potential requirements into account when developing policies related to the virus.
 
Amendments to the Family and Medical Leave Act
 
The bill, if passed, will add "public health emergency leave" related to coronavirus to the list of qualifying leaves under the FMLA. The amendment will become effective no later than 15 days after it becomes law and continue through December 31, 2020. The amendment will, if passed by the Senate and signed by the President:
  • Allow for unpaid leave during the first 14 days of the leave, although employees may substitute available paid leave during this period (employers may not force substitution).
  • Require leave paid at a rate of no less than 2/3 of the employee's regular rate of pay (as that term is defined under the Fair Labor Standards Act) after the first 14 days of the leave. The pay must equate to the number of hours the employee would have otherwise worked. If the employee's hours are variable, employers must average the hours worked (or during which the employee took leave) for the past 6 months. Employers who are signatories to a multiemployer collective bargaining agreement that provides paid sick leave may fulfill the paid leave obligations though its contributions to a plan that provides for the paid leave.
  • Expand the definition of an eligible employee, for purposes of public health emergency leave, to include an individual who has been employed for at least 30 days by the employer. Some health care providers and emergency responders will be excluded from the definition of eligible employee for this form of leave. However, regulations will be needed to better define which employees this exclusion covers.
  • Expand the definition of a covered employer for this purpose to include all employers with fewer than 500 employees, although small businesses with fewer than 50 employees will be exempt from providing the leave if it would jeopardize the viability of the business as a going concern. Again, regulations will be needed to better define when a small business is exempt.
  • Amend the definition of "parent" to include a biological, foster or adoptive parent, a stepparent, a parent-in-law, a parent of a domestic partner, a legal guardian or any other person who stood in the shoes of a parent to the employee when the employee was a child.
  • Expand the definition of a "family member" to include not just a parent, spouse or child, but also an individual who is a pregnant woman, senior citizen, individual with a disability, or has access or functional needs and who is:
    • a son or daughter of the employee;
    • a next of kin of the employee or a person for whom the employee is next of kin; or
    • a grandparent or grandchild of the employee.
An employee will qualify for public health emergency leave under this amendment to the FMLA if an absence is needed for the following reasons:
  • To comply with a recommendation or order by a public health official or health care provider because:
    • The physical presence of the employee on the job could jeopardize the health of others because of the employee's exposure to the coronavirus or symptoms of the coronavirus; and
    • To comply, the employee is unable to perform the functions of his or her position.
  • To care for a family member when a public health official or health care provider determine that the presence of the family member in the community would jeopardize the health others because of the exposure of the family member to the coronavirus or the family member's symptoms.
  • To care for the son or daughter of an employee (who is under 18) if the school or place of care has been closed OR the child care provider is unavailable, due to a public health emergency related to the coronavirus.
Under the bill, an employee must be restored to his or her position (or an equivalent position) unless the employer employs fewer than 25 employees and the position held by the employee who takes a public health emergency leave no longer exists due to economic conditions or other changes in operating conditions that affect employment and are caused by a public health crisis during the leave. To apply this exception to the restoration requirement, the employer must:
  • Make reasonable efforts to restore the employee to an equivalent position; and
  • If the reasonable efforts fail, the employer makes reasonable efforts for a 1 year period (beginning either on the date on the need due to the public health emergency end or the date that is 12 weeks after the employee's leave commenced, whichever is earlier) to contact the employee is an equivalent position becomes available).
There are a few aspects of this new form of FMLA leave that are not addressed in the bill. For example, can employees take this leave intermittently or on a reduced schedule? It is not addressed in the bill, so we can only assume that intermittent or reduced schedule leave is permitted. What type of certification is required for leave unrelated to symptoms or diagnosis with coronavirus? If the employee previously exhausted FMLA, is the employee entitled to any leave under this amendment? Also, if the employer is not currently covered under the FMLA, but previously gave an employee a lengthy leave equivalent to FMLA, will the employer be required to provide an entire 12 weeks of leave under this amendment? 
 
We hope that these questions and others will be cleared up either though an amendment by the Senate or future regulation. Notably, an employee cannot bring a civil action against an employer with less than 50 employees for its failure to provide the leave, but the Department of Labor may still investigate and bring an action against the employer.
 
If passed, this portion of the bill will require all employers to amend their FMLA and medical leave policies.
 
EMERGENCY PAID SICK LEAVE ACT
 
If the bill is passed as written, private employers with fewer than 500 employees (that engage in commerce or be in an industry that affects commerce) and all public employers will be required to provide emergency paid sick leave related to the coronavirus, beyond any amounts already accrued by the employee under other paid time off policies.
 
As with the FMLA amendments, this requirement will become effective no later than 15 days after it becomes law and continue through December 31, 2020. Here is a summary of the requirements:
  • Employers will be required to provide full-time employees 80 hours of emergency paid sick leave, and provide part-time employees with emergency paid sick leave in an amount that the employee works, on average, in a two week period. This obligation can be fulfilled through a multiemployer plan.
  • The emergency paid sick time must be available for use immediately, regardless of how long the individual has been employed. 
  • When the leave is needed for the employee's own condition or circumstances, the pay must equate to what the employee would otherwise be paid. When leave is needed to care for a child or family member, the required pay is 2/3 of the employee's pay. The Department of Labor will provide guidance on calculating pay.
  • An employee may first use this emergency paid sick time before the employee uses other accrued paid sick time, and an employee cannot force the employee to use other paid sick time first. 
  • After the first day of emergency paid sick leave, the employer can require that the employee follow the employer's reasonable notice requirements.
  • Employers will need to post a model notice, prepared by the Department of Labor.
  • The unused amount of emergency paid sick leave will not carry over from one year to the next and does not need to be paid out at the end of an individual's employment. 
  • This emergency paid sick leave is in addition to whatever paid leave the employer provides under other policies and employers may not change their current paid leave policies after the law becomes effective due to the emergency paid sick leave requirement. 
Emergency paid sick leave can be used for any of the following:
  • An absence to self-isolate because the employee is diagnosed with coronavirus.
  • An absence to obtain a medical diagnosis or care if an employee is experiencing the symptoms of coronavirus.
  • An absence resulting from the closure of an employee's place of employment by order of a Federal or State public official with jurisdiction, or at the employer's discretion, due to a public health emergency.
  • An absence because a Federal or State public official with jurisdiction or a health care provider has determined that the employee's presence on the job may jeopardize the health of others because of the employee's exposure to the coronavirus or because the employee is exhibiting symptoms.
  • An absence for the purpose of caring for a family member (defined in the same way as the term is defined under the amendment to the FMLA above),
    • who has been diagnosed with the coronavirus or is experiencing symptoms of the coronavirus for which a diagnosis or care is needed; or
    • who has been told to self-quarantine because of exposure to the coronavirus or due to symptoms of the coronavirus.
  • An absence for the purpose of caring for a child if the child's school or place of care has been closed or is unavailable due to the coronavirus.
It is not clear whether an employer can require the employee to use this emergency paid sick leave during the first 14 days of unpaid leave available under the FMLA amendments summarized above.
Employers may not interfere with an employee's right to use emergency paid sick leave, may not discriminate against an employee who requests or uses emergency paid sick leave and may not retaliate against an employee for using or requesting to use emergency paid sick leave. Should this become law, employers who violate it will be in violation of the Fair Labor Standards Act, meaning they may be liable to the employee for the emergency sick time that should have been provided, interest, an amount equal to the emergency paid sick time that should have been provided (i.e., liquidated damages), equitable relief (such as reinstatement), fees and costs. 
 
TAX CREDITS FOR EMERGENCY PAID SICK AND PAID FAMILY AND MEDICAL LEAVE
 
To help defray the cost to employers of providing the required paid leave, covered private employers will be allowed to take a credit against the employer portion of social security taxes (i.e. 6.2%) on employees’ wages each calendar quarter (through the end of 2020) in an amount equal to the qualified emergency paid sick leave wages paid by the employer that quarter under the above Emergency Paid Sick Leave Act or the paid leave provided under the above amendments to the FMLA. For wages paid under the Emergency Paid Sick Leave Act, the credit will be capped at $511 per day for days on which full pay is required and $200 per day for days on which 2/3 pay is required. For wages paid under the amendments to the FMLA, the credit cannot exceed $200 per day with an aggregate cap of $10,000 with respect to all calendar quarters. A similar tax credit will be allowed for certain self-employed individuals.  
 
The maximum number of days for which an employer may take credit for emergency paid leave, in a successive quarter, is ten days more than the number of days for which the employer took credit in the prior quarter. The credit for either emergency paid leave or paid FMLA leave cannot exceed the social security tax imposed on the employer for the wages paid; however, any excess will be treated as an overpayment that can be refunded to the employer. Employers may elect not to use this tax credit. If an employer does take the credit, the employer's gross income will be increased by the amount of the credit taken. The Secretary of Treasury will issue regulations related to these tax credits.
 
We will continue to monitor this and other concerns that arise related to the coronavirus pandemic and will provide updates. If you have questions on employment-related matters, please contact Tami A. Earnhart or any other member of our Labor, Employment & Immigration group. For matters outside of employment, please refer to our COVID-19 resource page and contact a member of our COVID-19 Task Force.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.
 
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