The Families First Coronavirus Response Act: Requirements and Considerations
On March 18, 2020, the Families First Coronavirus Response Act became federal law. The Act’s employment provisions apply to all government employers and private employers with fewer than 500 employees. The Act provides paid sick leave and emergency expanded access to FMLA leave for certain employees affected by the COVID-19 crisis. Covered employers will be reimbursed for benefits required under the Act through payroll tax credits.
The Act provides that covered employers may exclude health care providers and emergency responders from taking emergency paid sick time and emergency FMLA leave provided by the Act, although of course they remain eligible for traditional, unpaid FMLA leave if they meet the other eligibility requirements. Additionally, the Secretary of Labor is empowered to issue regulations excluding businesses with fewer than 50 employees if providing this leave would jeopardize the viability of the business; and certain health care providers and emergency responders. Until the Department of Labor provides additional information and guidance on these potential exclusions, employers should hold off on making determinations as to employees who may be disqualified from taking emergency paid sick time or emergency FMLA leave under the Act.
The FFCRA goes into effect on April 2, 2020. Prior to the effective date, employers should continue to provide FMLA leave, accommodations, and time off in compliance with current state and federal law and their own employment policies, and we encourage employers to seek legal advice when COVID-19 is a factor contributing to an employee’s need for time off or accommodations. Below is our analysis of the key employment provisions of the FFCRA.
Emergency Paid Sick Time
Employees are eligible for up to 80 hours of fully paid emergency sick leave (capped at $511 per day or $5,110 total) under the Act if they cannot work (or telework) for any of the following reasons:
- The employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
- The employee has been advised by a health care provider or public official to self-quarantine due to concerns related to COVID-19.
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis or care.
Employees are eligible for up to 80 hours of emergency sick leave paid at two-thirds of their regular rate of pay, or minimum wage, whichever is greater (capped at $200 per day or $2,000 total), if they cannot work (or telework) for any of the following reasons:
- The employee is caring for an individual who is subject to a federal, state, or local quarantine or isolation order related to COVID-19 or has been advised to self-quarantine by a health care provider or public official due concerns related to COVID-19.
- The employee is caring for a son or daughter because school or childcare is closed, or the childcare provider is unavailable, due to COVID-19 precautions.
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.
Notably, employers cannot require employees to exhaust other paid leave before using the emergency leave provided by the FFCRA. When the COVID-19 crisis comes to an end, employers may well have employees who have missed substantial work but retain a robust reserve of PTO.
Emergency Family and Medical Leave Expansion
The Act also provides for expanded access to leave under the Family and Medical Leave Act. FFCRA-covered employers must provide 12 weeks of emergency FMLA leave to employees who have been employed for at least 30 days who are unable to work (or telework) because they must care for a son or daughter under 18 years of age due to closure of the child’s school or child care, or because the child care provider is unavailable, due to a public health emergency declared by federal, state, or local authority.
The Act provides that the first 10 days of emergency FMLA leave are unpaid. (Employees may also qualify for the emergency sick leave described above, and therefore would receive two-thirds of their regular wages for the first 10 days as well.) The time away from work is paid at a rate of two-thirds of the employee’s usual pay (capped at $200 per day or $10,000 total) for the remaining period of leave. The employee may choose to concurrently utilize accrued PTO, provided by the employer, to fill the gap between the two-thirds of regular pay provided under the Act and the employee’s regular pay.
Other Important Provisions
The Act contains some specific directions for all covered employers. First, employers cannot burden employees receiving emergency sick leave with scheduling their own substitute coverage in the workplace. Second, employers are required to post a notice of the Act’s requirements in a conspicuous place. A model notice will be available next week. With many employees working remotely, employers should take the initiative to provide this notice by email, on the company’s intranet, or by means that will reasonably result in employees seeing the notice.
Finally, employers need to be particularly careful to avoid and prohibit discrimination and retaliation against employees who take emergency sick leave or emergency FMLA leave or complain the employer is non-compliant. This is especially critical given that employers may be making difficult decisions to temporarily or permanently reduce the workforce as the COVID-19 crisis continues.
Employers should seek legal advice with respect to the timing and notification of any layoff decisions in relation to the FFCRA’s effective date and state laws concerning unemployment benefits and eligibility. State laws with respect to unemployment benefits continue to change as states adjust to the COVID-19 crisis, including shuttering of bars, restaurants, theaters, schools and sport venues. Below, we provide a brief summary of state law developments (as of March 20) in Midwestern states that may affect decision-making.
Illinois closed public and private K-12 schools through March 30 and closed bars and restaurants to the extent they offer on-premises consumption. Gatherings of 50 or more people are prohibited unless the venue provides essential goods or services. Illinois has made the following changes to its eligibility requirements for unemployment benefits:
- Workers temporarily laid off due to workplace closure due to COVID-19 need not actively seek work to be eligible for benefits if they are ready to return to work as soon as the workplace reopens.
- The Illinois Department of Employment Security has closed its offices to the public. Services are available online and by telephone only.
- Workers confined to their homes may be eligible for unemployment benefits if they have been diagnosed with COVID-19; they are caring for a spouse, parent, or child who has been diagnosed with COVID-19; the government has imposed or recommended quarantine; or they have left work to care for a child whose school has temporarily closed
- The requirement that workers wait one week before claiming unemployment benefits is suspended.
Iowa closed its bars, restaurants, fitness centers, theaters, casino and gaming facilities, senior citizen centers, and adult daycare facilities until March 31. Businesses are permitted to provide food through drive-through, carryout and delivery services. Gatherings of more than 10 people are prohibited and social, community, spiritual, religious, recreational, leisure and sporting gatherings are also prohibited. Iowa is waiving unemployment insurance fees typically charged to employers as a result of unemployment claims and has made the following changes to its eligibility requirements for unemployment benefits claims related to COVID-19:
- Employees are eligible for unemployment benefits if their employers were forced to temporarily suspend operations or reduce hours to prevent the spread of COVID-19.
- Unemployed individuals need not search for work in order to be eligible for benefits.
- Workers may be eligible for benefits if they stay home to self-isolate; they stay home to care for family members, including children home due to closure of schools and daycare; or their employer is closed because of COVID-19.
In addition, employers may consider the Voluntary Shared Work program as an alternative to layoffs. Under the VSW program, an employee’s hours are reduced between 20 percent and 50 percent, and affected employees are paid a percentage of their weekly unemployment insurance amount based on the percentage their hours are reduced. Employer accounts will not be charged for benefits paid under the VSW program directly or indirectly related to COVID-19.
Kansas has banned gatherings of 50 or more people and closed its K-12 schools through the end of the academic year. Kansas has not passed any other measures related to COVID-19 or changed eligibility requirements for unemployment benefits. Employers facing a layoff or shutdown should consider Kansas’s Shared Work Program as well as the option to assist affected employees by applying for unemployment benefits via spreadsheet.
Minnesota has closed schools until March 27. Bars, restaurants, coffee houses, cafés, breweries, fitness centers, amusement parks, facilities of country clubs, theaters, cinemas, performance venues and many other places of public accommodation are closed until 5:00 PM on March 27, 2020. Non-essential and elective surgeries scheduled for March 23 at 5:00 PM or later must be delayed. Minnesota has changed its eligibility requirements for unemployment benefits related to COVID-19 as follows:
- Workers are eligible for benefits if a healthcare professional or health authority recommended or ordered them to avoid contact with others; they have been ordered not to come to the workplace due to an outbreak of a communicable disease; or they have been notified that regular childcare or school arrangements are unavailable, made reasonable efforts to obtain other childcare, and time off or other accommodation from their employer was not available.
- The one-week waiting period for eligibility to access unemployment benefits is waived.
- Applicants must actively seek suitable employment, but only to look for work that does not pose a health risk to the applicant or to others. Workers laid off temporarily may satisfy the work search requirement by staying in contact with their current employer.
- The five-week waiting period for business owners who have become unemployed due to COVID-19 is waived.
Additional legislation is pending in Minnesota:
HF 3532 Revises the employment-related protections of those under quarantine or isolation.
HF 4415 Requires compensation at the employee’s regular rate of pay for hourly employees of school districts and charter schools for school days canceled due to COVID-19 during the 2019-2020 school year.
SF 4425 Modifies workers’ compensation and line of duty benefits for the safety of firefighters; includes quarantine due to disease exposure related to employment as a qualifying event for workers’ compensation coverage.
SF 4194 Relates to health; modifies employee protections related to isolation and quarantine provisions.
SF 4200 Relates to human services, granting the commissioner of human services certain temporary emergency authority relating to COVID-19.
For Minneapolis employers, the Minneapolis Sick and Safe Time COVID-19 guidance states that a worker may use accrued sick and safe time for time off related to the virus.
Local authorities in Kansas City and St. Louis have shut down bars, restaurants and other venues, but Missouri has not passed any legislation regarding sick leave or other measures related to COVID-19. The Missouri Department of Labor and Industrial Relations provides resources for employers and employees. These include an Electronic Mass Claims Filing System (to expedite the filing of multiple unemployment claims) and a Shared Work Unemployment Compensation Program (as an alternative to a layoff).
Wisconsin closed all schools and private institutions for instruction and closed bars and dine-in restaurants. Gatherings of more than 10 people are prohibited. Wisconsin has waived, retroactive to March 12, work search requirements for unemployment benefits. Additionally, workers who are otherwise eligible for unemployment benefits but out of work due to COVID-19 are considered available for work and therefore eligible for benefits.