The Families First Coronavirus response Act was signed into law on March 18, 2020. The benefits were available on April 1, 2020 and continue through December 31, 2020. The FFCR A provides employees of small businesses with guaranteed sick pay and/or family leave pay for medical reasons related to COVID-19. The law is enforced and administered by the Department of Labor; however, the benefits are paid by the US Treasury.
As businesses reopen and employees return to work, employers may see an increased use of the FFCR A as we increase our interaction with other staff members and the general public. Employers MUST post the Department of Labor poster, “Employee Rights, Paid Sick Leave and Expanded Family and Medical Leave Under the Families First Coronavirus Response Act,” which is available on the Department of Labor website.
The paid sick leave and expanded family and medical leave provisions of the FFCR A apply to “covered employers” which is defined as certain public employers, and private employers with fewer than 500 employees.
Generally, the Act provides that covered employers must provide sick pay to all employees, regardless of length of employment, as follows:
* Two weeks (up to 80 hours) of paid sick leave at the employee’s regular rate of pay 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 because 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 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.
Qualifying Reasons for Leave:
Under the FFCR A, an employee qualifies for paid sick time if the employee is unable to work (or unable to telework) due to a need for leave because the employee:
1. is subject to a Federal, State, or local quarantine or isolation order related to COV I D -19;
2. has been advised by a health care provider to self-quarantine related to COV I D -19;
3. is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
4. is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
5. is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19; or
6. is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.
Duration of Leave:
For reasons (1 - 4) and (6): A full-time employee is eligible for up to 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.
For reason (5): A full-time employee is eligible for up to 12 weeks of leave at 40 hours a week, and a part-time employee is eligible for leave for the number of hours that the employee is normally scheduled to work over that period.
Calculation of Pay:
For leave reasons (1), (2), or (3):employees taking leave shall be paid at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).
For leave reasons (4) or (6): employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).
For leave reason (5): employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $12,000 in the aggregate (over a 12-week period—two weeks of paid sick leave followed by up to 10 weeks of paid expanded family and medical leave).
The FFCRA also provides that covered employers must provide to employees who have been employed for at least 30 days:
• Up to an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay where an employee 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.
Employees taking leave shall be paid at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $10,000 in the aggregate (over a 10-week period). This benefit may be combined with the 2 weeks of paid sick leave followed by up to 10 weeks of paid expanded family and medical leave for a total of 12 weeks of paid family leave, maximum benefit of $12,000.
Employers are eligible for a 100% reimbursement of qualified sick pay or family leave pay under the FFCR A through payroll tax credits. The funds to provide the mandated benefits under the FFCR A are available to the employer:
* By using payroll tax deposits held in escrow,
* Completing Form 7200, Advance Payment of Employer Credits Due to COVID-19, and
* As a refundable credit on Form 941, Employer’s Quarterly Federal Tax Return
Employers must withhold income tax and the employee’s share of Social Security and Medicare taxes from qualified sick and family leave wages; however, these wages are not subject to the employer portion of Social Security tax. The employer is still subject to the 1.45% contribution towards the Medicare tax. Qualified sick and family leave wages are treated the same as regular wages paid by the employer for purposes of employee benefit plans and may be subject to deductions for contributions to health plans, 401(k) and other retirement plans or any other employee benefit plans. If an eligible employer receives tax credits for qualified sick and family leave wages, those wages are not eligible as “payroll costs” for purposes of receiving loan forgiveness with respect to a paycheck protection program (PPP) loan under Section 1106 of the CARES Act.