SUMMARY OF THE MAJOR PROVISIONS OF THE FAMILIES FIRST CORONAVIRUS RESPONSE ACT*
On March 18, 2020, the Families First Coronavirus Response Act (“FFCRA”) became law. FFCRA is an emergency relief bill that aims to provide financial support for individuals who have been affected by the ongoing global COVID-19 pandemic. The bill will become effective in 15 days and remain in effect until December 31, 2020.
The FFCRA provisions are designed to:
- enhance paid sick, family, and medical leave.
- provide for free coronavirus testing for all individuals.
- supplement unemployment insurance benefits; and
- increase funding for nutrition and food assistance programs.
The FFCRA provisions are contained in related acts. We are listing them below.
The Emergency Paid Sick Leave Act (“EPSLA”) requires that, unless an employer requests a hardship exemption (available for employers with fewer than 50 employees), employers with fewer than 500 employees must provide additional emergency paid sick leave to employees.
- The leave applies to employees who must miss work due to specified COVID-19 related reasons:
- The employee is subject to a federal, state, or local quarantine or isolation order.
- The employee has been advised by a health care provider to self-quarantine.
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
- The employee is caring for an individual subject to a federal, state, or local quarantine or isolation order or an individual advised by a health care provider to self-quarantine.
- The employee is caring for a child whose school or place of care has been closed, or whose 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 Treasury or Secretary of Labor.
- The leave itself will provide:
- Sick employees must be paid at the regular rate of pay; capped at $511 per day for up to 10 days.
- Employees who take leave to care for an individual subject to quarantine, a minor child whose school or childcare center has been closed because of coronavirus, or an individual experiencing any other specified, substantially similar condition, must be paid at two-thirds the regular rate; capped at $200 per day for up to 10 days.
- For part-time workers, the leave will be calculated using hours equal to the number of hours that the employee works, on average, over a two-week period.
- Leave parameters:
- All employees are eligible for emergency sick leave, regardless of the duration of their employment.
- An employer may not require an employee to use other paid leave provided by the employer before the employee uses the paid sick leave described above.
- Paid sick leave under the Act must be provided in addition to whatever paid leave is already provided under the employer’s policies.
- NOTE: Small businesses with fewer than 50 employees may receive a hardship exemption from the Department of Labor if paid sick leave “would jeopardize the viability of the business as a going concern.”
The Emergency Family and Medical Leave Expansion Act requires that, unless an employer requests a hardship exemption (available for employers with fewer than 50 employees), employers with fewer than 500 employees must provide 12 weeks of public health emergency leave to employees unable to work or telework to care for a minor child whose school or care is unavailable due to COVID.
- This leave applies to any employee who has worked 30 days or more for the employer is eligible.
- After ten days of paid leave, the leave is at no less than two-thirds the employee’s regular pay.
- Employees may use emergency paid sick leave, described above, to provide for full or partial wage payment during the first two weeks of family and medical leave.
- This paid leave benefit is capped at $200 per day and $10,000 in total.
- NOTE: Small businesses with fewer than 50 employees may receive a hardship exemption from the Department of Labor if paid family and medical leave “would jeopardize the viability of the business as a going concern.”
- ALSO NOTE: It appears that the family and medical leave would not be available if employees are unable to work solely due to business closure. We hope that this will be clarified promptly.
Refundable tax credits pertaining to FFCRA’s Emergency Leave provisions discussed above will be available to the employer to help offset the incremental cost of providing these benefits.
The Emergency Unemployment Insurance Stabilization and Access Act provides additional protections for state unemployment insurance programs. These protections include:
- Providing states with additional funding and resources to assist them with the provision of unemployment insurance benefits so long as the states:
- Require employers to provide notification of potential unemployment insurance eligibility to laid-off workers.
- Ensure that workers have at least two ways (for example, online and phone) to apply for benefits.
- Notify applicants when an application is received and being processed and if the
- application cannot be processed, provide information to the applicant about how to ensure successful processing.
- The FFCRA also reserves $500 million in funding for emergency grants to be provided to states that experience at least a 10% increase in unemployment which ease eligibility requirements for unemployment insurance benefits that may be limiting access due to the COVID-19 outbreak, including waiving work search requirements, required waiting periods, and requirements to increase employer unemployment insurance taxes if employers have high layoff rates.
- The FFCRA directs the Secretary of Labor to provide technical assistance and guidance to states in establishing, implementing, and improving short-time compensation programs. Under such programs, employers would reduce hours instead of laying off employees, and employees would be eligible for partial UI benefits to help offset the wage loss resulting from their reduced hours.
Additional provisions of the FFCRA:
- Food Security – Several provisions of the FFCRA aim to provide food security for families and children by leveraging existing programs—including SNAP, WIC”, ACL. Individuals who currently receive food assistance through federal and state programs should expect they will continue to receive such assistance for the duration of the COVID-19 emergency, even if they receive meals through their schools or care centers that have closed or will close.
- COVID-19 testing costs. The FFCRA requires employer health plans and individual health insurance plans to cover the costs of COVID-19 diagnostic testing and testing-associated healthcare provider visits. These requirements will remain in effect until the end of the national emergency period that was declared by President Trump on March 13, 2020.
Implementation of the FFCRA – stayed tuned, federal, state, and local regulatory agencies will announce policies and procedures implementing the various provisions of the FFCRA.
* Please note that information is changing daily, and this summary is not legal advice but a summary of current information.
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We hope that you, your families, co-workers and friends remain healthy and safe.
Alexander R. Domanskis, Managing Member
and the entire team at Boodell & Domanskis LLC