Last night, the FFCRA was passed into law and President Trump signed it. Many of the details of this new legislation are being analyzed by experts and additional guidance will be provided as the legislation becomes more broadly understood. However, our clients are asking questions now, so here is a general outline of the impact to employers. As we have more information, we’ll share it!
The new rules apply to employers with fewer than 500 employees. Those employers with fewer than 50 employees may opt out if they can demonstrate that compliance would put the overall business in jeopardy.
Paid Sick Leave
If an employer already offers more than 2 weeks of paid sick leave, this part of the new rules won’t change things a lot. However, if an employer does not offer this leave—to part-time or full-time employees—they now must offer it.
- Part-time workers will be paid based on the number of hours they typically work in a 2-week period
- Sick leave must be available to employees who:
- Have been exposed to Coronavirus
- Exhibit symptoms and are seeking diagnosis
- Have been quarantined by the government or a healthcare provider and cannot work from home
- Are providing care to a family member who was exposed to the Coronavirus or who exhibits symptoms
- Have a child(ren) whose school or childcare service is closed due to the pandemic
- Sick leave must be provided to workers based on their salary or what they normally earn in a 2-week period, up to a maximum of $511/day for the employee’s own care and a cap of $200/day when the employee is caring for someone else
Additional Job-Protected Leave
In addition to the paid sick leave, the bill requires employers to provide up to 12 weeks of job-protected leave to care for a child under 18 who is impacted by Coronavirus because his/her school or daycare is closed, or his/her childcare provider is unavailable due to the pandemic; this applies to employees who are unable to work or telework.
- Employees are eligible if they have worked for the employer for at least 30 days
- The leave requires employers to pay employees at least 2/3 of their pay, up to a cap of $200/day or $10,000 for the entire leave period; the first 2 weeks (14 days) of the leave may be unpaid
How is an Employer Going to Afford These New Rules?
Employers are expected to be reimbursed for the expense of FFCRA within 3 months by a tax credit that will be “counted” against payroll tax deposits and are what’s called “fully refundable;” this means that if the amount employers must pay workers is larger than the total of what’s owed in payroll taxes, the Federal Government will send the employer a check for the remainder
- Senate Majority Leader McConnell and other Washington leaders are promising that there will be additional financial relief for employers in what is being called “phase three” legislation that is currently being negotiated. McConnell has committed publicly that Senators will not be allowed to return home until this third phase is enacted; stay tuned
How Long is All of This in Effect?
The provisions of the FFCRA end on December 31, 2020.
Peoplr and its employees are not lawyers, so nothing contained in this post should be interpreted as legal advice and you cannot rely solely on the information we’ve shared nor hold us liable for anything we say that negatively impacts you and/or your employees. We’re sending this out early on, so please don’t be surprised if people smarter than us revise these interpretations or provide more detailed information. If you have questions or disagree with what we’ve written, please let us know! This is a crazy time and our goal is to provide the best information we understand—collaboration is always welcome!