Just keeping you in the loop with what I have looked into thus far related to the Coronavirus Response Act.
As of now, the Senate has still not scheduled a vote on this bill. They could: a) approve the bill and send to Trump, b) Change the bill, and return it to the House, who is currently unavailable, or c) reject the bill altogether.
Let’s assume a) above.
I am not a lawyer, but I will break down what I understand. That being said, now would be a good time to contact your attorney.
First, employers with over 50 employees are exempt from this because they already have policies in place and are required to follow FMLA. The following information is important to anyone who either has fewer than 50 employees, has a business with 0 employees, or is an employee themselves in a business with less than 50 employees.
Emergency Family and Medical Leave Expansion Act.
Effective date: 15 days after Trump signs the bill
It applies to businesses with fewer than 50 employees, but the Secretary of Labor can later exempt these businesses when providing such leave may close down the business.
Employee eligibility: Employees that have been working at least 30 days. Employees do not need to meet the threshold of regular FMLA which is a longer tenure (remember this is Emergency FMLA for fewer than 50 employees).
Leave entitlement: 12 weeks, first 2 unpaid
Reasons for taking E FMLA:
- To adhere to a requirement to quarantine due to exposure or symptoms of coronavirus
- To care for an at-risk family member who must quarantine due to exposure or symptoms
- To care for a child of an employee if the child’s school or place of care has been closed
Intermittent leave: Unclear as of now. This could be an issue if employees are allowed to work from home but they also have to take care of kids. This could also be an issue if employer is limiting hours.
The first 10 days of EFMLA will be unpaid, except when employees elect to run accrued PTO concurrently. After two weeks, employees get paid at least two thirds of usual pay, being capped out at $200/day with $10,000 in the aggregate.
Sunset: end of year
Emergency Paid Sick Leave
Eligibility: all current employees, regardless of days of service
Leave entitlement: 2 weeks of paid leave (80 hours for full time, pro rata for part time)
Reasons for taking Paid sick leave:
- Quarantine/isolate because of diagnosed coronavirus
- To seek a diagnosis or preventative care for coronavirus symptoms
- To comply with a recommendation or order from public official or health care provider that an employee shouldn’t be at work because of coronavirus factors
- To care for a child whose school has closed, or childcare provider is unavailable, due to coronavirus
Amount of pay: Companies must pay employee taking leave for any of the first 3 reasons listed above a regular pay. When an employee takes paid sick leave for a family member or child, they get 2/3rds employee’s regular pay- see above EFMLA. Paid sick leave is capped at $511/day or $5110 in aggregate.
PTO Policy- if already in place, the employee gets paid sick time under the new law in addition to any PTO in bank. It is unclear with Paid sick is consecutive like EFMLA or combined together…hopefully consecutive. Original bill had a clause that employer cannot change PTO, but that was left out of latest bill.
Sunset- End of year as well with no carryforwards.
Credits and funding from Government
As mentioned above, the Labor Secretary can exempt small business if they believe the result of the payments under this bill will close down the business.
If the business does pay, they will receive tax credits when filing quarterly payroll taxes up to the amount that they had to pay out. Treasury Secretary Mnuchin said his agency would advance funds to businesses so that they can meet these requirement….I am not sure how that will play out.
No lawsuits against small employers are allowed, except by the Department of Labor.
If you work from home, you are not eligible for Paid Sick Leave or Emergency FMLA.
Overtime wages are not in any part of this, so if employee typically works 50 hours in a week, you would use regular pay as the multiplier for all wages
If running a business without employees:
You cannot pay yourself sick leave, but you could potentially get a tax credit when filing taxes. The same math applies here. The sick leave credit would be equal to number of days during the year that you cannot conduct business multiplied by the lesser of a) $511 per day for people who are sick or $200 if caring for children/family member, or b) your average daily self-employment income for the year.
Hope this clears up some of the stuff being thrown around right now…we will have to see what happens next.