News/Pubs/Events

House Passes Families First Coronavirus Response Act

An updated article was published March 19, 2020. View the updated article. The below article was written with information available on March 16, 2020.

On March 14, 2020, the U.S. House of Representatives passed a largely bipartisan bill (vote of 364-40) in response to the coronavirus disease 2019 (“COVID-19”) pandemic. Among other broad-sweeping provisions, the “Family First Coronavirus Response Act” impacts business owners and employers by making emergency changes to the Family Medical Leave Act (“FMLA”), including mandatory emergency paid leave under certain circumstances, and by creating the Emergency Paid Sick Leave Act as a standalone provision.

The following summary provides a snapshot of relevant employment-related provisions in the House Bill. This Bill is before the Senate now and may be signed into law by the President in the coming days.

I. Emergency Family and Medical Leave Expansion Act

In what is being called the Emergency Family and Medical Leave Expansion Act, this section of the House Bill would temporarily expand amended provisions of the FMLA until December 31, 2020. This expansion would make several noteworthy alterations to the familiar FMLA scheme, broadly captured below:

Changes Employers Covered

The Emergency Family and Medical Leave Act would apply the FMLA and the altered aspects of the FMLA to employers who employ “fewer than 500 employees” for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year.

Changes Eligible Employees

For such employers, the Emergency Family and Medical Leave Expansion Act would:

  • change the definition of “eligible employee” to apply to anyone employed at least 30 days by the employer of whom leave is being requested;
  • expand the definition of “family member” to include a parent, spouse, son or daughter under 18, or a pregnant individual, senior citizen, or individual with a disability who is a son, daughter, grandparent, grandchild, or next of kin to the employee,
    • expanding “parent” to include biological, foster, adoptive parent of the employee, a stepparent, parent-in-law, or parent of a domestic partner of an employee, or a legal guardian or other person who stood in loco parentis to an employee when the employee was a child.

Expands Medical Care and Covered Events

 For such employers, the Emergency Family and Medical Leave Expansion Act would:

  • define “qualifying need related to a public health emergency” as having a need for leave:
    • to comply with a recommendation or order by a public official having jurisdiction or a health care provider because
      • the employee’s physical presence would jeopardize the health of others because of exposure of the employee to COVID-19 or the employee is exhibiting COVID-19 symptoms, or
      • the employee is unable to perform functions of the job and comply with such recommendation or order,
    • to care for a family member recommended or ordered into quarantine under the same standards, or
    • to care for a son or daughter under 18 if the school or place of care has been closed or the child care provider is unavailable due to COVID-19,
      • for this particular subsection, if the necessity for leave is foreseeable, an employee shall provide the employer with such notice of leave as is practicable.

Makes Leave Paid and Unpaid

For such employers, the Emergency Family and Medical Leave Expansion Act would:

  • allow the first 14 days of leave applicable under this expansion to be unpaid
    • however, an employee may elect to substitute any accrued paid leave for the unpaid leave provided in this expansion (an employer may NOT require an employee to make this substitution);
  • require an employer to pay for each day of leave beyond the initial 14 days
    • the amount of this required pay may not be less than two-thirds of the employee’s regular rate of pay under the FLSA, and
    • the number of hours for this required pay must be in accordance with what would otherwise be normally scheduled for the employee,
      • if schedule variations make an employer unable to determine a normal number of hours for an employee, the employer shall:
        • use an average number per day over the prior six months of employment, or
        • use the reasonable expectation of the employee at the time of hiring of the average number of hours per day if the employee has not yet worked for six months.

Exempts Some Employers from Requirement to Return Employees to Same Position

For such employers, the Emergency Family and Medical Leave Expansion Act would:

  • NOT require employers with fewer than 25 employees to return an employee to their same position of employment after taking leave hereunder, if:
    • the position no longer exists due to economic conditions or operational changes caused by the COVID-19 emergency,
    • the employer makes reasonable efforts to restore the employee to an equivalent position (benefits, pay, and other terms), and
    • the employer makes reasonable efforts to contact the employee if such equivalent positions become available within 1-year from the earlier of the date when the qualifying need concludes or the date that is 12 weeks after the date on which the employee’s leave commences.

Exempts Certain Employers from Employee-Filed Civil Litigation

Finally, for such employers, the Emergency Family and Medical Leave Expansion Act would:

  • Exempt certain employers (see below) from civil actions brought by employees for a violation of the Emergency Family and Medical Leave Expansion Act:
    • Exemptions are only extended to employers that do NOT satisfy the traditional definition provided by the FMLA (50 or more employees working each day in 20 or more calendar weeks in the current or preceding calendar year) but who are swept up into the new proposed legislation.

II. Emergency Paid Sick Leave Act

In what is being called the Emergency Paid Sick Leave Act, this section of the House Bill would last until December 31, 2020. It defines employers as, and therefore applies to:

  • a private entity or individual who employs fewer than 500 employees;
  • a public agency or entity that employs 1 or more employees;
  • an entity employing a State employee;
  • an employing office; or
  • an executive agency.

The Emergency Paid Sick Leave Act would require an employer to provide “to each employee employed by the employer paid sick time” for any of the following reasons:

  • employee is self-isolating due to a COVID-19 diagnosis;
  • employee is obtaining medical diagnosis or care due to experiencing symptoms of COVID-19;
  • employee is complying with a recommendation or order by a public official with jurisdiction or a health care provider because of the employee’s exposure to COVID-19 or exhibition of COVID-19 symptoms;
  • employee is caring for or assisting a family member who is
    • self-isolating due to a COVID-19 diagnosis,
    • experiencing symptoms of COVID-19 and needs to obtain diagnosis or care, or
    • complying with a recommendation or order by a public official with jurisdiction or a health care provider because of exposure to COVID-19 or exhibition of COVID-19 symptoms;
  • employee is caring for his or her child because the child’s school or place of care has been closed or the child care provider is unavailable due to COVID-19.

For all intents and purposes, “family member” and “parent” are defined similarly to the definitions used in the Emergency Family and Medical Leave Expansion act, although a “sibling” of the employee is added to the subcategory of pregnant, senior citizen, or individual with a disability category (see above) in this particular provision.

For such qualifying employees, the Emergency Paid Sick Leave Act would entitle employees to paid sick time, as follows, and under the following conditions:

  • full-time employees – 80 hours;
  • part-time employees – a number of hours equal to the number of hours the employee works, on average, over a 2-week period (use same 6-month period or estimate if not applicable as stated in the Emergency Family and Medical Leave Expansion Act);
  • an employee’s required compensation shall be not less than the greater of:
    • the employee’s regular rate of pay,
    • the federal minimum wage rate, or
    • the minimum wage rate in affect in the applicable State or locality,
      • however, if such paid sick time is provided due to leave for care of a family member or child (rather than self-isolation due to a diagnosis of COVID-19, the employee experiencing symptoms that require diagnosis or care, or the employee complying with a recommendation or order by a public official / health care provider, see above), then the employee’s required compensation shall be two-thirds of the required amount calculated herein;
  • paid sick time under this section shall not carry over from one year to the next;
  • paid sick time under the Emergency Paid Sick Leave Act shall cease beginning with the employee’s next scheduled work shift immediately following the termination of the need for paid sick leave time;
  • paid sick time under the Emergency Paid Sick Leave Act shall be available to employees in addition to any paid leave policies already in effect;
  • employers may not require employees to find replacement workers to cover hours;
  • paid sick time is available for immediate use by employees regardless of how long the employee has been employed by the employer;
  • employees may use the paid sick time provided under the Emergency Paid Sick Leave Act first (before any other accrued leave) and employers may NOT require the use of other paid leave first;
  • employers must post notice of the requirements set forth herein (model to be provided);
  • it is unlawful to discharge, discipline, or discriminate against an employee for using such leave or complaining / participating in a complaint;
  • after the first workday or portion thereof that an employee receives paid sick time under this provision, employers may require the employee to follow reasonable notice procedures to continue receiving such paid sick time.

III. Tax Credits for Paid Sick and Paid Family and Medical Leave

In another section of the House Bill employers are extended certain tax credits:

  • a tax credit is made available to employers in an amount equal to 100 percent of the qualified sick leave wages paid by such employer for a given calendar quarter,
    • such credits are subject to certain limitations and refundability,
      • including a cap on the amount of qualified sick leave wages with respect to any individual,
      • a cap on the aggregate number of days taken into account for any calendar quarter, and
      • subject to other special rules;
  • additional tax credits for qualified sick leave may apply in specific circumstances, including for certain self-employed individuals;
  • a tax credit is likewise allowed for employers in an amount equal to 100 percent of the qualified family leave wages paid by such employer for a given calendar quarter,
    • such credits likewise are subject to certain limitations and refundability,
    • including a cap on the amount of qualified family leave wages with respect to any individual for any day or portion thereof,
    • a cap on the aggregate with respect to all calendar quarters, and
    • and subject to other special rules;
  • additional tax credits for qualified family leave may apply in specific circumstances, including for certain self-employed individuals.

Moreover, the House Bill would broadly provide that “[a]ny wages required to be paid by reason of the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act shall not be considered wages for purposes of section 3111(a) of the Internal Revenue Code of 1986,” which imposes an excise tax on employers.

The attorneys in the Labor and Employment Group of Bose McKinney & Evans are available to answer your questions and provide guidance regarding the impacts of these anticipated changes.