Review of the Families First Coronavirus Response Act (FFCRA)
On March 18th, 2020, the Families First Coronavirus Response Act (FFCRA) was signed into law, becoming effective April 1st, 2020, and ending December 31st, 2020. The FFRCA provides emergency paid sick leave, and it amended the FMLA to include expanded paid family and medical benefits to employees, so they can take care of themselves or their family members who have been impacted by COVID-19. Below is an overview of the paid leave offered by the newly enacted FFCRA.
The FFCRA is comprised of two components summarized herein:
- EMERGENCY PAID SICK LEAVE ACT
- FAMILY AND MEDICAL LEAVE EXPANSION ACT
Emergency Paid Sick Leave Act
Six Qualifying Reasons for Emergency Paid Sick Leave
Under the FFCRA, an employee qualifies for paid sick leave if the employee is unable to work (or unable to telework) due to a need for leave because the employee:
- Is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
- Has been advised by a health care provider to self-quarantine related to COVID-19;
- Is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
- Is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
- Is caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19; or
- 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.
Available Benefits to the Eligible Employees
If an employee uses leave for qualifying reasons 1, 2, or 3 (listed above), the employee is entitled to paid sick leave in the following amounts:
- Full-time Employees are entitled to up to two weeks (80 hours) pay with a maximum payout of $511.00 daily (Max $5,110.00 total).
- Part-time employees are entitled to up to two weeks of pay (using their average hours worked for two weeks) with a maximum payout of $511.00 daily (Max $5,110.00 total).
If an employee uses leave for qualifying reasons 4 and 6 (listed above), the employee is entitled to paid sick leave in the following amounts:
- Full-time Employees: up to two weeks at two-thirds (66.67%) of pay with a maximum payout of $200.00 daily (Max $2,000 total).
- Part-time Employees: up to two weeks of pay at two-thirds (66.67%), the equivalent average hours worked over two weeks, with a maximum payout of $200.00 daily (Max $2,000 total).
Note: Number 5 is also a qualifying reason for Emergency and Family Medical Leave Expansion Act
If an employee uses leave for qualifying reason 5 the employee is entitled to 2 weeks of paid sick leave and an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay (payout up to $200 daily with a max payout of $12,000) where an employee, who has been employed for at least 30 calendar days, is unable to work due to a bona fide need for leave to care for a child whose school or childcare provider is closed or unavailable for reasons related to COVID-19.
The duration of leave and the calculation depend on several factors, visit the Department of Labor for guidance.
Family and Medical Leave Expansion Act
The Family and Medical Leave Expansion Act expands the existing Federal Family and Medical Leave Act (FMLA) adding the following qualifying leave reasons to FMLA:
- Employee is unable to work (or telework) due to a need for leave to care for a child (<18), if the school, place of care or childcare provider is unavailable, due to a public health emergency.
The first 10 days of expanded FMLA leave are unpaid, after which the leave must be paid at two-thirds (66.67%) of the employee’s regular pay up to a maximum of $200/day or $10,000 total. The intent of the legislation is the employee would receive pay for the first 10 days of leave through the Emergency Paid Sick Leave Act detailed above.
All private sector companies with fewer than 500 employees are subject to the FFCRA regulations. There are some organizations that are exempt from FFCRA, and those exemptions are listed in the Exemptions to FFCRA section of this article.
Generally, employees must meet these guidelines to be eligible to use the Paid Sick Leave and the Family and Medical Leave Expansion Act of the FFCRA:
- Work for an organization that has less than 500 employees;
- Been employed with their current organization for at least 30 days prior to their leave request;
- Unable to work (including telework) due to any of the six qualifying reasons for emergency paid sick leave; and/or is
- Unable to work (including telework) due to caring for a child because the school is closed, or the childcare provider is unavailable.
Important considerations to keep in mind regarding the Family and Medical Leave Expansion Act:
- The FFCRA doesn’t extend the duration of FMLA, it only expands the use of FMLA
- Between FMLA and FFCRA, leave may not exceed 12 work-weeks in an employee's specified 12-month period
This documentation guidance applies to both the Emergency Paid Sick Leave and the Family and Medical Leave Expansion Act. According to the IRS, organizations can substantiate eligibility for the sick leave or family leave credits by receiving a written request from the employee that includes the following:
- Their name;
- The date or dates for which leave is requested;
- A statement of the COVID-19 related reason they are requesting leave and written support for such reason; and
- A statement that they are unable to work, including by means of telework, for such reason.
- For leave based on a quarantine order or self-quarantine advice, the request should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine. If the person subject to quarantine or advised to self-quarantine is not the employee, that person’s name and relation to the employee should be included.
For a leave request based on a school closing or child care provider unavailability, the statement should include the name and age of the child (or children) to be cared for, the name of the school or place of care that has closed, and a representation that no other person will be providing care for the child during the leave. If a child who needs care is 15 or older, the employee must affirm that there are special circumstances (but need not explain them) — the IRS otherwise assumes adolescents 15 and older can take care of themselves for the length of a workday.
The IRS has a very helpful overview and FAQ that covers other common questions about the tax credits in detail.
- Organizations may not require more documentation from employees than is described above. For example, employers may not request a doctor’s note or an official notice from a closed school or daycare.
- Consider setting-up different charge codes or time tracking codes to keep track of the amount of FFCRA leave that is utilized.
- Create an FFCRA leave form template so that it is easy to use for the employees and gives the employer the required statement required to apply for the tax credits from the IRS.
Paid Leave for Furloughed Employees
Employees who have been furloughed, or whose worksites have been closed, are not entitled to paid leave. The CARES Act has expanded unemployment benefits, and these benefits may be available for impacted employees. Furloughed employees should be encouraged to apply for unemployment benefits.
Interaction with Accrued Leave
Employers may not require employees to use existing accrued paid leave for qualifying reasons, to supplement partially paid FFCRA leave. Employees have the option to elect to use PTO or other types of accrued leave.
While there are tax advantages to the employer in having employees use the Emergency Paid Sick Leave available before using their PTO or other accrued leave, the Act specifies the employer may not dictate the order in which the employee applies available leave benefits. Likewise, employers cannot require employees exhaust accrued, or other leave benefits before taking advantage of the Emergency Paid Sick Leave.
The FFCRA’s paid leave provisions are effective on April 1, 2020, and apply to leave taken between April 1, 2020 and December 31, 2020. Organizations can pay their employees in excess of FFCRA requirements, but organizations will not receive a tax credit for amounts paid above the FFCRA’s statutory limits.
On March 25, the DOL published workplace posters for organizations with less than 500 employees to use to fulfill their obligations of notifying employees of their rights to utilize expanded paid sick leave and expanded paid Family and Medical Leave under the FFCRA. They published two new posters available for download: 1) non-federal employers and 2) federal employers.
- If employees are still working in an office, post these notices with your other employment posters.
- If employees are working both remotely and, in the office, post these notices with your other employment posters, and make them available electronically. Consider emailing the notices to employees and posting to your organization’s intranet.
- If employees are working remotely full-time, email the notices to employees and post to your organization’s intranet.
Exemptions to FFCRA
According to the Department of Labor, some small businesses with fewer than 50 employees including religious and nonprofit organizations, are exempt from two aspects of the FFCRA’s provisions, and must meet these guidelines:
- The provision of paid sick leave or expanded family and medical leave would result in the small business’ expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
- The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
- There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
There is no application process for exemption. An authorized officer of the organization must determine that at least one of the three conditions described above is satisfied and document why the small business qualifies for an exemption. The DOL has advised employers they are not required to send the documentation to the DOL at this time.
Federal and State employees have different eligibility guidelines. Eligibility will depend on whether those employees are covered under Title I or Title II of the Family Medical Leave Act. Federal employees should consult with their agency regarding their eligibility for expanded family and medical leave.
FFCRA is a Federal law, and organizations should also be conscious of State and local ordinances that expand on the requirements of the FFCRA and Emergency Sick Leave Act. Helios continues to monitor for updated information and Q&A’s from the DOL, and our team will continue to provide updates on these issues.
For more information on FFCRA and other COVID-19 related topics, please visit our COVID-19 Resource Center often for up-to-date information to help you stay informed of the ongoing issues and trends related to COVID-19.