On March 18, 2020, President Trump signed the Families First Coronavirus Response Act (the Act). The Act is one of several federal government efforts to stimulate the economy and mitigate the economic harm to individuals and families being caused by the COVID-19 virus outbreak in the United States.1 In addition to a $1 billion stimulus for unemployment insurance benefit payments and other COVID-19 related provisions, the Act includes the Emergency Family Medical Leave and Expansion Act (EFMLA)2 and the Emergency Paid Sick Leave Act (PSLA), both of which provide employees with additional time off to help for reasons related to the COVID-19 pandemic. The Act, along with employer's obligations to provide the foregoing leave, will become effective not later than April 2, 2020. The Act and its requirements expire on December 31, 2020.
Emergency Family Medical Leave and Expansion Act
U.S. employers with fewer than 500 employees3 must provide eligible employees with up to 12 weeks of job-protected leave under the Family and Medical Leave Act of 1933 (FMLA) to care for the employee's "son or daughter under 18 years of age … if the[ir] school or place of care has been closed, or the[ir] child care provider … is unavailable, due to a public health emergency," and the employee is unable to work (or telework) due to a need for such leave. "Public health emergency" is defined as "an emergency with respect to COVID-19 declared by a Federal, State, or local authority." President Trump has already issued a proclamation that "the COVID-19 outbreak in the United States constitutes a national emergency, beginning March 1, 2020," and numerous states and local governments have made similar declarations or issued "shelter in place" orders.
Employees are eligible for such leave so long as they have worked at least 30 days for their employer.4 The first 10 days of EFMLA leave may be unpaid, and employees may elect to substitute any of their accrued vacation, personal, medical, or sick leave for the length of such unpaid leave. Any additional EFMLA leave days shall be paid by the employer (who may be entitled to receive corresponding tax credits). The payment employers make will be calculated based on an amount that is not less than two-thirds of an employee's regular rate of pay and the number of hours the employee would otherwise be normally scheduled to work. Special rules apply when calculating the amount to be paid to employees working variable schedules. In no event, however, shall the required leave payment exceed $200 per day or an amount greater than $10,000 in the aggregate.
Where the need for a leave related to COVID-19 is foreseeable, an employee must provide the employer with as much notice of the need for a leave as is practicable.
When providing EFMLA leave, employers must continue to comply with the FMLA's provisions that forbid employers from denying restoring eligible employees to the position they previously held (or its equivalent) following their return from leave. However, the EFMLA Act does provide that an employer with fewer than 25 employees is exempt from the foregoing provisions with respect to employees on EFMLA leave so long as the employer i) made reasonable efforts during the "contact period" to restore or reinstate the employee to the employee's position (or an equivalent position) and ii) the position held by the employee at the start of the leave does not exist due to economic conditions or other changes in operating conditions of the employer (a) that affect employment; and (b) are caused by a public health emergency during the period of leave. The contact period is defined as the earlier of: i) one year following the end of the declaration of COVID-19 related emergency made by a federal, state, or local authority or ii) one year following the date that is 12 weeks after the date on which an employee's EFMLA leave begins.
Emergency Paid Sick Leave Act
Private employers with fewer than 500 employees and public employers with at least one employee will be required to provide employees with ten days of paid sick leave for qualifying reasons. While employers will be responsible for funding the paid PSLA leave, they may be able to receive tax credits for the paid leave provided to employees.
The PSLA sets forth six qualifying reasons for which employers must provide paid sick time to employees affected by COVID-19:
- The employee is subject to federal, state, or local quarantine or isolation order related to COVID-19;
- The employee has been advised by a health care provider to self-quarantine due to COVID-19 concerns;
- The employee is experiencing symptoms of COVID-19 and seeking medical diagnosis;
- The employee is caring for an individual who is subject to a federal, state, or local quarantine order, or the individual has been advised to self-quarantine due to COVID-19 concerns;
- The employee is caring for a child, if the child's school or child care facility has been closed or the child's care provider is unavailable because of COVID-19 precautions; or
- The employee is experiencing any other substantially similar condition specified by Health and Human Services in consultation with the Department of the Treasury and the Department of Labor.
The PSLA imposes caps on the amount of pay an employee may receive. Pay for employees taking leave due to their own medical condition is calculated based on the employee's regular rate or applicable minimum wage, whichever is greater, but capped at $511 per day and $5,110 total. Pay for employees acting as a caregiver for a family member is calculated based on two-thirds of the employee's regular rate or applicable minimum wage, whichever is greater, but capped at $200 per day and $2,000 total. Employees' PSLA entitlements expire on Dec. 31, 2020.
The PSLA also imposes certain restrictions on employers. Employers may not require employees to use other employer-provided paid leave before using the new paid sick time. Nor can employers require their employees to search for a replacement to cover their hours for the length of their PSLA leave.
No Retaliation
The Act also prohibits employers from discharging, disciplining, or otherwise discriminating against any employee who 1) takes sick leave provided for under the Act, or 2) has filed any complaint relating to the Act (including one seeking enforcement of the Act), or participates in any such proceeding.
Notice Requirement
Finally, employers must post and keep posted, where notices to employees are customarily posted, a notice of the Act's requirements. The Labor Secretary will prepare or approve such a notice approximately seven days after enactment.
Takeaway
The EFMLA and PSLA impose new, and potentially significant, obligations on covered employers, and they should therefore familiarize themselves immediately with their responsibilities (as well as those the Act imposes on employees). Covered employers should prepare to provide employees with time off under these acts immediately. Such preparation should include i) ensuring that those responsible for HR and payroll matters are familiar with the new leave laws, including how the laws interact with the company's current leave policies (including any policies adopted in order to help employees cope with the COVID-19 pandemic), ii) drafting EFMLA and PSLA policies and/or employee communications addressing these new developments, iii) posting the Act's required notices; and iv) contacting employment counsel to answer questions or assist with any of the foregoing.
[1] For Wilson Sonsini’s recent discussion of employment issues arising from the spread of the COVID-19 virus, see Wilson Sonsini Alert: Coronavirus Update: Summary of Bay Area Six-County Orders Regarding Sheltering in Place, March 16, 2020, Wilson Sonsini Alert: Coronavirus Update: Frequent Questions We Are Receiving, March 18, 2020, and Wilson Sonsini Alert: New York Expands Paid Sick Leave in Light of COVID-19, March 18, 2020.
[2] The EFMLA amends the Family and Medical Leave Act of 1993 (29 U.S.C. 2611 et seq.).
[3] Under the EFMLA, the Secretary of Labor has the authority to issue regulations exempting small businesses with fewer than 50 employees from providing EFMLA leave when doing so would jeopardize the viability of the business as a going concern.
[4] Absent amendment by the Act, to be eligible for leave under the FMLA an employee must have been employed with the employer for at least 12 months, and worked at least 1,250 hours during the 12 months prior to the start of the FMLA leave.
