House Passes Bill Providing Emergency Paid Sick Leave and Expanded FMLA Benefits

By Erin Fowler, William Pokorny and Tracey Truesdale - Franczek P.C.

March 14, 2020

In the early hours of March 14, 2020, the U.S. House of Representatives passed HR6201, the Families First Coronavirus Response Act, which, among other things, provides employees affected by coronavirus with paid sick leave and paid Family and Medical Leave Act (FMLA) benefits. Though passed by the House, the bill must still be passed by the Senate and signed into law by President Trump. As it currently stands, President Trump has announced his support for the bill. We will continue to update you as the bill makes its way through the legislature. For now, we’ve provided a summary of the key provisions of the bill as applicable to employers.

What type of leave is provided?

The bill provides employees with two separate forms of leave. The first is emergency paid sick leave, which provides full-time employees with up to 80 hours of paid sick leave to address the impact of coronavirus on them or their family members. Part-time employees are entitled to the average number of hours worked over a 2-week period.

The second form of leave is paid FMLA leave. This provides employees with up to 12 weeks of job-protected leave, with few exceptions. The first 14 days of leave is to be unpaid, though employees will be entitled to substitute available paid leave (including the emergency sick leave discussed above). During the remaining period of leave, employees are entitled to paid leave at the rate of at least 2/3 their regular rate of pay.

Who is covered?

Under both laws, private sector employers with 500 or fewer employees must provide the leave discussed above. The laws also extend leave to essentially all local governmental employers, regardless of the number of employees.

In terms of employees, all employees of covered employers will be immediately entitled to use emergency paid sick leave benefits. To qualify for emergency FMLA leave, an individual must have been employed with his or her employer for at least 30 calendar days. This is a significant departure from the FMLA as we know it, which requires employees to be employed for at least 12 months and have worked at least 1250 hours in the 12 months immediately preceding the need for leave.

When can leave be taken?

Generally, both emergency paid sick leave and emergency FMLA leave can be taken so that the employee can attend to their own health if impacted by COVID-19, to care for a family member affected by COVID-19, or to care for a child whose school or place of care is closed or whose child care provider is unavailable due to coronavirus.

Will employees be entitled to paid leave if an employer shuts down or sends some employees home in connection with the coronavirus situation?

The new emergency sick leave and FMLA leave provisions do not appear to apply to situations where an employer directs an otherwise healthy employee not to work to promote “social distancing” or because the employer is completely or partially shutting down operations during the crisis. Employees who find themselves out of work for these reasons may be eligible for unemployment benefits, and states and the federal government may be expanding the availability of benefits for coronavirus-related job losses.

Can an employer require employees to use employer-provided leave first?

No. The bill is clear about two things: (1) the leaves provided are in addition to employer-provided paid sick leave, vacation, or paid time off; and (2) an employer cannot dictate the sequencing of how leave is taken. This means that employees may take leave provided under this law first and then still take any employer-provided leave once leave under these laws is exhausted.

Once the law is signed, employers are also prohibited from modifying their current paid time off policies to avoid providing additional benefits to employees.

Will the federal government provide any assistance to employers to pay for these benefits?

Yes. The law allows private sector employers to claim a refundable FICA tax credit for benefits paid under these provisions. This credit is not available to government employers, meaning that state and local governments will have to foot the bill for any benefits provided to their employees. For private employers, the tax credit is limited to the first $200 per day paid to each employee for days paid at 2/3 of an employee’s regular rate, or $511 per day for sick leave required to be paid at 100% of an employee’s regular rate of pay. The credit for sick leave is only available for the first 10 calendar days of leave. The credit for FMLA leave is capped at the first $10,000 per employee.