There have been a lot of questions circulating regarding the newly enacted Families First Coronavirus Response Act (FFCRA). Here we tackle commonly-asked ones to the best of our ability with the information that is known today. Check back often as this is a fluid situation.
Question #1: Who does the FFCRA apply to?
The FCRA applies to employers with fewer than 500 employees. There is an exception for employers with less than 50 employees, see question #6.
Question #2: What is the employer’s obligation to pay an employee while they are out?
Emergency Paid Sick Leave is immediately available for everyone and may be taken for any of the following 6 reasons:
- 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 a COVID-19 concern.
- The employee is experiencing symptoms of COVID-19 and seeking medical diagnosis.
- The employee is caring for an individual subject to a federal, state or local quarantine or isolation order or advised by a health care provider to self-quarantine due to COVID-19 concerns.
- The employee is caring for a son or daughter when the school or childcare provider has closed or ceased operations due to COVID-19 precautions. According to the required IRS documentation, the employee alone must be providing care to the child, not if both parents or another individual is present to care for the child. Also, in the case of a 15- to 17-year old child, the employee must identify “special circumstances” requiring the employee to provide care.
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health. Note: Paid sick time may be paid at two-thirds of the employee’s regular rate if taken for the items 4-6 above and tax credit cannot exceed $200 per day for up to 10 days.
Reason 1-3, & 6 are paid at their regular rate – up to $511 per day, for 10 days or two weeks, up to $5,110 in total.
Reasons 4&5 are paid at 2/3 the employee’s regular rate – up to $200 per day for 10 days or two weeks, up to $2,000 in total.
Emergency FMLA is available when childcare or schools are closed under the Families First Coronavirus Response Act (FFCRA): Weeks 1 & 2 are unpaid, unless the employee elects to substitute Emergency Sick Time or any available PTO/Accrued Sick/Vacation sponsored by the employer.
Up to an additional 10 weeks (weeks 3-12), employees would be paid at 2/3 pay up to $200 per day.
If the employee had a varying schedule before the leave, use the average number of hours the employee was scheduled over the last six months, for calculating pay. If no period exists use a reasonable expectation.
Include leave time away in the calculation of average hours. Note: Be prepared, some employees may elect their employer sponsored PTO, sick or vacation time, since this would be paid at 100% versus the 2/3 pay provided by the FFCRA.
Question #3: How will the employers receive the tax credit for the wages paid out for Emergency Paid Sick Leave or FMLA?
An immediate dollar-for-dollar offset against payroll taxes will be provided.
For example, if total Federal Liability for the taxing period is $8,000, and the employer has paid $5,000 in FFCRA related wages, the payment due to the IRS would be $3,000.
If the wages paid exceed the liability owed for the quarter, the IRS will issue a refund. No further guidance on the facilitation of the refund is available at this point.
Question #4: Are the wages paid directly by the employer to the employee or does the employee need to file that with the Federal Government?
The payments under the FFCRA are paid by the employer directly to the employee.
Question #5: For employees looking to file unemployment, should file in the state they work in?
Yes, in most cases. Employees should be applying for unemployment in the state in which unemployment has been paid on their behalf. (If you are a Balance Point client and need help deciphering that, contact your customer service representative.)
Question #6: What are companies under 50 employees required to pay?
Employers with less than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or childcare unavailability if the leave requirements would jeopardize the viability of the business as a going concern. Guidance has not been provided yet.
Question #7: What are employers responsible for prior to the effective date of 4/1/20?
Nothing, the law takes effect on leave taken on or after 4/1. Payments cannot be made retroactively.
Question #8: Are employees who have been recently laid off able to receive compensation under the FFCRA?
No, the legislation cannot be applied retroactively.
However, the CARES Act adds new language that addresses this. If an employee was laid off on or after March 1, 2020, and that employee is rehired, they are immediately eligible for Emergency FMLA, as long as they employed for at least 30 of the last 60 calendar days prior to layoff.
Question #9: What employees are covered by the Act?
Both full time and part time employees. Employees must have completed 30 calendars days of work.
Question #10: How do I notify my employees of their rights under the FFCRA?
The DOL Wage and Hour Division released the required notification poster that will need to be posted in many workplaces and distributed to remote workers. You may access a copy here.
Introducing Our Business Response Package
There has been a lot of information circulating, so it’s understandable if you have questions on how these changes will affect your business. To help, we have a created a new service to help you navigate Emergency Paid Sick Leave and Emergency FMLA included in the FFCRA. Click here to learn more.