The 99.5 Percent Act has been proposed in the Senate, which could result in the most extensive changes to the federal estate and gift tax in decades.
On March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act (FFCRA), which addresses employee leave taken between April 1, 2020 and December 31, 2020 in response to COVID-19 (Coronavirus). One goal of the FFCRA is to provide employees with pay if they must miss work due to the virus. Of particular importance to both employers and employees is a section of the Act called the Emergency Family and Medical Leave Expansion Act (E-FMLA) and the newly created Emergency Paid Sick Leave Act (EPSLA).
Please note: These new laws are already in force and, although they include provisions for the Secretary of Labor to alter their scope and effect, no such regulations have yet been promulgated. While carve outs may materialize in the future, employers cannot rely on traditional exceptions to existing employee protection laws and should instead be guided by the strict language of the new laws, which are discussed below.
Emergency Family and Medical Leave Expansion Act (E-FMLA)
The E-FMLA requires that employers, including private employers of fewer than 500 employees, provide emergency paid family leave to eligible employees who have been employed for 30 or more days if:
- The employee is unable to work (or telework) due to the need to care for their child while school or childcare are closed, or
- The childcare provider is unavailable, due to a public health emergency
The first 10 days of leave are unpaid, unless the employee chooses to use paid time off or earned sick leave for those 10 days. After the 10 days, the employer must pay the employee an amount that is not less than two-thirds of the employee’s regular rate of pay based upon the number of hours the employee would otherwise be normally scheduled to work. However, the E-FMLA does provide a cap on the amount of paid leave, limiting it to $200 per day and $10,000 in the aggregate.
Emergency Paid Sick Leave Act (EPSLA)
The EPSLA also applies to private employers of fewer than 500 employees. It requires paid sick leave for employees, regardless of how long they have been employed, if an employee is unable to work (or telework) due to one of the following reasons:
- The employee is subject to a 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 concerns related to COVID–19
- The employee is experiencing symptoms of COVID–19 and seeking a medical diagnosis
- The employee is caring for an individual who is subject to an order as described in item 1 or has been advised as described in item 2
- The employee is caring for a child whose school or child care has been closed, or the child care provider is unavailable due to COVID–19 precautions
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor
If a full-time employee is experiencing one of the six reasons above, he or she is entitled to 80 hours of paid sick leave. Part-time employees are entitled to sick leave for a number of hours equal to the number of hours he/she works, on average, over a two-week period.
Importantly, the EPSLA prohibits employers from requiring an employee to use other paid leave first. The amount of compensation to be paid cannot be less than the greater of the employee’s regular rate of pay or federal or state minimum wage. There is a cap on the amount to be paid, but it depends on the scenario. If an employee is unable to work (or telework) due to items 1, 2 or 3 listed above, the cap on paid sick leave is $511 per day and $5,110 in the aggregate. If an employee is unable to work (or telework) due to scenarios 4, 5 or 6 listed above (which applies to employees who take leave to care for another person) the employee must be paid the lesser of two-thirds their full rate of pay or $200 per day and $2,000 in the aggregate.
The EPSLA also makes clear that it in no way diminishes or takes precedent over the rights or benefits that an employee is entitled to under any other Federal, State or local law, collective bargaining agreement, or existing employer policy.
Small businesses are regularly exempted from employee protection laws. However, the federal government made sure to include them here.
Employers of 25 or Less
For employers of 25 or less, if the employee takes leave based upon one of the qualifying needs provided for under E-FMLA while it’s in effect, the employee is not entitled to job restoration if the following factors are met:
- The employee’s position prior to the leave no longer exists due to economic conditions or other changes in the employer’s operating conditions that affect employment and are caused by a public health emergency during the period of leave
- The employer makes reasonable efforts to restore the employee to a position equivalent to the position the employee held when the leave commenced, with equivalent employment benefits, pay and other terms and conditions of employment
- If those reasonable efforts of the employer fail, the employer must make reasonable efforts to contact the employee if an equivalent position becomes available during the one-year period beginning on the earlier of the dates on which the qualifying need related to a public health emergency concludes or the date that is 12 weeks after the date on which the employee’s leave commenced
Employers of 50 or Less
The Secretary of Labor has the authority to issue regulations for good cause to exempt small businesses with fewer than 50 employees from the requirements of E-FMLA and EPSLA when the imposition of such requirements would jeopardize the viability of the business as a going concern. However, there’s currently no guidance on this. The Department of Labor’s website states that certain provisions of the Act may not apply to certain employers with fewer than 50 employees, and Department of Labor regulations are expected in April 2020. Although the new law goes in effect April 1, 2020, the Department of Labor has posted a Field Assistance Bulletin stating that the Department of Labor “will not bring enforcement actions against any public or private employer for violations of the Act occurring within 30 days of the enactment of the FFCRA , i.e. March 18 through April 17, 2020, provided that the employer has made reasonable, good faith efforts to comply with the Act.”
This area of the law is continually changing, so we’ll keep you updated. While this article is a brief overview of the newly created Families First Coronavirus Response Act, it is by no means all that is required by employers nor does it outline all employee rights provided for under the Act. You can view the Act in its entirety here.
The Business Law practice at Gawthrop Greenwood is a mainstay of the firm, serving businesses from startup to Fortune 500 in Pennsylvania, Delaware and beyond. For more information on business and employment law, including litigation, contact attorneys Jack Larkin at email@example.com or Gordon Prince at firstname.lastname@example.org