Tuesday, March 24, 2020

Summary of Families First Coronavirus Relief Bill Passed on March 18, 2020

Summary of Main Points Employers Need to Know About Families First Coronavirus Bill 

Let me say first that one of the best summaries of the Family First Conronavirus Bill that I have seen was authored by Bill Bischoff and recently posted on Moneywatch.com.  They provide some tax-related information concerning extension of the April 15 tax filing deadline, employer tax credits, etc. that I do not discuss here.

This Article from Forbes.com also provides a nice overview.

John A. Gallagher, Esquire
Employers with Less Than 500 Employees Must Provide Up to 10 Days of Paid Sick Leave to Certain Employees

The Act requires emergency paid sick leave of up to $511 per day for up to 10 days (up to $5,110 in total) for an eligible employee in Coronavirus quarantine or seeking a Coronavirus diagnosis. 
So in essence, at least as I read it, if an employee has been tested and found to have the Coronavirus, and thus is quarantined, he/she is eligible to be paid his/her salary (at least up to $511 per day, anyway), for up to 10-days.  At this time, I am not precisely sure where the $511 figure comes from. 
Similarly, if someone is sick, and seeking a test, they are similarly eligible for such paid leave (at least until they are told they do not have the virus).

Parents Who Cannot Work Due to Coronavirus School Closings Entitled to 12-Weeks of Leave  and Up to $12,000 of Pay
An employee can also receive emergency paid sick leave of up to $200 per day for up to 10 days (up to $2,000 in total) to care for a quarantined family member or a child whose school or child-care location has been closed due to the pandemic.  It is easy to apply that $200 a day rule when one is home merely to care for a quarantined family member.  It is with school closings that things will get sticky.
Since virtually all children are home from school, then upon proof that there are no other child-care options (i.e. a spouse of grandparent, etc.) any employee who must stay home due to school closings is entitled to up to $200 per day for 10-days.  
But, things get a little more tricky from that point on.  
The Act provides that employees who must stay home to care for children whose schools are closed are entitled to 12-weeks of leave with right to job reinstatement, and payment of up to $200 per day for a total of 50 days (i.e. 10-weeks). The $200 per day is the maximum - the figure is based upon 66.66% of the employees' normal gross pay.  So any employee earning $300 a day or more (i.e. roughly $78,000 per year or more) would receive the $200 a day maximum.
So, the way I see it, employees whose children are home from school and who cannot find substitute child care are entitled to 12-weeks of leave with job reinstatement, with up to $200 per day of paid leave during the entire 12-week period.

Congress Trying to Keep Up With COVID-19
UPDATE (3/27/20):  How Much Extra Unemployment Compensation Benefits Per Week is Federal Stimulus Bill Providing? 

Does a Company That is Shut Down Due to Coronavirus Have to Pay Employees or Can It Just Lay Them Off?
In addition to the paid leave benefits, the Act also requires that employees of companies with less than 500 employee be given unpaid leave of up to 12 weeks with full job reinstatement rights if they are eligible (i.e. have the virus and/or are quarantined).  However, such employees are entitled to be paid only the $511 per day for up to 10-days, as discussed above.   
Typically, such unpaid leave runs concurrently with paid leave.  So:
Pat the employee is diagnosed with Coronavirus on April 1.  Pat is sick and cannot return to work to until July 1. During the first 2-weeks of Pat's absence, Pat is paid $511 per day.  For the next 10-weeks, Pat's leave is unpaid (but Pat can use accrued sick time or vacation time). Provided Pat is able to return by July 1, Pat MUST be returned to his/her former job.

What If I Work From Home Already or All of My Employees Work from Home?  Do People Who Work Remotely Get Pay Under Families First Coronavirus Bill?

Let's say that a company employs many people who work from home no longer is operating because they have no business.

In that scenario, I believe that the employer's only obligation would be the $511 per day obligation discussed above.  That is, since employees working from home would not be unable to work due to school closings, the $200 per day obligation would not arise.  

Also, if the company's remote employees are not able to work because the company does not have any business, then they would not be eligible for the 12-weeks of paid or unpaid leave (and hence would not have job reinstatement rights) because their inability to work was not the result of virus-related illness or school shutdown but, rather, resulted from Coronavirus business conditions.

In such scenarios, employees should be encouraged to seek unemployment benefits.

We All Must be Resourceful During This Difficult and Challenging Time
Small Business owners With Less Than 50 Employees May Be Exempt from Paid Leave Requirements in Families First Coronavirus Bill

If a small company can prove that satisfying the obligations of the Act will cause material harm to the business (i.e. cause it to become insolvent or go bankrupt), then it will be exempt from the paid leave requirements. How exactly one goes about seeking or obtaining the exemption, and whether a claim of exempt status can be challenged by employees remains to be seen.  However, I would expect that the exempt determination is made by the employer in the first instance, and can be challenged by employees.  So I would suggest investigating those issues before one stops making the paid leave payments mandated by the Act.

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