On March 14, 2020, the House of Representatives passed the Families First Coronavirus Response Act. A summary issued by the House can be found here. Here are some key elements of the bill that are relevant to public agencies:
Emergency Paid Sick Leave Act
- Provides 2 weeks of paid sick leave, paid at employee’s regular rate, to quarantine or seek a diagnosis or preventive care for coronavirus.
- Sick leave is paid at two-thirds the employee’s regular rate if taken to care for a family member for such purposes or to care for a child whose school has closed, or child care provider is unavailable, due to the coronavirus.
- Full-time employees are entitled to 2 weeks (80 hours) and part-time employees are entitled to the typical number of hours that they work in a typical two-week period.
- These requirements apply to all government employers.
- These requirements expire on December 31, 2020.
Emergency Family and Medical Leave Expansion Act
- Allows 12 weeks of job-protected leave under the FMLA to: 1) adhere to a quarantine due to exposure to, or symptoms of, coronavirus; 2) care for an at-risk family member who is adhering to a quarantine due to exposure to, or symptoms of, coronavirus; or 3) care for an employee’s child whose school of place of care has been closed, or the child-care provider is unavailable, due to coronavirus.
- For the first 2 weeks, employees can receive paid sick leave provided through the bill. After that, the employee will receive no less than 2/3’s pay.
- These provisions apply to all government employers.
- These provisions apply to any employee who has been on the job for at least 30 days.
Tax Credits for Paid Sick Leave and Paid FMLA
- Employers are eligible for a 100% tax credit for qualified sick leave paid as a result of this law. The tax credit is allowed against the employer portion of social security taxes (typically 6.2% of an employee’s wages)
- Sick leave credit is capped at $511 per day for employees who are in self-isolation; and capped $200 per day for employees caring for a child or family member.
- Employers are also eligible for a 100% tax credit for qualified paid FMLA. The paid FMLA credit is capped at $200 per day.
- The biggest change for public employers will be the requirement for paid FMLA leave. Under this bill an employee is eligible for paid FMLA if they have been on the job for 30 calendar days. Therefore the normal requirement to have worked 12 months and 1250 hours does not apply.
- The bill appears to be written such that if employees have already used their 12 weeks of FMLA, they do not now get another 12 weeks; but it’s unclear if that’s the intent.
- The tax credit presumably applies to government employers to help them pay for the paid sick leave and paid FMLA. As noted above, the tax credit is taken against the employer’s portion of social security taxes. But what about public employers that are not part of social security? The bill does provide that if the tax credit exceeds the employer’s portion of social security taxes, the excess credit is refundable to the employer. Does that mean that public employers who are not part of social security will just get a “refund” from the federal government for all their costs? It’s unclear.
- With respect to paid sick leave, it’s important to note that this bill will not provide federal payment for existing sick leave. The bill expressly provides that the two weeks of paid sick leave is in addition to any existing sick leave policies of the employer. So employers cannot shift the cost of existing sick leave onto the federal government.
I will continue to follow this bill and provide additional commentary as the bill progresses…..