Revised Special Bulletin: Families First Coronavirus Response Act Enacted Into Law

Category: Special Bulletins
Date: Mar 23, 2020 02:46 PM

On March 18, 2020, in response to the COVID-19 pandemic, and in an effort to reduce the impact of the virus on American families, the Senate passed the Families First Coronavirus Response Act (the Act) and President Trump signed the bill into law a few hours later.  We initially reported on this issue on March 18, 2020 and are issuing a revised Bulletin to answer questions regarding the effective date of the Act and whether the Emergency Paid Sick Leave required under the Act is a separate entitlement if an employer already offers an equivalent amount of leave.

We have received numerous questions about the effective date.  The law will go into effect within 15 days of the President’s signature.  As of right now, we do not know exactly what date the law will go into effect.   Once we know the date, we will immediately notify our clients.  To date, the guidance from the Department of Labor (the federal agency that administers the FMLA) has not indicated if the law will go into effect prior to the fifteenth (15th) day from its enactment – April 2, 2020. 

Among other things, the Act amends the Family and Medical Family Leave Act (FMLA) by providing FMLA Public Health Emergency Leave and provides Public Health Emergency Paid Sick Leave to employees for certain coronavirus, or COVID-19, related reasons.  The final version of the law narrows the reasons (as compared to what had been passed by the House) an employee may take Public Health Emergency FMLA leave and places caps on the amount of paid leave available under the Emergency FMLA Leave and Paid Sick Leave.

FMLA Public Health Emergency Leave and Emergency Paid Sick Leave will remain in effect until December 31, 2020.  The benefits granted by the Act appear to apply to employees prospectively upon the effective day of the Act.

Here is what California employers need to know about the Act:

FMLA Public Health Emergency Leave

Which employers are required to provide FMLA Public Health Emergency Leave?

Private sector employers with fewer than 500 employees and all government employers.

There is a very narrow exception from the requirement to provide FMLA Public Health Emergency Leave for small businesses with less than 50 employees.  The Act gives the Secretary of Labor the authority to issue regulations for good cause to exempt small businesses with fewer than 50 employees from the FMLA Public Health Emergency Leave requirement “when the imposition of such requirements would jeopardize the viability of the business as a going concern.”  Therefore, the Act itself does not exempt these small businesses at this time.

Who is eligible to take FMLA Public Health Emergency Leave?

Employees of the above employers who have been employed by the employer for at least 30 calendar days are eligible for FMLA Public Health Emergency Leave.  This is different than the eligibility requirements for regular FMLA leave, which requires an employee to have been employed by the employer for at least 12 months and have worked 1250 hours during that period of time. 

An employer of a health care provider or an emergency responder may elect to exclude such employees from the application of these new FMLA provisions.  However, there is no definition for “health care provider” or “emergency responder.”

For what reasons may an employee take FMLA Public Health Emergency Leave?

An employee may take FMLA Public Health Emergency Leave if the employee is unable to work, or “telework,”  due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable, due to a public health emergency.

This is much narrower than the qualifying reasons that would have been allowed in the version the House of Representatives passed on March 14, 2020.

How much FMLA Public Health Emergency Leave is an employee eligible to take and is the leave paid or unpaid?

Employees have the right take up to 12 weeks of job-protected Public Health Emergency Leave.  The initial 10 days of leave may consist of unpaid leave.  However, an employee may elect to substitute any accrued vacation leave, personal leave, or medical or sick leave for unpaid leave during the initial 10 days of leave.  The employee may also elect to substitute the two weeks of unpaid leave with the paid sick leave provided under the Emergency Paid Sick Leave Act, as further explained below.  This is different than the 14 day period that was provided in the March 14 version.

From the eleventh day of an employee’s Public Health Emergency Leave thereafter, the employer must provide paid leave in an amount not less than two-thirds of an employee’s “regular rate of pay” for the number of hours the employee would otherwise be normally scheduled to work during the leave time.  If the employee’s schedule has varying hours from week to week, the hours used for this calculation would be a number equal to the average number of hours that the employee was scheduled per day over the six-month period ending on the date which the employee takes the Public Health Emergency Leave, including hours used by the employee for leave of any type.  The Act appears to permit employees to supplement the two-thirds pay with their accrued leaves to achieve 100% of their regular rate of pay.

There is a cap on this paid portion of the Public Health Emergency Leave and will not exceed $200 per day and $10,000 total.

Are employees entitled to 12-weeks of FMLA Public Health Emergency Leave in addition to their existing 12-week leave entitlement under the FMLA?

Most likely, no.  The Act appears to merely add one other qualifying reason for an employee to take FMLA leave, i.e., to take care of a child during a school closure related to the coronavirus.  Therefore, if an employee has already used all or a portion of his/her 12-week entitlement of FMLA leave for another qualifying reason, then the employee is only entitled to use the remaining balance of his/her 12-week FMLA entitlement for a qualifying coronavirus-related reason.  Also, if the employee has already exhausted his/her 12-weeks of FMLA leave for another qualifying reason, he/she is not eligible to take any FMLA Public Health Emergency Leave.  Similarly, if an employee exhausts his/her 12-weeks of FMLA leave as FMLA Public Health Emergency Leave, the employee will be unable to take additional FMLA leave until he/she becomes eligible again for FMLA leave.

As we originally reported, this poses practical consequences for employees.  For example, longstanding employees who have exhausted their FMLA leave for a serious health condition may be ineligible for FMLA Public Health Emergency Leave, though they would be eligible for the Emergency Paid Sick Leave explained below, while newly hired employees with 31 days of employment would be eligible for a full 12 weeks of FMLA leave.  We will update our clients if additional clarification is issued regarding this matter.

What rights to reinstatement does an employee have after their FMLA Public Health Emergency Leave ends?

Employees have the same right to reinstatement as they would under the FMLA.  The only exception is for employers with less than 25 employees who can satisfy the following conditions:

  • The employee takes FMLA Public Health Emergency Leave;
  • The position held by the employee when the leave commenced does not exist due to economic conditions or other changes in operating conditions of the employer that affect employment and are caused by a public health emergency during a 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 such reasonable efforts of the employer fail, the employer makes reasonable efforts during the “contact period” to contact the employee if an equivalent position becomes available.

The “Contact Period” is defined as the 1-year period beginning on the earlier of: (1) the date one which the qualifying need related to the public health emergency concludes; or (2) the date that is 12 weeks after the date on which the employee’s FMLA Public Health Emergency Leave commences.

Does FMLA Public Health Emergency Leave run concurrently with leave under the California Family Rights Act (CFRA)?

While it is not entirely clear at this time,  FMLA Public Health Emergency Leave would probably not run concurrently with leave under the CFRA.  Although the original version of the Act included qualifying reasons that would have overlapped with CFRA, the only use of the Public Health Emergency FMLA is to care for a child because of a school closure.  This is not a qualifying condition under CFRA.

Emergency Paid Sick Leave

What types of employers are required to provide Emergency Paid Sick Leave?

Private sector employers with fewer than 500 employees and any government or public agency employer with one or more employees are required to provide Emergency Paid Sick Leave.

An employer of a health care provider or an emergency responder may elect to exclude such employees from the application of these new FMLA provisions.  However, there is no definition for “emergency responder.” Although it is not clear, “health care provider” may have the same meaning as in the FMLA.  (26 U.S.C. § 2611.)

Does an employee need to work for an employer for a certain period of time to become eligible for Emergency Paid Sick Leave?

No, an employee is eligible for Emergency Paid Sick Leave regardless of how long the employee has been employed by an employer.

Under what circumstances may an employee receive Emergency Paid Sick Leave and how much is the leave entitlement?

Employees are entitled to Emergency Paid Sick Leave at their regular rate of pay if they are unable to work or telework for the following reasons:

(1) The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.

(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.

(3) The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.

Employees are entitled to Emergency Paid Sick Leave at two-thirds of the employee’s regular rate of pay if they are unable to work or telework because:

(4) The employee is caring for an individual who is subject to a Federal, State, or local quarantine or isolation order related to COVID-19 or been advised by a health care provider to self-quarantine due to concerns related to COVID-19 order as described in subparagraph (1) or has been advised as described in paragraph (2).

(5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID-19 precautions.

(6) 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.

The Act appears to permit employees to supplement the two-thirds pay with their accrued leaves to achieve 100% of their regular rate of pay.

Paid Sick Leave Entitlement is subject to the following caps:

$511/Day and $5,110 in the Aggregate for the Following Employee-Related COVID-19 Absence Reasons

(1) The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.

(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.

(3) The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.

$200/Day and $2,000 in the Aggregate for the Following Reasons Related to the Employee Taking Leave to Care for an “Individual” or “Son or Daughter”

(4) The employee is caring for an individual who is subject to an order as described in subparagraph (1) or has been advised as described in paragraph (2).

(5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID-19 precautions.

(6) 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

Who is a Son or Daughter?

“Son or Daughter” has the same definition as it does under the FMLA, and means a biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis, who is—

(A)   under 18 years of age; or

(B)   18 years of age or older and incapable of self-care because of a mental or physical disability.

Who is an individual?

The term “individual” is not defined and seems to be more open ended than the narrow definitions for “family member” and “domestic partner” in the previous version of the Act.  It is possible this could be a friend, neighbor or other person with whom the employee does not otherwise have a family member relationship.  Employers could require employees to provide the type of relationship when they request an employee to certify the need for leave

Does Emergency Paid Sick Leave run concurrently with FMLA Public Health Emergency Leave?

Yes, if the employee has FMLA leave available, Emergency Paid Sick Leave would run concurrently with FMLA Public Health Emergency Leave.  However, if an employee does not have any available FMLA leave, then he/she would only be able to take Emergency Paid Sick Leave and, therefore, the leaves would not run concurrently.  Further, please note that Emergency Paid Sick Leave applies to all employees of a covered employer immediately and regardless of how long the employees have worked for the employer.  Therefore, employees become eligible for Emergency Paid Sick Leave before they become eligible for FMLA Public Health Emergency Leave, which requires the employee to have first worked for at least 30 calendar days.

How does Emergency Paid Sick Leave interact with existing paid leave policies?

The revised bill text took out the section that noted that this paid sick leave is in addition to any paid leave provided for by the employer and that an employer cannot change their paid leave policies following the enactment of the bill.  This could imply that if an employer already provides paid sick leave, it does not need to add 80 hours (assuming full-time) on top of such accruals.  It is also not clear from the Act’s language what happens if an employee has already used such 80 hours of paid sick leave before this law goes into effect. We are waiting for the Department of Labor to address the question of whether the use of Emergency Paid Sick Leave is a separate entitlement, which does not require employees to concurrently use their existing sick leave accruals.  If this is addressed in the Department of Labor regulations (which are supposed to be issued by April 2, 2020) we will update this policy.  For now, we believe that it is indeed a separate entitlement. 

An employee may choose to first use this Emergency Paid Sick Leave for the coronavirus-related uses noted above.  In addition, the Act suggests that because the first 10 days of FMLA Public Health Emergency Leave are by default “unpaid,” an employee can choose whether to use this Emergency Paid Sick Leave during that time or go unpaid.

Does Emergency Paid Sick Leave carry over from one year to the next?

No, any paid sick leave provided under this law does not carry over from one year to the next.

Do employers need to cash-out unused Emergency Paid Sick Leave at separation of employment?

No.  There is no obligation to cash-out or provide an employee with any unused Emergency Paid Sick Leave at the time of separation of employment.

In addition to the above provisions, the version of the Act that was signed into law includes an addition that requires the Secretary of Labor to issue regulations to exclude certain health care providers/emergency responders from the definition of “employee” under this Act, to exempt small businesses with less than 50 employees from the requirements to provide leave to care for son or daughter because school or childcare is closed, and to coordinate the implementation of this law with the provisions allowing tax credits for private employers.

Liebert Cassidy Whitmore is monitoring the changing information and laws regarding the coronavirus closely.  Please check https://www.lcwlegal.com/responding-to-COVID-19 for updates on this and other evolving matters related to COVID-19.

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