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Paid Sick Leave and Emergency Paid Sick Leave Act

Last Updated 4.24.2020 @ 11:05 am

DISCLAIMER: The following information is a guide, not intended to be used as legal advice, and no attorney client relationship is established by any communication through this website.  Because every situation and every workplace is different we ask that you contact us with specific questions. 

Emergency Paid Sick Leave Act

What: Requires Employers with fewer than 500 employees and government employers to provide all employees upon hire two weeks of paid sick leave, paid at the employee’s regular rate.

Effective date: The bill becomes effective April 1, 2020 and terminates on December 31, 2020.

Reasons for Sick Leave:

  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 because of COVID-19;
  3. The employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis;
  4. The employee is caring for an individual subject or advised to quarantine or isolation;
  5. The employee is caring for a son or daughter whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 precautions; or
  6. The employee is experiencing substantially similar conditions as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.

Sick Pay:

  • Full-time employees are entitled to 2 weeks (80 hours) of usual pay.
  • Part-time employees are entitled to the typical number of hours that they work in a typical two-week period.

Limits of Sick Pay:

  • Limits paid leave to $511 per day and $5,110 in total where leave is taken for an employee’s illness or quarantine reasons (1), (2), and (3) noted above.
  • Limited to $200 per day and $2,000 in total where leave is taken for care for others and school closure reasons (4), (5), or (6).
  • Employees are paid at two-thirds the employee’s regular rate to care for a family member for such purposes or to care for a child whose school has closed, or childcare provider is unavailable, due to the coronavirus.

Requirement to use paid time off: An employer may not require an employee to use other paid leave provided by the employer to the employee before the employee uses the paid sick time.  Cannot require employee to take paid time off and/or Paid sick leave at the same time as Emergency Paid Sick Leave.  If not taking Emergency Paid Sick leave the first two weeks, you can mandate they take either PTO or paid sick leave but not both.

Carryover: These benefits shall not carry over from 1 year to the next.

Exemptions:

  • An employer may exclude employees who are health care providers or emergency responders from this coverage.
    • A health care provider is anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions.
      • This definition includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities institutions to provide services or to maintain the operation of the facility.
      • This also includes anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments.
      • This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is a health care provider necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.
        • To minimize the spread of the virus associated with COVID-19, the Department encourages employers to be judicious when using this definition to exempt health care providers from the provisions of the FFCRA.
    • An emergency responder is an employee who is necessary for the provision of transport, care, health care, comfort, and nutrition of such patients, or whose services are otherwise needed to limit the spread of COVID-19.
      • This includes but is not limited to military or national guard, law enforcement officers, correctional institution personnel, fire fighters, emergency medical services personnel, physicians, nurses, public health personnel, emergency medical technicians, paramedics, emergency management personnel, 911 operators, public works personnel, and persons with skills or training in operating specialized equipment or other skills needed to provide aid in a declared emergency as well as individuals who work for such facilities employing these individuals and whose work is necessary to maintain the operation of the facility.
      • This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is a health care provider necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.
      • To minimize the spread of the virus associated with COVID-19, the Department encourages employers to be judicious when using this definition to exempt health care providers from the provisions of the FFCRA.
  • The bill also grants the Secretary of Labor the authority to issue regulations to exclude certain health care providers and emergency responders from the definition of employee.
  • Small businesses with fewer than 50 employees are also exempt from these requirements if they jeopardize the viability of a business as a going concern.
    • An employer, including a religious or nonprofit organization, with fewer than 50 employees, is exempt from providing emergency paid sick leave due to school or place of care closures or child care provider unavailability for COVID-19 related reasons when doing so would jeopardize the viability of the small business as a going concern. A small business may claim this exemption if an authorized officer of the business has determined that:
      • The provision of paid sick leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
      • The absence of the employee or employees requesting paid sick leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
      • There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
      • DOL indicates that school closures/child care reasons for FFCRA leave are the ONLY reasons for which this exemption is available if one of the above criteria are met.
      • Smaller businesses with fewer than 50 employees – even those who can claim this exemption – are NOT exempt from providing EPSL for reasons #1, 2, 3, 4 and 6 for EPSL).

Retaliation: The bill prohibits retaliating against any employee who takes leave under the new law.

Penalties: The bill further provides that the failure to pay required sick leave will be treated as a failure to pay minimum wages in violation of the Fair Labor Standards Act.

Tax Credits: A refundable tax credit for employers equal to 100 percent of qualified family leave wages required to be paid by the qualified leave that are paid by an employer for each calendar quarter is available.

  • The tax credit is allowed against the tax imposed by section 3111(a) (the employer portion of Social Security taxes).
  • The amount of qualified family leave wages taken into account for each employee is capped at $200 per day and $10,000 for all calendar quarters.
  • If the credit exceeds the employer’s total liability under section 3111(a) for all employees for any calendar quarter, the excess credit is refundable to the employer.

A refundable tax credit equal to 100 percent of a qualified family leave equivalent amount for eligible self-employed individuals.

  • The credit is allowed against income taxes and is refundable.
  • Eligible self-employed individuals are individuals who would be entitled to receive paid leave pursuant to the Emergency Family and Medical Leave Expansion Act if the individual was the employee of an employer (i.e., not self-employed).
  • The qualified family leave equivalent amount is capped at the lesser $200 per day or the average daily self-employment income for the taxable year per day.

Employer Reimbursement

  • Employers receive 100% reimbursement for paid leave pursuant to the Act.
  • Health insurance costs are also included in the credit.
  • Employers face no payroll tax liability.
  • Self-employed individuals receive an equivalent credit.

When employers pay their employees, they are required to withhold from their employees’ paychecks federal income taxes and the employees’ share of Social Security and Medicare taxes. The employers then are required to deposit these federal taxes, along with their share of Social Security and Medicare taxes, with the IRS and file quarterly payroll tax returns (Form 941 series) with the IRS.

Under guidance that will be released next week, eligible employers who pay qualifying sick or childcare leave will be able to retain an amount of the payroll taxes equal to the amount of qualifying sick and childcare leave that they paid, rather than deposit them with the IRS. The payroll taxes that are available for retention include:

  • withheld federal income taxes,
  • the employee share of Social Security and Medicare taxes,
  • the employer share of Social Security and Medicare taxes with respect to all employees.
  • If there are not sufficient payroll taxes to cover the cost of qualified sick and childcare paid leave, employers will be able file a request for an accelerated payment from the IRS. The IRS expects to process these requests in two weeks or less. The details of this new, expedited procedure will be announced next week.

Non-Enforcement Period: The DOL has announced it will not sue employers for violation of the FFCRA through April 17, 2020, provided that the employer has made “reasonable, good faith efforts to comply with the Act.” An employer acts “reasonably” and “in good faith” when:

  1. the employer remedies any violations, including by making all affected employees whole as soon as practicable. 
  2. The violations of the Act were not “willful.”  (i.e. whether the employer either knew or showed reckless disregard for the matter of whether its conduct was prohibited…”)
  3. The Department receives a written commitment from the employer to comply with the FFCRA in the future.

The department will retain its right to exercise its enforcement  and make the violated parties whole if an employer willfully violate the act, fails to provide written commitment to comply with the FFCRA in the future, or fails to remedy the violation.

The FFCRA also requires employers post a workplace poster notifying employees of their rights under the FFCRA in a conspicuous place on the employer’s premises. But what about employees who are working from home? The Department of Labor has made clear employers can meet this requirement by emailing or direct mailing the poster to those employees or posting it on an employee information internal or external website. In a FAQ, the DOL explained employer are not obligated to share the notice with laid-off workers or new applicants, but it must do so for new hires.

  • Under this policy, Labor will not bring an enforcement action against any employer for violations of the Act so long as the employer has acted reasonably and in good faith to comply with the Act.
  • Labor will instead focus on compliance assistance during the 30-day period.

 

FAQ


Q: To calculate usual pay, do I include overtime?
A: Yes. When calculating an employee’s pay under the Emergency Family and Medical Leave Expansion Act, you are required to pay an employee for the hours the employee would have been normally scheduled to work even if that is more than 40 hours in a week. However, under the Emergency Paid Sick Leave Act an employer is required to pay only up to 80 hours over a two week-period.

Q: Will the EFMLEA and Emergency Paid Sick Leave be retroactive if the individual was negatively affected prior to April 1st?
A: No. Based on the plain language of the act itself, it is not retroactive. Before the law is effective, employers could encourage or enforce employees to take a portion of accrued paid time while they are off work. Employers will need to be compliant by April 1, 2020.

Q: Is 10 days (for unpaid leave) counted by consecutive days meaning weekends too, or days worked?
A: Under traditional FMLA, many employers know employees can have intermittent leave and reduced schedules. The same might be true here, but is not discussed in the new law, we are hoping for clarification from the Secretary of Labor.

Q: How far back do we use to calculate “usual pay”?
A: Six (6) months average. If an employee has a varied weekly schedule, or if an employee typically works overtime, the employer must calculate the average number of hours per day over a six-month period, with the ending date the date the employee takes such leave.

Q: Does the Emergency Paid Sick Leave Act apply if the employee is currently laid off due to COVID-19?
A: No. An employee must be qualified due to a reason. Under the FMLA extension, if an employee is unable to work or telework for a qualifying reason, i.e. due to care of a minor child, they would be eligible for benefits. Under the emergency paid sick leave act there are six qualifying reasons. Neither act nor current legislation mentions furlough / temporary layoff or termination during this period, but those employees would not be eligible for these benefits with the current statute. The Secretary of Labor could provide guidance otherwise on any day.

Q: We laid employees off due to lack of work as a result of declining business operations. One of the employees we laid off, is also a single-mom home with a child in elementary school which is closed. Do we retract the layoff and pay her under the new legislation?
A: If the employer called back employees from lay off, and the employee fell under qualifying reasons under either act, the employee is eligible for such benefits. Employers do not have to retract your employees from layoff under this act.

Q: If I am a small business with fewer than 50 employees, am I exempt from the requirements to provide paid sick leave?
A: A small business is exempt from certain paid sick leave and expanded family and medical leave requirements if providing an employee such leave would jeopardize the viability of the business as a going concern. This means a small business is exempt from mandated paid sick leave or expanded family and medical leave requirements only if the:

  • employer employs fewer than 50 employees;
  • leave is requested because the child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and
  • an authorized officer of the business has determined that at least one of the three conditions described in below is satisfied.
    • The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
    • The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
    • There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.

Q: Who is a “health care provider” who may be excluded by their employer from paid sick leave?
A: For the purposes of employees who may be exempted from paid sick leave by their employer under the FFCRA, a health care provider is anyone employed at:

  • any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions.
  • This definition includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities’ institutions to provide services or to maintain the operation of the facility.
  • This also includes anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments.
  • This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is a health care provider necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.
    • To minimize the spread of the virus associated with COVID-19, the Department encourages employers to be judicious when using this definition to exempt health care providers from the provisions of the FFCRA.

Q: Who is an emergency responder?
A: For the purposes of employees who may be excluded from paid sick leave by their employer under the FFCRA, an emergency responder is an employee who is necessary for the provision of transport, care, health care, comfort, and nutrition of such patients, or whose services are otherwise needed to limit the spread of COVID-19.

  • This includes but is not limited to military or national guard, law enforcement officers, correctional institution personnel, fire fighters, emergency medical services personnel, physicians, nurses, public health personnel, emergency medical technicians, paramedics, emergency management personnel, 911 operators, public works personnel, and persons with skills or training in operating specialized equipment or other skills needed to provide aid in a declared emergency as well as individuals who work for such facilities employing these individuals and whose work is necessary to maintain the operation of the facility.
  • This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is an emergency responder necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.
    • To minimize the spread of the virus associated with COVID-19, the Department encourages employers to be judicious when using this definition to exempt emergency responders from the provisions of the FFCRA.

Q: If I am an employer, may I use the paid sick leave mandated under the EPSLA to satisfy paid leave entitlements that an employee may have under my paid leave policy?
A: No, unless your employee agrees. Paid sick leave under the EPSLA is in addition to your employee’s (including Federal Employees’) other leave entitlements. You may not require your employee to use provided or accrued paid vacation, personal, medical, or sick leave before the paid sick leave. You also may not require your employee to use such existing leave concurrently with the paid sick leave under the EPSLA. But if you and your employee agree, your employee may use preexisting leave entitlements to supplement the amount he or she receives from paid sick leave, up to the employee’s normal earnings. Note, however, that you are not entitled to a tax credit for any paid sick leave that is not required to be paid or exceeds the limits set forth under the EPSLA. You are free to amend your own policies to the extent consistent with applicable law.

Q: What records do I need to keep when my employee takes paid sick leave?
A: Regardless of whether you grant or deny a request for paid sick leave, you must document the following:

  • The name of your employee requesting leave;
  • The date(s) for which leave is requested;
  • The reason for leave; and
  • A statement from the employee that he or she is unable to work because of the reason.

If your employee requests leave because he or she is subject to a quarantine or isolation order or to care for an individual subject to such an order, you should additionally document the name of the government entity that issued the order. If your employee requests leave to self-quarantine based on the advice of a health care provider or to care for an individual who is self-quarantining based on such advice, you should additionally document the name of the health care provider who gave advice.

If your employee requests leave to care for his or her child whose school or place of care is closed, or child care provider is unavailable, you may must also document:

  • The name of the child being cared for;
  • The name of the school, place of care, or child care provider that has closed or become unavailable; and
  • A statement from the employee that no other suitable person is available to care for the child.

Private sector employers that provide paid sick leave required by the FFCRA are eligible for reimbursement of the costs of that leave through refundable tax credits. If you intend to claim a tax credit under the FFCRA for your payment of the sick leave or expanded family and medical leave wages, you should retain appropriate documentation in your records. You should consult Internal Revenue Service (IRS) applicable forms, instructions, and information for the procedures that must be followed to claim a tax credit, including any needed substantiation to be retained to support the credit. You are not required to provide leave if materials sufficient to support the applicable tax credit have not been provided.

Q: If an employer closes the worksite while an employee is on paid sick leave, what happens?
A: If an employer closes while an employee is on paid sick leave, the employer must pay for any paid sick leave used before the employer closed. As of the date the employer closes the worksite, the employee is no longer entitled to paid sick leave, but may be eligible for unemployment insurance benefits. This is true whether the employer closes your worksite for lack of business or because the employer was required to close pursuant to a Federal, State or local directive.

Q: Can an employee use employer’s preexisting leave entitlements and emergency paid sick leave and expanded family and medical leave concurrently for the same hours?
A: During the first two weeks of unpaid expanded family and medical leave, employees may not simultaneously take paid sick leave under the EPSLA and preexisting paid leave, unless the employer agrees to allow them to supplement the amount received from paid sick leave with preexisting paid leave, up to their normal earnings. After the first two workweeks (usually 10 workdays) of expanded family and medical leave under the EFMLEA, however, employees may elect—or be required by the employer—to take the remaining expanded family and medical leave at the same time as any existing paid leave that, under the employer’s policies, would be available to the employee in that circumstance. This would likely include personal leave or paid time off, but not medical or sick leave if the employee is not ill.

If employees are required to take existing leave concurrently with remaining expanded family and medical leave, the employer must pay the full amount to which the employee is entitled under the existing paid leave policy for the period of leave taken. If the employee exhausts preexisting paid leave and is still entitled to additional expanded family and medical leave, the employer must pay at least 2/3 of employee pay for subsequent periods of expanded family and medical leave taken, up to $200 per workday and $10,000 in the aggregate, for expanded family and medical leave.

Q: If I am an employer, may I require my employee to take paid leave he or she may have under my existing paid leave policy concurrently with expanded family and medical leave under the EFMLEA?
A: Yes. After the first two workweeks (usually 10 workdays) of expanded family and medical leave under the EFMLEA, you may require that your employee take concurrently for the same hours expanded family and medical leave and existing leave that, under your policies, would be available to the employee in that circumstance. This would likely include personal leave or paid time off, but not medical or sick leave if your employee (or a covered family member) is not ill.

If you do so, you must pay your employee the full amount to which he or she is entitled under your existing paid leave policy for the period of leave taken. You must pay your employee at least 2/3 of his or her pay for subsequent periods of expanded family and medical leave taken, up to $200 per workday and $10,000 in the aggregate, for expanded family and medical leave. If your employee exhausts all preexisting paid vacation, personal, medical, or sick leave, you would need to pay your employee at least 2/3 of his or her pay for subsequent periods of expanded family and medical leave taken, up to $200 per day and $10,000 in the aggregate. You are free to amend your own policies to the extent consistent with applicable law.

 

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