Families First Coronavirus Response Act (FFCRA)
The Families First Coronavirus Response Act (FFCRA) signed into law on March 18th provides for emergency and medical leave pay for employees affected in various ways by COVID-19. Highlights of FFCRA are shown below:
Paid Emergency and Medical Leave – Effective April 2, 2020
- Employers who employ more than 50 employees, but fewer than 500 employees are required to provide sick pay as follows:
- Two weeks (up to 80 hours) of paid sick leave at employee’s regular rate of pay if the employee is unable to work because the employee is quarantined and or experiencing COVID-19 symptoms and seeking a medical diagnosis.
- Two weeks (up to 80 hours) of paid sick leave at 2/3rds employee’s regular rate of pay if the employee is unable to work because the employee has a bona fide need to care for an individual subject to quarantine or to care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, or employee is experiencing COVID-19 symptoms and seeking a medical diagnosis.
- Up to an additional ten weeksof paid family leave at 2/3rds employee’sregular rate of pay if the employee, who has been employed for at least 30 calendar days, is unable to work because the employee has a bona fide need for leave to care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19.
- Employers are not required to pay an employee for first 10 days of COVID-19 leave. An employee may use paid leave during first 10 days.
- Employers who employ fewer than 50 employees may be exempted to provide leave due to school closings or childcare unavailability if paying sick leave would cause material financial harm to the business (e.g., causing the business to go bankrupt). Employers must submit good cause request to Department of Labor.
- Businesses to which the Act applies are eligible for tax credits to directly offset the cost of paid sick leave, subject to certain limitations.
- The credit is generally available for up to $200 in wages for each day an employee receives qualified family leave wages. A maximum of $10,000 in wages per employee is eligible for the credit.
- However, the employer’s gross income will be increased by the amount of the credit (meaning the credit is not taken into account for purposes of determining any amount allowable as a payroll tax deduction, deduction for qualified family leave wages, or deduction for health plan expenses).