What Employers Need to Know About U.S. House Bill 6201: Families First Coronavirus Response Act

Wednesday afternoon, the Senate passed the Families First Coronavirus Response Act, and President Trump signed it into law. The act contains several provisions that will significantly impact employers with fewer than 500 employees.

If this applies to you, your obligations become effective no later than April 2, 2020 – 15 days from the date of enactment – and will automatically expire on December 31, 2020. Within seven days (by March 25, 2020), you are required to post a notice informing your employees of their rights under this new law.

Obviously, no one has a crystal ball on how all of this will play out. What we can tell you is what the law says.

Here is a summary of select provisions of the bill that entitles qualified employees to job-protected paid sick leave and extended leave to care for children.

Family & Medical Leave Act Expansion

  • Employers with fewer than 500 employees will provide 12 weeks of potentially job-protected (see exception below) paid FMLA leave. The first 10 days may be paid by other relief (see below).
  • You do not have to provide this leave for healthcare providers (as that term is defined by the FMLA) or emergency responders.
  • During the first 10 days of this leave, your employees may use accrued personal or sick leave (including Emergency Paid Sick Leave under the new regulation outlined below), but you cannot require employees to do so.
  • To qualify for this expanded leave benefit, an employee must have been working for at least 30 calendar days. There is no minimum number of hours worked required.
  • This leave applies only for employees to care for a child whose school or daycare has been closed, or whose childcare provider is not available, as a result of the COVID-19 pandemic.
  • Leave is not available if employees are able to telework, but whether an employee is “able” to do so will undoubtedly be subject to debate (i.e., if the employer provides remote work capabilities but the employee’s children are at home).
  • The first 10 days are generally unpaid (but see the Emergency Paid Sick Leave requirement of 10 days of paid sick leave below).
      • After the first 10 days, you must compensate employees in an amount that is not less than two-thirds of the employee’s regular rate of pay for the remaining time of protected leave.
      • These pay requirements apply to only the COVID-19-related leave reasons listed above.
  • Employees are entitled to pay not to exceed two-thirds of the employee’s regular pay rate, not to exceed $200 per day or $10,000 total.
  • The U.S. Secretary of Labor may develop regulations to exempt small businesses (fewer than 50 employees) when the imposition of the new requirements would jeopardize the business as a going concern. Note that the normal FMLA exemption of employees who work at a site with fewer than 50 employees within a 75-mile radius does not apply here.

Restoration to Position

  • Employers with 25 or more employees must generally return employees to the same or substantially equivalent position under existing FMLA rules.
  • Employers with fewer than 25 employees are not required to return the employee to work if:
    • The position held by the employee when the leave commenced does not exist due to economic conditions or other changes in operating conditions that affect employment and are caused by a public health emergency during the period of leave.
    • You (the employer) make a reasonable effort to restore the employee to a position equivalent to the position the employee held when leave commenced with equivalent benefits, pay and other terms and conditions of employment.
    • If your reasonable efforts fail, you make reasonable efforts to contact the employee if an equivalent position described above becomes available. This “contact period” remains in effect for a one-year period beginning on the earlier of: (a) the date on which the qualifying need related to a public health emergency concludes; or (b) the date that is 12 weeks after the date on which the employee’s leave commences.
  • The provisions are expected to go into effect on April 2, 2020, and they will expire on December 31, 2020.

Emergency Paid Sick Leave

  • Employers with fewer than 500 employees and government employers will be required to provide full-time employees with 10 days (80 hours) of paid sick leave for specific circumstances related to COVID-19, including:
      • Responding to quarantine requirements or recommendations;
      • Experiencing COVID-19 symptoms and seeking medical diagnosis;
      • Caring for family members who are responding to quarantine requirements or recommendations; and
      • Caring for children whose school or daycare is closed, or whose childcare provider is not otherwise available, due to COVID-19.
  • Part-time employees get paid sick leave equal to the number of hours they work, on a daily average, over the last six months (or if they have not been employed that long, based on the number of hours they would have reasonably expected to work).
  • Immediate use: Paid sick time is available for immediate use regardless of length of employment.
  • Rate of pay:
    • For absences related to the employee’s own condition, sick pay is the greater of the employee’s regular rate of pay or the applicable minimum wage, not to exceed $511 per day or $5,110 total.
    • For absences to care for others, sick pay is the greater of two-thirds of the employee’s regular rate or the applicable minimum wage, not to exceed $200 per day or $2,000 total.
  • You (employers) must post a notice informing employees of their rights to leave. The DOL will be creating a required posting.
  • The law expressly provides that it does not preempt existing state or local paid sick leave entitlements. Also, this paid sick time is in addition to time available under an employer’s existing policies.
  • The provisions will go into effect on April 2, 2020, and will expire on December 31, 2020.
  • A violation of the law is a minimum wage violation under the FLSA.

Collective Bargaining Agreements

  • Employers with employees subject to collective bargaining agreements may be able to fulfill their obligations to fund paid sick leave by contributing to an applicable multi-employer fund, so long as the employees subject to the agreement are able to secure pay from the fund consistent with hours worked under the collective bargaining agreement.

Employer Tax Credit

  • You will receive a refundable tax credit against your share of Social Security taxes equal to 100% of qualified paid sick leave wages paid for each calendar quarter under the Emergency Paid Sick Leave Act or the FMLA Expansion.

We will continue to provide guidance and updates on the status of these emergency measures as they rapidly evolve over the coming weeks.ages paid for each calendar quarter under the Emergency Paid Sick Leave Act or the FMLA Expansion.

It is important to note the proposed bill is not the final word on whether, when or how laws may change or how an employer’s obligations under these new regulations might change. There may be significant revisions to the current version of the bill or new regulations altogether, including new tax provisions, additional response measures, or new industry-specific relief provisions issued over the next several weeks.

We will continue to provide guidance and updates on the status of these emergency measures as they rapidly evolve over the coming weeks.

Home for the Virus Days? How to Keep Your Workers Away from the Office to Address COVID-19 ConcernsWith companies try to keep employees safe but still conduct business while the coronavirus flattens out, employers should be mindful of their obligations to employees while working off-site.

Non-exempt Hourly Employees

Even if working remotely, pay non-exempt employees for all time worked. If your hourly employees are answering emails or calls, they need to record that time and you need to pay them for it. If you are requiring them to be available (so you have restricted their time), they need to be paid for that time. Employers should be vigilant in requiring accurate reporting of time even though their workers won’t be at the facility punching a clock.

If hourly employees choose to use PTO, be consistent in how you apply your policy. If you decide to allow for sick leave bank sharing or other additional paid leave during a virus shutdown, make sure all similarly situated employees are treated the same.

Salaried Employees (Exempt and Non-exempt)

Remember that you cannot deduct pay from an exempt employee’s weekly salary if they perform any work during that week. If they work even an hour, they are entitled to their full weekly salary. If you have non-exempt, salaried employees, your obligations for overtime still apply even if they are working remotely.

Employees with Contracts

If you have a collective bargaining agreement, make sure you consider those obligations when you are making these decisions. Watch out for any employees who have unique employment contracts. They may be entitled to pay regardless of having to work from home. Re-read their contracts, and make sure you both are on the same page.

Extra Shifts 

If you have employees pulling extra shifts due to absences from other workers, keep an eye on your overtime. Also be sure they are accurately recording their time and not just “helping out” off the clock. While bonuses for those extra shifts are not required, gift cards or a pizza party will always be appreciated.

Watch the News

Keep up with any updates or restrictions from the CDC. Your best ally against rumors and suspicion is accurate information.

Child Care

If schools and day cares close, some employees may ask for assistance with child care.  There is no federally mandated obligation for an employer to provide separate child care.  Day cares are highly regulated entities, so an employer can’t just hire some babysitters and open a temporary day care in the basement. Even a temporary stipend to assist with the cost of child care may not solve the problem since most day cares close when schools shut down anyway. The best advice is to have an open and honest dialogue with your employees about these types of collateral issues and work toward a consistent approach that applies to everyone.

New York Bans Inquiry into Salary HistoryNew York is now the latest state to ban all employers from asking about a job applicant’s salary and wage history. The law, which went into effect on January 6, 2020, expands the reach of anti-discrimination laws in New York state. At least 12 other states similarly ban such questions or otherwise regulate the use of salary history in the hiring process: Alabama, California, Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, New Jersey, Oregon, Vermont, and Washington. Additionally, Colorado’s new law prohibiting salary history inquiries goes into effect on January 1, 2021. This New York law is another example of states prohibiting both private and public employers from asking certain things on job applications. We previously wrote about the Ban the Box movement here and here.

Basics of New York’s Law

The New York law applies to all public and private employers in New York state. But, the law does not apply when a company is engaging an independent contractor, only to companies considering applicants and employees seeking full-time, part-time or temporary/seasonal employment. It specifically prohibits employers from doing the following:

  • Relying on the wage or salary history of an applicant in determining whether to offer employment to or in determining the wages or salary for that person;
  • Seeking, requesting, or requiring the wage or salary history from an applicant or current employee as a condition for the individual (1) to be interviewed, (2) to continue to be considered for an offer of employment, or (3) to be employed or promoted;
  • Seeking, requesting, or requiring the wage or salary history of an applicant or current employee from just about anyone (i.e., current or former employer, current or former employee, or agent of the individual’s current or former employer);
  • Refusing to interview, hire, promote, otherwise employ, or otherwise retaliate against an applicant or current employee based upon prior wage or salary history;
  • Refusing to interview, hire, promote, otherwise employ, or otherwise retaliate against an applicant or current employee because such applicant or current employee did not provide wage or salary history in accordance with this section;
  • Refusing to interview, hire, promote, otherwise employ, or otherwise retaliate against an applicant or current or former employee because the applicant or current or former employee filed a complaint with the department alleging a violation of the law.

It’s important to note that an applicant or current employee may voluntarily – and without prompting – disclose or verify wage or salary history. (Cautious employers will carefully document such unprompted disclosures.) Additionally, an employer may confirm salary history after an offer of compensation is made and the applicant responds to the offer by providing prior salary history to negotiate for a higher wage.

Stay Tuned

Now more than ever employers must stay on top of state laws and city ordinances to make sure they are abiding by the current laws in their jurisdiction(s). More and more states are jumping on this bandwagon, and laws prohibiting questions during the application and interview process are no longer unusual. Employers who have been used to doing things a certain way now may need to change their practices to ensure compliance.