03/20/2020
New Federal Paid Sick Leave Program
The Act requires employers with fewer than 500 employees to provide 80 hours (or two weeks) of fully-paid leave to full-time employees (and pro-rata for part-time) on top of any existing paid leave program of the employer to cover employees not working for the following reasons:
• The employee has been asked to quarantine;
• The employee is experiencing symptoms that could be COVID-19;
• The employee is caring for an individual in one of these circumstances;
• The employee has to care for a child due to school closure; or,
• The employee is experiencing a condition designated by the U.S. Department of Health and Human Services Secretary as being a qualifying event.
The Act establishes caps such that payments could not exceed $2,000 or $5,110 (depending upon which qualifying event prompts the employee’s leave).
The U.S. Department of Labor (DOL) has the authority to exempt small businesses with fewer than 50 employees.
Expansion of FMLA
The Act requires employers with fewer than 500 employees to provide up to 12 weeks of leave (the last 10 being paid) to cover employees not working because the employee is caring for a child because the school is closed or child care provider is unavailable due to a public health emergency. The payment would be two-thirds (2/3) of wages, but not to exceed $200 per day or $10,000 in aggregate.
The DOL has the authority to waive the requirement for certain employers, including those with fewer than 50 employees.
Employer Tax Credit for Paid Sick Leave and FMLA Expansion
The Act establishes a refundable tax credit to reimburse employers for the costs associated with the paid sick leave and FMLA expansion provisions of the Act. The tax credits will be administered by the Internal Revenue Service and creditable against employer-side payroll tax liability, with any excess refunded by the employer.
Refundable tax credits are also available to self-employed workers facing the same employment interruptions and the provision expires at the end of 2020.
