COVID Resources

Families First Coronavirus Response Act (FFCRA)

Families First Coronavirus Response Act (FFCRA)

On Wednesday, March 18, 2020, the U.S. Senate passed the House version of the FFCRA and President Trump signed the bill a few hours later.  Its paid leave provisions are effective on April 1, 2020, and apply to leave taken between April 1, 2020, and December 31, 2020.

Main Provisions

The FFCRA contains the Emergency Paid Sick Leave Act (EPSLA), the Emergency Family and Medical Leave Expansion Act (EFMLEA), and other provisions related to healthcare costs, government food programs, and emergency funding for government agencies. 

The primary goal of the EPSLA and the EFMLEA is to ensure employees who are unable to work (or telework) are paid for time off related to COVID-19 and small employers are reimbursed with tax credits to offset the cost of providing the required benefits. 

Employees or self-employed individuals who are able to work (or telework) during this time are not affected by the required paid time off or the related tax credits.

Emergency Paid Sick Leave Act (EPSLA)

The major provisions of EPSLA are itemized below:

  • Requires employers to provide 10 days (up to 80 hours) of paid sick leave when the employee cannot work (or telework) for the following reasons related to COVID-19:
    1. Government quarantine or isolation order
    2. Self-quarantine advised by a health care provider
    3. Symptoms of COVID-19 and seeking medical diagnosis
    4. Caring for another individual with symptoms or under quarantine
    5. Caring for a son or daughter if schools are closed or childcare provider is unavailable
    6. All other conditions that may be substantially similar to the above
  • Applies to employers with less than 500 employees
  • Applies to all employees, full and part time, no matter how long they have been employed
  • Part-time employees will receive a pro-rated benefit
  • The pay rate for employees under conditions #1 to 3 above is the employees’ regular pay rate, not to exceed $511 per day or $5,110 for 10 days.
  • The pay rate for employees under conditions #4 and 5 (to care for others) above is 2/3 of the regular pay rate, not to exceed $200 per day or $2,000 for 10 days.
  • The paid leave under EPSLA is in addition to any sick leave benefits already provided by the employer.  Employers may not require an employee to use other employer provided paid leave first.  Employers are not prohibited from modifying existing policies.
  • Employers are entitled to a refundable payroll tax credit equal to 100% of the wages paid.

Emergency Family and Medical Leave Expansion Act (EFMLEA)

The major provisions of EFMLEA are itemized below:

  • Requires employers to provide up to 12 weeks of job protected paid leave when the employee cannot work (or telework) because they are caring for a son or daughter under 18 years old if schools are closed or childcare provider is unavailable due to a public health emergency.
  • Applies to employers with less than 500 employees.
  • Applies to employees with at least 30 days of service
  • The first 10 days of leave may be unpaid, or may be paid under existing paid time off policies, or under the EPSLA described earlier.
  • After 10 days (weeks 2 through 12), the pay rate is 2/3 of the regular pay rate, not to exceed $200 per day or $10,000 total for 50 days.
  • Employers over 50 employees may already be subject to FMLA, which may apply in situations where EFMLEA does not (for reasons other than caring for a child due to school closure)
  • Employers are entitled to a refundable payroll tax credit equal to 100% of the wages paid.

Additional Information

Self-employed individuals are eligible for a tax credit that is intended to provide an equivalent benefit as they would have received if they were an eligible employee.

Certain health care providers, emergency responders, and small businesses with less than 50 employees may be excluded or exempted from certain provisions of both the EPSLA and the EFMLEA.  It is unclear exactly how the Department of Labor may exempt small employers, but the Act says “when the imposition of such requirements would jeopardize the viability of the business as a going concern.” 

Neither the required paid time off nor the tax credit provisions apply to employers with more than 500 employees.  However, there may be other relevant state or federal laws that may apply to large organizations, such as FMLA.

Each employer should consider these new provisions to determine the obligations to employees and eligibility for payroll tax credits.   Please contact your advisor at Dent Moses if you would like to discuss how these provisions apply to your business.