COVID-19

HIGHLIGHTS OF FAMILIES FIRST ACT

Many US States don't have required paid leave.  The Families First Act added federal paid leave to keep money in employee's pockets while away from work for specified COVID-related reasons.  

  • Effective for paid leave 4/1/20 to 12/31/20

  • Applies to business with fewer than 500 employees. Businesses with less than 50 employess can apply for hardship waiver

  • Employers required to post appropriate notices. SAMPLE: https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf

  • There are penalties for interfering with employee's rights

  • Can't ask employees to prove diagnosis (don't want to overwhelm the medical system in getting these)

  • Requirements are subject to a 30-day non-enforcement period if you are operating in good faith

  • None of this supersedes or takes away any employee rights under state law, collective bargaining agreements, or emploiyer's own policy.

  • Recommend setting up separate COVID-pay items in your payroll system so these wages can be easily identified

  • U.S. Department of Labor Q&A  https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

EMERGENCY PAID SICK LEAVE

Employers required to provide ADDITIONAL 2 weeks (10 days) paid sick leave to employees (regardless of duration of employment) unable to work due to COVID-19 (government quarantine/isolation order, self-quarantine advised by a professional, experiencing symptoms & seeking diagnosis)

Benefit

Cannot exceed $511/day, $5,100/employee

Full time employees: 80 hours

 

Part time employees: typical number of hours performed in a 2-week period

Payroll Tax Credit

Payroll tax credit for 100% of sick leave

Credit covers compensation paid in those 10 days only.

Credit is capped at $511/day/employee

EMERGENCY PAID FAMILY & MEDICAL LEAVE

Employers required to pay 2/3 of wages for employees (who have been on payroll for at least 30 days) who unable to work due to caring for individual who is quarantined or at home due to school or daycare closures.

Benefit

Up to $200/day (capped at $10,000/employee)

First 10 days may be unpaid (but employee can use other paid benefits during this time).

Employers cannot require employess to find a replacement worker.

 

Employers cannot require employess to use other sick leave before this time.

Payroll Tax Credit

Payroll tax credit for 100% of family leave

Credit is capped at $200/day, $10,000 max / employee

 

 

Credit also include emplyer's qualified health expenses relating to such FMLA compensation

Employers don't receive a credit if they are also receiving the credit for paid family and medical leave in §45S

Payroll tax credits are refundable.

If payroll credits would be refundable and paying the payroll tax would shut your company down, you can apply for an actual cash benefit .

CARES ACT UPDATE:

ADVANCED REFUND OF CREDITS FOR PAID SICK LEAVE & PAID FAMILY LEAVE

  • The CARES Act provides for advance refunding of those credits.

  • IRS will waive applicable penalties for employers who don't deposit applicable payroll taxes in anticipation of receiving the credit

 

Form 7200, Advance Payment of Employer Credits due to COVID-19

Instructions for Form 7200