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Essentials of the Families First Coronavirus Response Act

Staff Recommendation
Wednesday, March 25, 2020

The SESCO Staff continues to meet daily and discuss all developments of the Emergency Paid Family and Medical Leave. The following is most up-to-date Staff recommendation as of the date as noted above. We are in communication with The Department of Labor (“DOL”) attempting to obtain answers and clarification on a number of questions we have that were absence from the Families First Coronavirus Response Act (“FFCRA” or “Act”). As such, we will continue to update our valued clients as we learn more.

  • Employer coverage:Every private employer with fewer than 500 employees (determined at the time leave is taken), and all governmental employers regardless of size.
    -Whether separate entities will be deemed a single employer to determine employer coverage will be determined by the “joint employer” or “integrated employer” tests described in the Fair Labor Standards Act (FLSA) and/or Family and Medical Leave Act (FMLA).
  • Employer coverage exception:Per the FFCRA, the Secretary of Labor has authority to issue regulations that exclude small businesses with fewer than 50 employees each if the Act’s requirements would jeopardize the viability of the business as a going concern. We are still awaiting the DOL’s guidance on this exception.
  • Employee coverage:Full-time and part-time employees who have been employed with a covered employer for 30 calendar days or more.
  • Employee coverage exception:Per the FFCRA, the Secretary of Labor has authority to issue regulations that exclude certain healthcare providers and emergency responders from the definition of an eligible employee. Further, employers of healthcare providers and emergency responders may elect to exclude such employees from coverage. We are still awaiting the DOL’s definition of these terms and subsequent application.
  • Leave use:
    - When an “employee is unable to work (or telework) due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable,” because of COVID-19.

    - Note: “Child care provider” is defined as a provider who receives compensation for providing child care services on a regular basis.
  • Leave allowance:Employers are required to provide up to 12 weeks of job-protected paid FMLA leave for COVID-19 (albeit the first 10 days may be unpaid).
  • Pay rate:The first 10 days can be unpaid. (See below for an explanation of optional use of paid leave during the first 10 days.) The remaining time must be paid at not less than two-thirds (2/3rds) of the employee’s regular rate of pay (as defined by the FLSA) for the number of hours the employee would otherwise be normally scheduled to work. There are special rules for calculating the hours for those employees that have variable weekly schedules.
  • Pay amount/cap:Up to $200 per day and $10,000 in the aggregate (per employee).
  • Optional use of other paid leave during the first 10 days:During the first 10 unpaid days of FMLA leave for COVID-19, employees may use accrued personal, vacation or medical or sick leave. However, employees may not be required to do so.
  • Paid leave after the first 10 days:After the first 10 days, employers must compensate employees in an amount that is not less than two-thirds (2/3rds) of the employee’s regular rate of pay for the remainder of the 12-week period.
  • Tax Credit:There is a tax credit for employers for amounts required to be paid as family and medical leave under the FFCRA. The amount of the credit is equal to 100 percent of the “qualified family leave wages” that the employer is required to pay for the applicable quarter. The dollar-for-dollar credit results in $200 per employee for any day (or portion thereof) for which the employer pays the employee qualified family leave wages, up to a maximum aggregate amount for all calendar quarters of $10,000 per employee. The credit is taken on the employer’s quarterly Social Security tax remittance and is refundable where the credit exceeds employment taxes owed.
  • Job restoration:Protection similar to regular FMLA leave (i.e., employees generally must be returned to the same or an equivalent position upon return to work).
  • Job restoration exception:For employers of fewer than 25 employees, in the event the position has been eliminated due to the pandemic and the employer (1) makes “reasonable efforts” to restore the employee to an equivalent position with equivalent pay, benefits, etc.; and (2) if such efforts fail, notifies the affected employee if an equivalent position later becomes available during the defined “contact period.”
    The “contact period” is defined as “the 1-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.”
  • Effective date:“Not later than 15 days after the date of enactment” (i.e., effective beginning April 1, 2020), expiring Dec. 31, 2020.


Emergency Paid Sick Leave

  • Employer coverage:Every private employer with fewer than 500 employees, and all governmental employers regardless of size.
    ​
  • Employer coverage exception:Per the FFCRA, the Secretary of Labor has authority to issue regulations that exclude small businesses with fewer than 50 employees each if the act’s requirements would jeopardize the viability of the business as a going concern. SESCO is awaiting DOL guidance on this exception.
  • Employee coverage:All current part-time and full-time employees of a covered employer (i.e., no matter how long employed).
  • Employee coverage exception:Employers of healthcare providers and emergency responders may elect to exclude such employees from coverage. SESCO is awaiting DOL guidance on the definitions of Healthcare providers and emergency responders.
  • Leave use:
  1. Quarantine – to comply with a federal, state or local quarantine or isolation order related to COVID-19. Full pay.
  2. Self-Quarantine – to self-quarantine, if the employee has been advised to do so by a local healthcare provider. Full Pay.
  3. Diagnosis – to obtain a medical diagnosis if the employee is experiencing symptoms of COVID-19. Full Pay.
  4. Care for a Quarantined Individual – to care for an individual required to be quarantined or advised to be quarantined. Two Thirds Pay (2/3rds)
  5. ​Child Care – to care for an employee’s son or daughter if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable,” because of COVID-19 precautions. Two Thirds Pay (2/3rds)

    Note: “Child care provider” is not defined in the act.
  6. Substantially Similar Care – to care for an employee’s substantially similar condition, as specified by the Secretary of Health and Human Services. Two Thirds pay (2/3rds)
  • Full-time employee leave allowance:Employers are required to provide 80 hours of paid sick leave for full-time employees. Pay is based on the employee’s regular rate as averaged over the previous six (6) month period.
  • Part-time employee leave allowance:Employers are required to provide a total number of hours of paid sick time equal to the number of hours the part-time employee works, on average, over a two-week period. Or, put another way, the equivalent of two weeks of hours for part-time employees.
  • Carryover:Not allowed from year to year.
  • Unused Leave Cash-out: Not required upon separation.
  • Leave sequencing:Employees may use the paid FFCRA sick leave first, before the use of other available leave. Also, an employer cannot require an employee to use other accrued, unused paid leave before the use of FFCRA paid sick leave.
  • Pay rate:Paid at the employee’s regular rate of pay (as defined by the FLSA) or the applicable federal FLSA minimum wage or state or local minimum wage, whichever is greater.
  • Pay amount/cap:

    - For Items 1, 2 and 3 above – full pay at the rate described above, up to $511 per day and $5,110 in the aggregate (per employee).
    - For Items 4, 5 and 6 above – two-thirds (2/3rds) pay at the rate described above, up to $200 per day and $2,000 in the aggregate (per employee).
  • Tax Credit:There is a tax credit for employers for “qualified sick leave wages” that the employer is required to pay for a given quarter. This amount,in turn, varies depending upon the reason for the leave and is consistent with the amounts listed in the bullet above.

    - For Items 1, 2 and 3 – the amount of qualified sick leave wages taken into account for the tax credit is capped at $511 per employee per day, $5,110 (10 days) in the aggregate.
    - For Items 4, 5 and 6 – the amount of qualified sick leave wages taken into account for the tax credit is capped at $200 per employee per day, $2,000 (10 days) in the aggregate.

    The credit is taken on the employer’s quarterly Social Security tax remittance and is refundable where the credit exceeds employment taxes owed.
  • Notice:Employers will be required to post a notice informing employees of their right to leave. A model notice will be provided by the Department of Labor.
  • State law:Does not pre-empt existing state or local paid sick leave entitlements.
  • Effective date:“Not later than 15 days after the date of enactment” (i.e., effective beginning April 1, 2020), expiring Dec. 31, 2020.


An important point for employers is that paid leave as outlined above is not available if employees are unable to work solely due to business decisions and/or operational closures. Rather, employees are eligible for paid leave only if they meet the specific criteria outlined above. This, however, is likely to be a heavily litigated issue, depending on the particular factual circumstances at issue.

Each covered employer must post a notice of the FFCRA requirements in a conspicuous place on its premises. An employer may satisfy this requirement by emailing or direct mailing this notice to employees or posting this notice on an employee information internal or external website. The notice can be accessed on SESCO’s website by clicking HERE

SESCO retainer client and select association members can contact SESCO consultants and attorneys at no charge to discuss any COVID-19 or any labor and employment law matter. For businesses who are not retainer clients, contact SESCO to explore our monthly service agreement program providing professional support services via a fixed fee.