This Wednesday, April 1, 2020 The Families First Coronavirus Relief Act becomes effective. This legislation, provides, in part, for Emergency Paid Sick Leave and Expanded Family Medical Leave in response to COVID-19. Through earlier transmissions we have provided a summary and guidance as to those components of the Act. As the effective date draws near, employers need a defined plan. Additional guidance to the FFCRA may help struggling employers make appropriate decisions to preserve the viability of their businesses now and into the foreseeable future.
If an employer is required to close due to a government mandated shutdown or because of a corresponding lack of work, the Emergency Sick Pay and/or Expanded Family Medical Leave provisions may not apply.
Employers that are forced to close after the FFCRA’s effective date will not be required to pay emergency sick leave or expanded family beyond the date of closure even where the employee requested leave prior to closure. The employer must pay eligible employees benefits under the FFCRA for Emergency Paid Sick Leave and Expanded Family Medical Leave up to the date of closure, but if the employer closes while an employee is receiving emergency paid sick leave or expanded family, the employer must only pay for emergency paid sick leave or expanded family medical leave used before the employer closed. As of the date the employer closes, benefits for emergency paid sick leave or expanded family medical leave cease.
The same concept applies for furlough. If an employer furloughs its employees because it does not have enough work, employees are not eligible for emergency paid sick leave or expanded family medical leave. Even if an employer closes its worksite for a short period of time, employees are not entitled to take emergency paid sick leave or expanded family medical leave.
Reduced work hours have a similar effect. If an employer cuts hours because it does not have work for its employees to perform, employees are not eligible for paid sick leave or expanded family medical leave for the hours that are no longer scheduled to work.
These provisions are designed to provide some measure of relief to employers, particularly those that have continued to pay employees through this difficult time. They are designed to coordinate additional state and federal benefit packages. They are designed to help employees witness continued income protection during the COVID-19 crisis.
Where benefits under the FFCRA are suspended, employees may find eligibility for unemployment insurance benefits. Employees should be encouraged to contact State workforce agency or State unemployment insurance offices for specific questions about eligibility. Payments of leave benefits under the FFCRA and/or the employer’s internal leave policies may impact eligibility or the start date of Unemployment Benefits. The new CARES Stimulus package includes augmented Unemployment Compensation relief for employees, providing, in many cases, full wage relief. We will provide a summary update of the impact of the stimulus package in the near future.
In the interim, employers need to familiarize themselves with these provisions of FFCRA and develop a strategic plan for business and employee retention. Although, the FFCRA guidance provides relief even after the April 1, 2020 start date, employers should move swiftly to organize a strategic plan. Whether shutdown and layoff is imminent and now unavoidable or ongoing business is available and employee retention is required, employers will need a documented plan of address to preserve tax relief opportunities and mitigate liability exposure.
If you have questions, please do not hesitate to contact one of the attorneys in our Employment Practice Group at 1-888-488-2638.