COVID-19 Relief Bill Impacts Employers
By Matthew McLaughlin, McLaughlin PC
On March 19, President Trump signed into law the Families First Coronavirus Response Act (“FFCRA”) which will provide the first wave of relief to employees impacted by COVID-19. There is more legislation to come that will provide other types of relief to the general public, but this bill specifically gives your employees some financial resources while also placing obligations on you as an employer.
Here is what the FFCRA does:
First, this only applies to employers with fewer than 500 employees and employers’ obligations are effective 15 days from today (March 19, 2020) and expire on December 31, 2020.
Emergency Paid Sick Leave
Employers are required to provide up to 80 hours of paid sick leave to full-time employees regardless of how long the employee has been employed. Part-time employees are only entitled to receive the number of hours they have worked on average over a two-week period.
These benefits are only available to employees who cannot work for reasons related to the Coronavirus and must be related to one of the following:
The employee is subject to a federal, state or local quarantine order related to COVID-19;
The employee has been advised by a health care provider to quarantine for COVID-19 concerns;
The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
The employee is caring for an individual who is subject to an order as described in number 1 or has been advised by a health care provider as described in number 2;
The employee is caring for a son or daughter if the child’s school or place of care has been closed or the child’s provider is unavailable due to COVID-19 precautions;
The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.
Employees who need to care for themselves based on numbers 1-3 above may receive their full regular rate of pay for the number of hours they would have worked per day. Employers are allowed to cap this amount at $511 per day ($5,110 aggregate) per employee. Employees who need to care for others based on numbers 4-6 above are entitled to only 2/3 of their regular pay and employers can cap this at $200 per day ($2,000 aggregate) per employee.
Employers must provide these benefits in addition to any existing paid leave benefits that the employee is subject to already. Employees may access the emergency relief provided in the FFCRA before using any other available leave benefits the employer offers.
Emergency Family Medical Leave Expansion
The FFCRA also expands the Family Medical Leave Act (FMLA) to provide leave for employees with childcare needs. This covers all employers with 500 or fewer employees, including those with 50 or fewer employees. However, the Secretary of Labor has the discretion to exempt employers with fewer than 50 employees, but the extent of that discretion is unknown. Additionally, this only applies to employees who have worked for 30 days or more.
This applies to employees who are not able to work (or telework) due to a need for leave to care for the employee’s child (under 18) if the child’s school or childcare center is closed due to a public health emergency.
Employers are allowed to provide the first 10 days of this leave without pay, though employees may voluntarily elect to use their emergency paid sick leave addressed above during the first 10 days of the leave. Employers are prohibited from requiring employees to use existing paid leave during this time period. After the first 10 days, the employer must provide additional paid leave to the employee for the remaining 10 weeks but only at two-thirds of the employee’s regular rate. The amount is capped at $200 per day ($10,000 aggregate) per employee.
Employer Tax Credits
To compensate employers for this obligation, the FFCRA provides a refundable tax credit to employers for 100% of the qualified sick leave wages or family leave wages paid to their employees subject to the above-noted limits.
Department of Transportation
The U.S. Department of Transportation’s Federal Motor Carrier Safety Administration (FMCSA) issued a national emergency declaration to provide hours-of-service regulatory relief to commercial vehicle drivers transporting emergency relief in response to the nationwide coronavirus (COVID-19) outbreak. This declaration is the first time FMCSA has issued nation-wide relief. FMCSA’s declaration provides regulatory relief for commercial motor vehicle operations providing direct assistance supporting emergency relief efforts intended to meet immediate needs for:
Medical supplies and equipment related to the testing, diagnosis and treatment of COVID-19
Supplies and equipment, including masks, gloves, hand sanitizer, soap and disinfectants, necessary for healthcare worker, patient and community safety, sanitation, and prevention of COVID-19 spread in communities.
Food for emergency restocking of stores.
Equipment, supplies and persons necessary for establishment and management of temporary housing and quarantine facilities related to COVID-19.
Persons designated by Federal, State or local authorities for transport for medical, isolation or quarantine purposes.
Personnel to provide medical or other emergency services.
IRS Extends Filing Deadline to July 15
The Treasury Department and Internal Revenue Service announced March 20 that the federal income tax filing due date is automatically extended from April 15, 2020, to July 15, 2020.
Taxpayers can also defer federal income tax payments due on April 15, 2020, to July 15, 2020, without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax.
Export-Import Bank (EXIM)
The Export-Import Bank of the United States (EXIM) announced relief measures for U.S. exporters and financial institutions due to the anticipated effects of the coronavirus outbreak. EXIM is offering relief measures, including waivers, deadline extensions, streamlined processing, and flexibility, to its customers for an initial period of 30 days (with the possibility of a further extension of the period, at EXIM’s discretion) for the following programs:
Working Capital Guarantee Program
Multi-Buyer and Single-Buyer Short-Term Insurance Program
Medium-Term Single-Buyer Insurance Policies Issued to Exporters
To read complete details regarding the relief provisions and contact information for specific EXIM program representatives, click here