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COVID-19 Update: Sick Leave Relief Act Passed

By Net Assets posted 03-19-2020 09:56 AM

  
The information below is accurate as of press time. However, as the situation surrounding COVID-19 continues to evolve, it's possible that some data have changed since publication. Additionally, this information is provided for general educational purposes only. It should not be relied upon as, or in place of, legal or other professional advice. Readers are encouraged to stay informed through news and recommendations for their own communities and also work with their schools’ trusted counsel and partners when addressing specific issues.
The Frequently Asked Questions below were last updated on April 6, 2020, to reflect additional guidance from the U.S. Department of Labor. 

(from NBOA) Late on Wednesday, March 18, 2020, the federal government passed the Families First Coronavirus Response Act, ensuring free testing and paid leave for certain workers.

The following provision applies to all employers, regardless of size:

  • Health insurance is required to cover testing for COVID-19 in full, and the testing cost will not apply to a deductible.

The following provisions apply to organizations with fewer than 500 employees, including independent schools. Employers with fewer than 50 employees can apply for an exemption if they believe payment of sick leave will cause their business to fail:

  • Any employee who is under quarantine by federal, state, or local officials; is advised to quarantine by their health care professional due to concerns about COVID-19; is experiencing symptoms of COVID-19 and is seeking a medical diagnosis; is caring for someone who is under quarantine by federal, state, or local officials or by their health care professional due to concerns about COVID-19 OR is required to stay home because they are caring for a child whose school or daycare has closed due to COVID-19 precautions must be provided up to 80 hours of paid sick leave by their employer for the first two weeks of absence from employment. Workers taking leave for themselves must be paid at least their normal wage, capped at $511/day and $5,110 total. Workers taking time off to care for family members must be paid at 2/3 the employee’s normal wage, capped at $200/day and $2,000 total. This wage is not subject to social security payroll tax. Accrued time off cannot be substituted for this wage, and employers cannot require employees to find their own shift coverage for this time.
  • Any employee who has worked for the employer for at least 30 calendar days who is required to stay home because they are caring for a child whose school or daycare has closed must be provided Family Medical Leave in the form of job protection and paid no less than 2/3 of their regular salary for up to 10 weeks after an initial unpaid 2 week period (this period may be paid through accrued time off if the employee wishes or through the emergency sick leave mandated by the same bill). This wage is not subject to social security payroll tax. 
  • Schools can recoup this cost through a refundable tax credit equal to 100% of qualified leave wages under the bill capped at $200/day and $10,000/quarter, per employee for Family Medical Leave. That works out to $25/day for 400 hours/quarter. The tax credit is not reliant upon taxability of the employer, so it does apply to schools.

The Act has some notable gaps, including the following:

  • The Act does not provide a guarantee that treatment for COVID-19 will be covered in full by health insurers.
  • The Act does not provide paid leave for employees taking time off to care for themselves related to COVID-19 after the initial two week period.  Unpaid FMLA may still apply.
  • It also does not cover people whose jobs have been lost due to COVID-19. They are being funneled into the unemployment system, which was provided more money by this act to support the anticipated spike in claims.
  • Employers can elect to exclude certain health care providers and emergency responders from eligibility for either Sick Leave or Family Medical Leave.
  • Finally, it does not provide direct payments to employees, so schools are on the hook for the monetary outlay until they file quarterly taxes and recoup the costs.

Frequently Asked Questions

  1. The law goes into effect April 1. What do we do about leave until then?
    Follow the policy you already have in place until April 1 if at all possible. If you opt to change that policy and begin offering this leave early, you will not be reimbursed for any wages paid for leave which started prior to April 1, and employees will still be eligible for all leave available to them under this law after April 1.
  2. Once the law goes into effect can an employee take the two weeks of Emergency Sick Leave before any accumulated PTO?
    Yes. Employers are required to provide the two weeks of paid sick leave prior to asking employees to exhaust their PTO.
  3. Can the Emergency Sick Leave be taken in daily or hourly increments, or must it be taken for a full two weeks?
    The Emergency Sick Leave provides a maximum of 80 hours taken over two weeks.  Teleworking employees may take this time in partial day increments with the employer’s agreement. Non-teleworking employees can only take intermittent leave for the care of a child whose daycare or school has closed, if the school permits it, in full-day increments. Teleworking employees may take partial days of Emergency Sick Leave for any of the qualifying reasons, if the school agrees. Employees who no longer have a qualifying reason for taking Emergency Sick Leave before they exhaust their sick leave may take any remaining Emergency Sick Leave at a later time, until December 31, 2020, if another qualifying reason occurs. Employees who wish to take intermittent leave under the Paid Family Leave may do so.
  4. What does "quarantine by federal, state or local officials" mean? If for example our city or state issues a "shelter in place" order, is that quarantine?
    Quarantine in this instance means that a person is reasonably believed to either have the virus or have been exposed to the virus, so a professional health official has asked them to quarantine themselves away from other people or they are under an order from a government official to remain at home. In this case, shelter in place orders would apply.
  1. What does it mean to be “unable to work”? What if I offer telework to the employee?
    Employees taking leave under this Act must actually be taking leave from scheduled work hours and duties. If a school closes its physical campus either voluntarily or due to a shelter in place order and does not have telework available for an employee, the employee is ineligible for this leave because there is no work for the employee. If an employee is out on this leave when the school shuts down the operations from which the employee is taking leave, the employee is no longer eligible for leave.  Employees may not take this leave when no work is available to them.
  2. If there is no work available for an employee, can they take leave under the FFCRA?
    Employees taking leave under this Act must actually be taking leave from scheduled work hours and duties. If a school closes its physical campus and does not have telework available for an employee, the employee is ineligible for this leave. If an employee is out on this leave when the school shuts down the operations from which the employee is taking leave, the employee is no longer eligible for leave.  Employees may not take this leave when no work is available to them.
  3. Can an employee supplement the Emergency Sick Leave or Paid Family Leave offered by this act with unemployment insurance?
    Employees may not file for unemployment if they are on paid leave from the school.
  4. How do I calculate the regular rate of pay for part-time employees under the FFCRA?
    The regular rate of pay for a part-time employee is calculated as the greater of: the regular rate of pay for the hours the employee has been scheduled to work over the last two weeks, the federal minimum wage, or the applicable state or local minimum wage. If a non-exempt employee is regularly scheduled to work more than 40 hours per week, for the purposes of the Paid Family Leave only, the employee’s regular weekly pay includes the overtime regularly scheduled. If the employee is part-time and works variable hours, the employee’s regular weekly rate of pay is calculated as the average weekly wage paid over the previous six months. All rates are subject to the established wage cap.
  5. How many weeks of paid leave are employees eligible to take when the reason for leave is to care for a child whose daycare or school has closed for reasons related to COVID-19?
    Employees who are taking time to care for a child whose daycare or school has closed for reasons related to COVID-19 are covered by both Emergency Sick Leave and Paid Family Leave and employees are eligible for a maximum of 12 paid weeks of leave under the act. An employee may choose, but is not required, to take Emergency Sick Leave during the first two weeks of unpaid family leave. If an employee chooses not use Emergency Sick Leave during those two weeks, an employee may take Emergency Sick Leave for two weeks, two weeks of unpaid family leave, and another 10 weeks of Paid Family Leave. Employees may opt to take accrued time off from the employer for the unpaid 2 weeks of family leave.
  6. Can an employee who has already exhausted their FMLA take leave under this act?
    All employees are eligible for the two weeks of Emergency Sick Leave, regardless of any prior usage of FMLA. However, employees who previously able to take leave under FMLA can only take a maximum of 12 weeks of FMLA leave in a twelve month period and are only eligible for Paid Family Leave for any weeks remaining as of April 1st.  For example, an employee who has taken 12 weeks of leave within the last year would be eligible for only Emergency Sick Leave, but no Paid Family Leave.  An employee who has taken 8 weeks of leave within the last year would be eligible for the 2 weeks of Emergency Sick Leave and 4 weeks of Paid Family Leave if they meet eligibility requirements.
  7. Can I supplement an employee’s leave under Paid Family Leave with accrued paid leave if they are not receiving 100% of their wage?
    Yes, any leave taken under Paid Family Leave can be supplemented with accrued paid leave at the employer’s discretion if the employee requests it. Any supplemental wages are not recoupable by the school through tax credits.
  8. What sort of records do I need to request and keep when employees take this leave?
    You must require your employee to provide you with appropriate documentation in support of the reason for the leave, including: the employee’s name, qualifying reason for requesting leave, documentation of the reason for the leave (such as a quarantine or isolation order or the name the health care provider under whose advice the employee is self-quarantining), statement that the employee is unable to work, including telework, for that reason, and the date(s) for which leave is requested. If you intend to claim a tax credit under the FFCRA for your payment of the sick leave wages, you should retain this documentation in your records.

    If one of your employees takes Paid Family Leave, you must require your employee to provide you with appropriate documentation in support of such leave, just as you would for conventional FMLA leave requests, such as the medical certification form. This requirement also applies when the first two weeks of unpaid leave run concurrently with paid sick leave taken for the same reason. If you intend to claim a tax credit under the FFCRA for the expanded family and medical leave, you should retain this documentation in your records.

    You should consult IRS applicable forms, instructions, and information for the procedures that must be followed to claim your tax credit, including any needed substantiation to be retained to support the credit.

Further Information
Families First Coronavirus Response Act
DOL FAQsPoster and Poster FAQs
DOL Employer Paid Leave Requirements
DOL Employee Paid Leave Rights

IRS Tax Credits for Small, Midsize Businesses
Guidance from NAIS, Venable and Liebert Cassidy Whitmore.

NBOA members with questions or concerns are welcome to contact Jennifer Osland Hillen, vice president of professional development and business affairs at jennifer.hillen@nboa.org.

#RegulatoryUpdates
#Pandemic

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Comments

04-06-2020 03:34 PM

Thank you very much, Donna, for your comment. NBOA's director, human resources programs, @Amber Stockham, has conferred with NBOA's legal counsel, Grace H. Lee, and updated the guidance, particularly questions 4 and 6. A shelter in place order is considered a legitimate reason to stay home and may impact an employee's ability to take FFCRA leave.

04-03-2020 12:46 PM

Does the info in the Q&A need to be updated?  I received this from an accounting firm...

Important Update to The Families First Coronavirus Response Act (FFCRA)

Providing FFCRA Paid Sick Leave if Under a State-Ordered Stay-at-Home Order

Released: April 2, 2020

The Department of Labor (DOL) late yesterday published a 124-page clarification document relating to The Families First Coronavirus Response Act (FFCRA) that went into effect April 1st.

Clarification for one of the most confusing reasons (#1 – Is subject to a Federal/State or local quarantine or isolation order related to COVID-19) was addressed in this update. The DOL notes that this qualifying reason relating to quarantine or isolation orders includes a broad range of governmental orders, including orders that advise some or all citizens to shelter in place, stay at home, quarantine, or otherwise restrict their own mobility.

The DOL also clarifies that employees may take paid sick leave under Reason #1 ONLY if being subject to one of these orders prevents them from working or teleworking based on the examples below. The question to ask in applying the rule is whether the employee would be able to work or telework “but for” being required to comply with a quarantine or isolation order.