Families First Coronavirus Response Act

The Families First Coronavirus Response Act (the "Act") was passed to respond to COVID19 employment-related issues. It is intended to provide employees paid leave from work, yet alleviate the financial burdens this causes the employer. To accomplish these objectives, the Act provides:

1. Extended and expanded protections under the Family Medical Leave Act's ("FMLA") jobprotections for certain COVID-19-childcare-related absences. This includes requiring the employer to pay FMLA leave benefits;
2. New paid sick leave benefits for certain COVID-19-related absences;
3. Employer tax credits to defray the costs of paying these benefits; and
4. Grants to eligible states to further fund their unemployment trust fund accounts.

The Act is in effect from April 2, 2020 through December 31, 2020. This memorandum covers the provisions applicable to private employers and employees. It does not cover public employees, or employees working under a collective bargaining agreement.

1. Specifically what does the Act do?

The Emergency Family and Medical Leave Expansion Act portion of the Act amends the FMLA that went into effect in 1993. This amendment allows eligible employee to use FMLA leave for COVID-19-childcare-related-absences.
Here are the highlights:

A. The Act applies solely to employers with less than 500 employees ("Covered Employer"), and employees working for at least 30 days for a Covered Employer. ("Eligible 2 Employee") The Department of Labor is authorized to exclude employers with fewer than 50 employees, if a hardship exemption applies.

B. An Eligible Employee may take up to 12 weeks of job-protected FMLA leave where he/she is unable to work or telework because of a need for leave to care for a minor child if the child's school or place of care has been closed, or the child-care provider is unavailable, because of a COVID-19- coronavirus-declared public health emergency

C. The first 10 days of expanded-FMLA leave is unpaid. However, an Eligible Employee may replace accrued but unused vacation, personal leave, or sick leave for the unpaid leave. At the same time, a Covered Employer may not require such replacement.

D. Then, after the first 10 days of expanded-FMLA leave ends, a Covered Employer must pay the Eligible Employee not less than two-thirds of the Eligible Employee's regular rate of pay for each day of amended-FMLA leave taken. This is capped at $200.00 per day, and $10,000.00 in the aggregate per employee.

E. This is, generally-speaking, job-protected leave. An Eligible Employee taking leave Under the Act does not have greater rights to continued employment than an employee not on leave. And, there are additional limitations to job-protection rights for employees working
at an employer with fewer than 25 employees.

2. What paid sick leave benefits does the Act provide to an employee?

In addition to amending the FMLA, the Act adds the Emergency Paid Sick Leave Act. ("EPSLA"). EPSLA is similar to, but different than the amended FMLA:

A. Similar to the expanded FMLA, the EPSLA applies to the same Covered Employer, and may also exclude employers with fewer than 50 employees, if a hardship exemption applies.

B. With some exceptions, all full-time employees (as opposed to only Eligible Employees under the amended-FMLA), regardless of their length of employment, are entitled to 80 hours paid sick leave immediately. Part-time employees receive a pro-rated amount.

C. The new sick leave amounts are cumulative to, but not in lieu of, other statutorily-provided or employer-provided paid sick leave benefits. Also, a Covered Employer must permit employees to use COVID-19-related sick leave before taking other sick leave.

D. These amounts cannot be carried over into the new year.

E. These amounts are not paid out at termination.

F. Employees may use this sick leave where they cannot work or telework because (the
numbered paragraphs below are intentionally used):
1. They are subject to a federal, state, or local quarantine or isolation order related to COVID-19;
2. The employee has been advised by a health care provider to self-quarantine due to COVID-19-related fears;
3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
4. The employee is caring for someone who is subject to a quarantine or isolation order or who has been advised to self-quarantine;
5. The employee is caring for a child if the child's school or place of care is closed or the child-care provider is unavailable because of COVID-19 precautions; or
6. The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of Treasury and the Secretary of Labor.

G. Generally, the Covered Employer must pay the employee up to two weeks (80 hours, or a part-time employee's two-week equivalent) of paid sick leave based on the higher of their regular rate of pay, or the applicable state or federal minimum wage, paid at:

(i) 100% for qualifying reasons in Paragraph F, 1-3, above, up to $511.00 daily and $5,110.00 total;
(ii) 2/3 for qualifying reasons in Paragraph F, #4 and #6 above, up to $200.00 daily and
$2,000.00 total; and
(iii) up to 12 weeks of paid sick leave and expanded family and
medical leave paid at 2/3 for qualifying reason Paragraph F, #5, above, up to $200.00 daily and $12,000.00 total.

H. Employers must post a notice related to this section in a conspicuous place in the workplace. The poster can be found at:

3. How does the Act assist a Covered Employer?

The Act provides a refundable tax credit equal to 100% percent of qualified paid leave benefits paid by an employer subject to certain caps and offset against social security taxes paid by the employer.

4. What is the small business hardship exemption?

Small businesses with fewer than 50 employees will be eligible for an exemption from the leave requirements relating to school closings or child care unavailability where the requirements would jeopardize the ability of the business to continue. The exemption will be available on the basis of simple and clear criteria that make it available in circumstances involving jeopardy to the viability of an employer's business as a going concern. Labor will provide emergency guidance and rulemaking to clearly articulate this standard

5. Is unemployment insurance protected? Expanded?

The Act expanded unemployment insurance. It's Emergency Unemployment Insurance Stabilization and Access Act ("EUISAA"). The EUISAA sets out requirements for emergency administrative grants to states, and authorizes emergency flexibility allowing states to temporarily modify certain aspects of their unemployment compensation ("UC") laws, a short-term waiver of interest on state trust fund advances, and full federal funding during extended benefit periods through December 31, 2020.

The EUISAA will provide support to state unemployment compensation programs beginning 60 days after enactment, if states make required unemployment compensation program changes, such as:

A. Requiring employers to notify employees of unemployment compensation availability at the time of their separation;
B. Waiving work requirements;
C. Waiving the waiting week; and
D. Not charging employers directly impacted by the COVID-19 outbreak due to an illness in the workplace or direction from public health officials to isolate or quarantine workers.

In Michigan, Governor Whitmer made the required immediate changes to its UC system, and signed Executive Order 2020-10, whose goal is to give workers affected by COVID-19 unemployment greater access to UC. The order was made effective immediately and remains in effect until continuing until April 14, 2020 at 11:59 pm. It temporarily expands UC to

A. Workers sick, quarantined, or immunocompromised, and without access to paid family and medical leave or are laid off.
B. Workers with unanticipated family care responsibility, including those who have childcare responsibilities due to school closures, or those who are forced to care for loved ones who become ill and who do not have access to paid family and medical leave or are laid off
C. Individuals working in the public health community who become ill or are quarantined due to exposure to COVID-19 and who do not have access to paid family and medical leave or are laid off.
The Executive Order extends access to benefits for unemployed workers:
A. Benefits will be increased from 20 to 26 weeks.
B. The application eligibility period will be increased from 14 to 28 days.
C. The in-person registration and work search requirements will be suspended.
The Governor's Order also assisted employers. An employer must not be charged for unemployment benefits if its employees become unemployed because of an executive order requiring them to close or limit operations. That would include the recently issued Executive Order

If you have questions or comments, please call Michael B. Rizik Jr., the Rizik & Rizik law firm,
9400 South Saginaw Street, Ste E, Grand Blanc, MI 48439. Cell: 810-610-2673.