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The Families First Coronavirus Response Act




On March 18, 2020, the U.S. Congress and the President of the United States enacted THE FAMILIES FIRST CORONAVIRUS RESPONSE ACT as a part of an assistance package amid the current health emergency of COVID-19. The Act will be effective from April 1, 2020 until December 31, 2020, and requires employer-paid leave for workers who need to take time-off from work due to events caused by the outbreak of COVID-19. The Act applies to private sector and certain public sector employers with less than 500 employees.


Employees' Paid Leave Entitlement and Duration

1. Paid Sick Leave: a two-week period, up to 80 hours of paid sick leave based on the higher of the regular pay rate, or the applicable state or federal minimum wage:

* 100% pay if employee meets qualifying reasons 1 to 3 (see list of qualifying reasons below), up to $511 daily and $5,110 total

* two-thirds of pay if employee meets qualifying reasons 4 and 6 (see list of qualifying reasons below), up to $200 daily and $2,000 total


2. Paid Family and Medical Leave: up to an additional 12 weeks of paid sick leave based on the higher of the regular pay rate, or the applicable state or federal minimum wage:

* two-thirds of pay if employee meets qualifying reason 5 (see qualifying reasons below), up to $200 daily and $12,000 total



Qualifying Reasons for Leave Realted to COVID-19

An employee is entitled to take leave if the employee is unable to work, including telework, if the employee:

  1. is subject to a federal, state, or local quarantine or isolation order related to COVID-19 

  2. has been advised by a health care provider to self-quarantine related to COVID-19

  3. is experiencing COVID-19 symptoms and is seeking a medical diagnosis

  4. is caring for an individual subject to an order described in (1), or self-quarantine as described in (2), related to COVID-19.

  5. is taking care of a child whose school or place of care is closed due to COVID-19

  6. is experiencing any other substantial condition specified by the Secretary of Health and Human Services

Small businesses with less than 50 employees may qualify for the exemption from the requirement to provide licenses due to school closings or unavailability of childcare, if the requirements for the license affect the viability of the business.



Compliance

Requirements are subject to a 30-day non-enforcement period in good faith compliance efforts.

To take immediate advantage of the paid leave credit, businesses can retain and access funds that they would otherwise pay to the IRS in payroll taxes.

If those amounts are not sufficient to cover the cost of paid leave, employers can seek and expedited advance from the IRS by submitting a streamline claim form that will be released soon.



Employer Reimbursement

Covered employers qualify for a "dollar-for-dollar reimbursement" through a tax offset against payroll taxes. Where a refund is owed, the IRS will send the refund as quickly as possible.



Prohibitions

Employers may not discharge, discipline, or discriminate against any employee who takes paid sick leave and files a complaint or institutes a proceeding under or related to the FFCRA.



We encourage you to visit our blog and several links mentioned below that are helpful to understand the Act's provisions.


At Carbonell and Co., LLP, we are committed to provide assistance and guidance to our clients and their families in these crucial and trying times. Should you have any questions or comments, please do not hesitate to contact us.


Stay safe and healthy!



References

https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Federal.pdf

https://www.dol.gov/newsroom/releases/whd/whd20200324

https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

https://www.irs.gov/newsroom/treasury-irs-and-labor-announce-plan-to-implement-coronavirus-related-paid-leave-for-workers-and-tax-credits-for-small-and-midsize-businesses-to-swiftly-recover-the-cost-of-providing-coronavirus

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