Late Wednesday, the Senate passed the final version of the House of Representatives COVID-19 relief bill without amendment, which President Trump signed into law. The Families First Coronavirus Response Act (“FFCRA”) includes several provisions. Our alert focuses on leave and benefit mandates.
Emergency Paid Sick Leave requires private employers with less than 500 employees (and public employers of any size) to provide temporary paid sick leave to full-time and part-time employees (with no minimum length of employment requirement). This applies to employees who are unable to (tele)work due to circumstances related to COVID-19, such as caring for themselves or others. This leave must be given in addition to any existing employer-provided leave. Employers cannot reduce existing leave policies in response to this law.
Emergency Family Medical Leave Expansion temporarily expands FMLA to provide leave for childcare due to COVID-19 issues only. It’s important to remember that FMLA as we know it (without regard to these rules) is still in play. This law did not replace it. This law subjects more employers to the temporary expansion because it applies to employers with less than 500 employees, including employers with less than 50 employees (who are not currently subject to existing FMLA requirements). However, employers with less than 50 employees may be exempt based on future guidance. Also, this law does not affect FMLA’s existing health benefit provisions.
A Tax credit is available to employers via payroll tax for providing the above-stated leaves as applicable, subject to limits and exceptions. Increased credits may be available for employers’ costs to maintain group health plan coverage during these leave periods.
COVID-19: Employment Law Implications & Response Strategies
Note: This webinar was recorded 3/18/2020, before the FFCRA was passed into law.
Health plan mandates apply to all individual and group plans for coverage of certain COVID-19 related expenses.
Next Steps: The law provides us with information to discern basic requirements, but we need additional guidance (typically in the form of regulations) to determine how to implement the mandates. Due to the short timeframe employers have to be in compliance, we recommend the following action items in the meantime:
- Consider the potential cost for required paid leave for budgeting and other purposes, as well as expected tax credits
- Update FMLA policies and procedures to accommodate the expansion. Reminder that existing FMLA terms do not change!
- Coordinate health plan coverage changes with the insurer/TPA
- Stay up-to-date on new developments as changes are occurring rapidly
Our bulletin below provides a summary of the four above-discussed provisions within the new law. The law is subject to regulatory or court interpretation, and portions of it may be amended (potentially to help small employers) as part of the Senate’s consideration of the “phase 3” relief package (the White House’s $850 Billion stimulus bill).
The law will be effective 15 days from enactment (presumably April 2) and expires on December 31, 2020.
If you have questions or need help, please contact one of our benefit consultants.