The Families First Coronavirus Response Act (FFCRA) provides paid leave for employees who are adversely impacted in certain specified ways by COVID-19. Two components of the FFCRA important for Indiana employers are discussed below: the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family and Medical Leave Expansion Act (EFMLEA).

Emergency Paid Sick Leave Act (EPSLA)

When does the EPSLA take effect? April 1, 2020. It applies to qualifying leave taken on or after April 1, 2020 and on or before December 31, 2020.

What employers are covered? The EPSLA applies to private employers with fewer than 500 employees in the United States and/or its Territories/possessions, and to several types of (but not all) public agencies with at least one employee, as of the date the leave is to be taken.

I have fewer than 50 employees and providing paid leave is a hardship. Is there an exception? Employers with fewer than 50 employees might be able to claim exemption from compliance with the requirement to provide paid sick leave pursuant to reason (5) below (caring for child whose school or place of care is closed, or child care provider is not available, for reasons related to COVID-19) if such leave would result in expenses and financial obligations exceeding available business revenues and cause the business to cease operating at a minimal capacity; the absence of the employee requesting leave would entail a substantial risk to the financial health or operational capabilities of the business because of the employee’s specialized skills, knowledge of the business, or responsibilities; or there are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed to perform the work of the employee requesting leave, and such work is needed for the business to work at minimal capacity.

What employees are covered? All employees of covered employers, although employers may exclude health care providers and emergency responders as defined at 29 CFR 826.30 (Note: some of the regulations have been corrected).

What are the reasons for which my employees may take emergency paid sick leave under EPSLA, and what documentation may I require? Covered employers are required to provide paid sick leave if the employee is not able to work or telework due to a need for leave for the reasons that follow. In all cases, the employee must provide the following documentation: employee’s name; date(s) for which leave is requested; qualifying reason for the leave; and oral or written statement that the employee is not able to work because of the qualifying reason. Additional documentation requirements for each specific reason are set forth below. If the IRS requires any additional documentation for tax credits, such additional documentation also is required of the employee. Documentation (including the employer’s documentation of information provided by the employee orally) must be retained for at least four years regardless of whether the leave was granted or denied.

The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19. Additional Documentation Required: Name of government entity that issued the order.
The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19. This means that the health care provider has advised self-quarantine based on a belief that the employee: has COVID-19; may have COVID-19; or is particularly vulnerable to COVID-19. Additional Documentation Required: Name of health care provider who recommended quarantine.
The employee is experiencing symptoms of COVID-19 (fever, dry cough, shortness of breath, and/or any other COVID-19 symptoms identified by the CDC) and is seeking a medical diagnosis from a health care provider (making, waiting for, or attending an appointment). Additional Documentation: Name of health care provider seen (there currently is not a regulation specifically stating this, but it makes sense to obtain this information once the employee has seen the health care provider).
The employee is caring for an individual (immediate family member, person who regularly resides in employee’s home, or similar person with whom employee has a relationship where care would be expected during quarantine) who is subject to a Federal, State, or local quarantine or isolation order related to COVID-19 or who has been advised by a health care provider to self-quarantine because of a belief that the individual has COVID-19; may have COVID-19; or is particularly vulnerable to COVID-19. Additional Documentation Required: Name of government entity that issued the order or health care provider who recommended quarantine.
The employee is caring for his/her son or daughter (under 18 or 18 or older and incapable of self-care because of disability) whose school or place of care is closed, or whose child care provider is unavailable, for reasons related to COVID-19, but only if no other suitable person is available to care for the child during the period of such leave. Additional Documentation Required: Name of child; name of school, place of care, or child care provider that is closed or unavailable; notice (public posting on social media, e-mail from school or care provider, etc.) that school or care is not available due to COVID-19 reasons; and representation that no other suitable person will be caring for the child during the period for which leave is requested.
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.

How much do I pay? For reasons described in (1) – (3) above, an employee is entitled to an amount that is no less than the greater of the following (a), (b), or (c) times [x] the number of hours the employee normally would have been scheduled to work during the qualifying leave: (a) the employee’s average “regular rate” of pay, as “regular rate” is defined and determined under the federal Fair Labor Standards Act (FLSA); (b) the applicable FLSA minimum wage; or (c) the applicable State or local minimum wage. In no event shall an employee’s paid leave under EPSLA for reasons described in (1) – (3) above exceed $511/day and $5,110 in the aggregate. The amount described in the first sentence is reduced to two-thirds (2/3) of such amount for reasons described in (4) – (6). In no event shall an employee’s paid leave under EPSLA for reasons described in (4) – (6) above exceed $200/day and $2,000 in the aggregate.

How many hours of sick pay do I pay? The maximum amount of paid sick leave under EPSLA is 80 hours for full-time employees (normally scheduled to work at least 40 hours per week). For part-time employees, the maximum is the number of hours the employee is normally scheduled to work, on average, over a 2-week period. If the employee’s schedule is unknown or varies, you may use a 6-month average (or, if the employee has been employed fewer than 6 months, the average during the employee’s employment). This is more fully-described in the DOL’s temporary rule at 29 CFR 826.21 (Note: some of the regulations have been corrected).

Is an employee entitled to two weeks of paid sick leave for each reason? No. The employee is eligible for no more than two weeks (80 hours for full-time employee; average number of hours scheduled over 2-week period for part-time employee) of paid leave under EPSLA regardless of the employee’s need.

Is paid sick leave pursuant to EPSLA in addition to other paid time off that I offer? Yes.

May I require my employees to use other accrued paid time off before paying paid sick leave pay pursuant to EPSLA? No. You may not require an employee to use any other paid leave to which the employee may be entitled pursuant to other Federal, State or Local law, a collective bargaining agreement, or employer policy prior to using paid sick leave pursuant to EPSLA.

May I allow my employees to supplement paid sick leave that otherwise would be paid at 2/3 pay with their accrued paid time off? Yes, you may, but do not have to, agree to this. You may not require the employee to supplement. You will not receive a tax credit for the amount supplemented.

May I require my employees to find a replacement as a condition of using paid sick leave pursuant to EPSLA? No.

May I require my employees to provide notice of their need for paid sick leave? Generally, no notice of the need for paid sick leave under EPSLA may be required for the first covered sick day, but employers may require employees to follow the employer’s reasonable notice procedures after that first day. If the leave is to care for a child whose school or place of care is closed, or whose child care provider is not available, for reasons related to COVID-19, employees must provide notice as soon as practicable.

Can an employee take paid sick leave pursuant to EPSLA intermittently? It depends. If the employee is teleworking, the employee may take paid sick leave intermittently, but only if you and the employee agree. If the employee is working at the workplace, the employee may take paid sick leave intermittently only for reason (5) (caring for child whose school or place of care is closed, or child care provider is not available, for reasons relating to COVID-19), and only if you and the employee agree. If an employee returns to work before exhausting all paid sick leave for which the employee is eligible under EPSLA, the employee has until December 31, 2020 to use up the balance of available leave.

Will providing paid sick leave pursuant to EPSLA impact an employee’s exempt status? No.

If I closed the worksite before April 1, 2020, can I pay my employees paid sick leave pursuant to EPSLA while I am closed? No. Your employees are off work because you do not have work for them, which is not a qualifying reason.

If I close(d) the worksite on or after April 1, 2020, can I pay my employees paid sick leave pursuant to EPSLA while I am closed? No. Your employees are off work because you do not have work for them, which is not a qualifying reason. However, if an employee took paid sick leave for a qualifying reason on or after April 1, 2020 and before you closed, the employee would be eligible for paid sick leave for such time period.

If I furloughed an employee before April 1, 2020, can I pay that employee paid sick leave pursuant to EPSLA while on furlough? No. Your employee is off work because you do not have work for him/her, which is not a qualifying reason.

If I furlough(ed) an employee on or after April 1, 2020, can I pay that employee paid sick leave pursuant to EPSLA while on furlough? No. Your employee is off work because you do not have work for him/her, which is not a qualifying reason. However, if the employee took paid sick leave for a qualifying reason on or after April 1, 2020 and before being furloughed, the employee would be eligible for paid sick leave for such time period.

Do I pay out unused EPSLA paid sick leave on termination of employment or after December 31, 2020? No.

If my employee received 80 hours of paid sick leave pursuant to EPSLA from another employer, do I have to provide additional paid sick leave pursuant to EPSLA? No. An individual employee is eligible for no more than 80 hours of paid sick leave under EPSLA in total from all employers.

If I am covered by EPSLA, do I have to post a notice? Yes. The DOL provides the notice for free download. Employers may email this notice to employees.

Emergency Family and Medical Leave Expansion Act (EFMLEA)

When does the EFMLEA take effect? April 1, 2020. It applies to qualifying leave taken on or after April 1, 2020 and on or before December 31, 2020.

What employers are covered? The EFMLEA applies to private employers with fewer than 500 employees in the United States and/or its Territories/possessions, and to several types of (but not all) public agencies with at least one employee, as of the date the leave is to be taken.

I have fewer than 50 employees and providing paid leave is a hardship. Is there an exception? Employers with fewer than 50 employees might be able to claim exemption from compliance with the requirement to provide paid leave pursuant to EFMLEA if such leave would result in expenses and financial obligations exceeding available business revenues and cause the business to cease operating at a minimal capacity; the absence of the employee requesting leave would entail a substantial risk to the financial health or operational capabilities of the business because of the employee’s specialized skills, knowledge of the business, or responsibilities; or there are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed to perform the work of the employee requesting leave, and such work is needed for the business to work at minimal capacity.

I have fewer than 50 employees. Am I now covered by all provisions of the FMLA? Employers that are not otherwise covered by the FMLA (for example, fewer than 50 employees) are not covered by all other FMLA provisions just because they are covered by EFMLEA in 2020.

What employees are covered? All employees of covered employers who have been employed for at least 30 calendar days are eligible for the benefits of the EFMLEA, even if such employee is not eligible for the benefits of the FMLA generally, although employers may exclude healthcare providers and emergency responders as defined at 29 CFR 826.30 (Note: some of the regulations have been corrected).

What are the reasons for which my employee may take paid leave under the EFMLEA? An eligible employee may take up to 12 weeks of leave to care for his/her son or daughter (under 18 or 18 or older and incapable of self-care because of disability) whose school or place of care is closed, or whose child care provider is unavailable, for reasons related to COVID-19, but only if no other suitable person is available to care for the child during the period of such leave.

What documentation is required? Employee’s name; date(s) for which leave is requested; qualifying reason for the leave; oral or written statement that the employee is not able to work because of the qualifying reason; name of child; name of school, place of care, or child care provider that is closed or unavailable; notice (public posting on social media, e-mail from school or care provider, etc.) that school or care is not available due to COVID-19 reasons; and representation that no other suitable person will be caring for the child during the period for which leave is requested. If the IRS requires any additional documentation for tax credits, such additional documentation also is required of the employee. Documentation (including the employer’s documentation of information provided by the employee orally) must be retained for at least four years regardless of whether the leave was granted or denied.

How much do I pay? The first 10 days of EFMLEA leave may be unpaid leave; however, an employee may elect to use accrued paid vacation, personal, or medical/sick leave during this time period or, if the employee has not used it up, the employee may take paid sick leave pursuant to EPSLA during this initial 10 day period. After taking leave for 10 days, the employer must pay the employee for each day of EFMLEA leave. Under the EFMLEA, an employee is entitled to an amount that is no less than two-thirds (2/3) of the employee’s average “regular rate” of pay, as “regular rate” is defined and determined under the federal Fair Labor Standards Act (FLSA) times [x] the number of hours the employee normally would have been scheduled to work during the qualifying leave. In no event shall an employee’s paid leave under EFMLEA exceed $200/day and $10,000 in the aggregate. If the employee uses paid sick leave pursuant to EPSLA during the first two weeks of the EFMLEA leave, the employee could be paid up to $200/day and $12,000 in the aggregate during the 12 weeks of leave.

How many hours of paid leave pay do I pay? You pay for the employee’s normally scheduled hours missed each day because of the leave. If the employee’s schedule varies such that you cannot know how many hours the employee would miss due to leave, you may use a 6-month average (or, if the employee has been employed fewer than 6 months, the average during the employee’s employment). This is more fully-described in the DOL’s temporary rule at 29 CFR 826.24 (Note: some of the regulations have been corrected).

I am covered by the FMLA generally. Are employees entitled to 12 weeks of leave under EFMLEA in addition to time for which they are eligible under regular FMLA? No. During the applicable 12-month period, an employee’s use of leave pursuant to EFMLEA will decrease the leave available to the employee under regular FMLA, and an employee’s use of leave pursuant to regular FMLA will decrease the amount of leave available to the employee under EFMLEA. However, an employee is eligible for paid sick leave pursuant to EPSLA even if the employee used up all 12 weeks of FMLA leave. So, an employee who used up all of his/her FMLA leave could still get two weeks of leave pursuant to EPSLA to care for a child whose school or place of care is closed, or whose child care provider is not available, for reasons related to COVID-19.

Is paid leave pursuant to the EFMLEA in addition to other paid time off that I offer? Yes.

May I require my employees to use other accrued paid time off before providing leave pursuant to EFMLEA? If the employee does not use paid sick leave pursuant to EPSLA during the first 2 weeks of EFMLEA leave, then the employee may elect, or you may require, the employee to use accrued paid time off for the first 2 weeks of EFMLEA that otherwise would be unpaid. Regardless of whether the employee uses paid leave under EPSLA or under your policies, the paid leave would run concurrent with the first 2 weeks of EFMLEA. Keep in mind that EPSLA pay for this reason is at 2/3 pay, whereas accrued paid time off likely is at full pay. Also keep in mind there is no tax credit for use of regular paid time off.

May I allow my employees to supplement paid leave that otherwise would be paid at 2/3 pay with their accrued paid time off? Yes, you may, but do not have to, agree to this. You may not require the employee to supplement. You will not receive a tax credit for the amount supplemented.

I am covered by the FMLA generally. Is all FMLA leave paid now? No, only leave pursuant to EFMLEA (leave because employee must care for a child whose school or place of care is closed, or child care provider is not available, for reasons related to COVID-19).

May I require my employees to provide notice of their need for EFMLEA leave? Employees must provide notice of foreseeable leave as soon as practicable.

Can an employee take paid leave pursuant to EFMLEA intermittently? Yes, but only if you and the employee agree.

Will providing paid leave pursuant to EFMLEA impact an employee’s exempt status? No.

If I closed the worksite before April 1, 2020, can I pay my employees paid leave pursuant to EFMLEA while I am closed? No. Your employees are off work because you do not have work for them, which is not a qualifying reason.

If I close(d) the worksite on or after April 1, 2020, can I pay my employees paid leave pursuant to EFMLEA while I am closed? No. Your employees are off work because you do not have work for them, which is not a qualifying reason. However, if an employee took paid leave for a qualifying reason on or after April 1, 2020 and before you closed, the employee would be eligible for paid leave for such time period.

If I furloughed an employee before April 1, 2020, can I pay that employee paid leave pursuant to EFMLEA while on furlough? No. Your employee is off work because you do not have work for him/her, which is not a qualifying reason.

If I furlough(ed) an employee on or after April 1, 2020, can I pay that employee paid leave pursuant to EFMLEA while on furlough? No. Your employee is off work because you do not have work for him/her, which is not a qualifying reason. However, if the employee took paid leave for a qualifying reason on or after April 1, 2020 and before being furloughed, the employee would be eligible for paid leave for such time period.

Do I have to allow my employee to return to work? An employee typically must be restored to his/her position, or an equivalent position, upon return from EFMLEA leave (subject to any applicable exceptions under regular FMLA); however, an employer with fewer than 25 eligible employees need not restore the employee if the following apply: the employee took leave for a qualifying reason under EFMLEA; the position held by the employee when commencing leave does not exist due to economic conditions or other changes in operating conditions of the employer that affect employment and are caused by a public health emergency during the period of leave; the employer makes reasonable efforts to restore the employee to an equivalent position; if the employer’s efforts are not successful, the employer makes reasonable efforts to contact the employee if an equivalent position becomes available within one year from the earlier of (a) the date the employee’s need for leave ends or (b) 12 weeks from the date the employee commences leave.

Do I pay out unused EFMLEA paid leave on termination of employment or after December 31, 2020? No.

If I am covered by EFMLEA, do I have to post a notice? Yes. The DOL provides the notice for free download. Employers may email this notice to employees.

TAX CREDITS

Can I get reimbursed for paid leave payments required by EPSLA and EFMLEA? Employers are eligible for payroll tax credits equal to 100% of qualified paid leave wages under EPSLA and EFMLEA, subject to caps as follows:

EPSLA for reasons (1) – (3) above, $511/day; $5,110 aggregate

EPSLA for reasons (4) – (6) above, $200/day; $2,000 aggregate

EFMLEA, $200/day; $10,000 aggregate

Note, this means that, for qualifying leave to care for a child whose school or place of care is closed, or whose child care provider is not available, because of reasons relating to COVID-19, the total for 12 weeks could be $200/day; $12,000 aggregate.

What records are required? The employer should keep the following for at least four years:

Documentation referenced above in this post
Documentation to show how you determined the amount of paid leave paid to an employee pursuant to EPSLA and/or EFMLEA that is eligible for credit, including records of work, telework, and periods leave
Documentation to show how you determined the amount of qualified health plan expenses the employer allocated to wages
Copies of any completed IRS Forms 7200 that you submitted to IRS
Copies of completed IRS Forms 941 that you submitted to IRS (or records provided to a third party who you use to meet your employment tax obligations)
Any other documentation that the IRS might require

The employment attorneys of Wooden McLaughlin LLP can assist with these and all of your employment law needs. Call us at 888-639-6151 or visit our offices in Indianapolis, Evansville, or Bloomington to schedule a consultation.

(This post summarizes complex legal issues and is not legal advice. Consider consulting with a lawyer about specific situations.)