HR 6201 is in response to the massive amounts of people now out of work and school. The first part of the bill deals with food programs and I’ll let you read up on that for yourselves. For now, my focus will be how this changes our businesses.
First there’s a change on the existing Family Medical Leave Act. Originally this law was for businesses with 500 or more employees. Now, it’s for all businesses. It’s for all employees whether they are full-time or Part-time.
The first 10 days will be without pay OR they can use the new Emergency Leave Day Act which I will talk about shortly. The remaining 10 weeks will be 2/3 of salary with a maximum payment of $200 per day and a total of $10K.
The key here is that the employee MUST be caring for a minor child.
Now that schools have been closed around the country, the kids are home, and many people may be looking towards the Emergency Leave Day Act. Most of the time, this option will be utilized for those that can not telecommute.
Emergency Paid Sick Leave Act is new. Unlike FMLA, an employee is immediately eligible for paid sick leave.
Who is eligible for “emergency leave day”?
the employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
the employee has been advised by a health care provider to self-quarantine because of COVID-19.
the employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis.
the employee is caring for an individual subject or advised to quarantine or isolation.
the employee is caring for a son or daughter whose school or place of care is closed, or childcare provider is unavailable, due to COVID-19 precautions; or
the employee is experiencing substantially similar conditions as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.
Employee’s Paid Sick Leave
80 hours at their regular rate of pay up to a maximum entitlement of $511/day or $5110 (for reasons 1, 2 & 3, employee’s own illness).
When caring for a family member (for reasons 4, 5, 6 above or school closure), sick leave is paid at two-thirds the employee’s regular rate. Pay is limited to $200 per day ($2,000 in total)
Part-time employees: the number of hours that the employee works, on average, over a 2-week period.
I’m still seeking the answer to this question – I have the question into a few HR consultants, so stay tune… BUT here’s what I don’t know.
Can you do a temporary lay-off, prior to doing the Emergency Paid Sick Leave Act? I’ll report on that as soon as I get an answer.
If you offer health insurance and are considering doing a temporary lay-off, it is advisable to work with a broker to understand how it would affect your employees. In California, the person can apply for Coverage California. There is a special open enrollment going on through June 30, 2020 and sometimes that can be less expensive than trying to keep them on your group plan without a paycheck.
Care giving for family member effected by the COVID-19
Reduced Work Hours
Potential Closure or Layoffs
Eligible individuals can receive benefits that range from $40-$450 per week.
Tax Assistance for Employers experiencing hardship may request 60 days extension on filing payroll reports/taxes
I know I have followers in other states. Please check your state website for information.
How are small business owners going to pay for the sick leave? The Government will be providing payroll tax credits for you in your quarterly returns. Make sure you are labeling your payroll as sick leave. This will help substantiate the claim.
U.S. Small Business Administration Disaster Loans
Businesses adversely affected by the coronavirus now qualify for up to $2 million in disaster loans due to economic hardship. Interest rates are 3.75% for businesses, and 2.75% for nonprofits. Repayment can be deferred for up to twelve months. Terms may be extended to up to 30 years for repayment. https://www.sba.gov/funding-programs/disaster-assistance