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Congress Finalizes Coronavirus Economic Relief Package.  Here’s What You Need to Know about the Families First Coronavirus Response Act.

There’s growing consensus that Americans need to stay home to help prevent the spread of COVID-19 (coronavirus).  The health of the nation comes first, experts say, but will workers still get paid?

On Wednesday, congress passed the Families First Coronavirus Response Act (the “Act”), a sweeping legislation designed to assist a large segment of the nation’s workforce whose ability to work is or may become impacted by the coronavirus pandemic.  The Act dedicates tens of billions of dollars for paid sick leave, unemployment insurance, free testing and other measures to help Americans impacted by the crisis.

What is the Families First Coronavirus Response Act?

The Act is primarily aimed at expanding the safety net to cope with the potentially catastrophic economic impact of coronavirus.  In addition to ensuring free coronavirus testing, the plan would dramatically increase several benefits, particularly family medical leave and paid sick leave, while also bolstering unemployment insurance, spending on health insurance for the poor, and food programs for children and the elderly.

One of the biggest changes is a new paid sick leave guarantee for those impacted by the coronavirus.  Under the new law, certain employers would be required to provide 14

days of paid sick leave at 100 percent of the person’s normal salary, up to $511 per day. It

would also provide up to 12 weeks of paid family and medical leave at 67 percent of the

employee’s normal pay, up to $200 per day if you are caring for a sick family member or a child whose school or day care is closed.

Who is Covered?

This Act allows an eligible employee to take paid sick leave because the employee is:

  • subject to a federal, state or local quarantine or isolation order related to COVID-19;
  • advised by a health care provider to self-quarantine due to COVID-19 concerns;
  • experiencing COVID-19 symptoms and seeking medical diagnosis;
  • caring for an individual subject to a federal, state or local quarantine or isolation order or advised by a health care provider to self-quarantine due to COVID-19 concerns;
  • caring for the employee’s child if the child’s school or place of care is closed or the child’s care provider is unavailable due to public health emergency; or
  • 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.

Additionally, any individual employed by the employer for at least 30 days may take up to 12 weeks of job-protected leave to allow an employee, who is unable to work or telework, to care for the employee’s child if the child’s school or place of care is closed or the childcare provider is unavailable due to the coronavirus.

Which Employers Fall Under This Act?

Small and midsize companies, i.e., 500 or fewer employees, would be required to provide these benefits for workers impacted by the coronavirus.  The Act states that part-time employees also get paid sick leave equivalent to the number of hours they typically work during a two-week period based on the average number of hours the employee worked for the six months prior to taking their leave.  Part-time employees who have worked for less than six months prior to leave are entitled to the employee’s reasonable expectation at hiring of the average number of hours the employee would normally be scheduled to work.

Many small-business owners are worried about how to pay for these benefits, especially at a time when business across numerous industries has basically come to a halt. The bill provides a tax credit to cover the costs.  They will be reimbursed for the full amount within three months, in the form of a payroll tax credit.

People who are self-employed get these benefits in the form of a tax credit.  Additionally, people who are self-employed but work for another employer — e.g. Lyft and Uber drivers, caterers or planners for major events like South by Southwest — are also eligible for a tax credit of up to two weeks of sick pay at their average pay and 12 weeks of family leave pay at two-thirds their normal rate.

The Act requires that all government employers must also provide these benefits to employees.

Who May Not Be Covered?

Since the bill was released, it has been criticized for not covering all workers. Large companies with more than 500 employees are not mentioned in the Act. Employees at these companies will have to rely on the policies of the companies they work for.

The labor department can also exempt businesses with fewer than 50 employees, and health care providers like hospitals and nursing homes, from having to pay these benefits if it “would jeopardize the viability of the business.”

Employers can also decline to give leave to workers on the front lines of the crisis: health care providers and emergency responders.

Key Takeaways:

  • These benefits are in place until December 21, 2020 – The Act not is meant as a response to coronavirus and is not permanent.
  • You do not have to have the coronavirus to receive these benefits – The two weeks of paid sick leave apply to anyone told to quarantine, showing symptoms, exposed to the virus or trying to get a test or preventive care.
  • The Act is set to go into effect April 2, 2020

For more information on the Families First Coronavirus Response Act, visit congress.gov.  For Maryland-specific information related to your employment and coronavirus, visit the Department of Labor’s website.  For more information on how to protect yourself and your family from the coronavirus, visit the CDC’s website.

 

 

 

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