On Thursday the President signed the Families First Coronavirus Response Act. The text of the new law can be found here.
Below are provisions that may impact our member pharmacies. Click here for a Forbes Tate overview of the act. Click here for IPC clarifications on the new law.
The law includes:
- FMLA COVID-19 Benefit – This benefit provides up to 12 weeks of family and medical leave benefits related to the coronavirus to be paid at 2/3rds of regular pay rates after the first 10 days which are unpaid. The circumstances under which the leave is available have also been significantly limited, only allowing leave for child care in the event of school closure or if the employee's child care provider is unavailable due to the public health emergency.
- Paid Sick Leave – This benefit applies up to 80 hours of additional paid sick leave for employees related to the coronavirus. The new version places daily and aggregate caps on the sick leave benefit of either $511 per day and $5,110 in the aggregate if the employee is sick or quarantined, and $200 per day and $2,000 in aggregate if the employee is caring for someone else. The new version also includes language granting authority to the Dept. of Labor to create regulations that can exempt small businesses with fewer than 50 employees from the requirements when the imposition of the requirements would jeopardize the viability of the business as a going concern. In the previous version this authority was only applicable to the FMLA provision.
- Tax Credits – tax credits for employers intended to mitigate the impacts of the expanded leave provisions; and
- COVID-19 Testing – free testing for the coronavirus during the emergency.
Pay Requirements for Public Health Emergency Leave
The amended FMLA does not require employers to pay employees taking Public Health Emergency Leave for the first ten (10) days of leave. Employees may opt to use (substitute) any accrued paid time off, vacation time, sick leave, or other paid leave during this initial period (including sick leave under the Emergency Paid Sick Leave Act below). After the first ten (10) days of Public Health Emergency Leave, the amended FMLA requires employers to pay employees on such leave at a rate of two-thirds the employees’ regular rate of pay (as determined under the Fair Labor Standards Act) and for the number of hours the employee would normally be scheduled to work. In no event, however, shall the employee’s paid leave exceed $200 per day and $10,000 in the aggregate. Tax Credit: Recognizing the fiscal impact of the Public Health Emergency Leave, the FFCRA provides a payroll tax credit for covered employers.
Emergency Paid Sick Leave Act
Full-time employees are entitled to 80 hours of paid sick leave, and part-time employees are entitled to sick leave equivalent to those hours the employee works, on average, over a 2-week period. Where the employee takes leave for his or her own self-isolation, medical diagnosis, or treatment, the employee is entitled to paid leave at 100% of his or her regular rate of pay. However, where leave is taken to care for a family member or child, employers only are required to provide leave at two-thirds the employee’s regular rate of pay. As amended by the House on March 16, 2020, the current version of the Sick Leave Act imposes a cap on daily and aggregate sick leave pay, dictating that in no event is paid sick leave to exceed $511 per day and $5,110 in the aggregate for an employee’s self-isolation, medical diagnosis, or treatment. Additionally, a cap of $200 per day and $2,000 in the aggregate applies to any sick leave taken by an employee to care for a family member or child.
Tax Credit: Similar to the tax credit afforded to employers for Public Health Emergency Leave, the FFCRA also provides a payroll tax credit for the Sick Leave Act.
Notably, these new paid sick leave allotments are in addition to an employer’s existing paid sick leave policies. Additionally, employers are prohibited from requiring that employees use employer-provided vacation time, sick time, or other paid time off before using paid sick leave under the Sick Leave Act.
Tax Credits for Paid Sick Leave and Family and Medical Leave
Tax Credit for Paid Sick Leave
An employer will receive a quarterly 100% refundable credit against the payroll taxes for the qualified sick leave wages paid by the employer.
In calculating the credit, the amount of qualified sick leave wages taken into account with respect to any individual shall not exceed $511 per day.
- This limit is intended for an employee who is subject to a quarantine or isolation order related to COVID-19, has been advised by a health care provider to self-quarantine due to COVID-19, or is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
- For other permissible uses of the sick leave the individual amount may not exceed $200 per day. These circumstances are where the employee is caring for an individual who is subject to a quarantine order or has been advised to self-quarantine, the employee is caring for their child as a result of child care or school closures or if the child care provider is unavailable due to COVID-19 precautions, or the employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.
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