President Donald J. Trump is joined by Vice President Mike Pence and Secretary of the Treasury Steven Mnuchin as he signs H.R. 6201, the Families First Coronavirus Response Act, March 18, in the Oval Office of the White House. Photo contributed by White House Photos.
Written by Frank Lopez
To try and provide protections for employees, the Senate recently passed the Families First Coronavirus Response Act, phase II, on March 18. Though it is a comprehensive bill, The Business Journal decided to do a quick focus on the most immediate effects it could have on local businesses in the Central Valley. The Business Journal will continue to provide more detailed reports on the Act. The Familes First Act is not related to the CARES Act passed last week.
In response to the increasing severity of the COVID-19 pandemic, or the novel coronavirus, the Senate passed the Families First Coronavirus Response Act, phase II, on March 18, with President Trump signing it into law on the same day.
The act will go into effect April 2 expand employee protections for paid family leave and paid sick leave. The act will be in effect until December 31st, 2020.
Beginning April 2, the Response Act will update the Family and Medical Leave Act (FMLA) and require employers with fewer than 500 employees to provide up to 12 weeks of job-protected leave if they are unable to work, either onsite or remotely, because their child’s school or child care service is closed due to a public health emergency.
The first 10 days of leave can be unpaid, but an employee will be able to substitute accrued vacation, either personal or sick leave during the crisis. The employer is not allowed to require an employee to do so, however.
Anna Barcus Allen, an attorney at the law offices of Whitney Thompson & Jeff in Fresno says that all employers who are eligible under the Act, should be prepared for all eligible employees to take advantage of the paid time off, especially companies whose employees have young children whose school or daycare has been closed.
Small businesses with fewer than 50 employees may be able to be exempted from providing paid leave to employees who are not working because of school closings or child care unavailability if the leave requirements would jeopardize the viability of the business.
“It is reasonable to expect several employees to use the additional paid leave, and employers should be prepared for the same,” Allen said. “An employee should provide notice of leave to his or her employer as soon as practicable.”
Eligible employers will be able to immediately take advantage of the paid leave credits in a dollar-for-dollar offset against certain payroll taxes, and if the amount of leave paid pursuant to the At is over the amount of certain payroll taxes owed for all of the employer’s works, the excess amount will be considered overpayment and be refunded.
Under the Act, eligible employers will be required to provide up to 80 hours of paid sick leave benefits if an employee: has been ordered by the government to quarantine due to COVID-19, has been advised by a health care provider to self-quarantine because of COVID-19, caring for someone mandated by the government to be quarantined or isolated or advised by a health care provider to quarantine or self isolate, care for their child whose school or child care service is closed, or for employees experiencing similar conditions to the virus as specified by the secretary of health and human services and in consultation with the labor and treasury secretaries.
Brett Sutton, owner and managing partner of Sutton Hague Law Corporation, which has offices in California, including Fresno, and Nevada.
Sutton said that there are many businesses that will not be able to afford to operate and give out paid leave, and will have to decide this week if they can deal with the paid leave or not.
Many employers are barely hanging on, Sutton said, and when they are told that they might have to front the cost of a paid leave for all of their employees, at a time when they can least afford it, they are presented with some very challenging issues.
“It’s a big burden on employers, and I think, the worst piece of legislation for employers in American history, for the most ill times, and I think its going to result in a second wave of layoffs on a scale that we have never seen before,” Sutton said.