Small Businesses Alert: Families First Coronavirus Response Act

The COVID 19 pandemic is slowly stopping the U.S. in its tracks. As governments find ways to flatten the curve, the U.S. House did its part by passing H.B. 6201, entitled “Families First Coronavirus Response Act.” H.B. 6201 is not yet the law, but we anticipate versions of the bill’s most significant provisions will become law as early as this week. This will have significant implications for small businesses. Below is a summary of those potential impacts:

  1. The bill incorporates the proposed “Emergency Paid Leave Act of 2020,” which establishes a federal emergency paid leave benefits program to provide payments to employees taking leave due to the coronavirus outbreak retroactive to leaves begun on or after January 19, 2020. Under this proposed act, subject to certain exceptions, employees who take a coronavirus related leave, including for purposes of caregiving in connection with a school closing, would be eligible for payment of 2/3 of their monthly wages, up to $4,000 per month, for up to three months. This federal benefit would be reduced dollar-for-dollar, however, for any State or private payments for leave over the same period.
  2. The bill will expand the employee protections the Family Medical Leave Act, 29 U.S.C. § 2611 et al., to include employees absent due to a “public health emergency leave.” Additionally, the bill would expand application of the FMLA for “public health emergency leave” to allemployers, regardless of number of employees, and cover employees with only thirty days of service, rather than twelve months. An employee would be permitted to elect to substitute an accrued paid leave benefit, but an employer would not be permitted to require the employee to do so. For employers with fewer than twenty five employees, the requirement to hold the employee’s position open would be relaxed under certain enumerated circumstances.
  3. The bill incorporates the proposed “Paid Sick Days for Public Health Emergencies and Personal and Family Care Act.” This act would require employers to provide their employees with at least 1 hour of paid sick time for every 30 hours worked, up to at least 56 total hours of paid sick time. Importantly, employers with existing paid sick time policies (including those that are imposed by state law) that are as good or better than the proposed federal program would notbe required to provide any additional sick time benefits under federal law. The act would require, however, that employers notify each of their employees and include in any employee handbook certain information concerning the new federal law.

As with the pandemic, the situation is still fluid. And these rules are still subject to revision before passage. Laredo & Smith will be monitoring the bill closely over the next week and communicating information as it becomes known.  In the interim, please do not hesitate to contact your Laredo & Smith attorney with any questions. We are here to help you ride this out.