DOL Clarifies The Families First Coronavirus Response Act
By Kevin M. Mosher • Mar 27, 2020
The DOL offered some worthwhile clarification in the waning days before the new Families First Coronavirus Response Act (FFCRA) goes into effect on April 1. The following are some key clarification points that should help employers as they prepare. Some of these points clarify ambiguities in the language of the law, so it’s very good the DOL issued them.
Inability To Work. Employees must be unable to work to receive paid benefits under the Emergency FMLA and the new paid leave law.
Layoffs/Furloughs Before & After April 1. The government provided helpful guidance on this! If your company temporarily lays off (furloughs) an employee before the FFCRA goes into effect, they are not entitled to benefits come April 1. Likewise, employees are not entitled to FFCRA leave if you lay them off after April 1. If employees have no work to do, then they have no entitlement to leave benefits. The same applies if you close your business. Benefits end the day the business closes down.
Intermittent Leave. The government clarified that employees may take the FMLA and paid leave benefits intermittently, even while teleworking, if the employee meets the criteria required under the FMLA or the paid leave law.
Benefits before April 1. This law is not retroactive. Benefits paid to employees along the lines of those outlined in the FFCRA prior to April 1 will not be reimbursed to employers by the IRS.
Clarifying Being Unable to Work. The DOL also clarified that being “unable to work” means just that—the employee is prevented from working, either under normal circumstances at their worksite or via telework.
Reducing Hours. More clarification. If the employer reduces an employee’s hours, the employee cannot use the benefits under the FFCRA to make up the difference in lost hours.
Documents to Support Leave. Employers can require employees to provide documents to support their claimed entitlement to benefits under the FFCRA. This is to the employer’s benefit, because the documentation shows the IRS that the request for reimbursement is legitimate. The DOL offered that such documents could be: written documentation from a health care provider, copy of the Federal or State isolation or quarantine order, documentation regarding school or day care being closed due to COVID-19, and anything else relevant to the need for the leave.
Small Business Exemption. The DOL is allowing employers with under 50 employees the ability to not participate in offering FFCRA benefits so long as the business can prove compliance would jeopardize its viability as a going concern. More regulations are forthcoming, but it’s clear there will be a path for smaller employers to utilize this exemption.
Posting Notices. The DOL clarified the posting requirement, stating that you can post them in a conspicuous place where employees can see it. For new hires, you may either email, direct mail, use the conspicuous posting or post it internally or externally on a company website.
Reimbursement. More clarification from the DOL and IRS that employers will be reimbursed for their payments under the Emergency FMLA and paid sick leave law, up to the limits allowed under both. The IRS provided a helpful example of how the offsetting credits to reimburse employers under the paid sick leave law would work:
If an eligible employer paid $5,000 in sick leave and is otherwise required to deposit $8,000 in payroll taxes, including taxes withheld from all its employees, the employer could use up to $5,000 of the $8,000 of taxes it was going to deposit for making qualified leave payments. The employer would only be required under the law to deposit the remaining $3,000 on its next regular deposit date.
If an eligible employer paid $10,000 in sick leave and was required to deposit $8,000 in taxes, the employer could use the entire $8,000 of taxes in order to make qualified leave payments and file a request for an accelerated credit for the remaining $2,000.
MyHRgenius and Thompson Coe continue to monitor these new HR laws and their impact on employers throughout the country. For more information, including webinars, primers, summaries and podcasts on COVID-19 go to www.myhrgenius.co or www.thompsoncoe.com or call 651-389-5080.
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