The Families First Coronavirus Response Act: A Summary

Renner Business News; March 27, 2020

The Families First Coronavirus Response Act provides federal support for employers who continue to pay employees who are unable to work due to school closings or illness related to COVID-19.

The Act applies to private employers, including nonprofits, with fewer than 500 employees and certain public employers.

Employers must implement the provisions by April 2.

School and Child Care Closings

If an employee can’t work because he or she is caring for a child whose school or place of care is closed due to Coronavirus precautions, then he or she can take emergency leave according to the terms of the new Coronavirus Response Act. The law provides for sick pay for the first two weeks and then family leave for up to 10 additional weeks. The amount of pay is limited to two-thirds of the employee’s normal pay up to $200 per day.

• Initial two weeks of implementation – emergency sick pay 
  If employees are unable to work because of school closing, he or she may take emergency sick leave up to the limit of the law. The leave is paid at two-thirds of the employee’s regular pay up to $200 per day.
•   Weeks 3 to 10 – emergency family leave
  After the first two weeks of leave, if an employee is unable to work because of school closing, he or she may take emergency family leave up to the limit of the law. The leave is paid at two-thirds of the employee’s regular pay up to $200 per day.

COVID-19 Illness

If employees are affected by COVID-19 in the ways listed below, employers will provide emergency leave according to the terms of the new law. The law provides for sick pay for two weeks. The amount of pay is limited to the employee’s full pay up to $511 per day.

Under the law, hours charged to COVID-19 leave for documented  COVID-19 illness are paid at the employee’s full rate of pay and are limited to $511 per day.

An employee qualifies for emergency sick pay under this part of the law if he or she:

• Is subject to a Coronavirus quarantine or isolation order;
• Has been advised by a health care provider to self-quarantine;
• Is experiencing Coronavirus like symptoms and is seeking a diagnosis; or
• Is caring for an individual in the first two categories.

The law provides for 10 days of this type of emergency leave.

Claiming the Credit

Employers may claim a refundable payroll tax credit for 100% of the amount of wages paid for emergency family leave and sick leave under the new law, up to the limits described above.

Exemption

Small businesses with fewer than 50 employees may qualify for exemption from providing paid leave due to school closings if providing the leave would jeopardize the viability of the business as a going concern.

Have Accounting Questions?

Contact us today and schedule a meeting to learn how Renner & Company can help, or give us a call at 703.535.1200.