For most people, it’s only been a week or so since the global COVID-19 pandemic totally upended their world. Employees have found themselves working from home, dealing with a vastly increased workload … or had their hours cut and possibly found themselves out of work entirely.
Which is to say nothing of the myriad worries about the disease itself, groceries and the distractions that come from working at home.
(Pro tip: Hide that Netflix bookmark.)
As for employers? They’ve been trying to make sense of it all.
Make no mistake: This is uncharted territory, made more frustrating by a situation which seems to change every hour. However, there’s no reason to panic. Getting a plan, finding the right resources for accurate information and knowing what to expect from the new laws are a strong foundation for keeping things going in these uncertain times.
Let’s start by taking a look at a part of the landmark piece of legislation recently passed into law.
What the New World of Paid Medical Leave May Mean for Employers
On Wednesday, March 18, President Trump signed H.R. 6201, the Families First Coronavirus Response Act into law. Going into effect on April 2, the bill contains multiple stimulus measures and will remain effective until Dec. 31.
Of chief interest to employers are the expanded Family Medical Leave Act (FMLA) provisions. Applying to all businesses with less than 500 employees (future regulations might make exemptions for businesses with fewer than 50 employees), the provisions make considerable expansions to the FMLA.
An area of critical interest to employers is paid medical leave.
“One of the major changes of the emergency FMLA expansion is going to be in effect during this pandemic,” says Carolina Romero, a human resources consultant with HR consulting firm eqHR Solutions. The change? All full- and part-time employees of companies with fewer than 500 employees are eligible for 80 hours of paid sick leave under the Emergency Paid Sick Leave Act, regardless of how long they’ve been with the company. “Typically, with FMLA, you have to have worked for a longer amount of time. That’s quite a huge change,” notes Romero.
“It does exclude health care providers and emergency responders, the first 10 days are unpaid, and employees can use paid time off during the first 10 days, but they are not required to do so,” says Romero. “If they choose to, they can use the sick leave and vacation they already have … but you can’t require them.”
Sidebar: Carolina Romero walks us through how HR 6201 affects employers and employees. Please be aware these rules may change in the coming days:
Emergency paid FMLA for employers with 500 or fewer employees:
(Note: This Is only for employees unable to work or telework and need to care for minor children whose school or childcare provider have closed. Other uses previously stated in the bill no longer apply)
- 1. The first 10 days are unpaid but may be subsidized by the emergency paid sick leave or accrued sick leave. However, employers cannot require them to use this.
- 2. Employees must be paid 2/3rds of their regular rate, capped at $200 per day and an aggregate of $10,000.
- 3. Health care providers and emergency responders can be exempted from this leave.
Emergency Paid Sick Leave for employers with 500 or fewer employers:
(Note: Employers cannot require employees to use accrued paid time off before using this)
- 1. A payroll tax credit will reimburse all employees to their employer.
- 2. Full-time employees are entitled to two weeks (80 hours) of paid sick leave for specific circumstances related to coronavirus.
- 3. Part-time employees entitled to the number of hours they work on average over a two-week period.
- 4. This also applies to public agencies with one or more employees.
- 5. Covered employees are broken into two groups:
- Employees under federal, state or local quarantine order related to Coronavirus
- Employee is advised by healthcare provider to self-quarantine
- Employee is experiencing symptoms and seeking a medical diagnosis These employees will be paid at the greater of their regular rate of pay or the minimum wage. Capped at $511 per day and an aggregate of $5,110.
- Employee is caring for an individual subject to an order (listed above)
- The employee has been advised to self-quarantine by healthcare provider
- The employee is caring for a child whose school or care provider has closed. These employees will be paid at 2/3 of their regular rate of pay or 2/3 the applicable minimum wage, whichever is higher. The pay is capped at $200 per day and an aggregate of $2,000.
“The responsibility is going to be on the employer to pay for this, unfortunately,” cautions Romero, who also acknowledges much is still unknown at this time. “There will be a payroll tax credit; as to what that’s going to be that hasn’t been established yet. There are small business loans available for those who haven’t qualified yet. There is a limited exception for this, for employers who have 25 employees or less. In that case, they may not be mandated to follow the emergency FMLA.”
“Things are changing on the hour and they haven’t released yet what kind of funding they’re going to release to the public,” Romero adds. “As it stands right now, the employer must pay for it.”
Reasons for CautionIt’s a caution echoed by Chris Cooley, co-founder of MyHRConcierge, a human resources services provider. “Right now, everything is so fluid, the bill has come out and business owners just need to be diligent and finding good resources of information and using that information in a consistent matter,” Cooley warns.
Cooley also voices concerns about nervous employers adopting screening practices at work. “You need to be careful with that. The EEOC just very recently came out and said you can take an employee’s temperature, and from that aspect you can,” Cooley says. “What you have to figure out now though is if you take their temperature, are there any risks for yourself? What information are you going to get? You can have carriers without fever. You have to weigh the risk.”
It’s also unclear if employers are liable for any COVID-19 cases which may occur in their workplaces. “That’s tricky. We haven’t been there yet,” says Cooley. “I think a lot of this will be determined by time and cases.” As for potential lawsuits? “Get your attorney and you just have to fight that case. We’re going to find out more about that (situation) as we move forward.”
There is another worry for employers – fraud. Leigh Grady, payroll manager for Atlanta-based FINSYNC, cautions that dangers like fraud and phishing don’t go away during pandemics. “I think you have to be very cognizant of who you’re doing business with. Have a better understanding of your clients, too,” warns Grady.
Direct Deposit, Working from Home May Become More Popular
Grady and FINSYNC have noticed direct deposit is becoming more popular. “I think more people will go to direct deposit,” says Grady. “Delivery (of paper checks) is going to be a little harder.” Grady says her company has been using courier services to deliver checks and offering the clients the ability to print checks on site. However, Grady also mentions cashflow industries like restaurants are actually moving to live checks. “With direct deposit, you move all that money up front. We’re putting it in live checks to help their cash flow,” says Grady.
Weathering the Storm
Payroll Tax Management is here to help with your payroll tax processing during these uncertain times. Although we’ve taken prudent steps to protect our employees, our cloud-based system means we can offer the same services and care even when working remotely. As a provider of critical services, we even have staff available to print checks, sending out paper filing and other tasks that can’t be done remotely.
We’re open for business. Have any questions or concerns? Contact us today via the link below.