Paid Sick Leave under the Families First Coronavirus Response Act and its Effect on Small Businesses By Gaylord Gardner

President Trump recently signed the Families First Coronavirus Response Act and drastically changed how many businesses have to deal with paid sick time.   Many small businesses do not provide paid sick time to their employees or they provide limited sick time to their employees.  The Families First Coronavirus Response Act has temporarily changed how small businesses have to deal with paid sick time in regard to COVID-19. 

The new law requires that any private employer with under 500 employees must provide each employee with paid sick time to the extent that the employee is unable to work (or telework) due to a need for leave because:

(1) The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID–19.

(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID–19.

(3) The employee is experiencing symptoms of COVID–19 and seeking a medical diagnosis.

(4) The employee is caring for an individual who is subject to an order as described in subparagraph (1) or has been advised as described in paragraph (2).

(5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID–19 precautions.

(6) The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

Under the new law, full-time employees can receive 80 hours of emergency paid sick leave and part-time employees can receive a proportionately similar amount, based on the average number of hours they work in a two-week period.   Additionally, the law prohibits the employer from requiring the employee to use the employee’s other paid leave so this paid sick time is in addition to the employee’s other accrued paid time off.   The law does cap the amount of sick pay an employee can be paid to $511 per day and $5,110 in the aggregate when paid sick leave is taken for reasons (1), (2), or (3) above, and to $200 per day and $2,000 in the aggregate when paid sick leave is used for reasons (4), (5), or (6) above.

For small businesses, paying sick time to employees could prove to be difficult and not financially feasible but the law prohibits employers from encouraging or preventing employees from taking paid sick time.  However, the law does allow the Department of Labor to issue exemptions for businesses under 50 employees, but currently, how that will work is not clear so small businesses need to plan to comply with the law.

For small businesses trying to figure out how to implement this new law or seeking to apply for an exemption, you should contact one of our attorneys to guide you through this process.

Post authored by Gaylord Gardner