On March, 18, 2020, the President signed H.R. 6201, Families First Coronavirus Response Act (FFCRA). Effective April 2, the Act requires small employers with 500 or fewer employees to provide 10 days of short-term emergency paid sick leave for employees to care for themselves or others due to a quarantine or illness, and if needed, 10 weeks of paid FMLA to stay home with a child due to school or day care closings.
The Secretary of Labor has issued regulations excluding certain health care providers and emergency responders from the definition of eligible employee; and defined an exemption for small businesses (fewer than 50 employees).
Our team is available to answer questions and provide additional information. As circumstances around COVID-19 progresses, laws will continue to change. Information and guidance provided in this email is subject to change. Remember to consult a qualified employment law counsel before adopting any new HR policies.
Exemption for Small Employers
Small employers with fewer than 50 employees may qualify for an exemption from the requirement to provide paid leave, if the leave payments would jeopardize the viability of their business as a going concern.
The regulation further clarifies that the small employer may be exempt when:
- The leave would cause expenses and financial obligations to exceed business revenue and cause the small employer to cease operating at a minimal capacity;
- The absence of the employee(s) would pose a substantial risk to the financial health or operational capacity of the small employer because of their specialized skills, knowledge, or responsibility;
- The small employer cannot find enough other workers who are able, willing, qualified, and available to perform the work when needed to operate at a minimal capacity.
For the reasons above, an employer may deny paid sick or expanded family and medical leave to otherwise eligible employees. If a small employer decides to deny paid sick or expanded family and medical leave to an employee(s), the employer must document the facts and circumstances that meet the criteria to justify a denial.
The employer does not send this documentation to the Department but should retain for its own records and files.
Note: Employers should remember under the FFCRA, wages paid for expanded sick or family and medical leave receive a dollar for dollar tax credit. It may be difficult for employers to prove and justify why an exemption would be needed. Appropriate documentation and records will be critical.
