COVID-19: Family and Medical Leave Legislation

On Wednesday, March 18th, the President signed into law the Families First Coronavirus Response Act (FFCR). The FFCR applies to all employers with 500 or fewer employees and contains three primary sections related to employers: Emergency Family and Medical Leave Act Expansion; Emergency Paid Sick Leave Act; and Tax Credits for Paid Sick and Paid Family and Medical Leave. The FFCR is slated to take effect April 2, 2020 and will expire on December 31, 2020.

The FFCR applies to almost all private employers with fewer than 500 employees. Exemptions are for health care providers, emergency responders, and businesses with fewer than 50 employees—if the employer can establish that the requirements would “jeopardize the viability of the business”. Guidelines regarding what “jeopardizes the viability of the business” means have not been issued.

Emergency Family and Medical Leave Act

Under the Emergency Family and Medical Leave Act, only employees who have worked for an employer for 30 calendar days are eligible to take leave for a “qualifying need due to a public health emergency.” A qualifying need is defined as an employee who is unable to work because the employee’s child, under the age of 18, is at home due to a school or day care closure or the unavailability of other child care providers because of a COVID-19 emergency. Employees may take up to 12 weeks of leave, with 10 of those weeks  paid as an extra benefit under the Act. The employer is not required to provide paid leave for the first 10 days (2 work weeks) of leave, but employees have the option to use other paid leave benefits to cover this period.  After the first 10 days, the paid leave should be calculated at two-thirds of the employee’s regular pay and capped at $200 a day and $10,000 in total.

Emergency Paid Sick Leave Act

The Emergency Paid Sick Leave Act requires paid sick leave when an employee cannot work due to one of the following:

  • The employee is under a federal, state, or local quarantine or isolation order because of COVID-19;
  • The employee is advised by a health care provider to self-quarantine because of COVID-19;
  • The employee has symptoms of COVID-19 and is seeking a medical diagnosis;
  • The employee is caring for an individual who meets one of the first two conditions, above;
  • The employee is caring for a son or daughter whose school or child care center is closed because of COVID-19 precautions, or whose child care provider is unavailable for the same reason; or
  • “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.”

The employer must provide paid leave to employees immediately, even if those employees were just hired. Full-time employees are eligible to take 80 hours of paid leave. The calculation for part-time employees should be based on the average number of hours worked over a two-week period.
For reasons 1-3 above, the employee should be paid at the employee’s regular rate of pay capped at $511 a day and $5,110 total. For reasons 4-6 above, the employee should be paid at the employee’s regular rate of pay capped at $200 and $2,000 total.

If an employer offers other types of paid leave, the employer can choose to have the employee use the federal, state, or local “statutory” paid leave first. But an employer cannot make the employee use the employer’s other non-statutory paid leave first.

Understand: an employer may not terminate, discipline, or discriminate against an employee who takes leave under this provision. As well, this law does not preempt any local, state, or federal laws regarding paid leave laws or the employer’s own paid leave policies.

Tax Credits for Paid Sick and Paid Family

Employers are eligible to receive tax credit against the employer’s Social Security tax liability equal to 100% of the sick leave amounts paid by the employer, subject to the limits described above. In addition, certain employer paid health premiums will increase the credit.    

Contact our office if you have questions about this or other legal matters.  We remain open to serve our clients during this crisis.  

This article is provided for general information and should not be relied upon as legal advice for a specific situation. If you are in need of specific advice or legal representation, please do not hesitate to contact us.

©2020 Bea & VandenBerk

Illinois Employment Law for 2020

2019 was a busy year for the Illinois legislature with respect to state employment law changes. Below is a summary of the most important pieces of legislation affecting employers in 2020:

Amendments to the Equal Pay Act of 2003

Made effective on September 29, 2019, the intent of the legislation is to address pay disparity between men and women. As amended, the Equal Pay Act prevents employers from:

  • Requesting or requiring that an applicant disclose wage or salary history as a condition of employment;
  • Requesting or requiring a wage or salary history as a condition of being considered for employment, as a condition of being interviewed, as a condition of an offer of employment, or as a condition of an offer of employment or an offer of compensation;
  • Screening job applicants based on their current or prior wages or salary histories, including benefits or other compensation, by requiring that the wage or salary history of an applicant satisfy minimum or maximum criteria; or   
  • Seeking the wage or salary history, including benefits or other compensation, of a job applicant from any current or former employer.
Continue reading “Illinois Employment Law for 2020”

New Proposed Fair Labor Standards Act Overtime Rules

The Department of Labor (DOL) finalized its proposed rules for overtime eligibility. As some may recall, the DOL attempted to issue new overtime rules back in 2015, but those overtime rules were enjoined by a federal district court in 2016. Below is a summary of the final 2019 overtime rules:

Continue reading “New Proposed Fair Labor Standards Act Overtime Rules”

Nonprofits and Taxable Parking Expenses

Navigating the Possibility of Incurring UBTI

Nonprofit organizations that provide employee parking benefits may be surprised to learn that they may be subject to incur unrelated business taxable income (UBTI). In addition, organizations with no UBTI may now be required to file form 990-T.   

The Tax Cuts and Jobs Act (Act) amended Section 274 of the Internal Revenue Code (IRC) to disallow for-profit employers from deducting certain expenses related to transportation fringe benefits provided to their employees. The Act added IRC Section 512(a)(7) to what constitutes UBTI for nonprofits and other tax-exempt entities. The Act states that tax-exempt entities are required to increase their UBTI by expenses related to transportation fringe benefits provided to their employees. The transportation fringe benefits subject to this tax include expenses associated with:

Continue reading “Nonprofits and Taxable Parking Expenses”

Law Suit Shows the Danger of Disregarded Employment Law

President Trump Sued for Unpaid Overtime

In July 2018, President Donald Trump learned the danger of disregarding employment law when he was sued by his long-time, personal chauffeur for unpaid overtime. In this case, Trump did not abide by state and federal wage and hour rules.

Reportedly, chauffeur Noel Cintron was “forced to work thousands of hours of overtime without compensation,”1 anywhere from 50-55 hours per week.  He would begin at 7:00 a.m., five days a week, and stay until Trump, his family, or business associates no longer needed Cintron’s services. Continue reading “Law Suit Shows the Danger of Disregarded Employment Law”

“Mark of the Beast”: Fourth Circuit Upholds Judgment That Employer Failed to Accommodate Employee’s Religious Beliefs

A recent Fourth Circuit Court of Appeals ruling highlights an employer’s mistakes when refusing an employee’s request for a religious accommodation. The case, EEOC v. Consol Energy, Inc., upheld the lower court’s judgment against Consol that it failed to accommodate an employee’s religious objection to participate in the employer’s mandated biometric hand scanner system. The Fourth Circuit also upheld the district court’s damages award to the employee of almost $600,000.

Continue reading ““Mark of the Beast”: Fourth Circuit Upholds Judgment That Employer Failed to Accommodate Employee’s Religious Beliefs”

Update: U.S. Department of Labor Withdraws Guidance on Independent Contractors and Joint Employment

On June 7, 2017, the U.S. Department of Labor (DOL) announced that it was withdrawing the Obama-era DOL 2015 and 2016 informal guidance memorandums on independent contractors and joint employment also referred to as joint employer. These memorandums were “Administrator’s Interpretations” meant to provide guidance as to how the law and related regulations with respect to independent contractors and joint employment should be interpreted and applied to employers.
Continue reading “Update: U.S. Department of Labor Withdraws Guidance on Independent Contractors and Joint Employment”

Federal Emergency Motion Blocks Enforcement of FLSA’s New Overtime Rules

On November 22, 2016, the Federal Eastern District Court of Texas granted an emergency motion for a preliminary injunction to prevent the Department of Labor (DOL) from enforcing the new Federal Labor Standards Act’s (FLSA) overtime rules set to take effect on December 1, 2016. Since the district court ruling enjoined the implementation of the overtime rules nationwide, employers do not have to comply with the proposed overtime rules that would have doubled the minimum salary requirements for the so-called “white collar” exemption to required overtime pay.

Employers should be aware, however, that the ruling was a preliminary injunction. It will only remain in effect until the merits of the case are resolved by the federal District Court, Fifth Circuit Court of Appeals, or the U.S. Supreme Court.   Continue reading “Federal Emergency Motion Blocks Enforcement of FLSA’s New Overtime Rules”

Keeping Tabs on Independent Contractors

Is your organization classifying its independent contractors correctly?

The misclassification of independent contractors as employees continues to remain at the forefront of the enforcement agendas for both the Internal Revenue Service (IRS) and the Department of Labor (DOL). In addition, as of this writing, 37 states have entered into formal memoranda of understanding with the DOL to jointly pursue worker misclassification. Many employers, both small and large, continue to struggle with how to properly classify their workers. The potential costs to an employer who misclassifies an employee as an independent contractor can be significant. For example, if an employer issues Form-1099 to a worker considered to be an independent contractor who is later determined to be an employee by the DOL, the employer may be required to pay back-wages, liquidated damages and attorney’s fees. He may also be liable to the IRS and Social Security Administration for unpaid taxes and other penalties.        Continue reading “Keeping Tabs on Independent Contractors”

Illinois Employment Law Short Takes

Two important Illinois employment laws take effect on January 1, 2017: the Illinois Sick Leave Act and the Illinois Freedom to Work Act.

The Illinois Sick Leave Act
The Illinois Sick Leave Act, which does not require employers to provide personal sick leave, applies only to employers who provide personal sick leave benefits to their employees. The Act does not compel any employer to adopt personal sick leave benefits, even if that employer does not already have personal sick leave benefits in place. Continue reading “Illinois Employment Law Short Takes”