The St. Petersburg Chamber of Commerce presents: Coronavirus Impact Insights
On this episode of Chamber Coronavirus Impact Insights, Meredith Gaunce of Gaunce Law joins St. Petersburg Chamber CEO Chris Steinocher and Catalyst publisher Joe Hamilton in the studio to discuss the impact of The Families First Coronavirus Response Act, passed by Congress last week.
Gaunce, who specializes in helping business owners understand how employment laws affect their businesses, explains that the law has two particularly important aspects for small businesses (between 1-500 employees) to grapple with: The Emergency Paid Sick Leave Act, and the Emergency Family Medical Leave Expansion Act.
The Emergency Family Medical Leave Expansion Act takes the Family Medical Leave Act (FMLA), which allowed up to three months of unpaid leave for qualifying reasons, and drastically expands it. It mandates that employers provide employees that are charged with caring for a son or daughter because of a Covid-19 related school or daycare closure – who cannot work and cannot telework – 12 weeks of paid leave, at two-thirds of their regular compensation. Companies with 25 employees or more are required to make reasonable efforts to ensure these employees can return to a similar position at the end of that leave.
The Emergency Paid Sick Leave Act federally mandates that employers provide 10 days of paid sick leave or 80 hours for full-time workers. Employers must also cover part-time workers but at a pro-rated rate. Paid sick leave for employees who have symptoms or a diagnosis of Covid-19, or have been directed to self-quarantine by a health care professional, covers full wages and caps at $511 per day. Paid sick leave for employees who are caring for another person covers two-thirds of their pay rate and caps at $200 per day.
While Congress left provisions for the Secretary of Labor to add an exemption for small businesses between 1-50 employees from providing these benefits, the details of that exemption have not yet been finalized. It is most likely, according to Gaunce, that the exemption would require employers to prove that they have 50 employees or less and that paying such benefits would create a hardship for the business.
These provisions go into effect April 2, and work hand-in-hand. The law will sunset Dec. 31. Gaunce’s best advice to employees is to track how much the business pays out in sick leave and unemployment, as businesses will be compensated via tax credits. The best thing an employer can do is have detailed financial information on the compensation they give out readily accessible.
Finally, Gaunce, Steinocher and Hamilton discuss the pros and cons of laying off workers or furloughing them to allow them to keep any employment-based insurance benefits.