What the Families First Coronavirus Response Act Means for Nonprofit Arts Organizations
This post is a summary of our research on this issue and should not be construed as a definitive resource on this subject. Please consult the US Department of Labor , another appropriate government agency, or a qualified human resources professional before implementing these policies in your organization.
There have been three major pieces of US legislation as a result of the COVID-19 pandemic. The first was the Coronavirus Preparedness and Response Supplemental Appropriations Act (CPRSA Act), which provided funding for health agencies and medical supplies, as well as some initial funding for disaster loans. The third was the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which provided a many economic resources to address the economic impact of the coronavirus, including relief funding and major expansions to both unemployment resources and disaster loans.
The second law, the Families First Coronavirus Response Act (FFCR Act), in addition to funding COVID-19 testing and some increased funding for unemployment, made some significant changes to sick leave regulations in regards to COVID-19, as well as expanding Family Medical Leave Act (FMLA) eligibility. This was done in an effort to remove pressure on workers who would otherwise be inclined to come to work while ill or caring for someone who was ill in order to avoid lost wages. The FFRC Act takes effect on April 1, 2020. Below we have summarized how certain aspects this law might apply to your organization and employees as we navigate through this public health crisis.
FFCRA Summary
The FFCRA takes effect April 1, 2020 and applies to leave taken between April 1, 2020, and December 31, 2020.
The rules apply to businesses that have fewer than 500 employees (including full-time, part-time and temporary) at the time when the employee requests the leave. This count also includes employees that are already on leave.
Employers are required to provide all employees:
Two Weeks Paid Sick Leave (up to 80 hours) at the employee’s regular rate of pay if the employee:
- is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
- has been advised by a health care provider to self-quarantine related to COVID-19;
- is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
-OR-
Two Weeks Paid Sick Leave (up to 80 hours) at 2/3 employee’s regular rate of pay if the employee:
- is caring for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider)
- is caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19; or
- is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.
-IN ADDITION-
Employers are required to provide to employees it has employed for at least 30 days:
Paid Expanded Family and Medical Leave (up to 10 additional weeks) at 2/3 the employee’s regular rate of pay (after two weeks of unpaid leave, or two weeks of paid sick leave as noted above) if the employee:
- Is unable to work due to a bona fide need for leave to care for a child whose school or childcare provider is closed or unavailable for reasons related to COVID-19.
*Small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or childcare unavailability if the leave requirements would jeopardize the viability of the business as a going concern. The employer must document the reasons for the exemption, illustrating how the leave would jeopardize the viability of the business and retain that documentation for their records. There is currently no requirement to file that documentation, nor is there any system or mechanism to do so.
Rate of pay will be calculated based on whichever is higher:
- The employee’s regular rate of pay
- Federal minimum wage
- Applicable State or Local minimum wage
Employers may be reimbursed for the expenses related to this leave through refundable tax credits
According to the IRS:
Employers receive 100% reimbursement for paid leave pursuant to the Act.
- Health insurance costs are also included in the credit.
- Employers face no payroll tax liability.
- Self-employed individuals receive an equivalent credit.
Reimbursement will be quick and easy to obtain.
- An immediate dollar-for-dollar tax offset of the employer’s cost against payroll taxes owed for all employees will be provided
- Where a refund is owed, the IRS will send the refund as quickly as possible.
Employers should obtain documentation from their employees regarding the reason for the leave and may be required to provide this to the IRS.
The forms to file for this credit are not available at the writing of this summary.
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