Bill Calls for Paid Leave at Small Companies

In response to the coronavirus pandemic, the U.S. House of Representatives on Monday passed major changes to the Families First Coronavirus Response Act. Among other things, the law requires small companies to continue to pay employees who stay home to care for children whose schools have closed or to care for an at-risk family member.

President Trump has endorsed the bill. When CNN asked Senate Majority Leader Mitch McConnell what the Senate would do when it receives the bill, his response was clear: “Pass it.” The Leader has also said. . .” the Senate will not adjourn until we have passed significant and bold new steps, above and beyond what the House passed, to help our strong nation and our strong underlying economy weather this storm.”

The job-protected leave portion of the bill says this: Government employees and employees of employers with fewer than 500 employees who have been on the job for at least 30 days will have the right to take job-protected leave.

The leave can be used for quarantine due to exposure to or symptoms of coronavirus; to care for an at-risk family member quarantined due to exposure to or symptoms of coronavirus; and to care for a child of an employee if the child’s school or child care has been closed or is unavailable due to coronavirus.

The 500-employee language is intended to be more inclusive than the existing protections under the Family and Medical Leave Act (FMLA) but does leave out some employees. Employers will be required to pay two-thirds of an employee’s earnings.

The bill also provides for a refundable tax credit equal to 100 percent of qualified paid sick or family leave wages paid by an employer for each calendar quarter. The tax credit is allowed against the employer portion of Social Security taxes. It applies to amounts paid to employees who are sick or quarantined; a lesser credit applies to amounts paid to employees caring for a family member or for a child whose school or place of care has been closed.

Caps and limits apply, including a $511-per-day sick cap and a 67 percent cap on family leave not to exceed $200 a day.

The bill also includes a provision for emergency transfers to administer unemployment compensation. It provides $1 billion for emergency grants to states for activities related to processing and paying unemployment insurance benefits.

The bill does not include an extension of the tax filing deadline; the deadline remains April 15.

It also does not include a payroll tax cut. President Trump called for payroll tax relief to last through the election, but neither party in Congress seemed inclined to agree. The law also:

  • Requires private health plans to provide coverage for COVID-19 diagnostic testing, including the cost of a provider, urgent care center, and emergency room visits.
  • Reimburses for the cost for COVID-19 diagnostic testing and services provided to those without health insurance.
  • Funds COVID-19 diagnostic testing for veterans receiving care through Medical Services or through Medical Community Care.
  • Funds nutrition assistance programs.