Coronavirus Response Act
Out of the box, unemployment is the first action to be taken for any of your employees. That is done online at the state's website.
Families First Coronavirus Response Act
Contained in the same legislation as passed, there are TWO Paid Leave Acts. This discussion is applicable only to Division E, the Emergency Paid Sick Leave Act.
1. Division E Emergency Paid Sick Leave Act - This applies to the 1st 10 days of employee sick leave and applies to ALL employers with fewer than 500 employees. The following includes a description of only that part of the Bill.
2. Division C Emergency Family and Medical Leave Expansion Act - This applies to employers with 50 or more employees and covers 12 weeks of sick leave. The following excludes a description of that part of the Bill.
I. Division E Emergency Paid Sick Leave Act. With regard to Division E Emergency Paid Sick Leave Act, HR 6201, passed by both House and Senate, your employees would ONLY qualify under those provisions if they meet the certain qualifications.
Keep in mind that this information is very very fluid and omits any regulatory impacts etc.... In this regard, those employers with "health care providers and emergency responders" may elect to exclude any employee from the following tests.
In general, the Secretary of Labor may also excluded certain employee categories as well as those who have home care for children.
Two Week Paid Sick Leave - This only applies in the following circumstance and when the employee cannot telework. The following tests are need based because:
(1) The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID - 19;
(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID - 19;
(3) The employee is experiencing symptoms of COVID -19 and seeking a medical diagnosis;
(4) The employee is caring for an individual who is subject to an order as described in (1) or has been advised as described in (2);
(5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID - 19 precautions.
(6) 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.
Amount of Paid Sick Leave
Under Division E Emergency Paid Sick Leave Act, such paid sick time shall not exceed:
(I) $511 per day and $5,110 in the aggregate for a use described in paragraph (1), (2), or (3) of section 5102(a); and
(II) $200 per day and $2,000 in the aggregate for a use described in paragraph (4), (5), or (6) of section 5102(a).
Promise of Payroll Tax Offset
The Joint Committee on Taxation report on Families First Coronavirus Response Act, HR 6201. It states that "Under the provision, an employer is allowed a credit against the OASDI tax or RRTA tax imposed on the employer for each calendar quarter in an amount equal to 100 percent of the qualified sick leave wages paid by the employer with respect to that calendar quarter, subject to the limits ...." Thus, the credit is a quarterly determination, not a rolling catch up. However, it is a refundable credit, meaning that if the credit exceeds on-going payroll taxes, that excess if refunded to the employer.
In addition, the credit is increased for group health plan expenses allocable to each employee's sick leave.
The effective date of Division E Emergency Paid Sick Leave Act is the enactment date, but no later than 15 days thereafter.
Important - These employee benefits are in addition to existing payroll policies historically in place.
Section 7002 provides for similar Self-Employment credit provisions again self-employment taxes and is also refundable.
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