Compliance Check: Family First Coronavirus Response Act
On March 18, 2020, President Trump signed the Family First Coronavirus Response Act in response to the spread of COVID-19. The Act is an economic stimulus plan that affects coverage for COVID-19 testing and provides expanded federal family and medical leave and a new federal paid sick leave law.
The detailed provisions take effect on April 2, 2020, and will be in effect until December 31, 2020. What’s included in the new Act?
Coverage for COVID-19 Testing:
Private group health plans must provide coverage and not impose any cost sharing until the end of the national emergency period. This includes:
- In vitro diagnostic products for the detection or diagnosis of the virus that causes COVID-19 that have been approved, cleared, or authorized by the FDCA.
- Items or services furnished to an individual during healthcare provider visits that result in an order for an in vitro diagnostic product.
Emergency Family and Medical Leave:
An amendment to the Family and Medical Leave Act of 1993 (FMLA), Emergency Family and Medical Leave provides additional qualifying reasons for leave. The Act has eligibility requirements, including:
- Employees unable to work– or telework– due to a need for leave to care for their family.
- To be eligible, the employee must have been employed for at least 30 calendar days.
- Employers are required to provide this leave if they have less than 500 employees.
An employee’s first 10 days of leave due to a public health emergency may be unpaid– but may elect to substitute paid leave for the unpaid leave. Following the first 10 days the employee will be paid two-thirds of their regular pay for the remaining period of leave. (Note: Paid leave cannot exceed $200 per day and $10,000 in the aggregate).
Where necessity for leave due to a public health emergency is foreseeable, the employee must provide a notice of the need for leave ASAP.
Job reinstatement rights for leave taken due to public health emergencies (except for employers with less than 25 employees) may be excused from reinstating an employee’s position under the following conditions:
- The position held by the employee when the leave began doesn’t exist due to economic conditions or other changes in operating conditions of the employer.
- The employer makes reasonable efforts to restore the employee to a position equivalent to the position the employee held when the leave began, with equivalent employment benefits, pay, and other terms and conditions of employment.
- If the reasonable efforts to restore the employee to an equivalent position fail, the employer must make reasonable efforts to contact the employee if an equivalent position becomes available within a one-year period beginning on the earlier date on which the reason for the leave due to public health emergency ends or 12 weeks after the date on with the public health emergency leave begins.
Employers and the DOL may elect to exclude these healthcare providers or emergency responders from eligibility for the Act. Additionally, the DOL may exempt certain employers with fewer than 50 employees from providing leave under the Act if the requirements would jeopardize the viability of the employer.
Emergency Paid Sick Leave:
The Act requires employers with fewer than 500 employees to provide paid leave due to an employees’ inability to work or telework due to:
- Federal, state, or local mandate to quarantine or isolate due to COVID-19.
- Healthcare provider has advised the employee to self-quarantine due to COVID-19 concerns.
- The employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis.
- The employee is caring for an individual who is subject to an order as described in number 1, or 2.
- The employee is caring for dependents if the school or place of care has been closed due to COVID-19 precautions.
Full-time employees are entitled to 80-hours of paid sick leave, while part-time employees are entitled to a number of hours equal to the number of hours they would typically work over a two-week period.
Compensation during paid sick leave shall not exceed $511 per day and $5,110 in aggregate for reasons 1-3 listed above. Compensation shall not exceed $200 per day and $2,000 in aggregate for reasons 4-5 listed above.
Employers must post a notice provided by the DOL on the premises of the employer where notices to employees are generally posted. The notice will be available no later than March 25, 2020.
Next Steps for Employers:
Ensure COVID-19 testing is including in all group health plans:
- Contact carriers and/or TPAs to immediately implement coverage of COVID-19 testing with no cost-sharing, no prior authorization requirements, and no medical management requirements.
- Understand the extent to which plans must cover items and services related to COVID-19 testing.
- Review/modify FMLA documentation to reflect temporary FFCRA requirements.
- Work with an FMLA administration vendor to coordinate compliance with FFCRA.
- Communicate to employees the new FMLA benefits for COVID-19 related leave.
- Work with payroll to establish procedures for calculating and paying out paid leave after the first two weeks.
Emergency Paid Sick Leave:
- Work with a leave administration vendor to coordinate compliance with FFCRA.
- Obtain the DOL model notice and post.
- Communicate and educate employees on eligibility for paid sick leave.
- Work with payroll to establish procedures for calculating and paying out sick leave.
Employment Tax Credits:
- Work with payroll to track payments under expanded FMLA or paid sick leave.
- Work with a payroll tax vendor to calculate and claim tax credits through tax deposits and payroll tax filings.
COVID-19 continues to be a significant issue for all employers in all industries.