Mandatory Paid Leave: the E-FMLA

Emergency Family and Medical Leave Expansion Act

Congress passed and the president signed the Families First Coronavirus Response Act, which included the Emergency Family and Medical Leave Expansion Act (E-FMLA). E-FMLA goes into effect on April 2, 2020 and expands coverage of the Family Medical Leave Act (FMLA) to include paid leave to care for a son or daughter under 18 years old if that child’s school or place of care is unavailable due to a COVID-19-related public health emergency. As written, E-FMLA is available only through December 31, 2020.

  • Highlights. E-FMLA significantly expands FMLA in the following ways:
    • It creates a new form of leave providing 2 weeks of unpaid leave and up to 10 weeks of employer-paid leave. Employers are “reimbursed” for this paid leave benefit through payroll tax credits.
    • An employee is eligible if employed at least 30 calendar days.
    • Covered employers are those with less than 500 employees. This is a big change for small employers (with less than 50 employees) who have not previously been covered.
    • It expands coverage to include an employee who is unable to work (including remote work) because the employee must care for a son or daughter under 18 years old due to a COVID-19 related school closure or unavailability of the child’s child care provider because of the COVID-19 public health emergency.
  • Period of Coverage. E-FMLA only applies between April 2, 2020, and December 31, 2020.
  • Unpaid and Paid Leave. FMLA does not require paid leave. E-FMLA does, after the first 10 days.
    • At the employer’s option, the first 10 days of E-FMLA leave may be unpaid. The employee may use available paid leave (for example, accrued but unused PTO) during the 10-day period of unpaid leave.
    • After 10 days, E-FMLA must be paid by the employer. The paid benefit amount  must not be less than two-thirds of the employee’s regular rate of pay for the number of hours the employee would normally be scheduled to work–up to $200 per day, and up to $10,000 total. The employer may pay more, but the extra amount will not be covered by the tax credit.
    • For employees with variable hours, the payments are based on the employee’s average scheduled hours per day for the prior six-month period. For employees employed less than six months, the hours are based on the hours the employee reasonably expected to work at the time of hire.
    • The total FMLA leave may not exceed 12 weeks (2 weeks of unpaid leave and up to 10 weeks of employer-paid leave).
  • Covered Employer. A covered employer for E-FMLA is one with less than 500 employees (for each working day during each of 20 or more calendar wees in the current or prior calendar year). This is a big change for employers with less than 50 employees because those employers would not otherwise be covered by FMLA.
    • The law permits the Secretary of Labor to issue regulations exempting small businesses with less than 50 employees if the requirements of E-FLMA would jeopardize the viability of the business as a going concern. The Secretary will probably issue regulations before April 2.
    • The law permits employers of health care workers and emergency responders to exclude those employees from E-FMLA coverage.
  • Employee notice. If an employee needs to take leave and the need is foreseeable, the employee must provide the employer notice as soon as practicable.
  • Qualifying need. E-FMLA leave is available if the employee is not able to work (including being unable to work remotely) because of a need to care for a son or daughter under 18 years old due to a public health emergency school closure or because the child care provider is unavailable because of a public health emergency.
    • A child care provider means a provider who receives compensation for providing child care services on a regular basis.
    • A public health emergency means an emergency regarding COVID-19 declared by any Federal State or local authority.
    • Job Restoration Requirements. Generally, the employer must restore the employee to the same or equivalent job. But for employers with less than 25 employees, the employer does not have to restore the employee’s job if the following three conditions are met:
      • Employee’s position no longer exists due to economic conditions or other changes in the employer’s operations that affect employment and are caused by a public health emergency during the leave;
      • The employer makes reasonable efforts to restore the employee to an equivalent position (with equivalent benefits, pay, and other terms and conditions of employment); and
      • If no equivalent job is available, then for a one-year period the employer will make reasonable efforts to contact the employee if an equivalent position becomes available. That one-year period begins on the earlier of the date the qualifying need related to the public health emergency ends or 12 weeks after employee’s leave began.
  • Payroll Tax Credit for E-FMLA. The tax credit for E-FMLA benefits is a credit applied against the employer’s payroll tax liability (up to the amount of the leave payment caps). If the credits exceed the employer’s payroll tax liability, the excess will be treated as an overpayment that may be refunded.

The key takeaway is that covered employers with fewer than 500 employees will soon be required to provide paid E-FMLA to employees who are unable to work because of the COVID-19 pandemic.

Contact Daniel Ichinaga, Nat Taylor, or Abigail St. Hilaire with any questions.