March 31, 2020
Yesterday I told you about the guidance issued by the IRS and Department of Labor (DOL). Today, I am going to share information from
Business Management Daily
on how you can coordinate and track employees on that are off from work because either they or someone that they have to care for has COVID-19. The
Families First Coronavirus Response Act (FFCRA
)
mandates both paid sick leave and paid family leave for some employees. With the new mandates come recordkeeping requirements. Here's how to track usage and coordinate coverage.
Number of Employees
If you have more than 500 employees, you are exempt from the FFCRA's paid-leave mandates.
Headcount does matter if you have 25 or fewer workers and do not intend to reinstate a worker who took
Family and Medical Leave Act (FMLA)
leave. That requires petitioning for an exemption. You would have to provide the Department of Labor with your employee count, plus records showing the job no longer exists because of the coronavirus pandemic.
You will also have to document that you looked for another position for the worker and kept doing so for 12 months. (The DOL will also issue emergency regulations for employers with 50 or fewer employees that can show that providing leave would impair their ability to function as a going concern.)
Tracking Eligibility
Covered employers have to track each employee's eligibility for both types of leave. Start with the first day of work. Employees are eligible on Day One for the 10 days of paid emergency sick leave. After 30 days, they are eligible for partially paid public health emergency leave.
Coordinating Leave
The law's FMLA public health emergency leave provision allows employees to first take paid emergency sick leave, followed by partially paid public health emergency leave under more limited circumstances. Generally, employers will credit the first 10 days to paid emergency sick leave.
Note in your records the reason for the leave and the rate paid, since COVID-19 quarantine, testing, and treatment is paid at a different rate (up to $511 per day) than taking off to care for a family member or because school and day care is closed (up to $200 per day). You will need to establish each worker's regular rate of pay based on
Fair Labor Standards Act
rules.
.
Next, determine if the employee is entitled to expanded FMLA leave. Only those caring for children due to coronavirus-related school or daycare closures are eligible.
Only employees whom you have not offered an opportunity to telework are eligible. Note any offer to work from home. If the employee rejects the offer, document that you explained this means he will not receive paid FMLA leave. Next, document that schools or daycare for minor children have closed. Then document pay at two-thirds of the regular rate of pay, up to a maximum of $200 per day.
We will share more details as they become available. Please visit our
COVID-19 Resource Page
for more updates.
Feel free to contact any member of our team at (610) 828-1900 (PA) or (732) 341-3893 (NJ) with questions. Rich Higgins, CPA, managing principal – New Jersey office can be contacted at
Richard.Higgins@MCC-CPAs.com
. I can be reached at
Marty.McCarthy@MCC-CPAs.com
. As always, we are happy to help.
Stay safe,
Marty McCarthy, CPA, CCIFP
Managing Partner
McCarthy & Company
Source: Business Management Daily
Disclaimer: This alert is for informational purposes only and does not constitute professional advice. Information contained in this communication is not intended or written to be used as tax advice, and cannot be used by the recipient to avoid penalties that may be imposed under the Internal Revenue Code. We strongly advise you to seek professional assistance with respect to your specific issue(s).
