A message from Barry DuVal, President of the Virginia Chamber of Commerce:
On Friday,
the House passed HR 6201, which would require businesses with 500 or fewer employees to provide 2 weeks of paid sick leave at an employee's full wages and an additional 10 weeks of paid leave at 2/3 the employee's pay rate
- this includes paid leave for taking care of children as a result of school closures and for any federal, state or local quarantines. The mandate would be in addition to any paid leave the employer already provides. The leave is for any covered absences between 15 days after the bill is signed into law and December 31, 2020. While the bill attempts to mitigate these costs through tax credits and refunds, these payments to employers will not be immediate. There is a section that allows employers with 50 or fewer employers to petition the Department of Labor for an exemption from the 10 week leave requirement.
Please see below for a summary of the legislation:
Paid Sick Leave:
Requires private sector employers with fewer than 500 employees and government employers to provide employees with two-weeks of paid sick leave (80 hours for full-time employees and typical number of hours over two-weeks for part-time employees).
Eligibility:
The paid sick leave is available to any employee without regard to duration of employment if they are out in order to:
- Self-isolate because they have coronavirus,
- Obtain a diagnosis because they are exhibiting symptoms,
- Comply with an order by a health care professional to stay away from work,
- Care for a family member facing the instances mentioned above, or
- Care for children if schools are closed or their caregiver is unavailable because of a public health emergency.
Rate of Pay:
Employees are compensated at the higher of their regular rate, the federal minimum wage, or the local minimum wage. However, if the employee is absent to care for a sick family member or a child unable to attend school, they are compensated at 2/3 of the rate they would otherwise receive.
Relationship to Existing Programs:
This paid sick leave is in addition to whatever sick leave is already offered by the employer [including subject to state or local requirements]. Once this legislation is enacted an employer may not make changes to its sick leave policy.
Effective Dates:
The provision takes effect not later than 15 days after enactment of the bill and sunsets on December 31, 2020.
Funding:
Each quarter, private sector employers subject to the requirement are entitled to a fully refundable tax credit equal to 100% of the qualified sick leave wages paid by the employer. Qualified sick leave wages are capped at $511 per day [$200 per day if the leave is for caring for a family member] and 10 days. The tax credit is applied against employer Social Security taxes, but employers are reimbursed if their costs for qualified sick leave exceed the taxes they would owe. The Treasury Secretary is provided with regulatory authority intended to help with cash flow issues, for example by waiving penalties on failing to deposit payroll taxes in anticipation of the credit.
Paid Family and Medical Leave:
With certain possible exceptions [see below], requires private sector employers with fewer than 500 employees and government employers to provide employees with up to 12 weeks of paid family and medical leave.
Eligibility:
The paid sick leave is available to any employee who has been employed for at least 30 days if they are out in order to:
- Comply with a requirement or recommendation to quarantine because of exposure to or symptoms of coronavirus,
- Care for a family member facing the instances mentioned above, or
- Care for children if schools are closed or their daycare is unavailable because of a public health emergency.
Rate of Pay:
After 14 days, during which time the employee can take unpaid or paid leave (if available), employees are compensated at 2/3 of their regular rate.
Small Business and Other Exemptions:
The Secretary of Labor is authorized to exempt health care providers and emergency responders and small businesses with fewer than 50 employees if the requirement would jeopardize the business as an ongoing concern. The requirements to restore the employee to their position after the paid leave is taken do not apply to businesses with fewer than 25 employees if the position no longer exists because of the public health emergency (provided the employer takes certain actions to try and assist the employee). Employers with less than 50 employees are exempt from civil actions brought by employees for violations of this section.
Effective Dates:
The provision takes effect not later than 15 days after enactment of the bill and sunsets on December 31, 2020.
Funding:
Each quarter, private sector employers subject to the requirement are entitled to a fully refundable tax credit equal to 100% of the qualified paid family leave wages paid by the employer. Qualified paid family leave wages are capped at $200 per day and $10,000 overall. The tax credit is applied against employer Social Security taxes, but employers are reimbursed if their costs for qualified paid family leave exceed the taxes they would owe. The Treasury Secretary is provided with regulatory authority intended to help with cash flow issues, for example by waiving penalties on failing to deposit payroll taxes in anticipation of the credit.
