Avalanche of Legislation Passed in Response to COVID 19

I wrote my last column in the shadow of the coronavirus shutting down wide swaths of the northeast and California and Washington State doing the same. Since then, nearly all of the country has followed suit. Hundreds of thousands have now been diagnosed with COVID 19 in the United States and tens of thousands have died. Weekly unemployment claims are setting records.

Against this background, federal, state, and local governments are providing an unprecedented legislative response. Expanded sick leave and additional unemployment benefits are among the laws that have been passed in seeming record time. At this point, it is apparent that the federal, state, and local governments are prepared to respond to this crisis with legislation and other actions designed to provide economic relief for individuals and businesses.  A summary of some of the high points of the recent legislation follows.

Families First Coronavirus Act (FFCRA)

Under this Act, most employers with fewer than 500 employees are required to provide eligible employees with up to two weeks of paid sick leave if an employee is quarantined, isolating, or caring for someone that is quarantined or isolating because of certain reasons related to COVID-19. It also expands the FMLA to provide for paid leave of up to 12 weeks of paid leave for employee that is unable to work or telework because of a bona fide need to care for a child whose school or child care provider is closed for reasons related to COVID 19. The paid leave is paid for through a credit on an employer’s payroll taxes.

Coronavirus Aid, Relief, and Economic Security Act (CARES ACT). The CARES Act is the largest economic relief bill in U.S. history. It will allocate up to $2.2 trillion for individuals and trillions affected by the coronavirus pandemic and the related economic downturn. While the CARES Act contains numerous provisions, key provisions for employers are a potential 50% tax credit for payroll taxes when the firm has a 50% decline in gross receipts due to government actions related to the pandemic, the Paychex Protection Program, which provides a forgivable loan to cover payroll and other overhead expenses for a limited period, and changes to the unemployment laws so that affected employees are eligible to receive unemployment compensation earlier and receive up to $600 more than they otherwise would have.

Expanded Sick Leave, Executive Orders, and Other State Law Issues.

The states have been as active as the federal government in response to the pandemic. We have seen sick leave expanded, created, or otherwise modified in any number of states. State and local leaders have issued Executive Orders that have profoundly affected how we live our lives: some businesses have been completely shut down, forcing companies to lay off staff; others have been deemed essential, requiring them to figure out how to keep a work force operational in the midst of a pandemic; and, some businesses have been forced to learn how to operate remotely, creating a trial by fire for technology and other systems that allow a business to operate while despite the separation between staff.

Navigating the challenges presented by this pandemic is not easy for employers. The myriad legislation provides crucial support to many that need it, but creates an administrative quagmire for the employers that much make sense of it. In addition to responding to this pandemic, employers must remain vigilant and stay apprised of all the obligations these new laws impose. It is not just that additional sources of leave are being provided to employees, employers must also be aware of their obligations to post notices and update their policies to comply with the new laws.