What Employers Need to Know About the Families First Coronavirus Response Act

In response to the coronavirus of 2019 (COVID-19), President Trump signed the Families First Coronavirus Response Act, H.R. 6201, into law on March 18, 2020.  The Act provides various forms of relief including free COVID-19 testing, expanded food assistance and unemployment benefits, and requires employers to provide additional protections for healthcare workers.  Additional bills are pending and likely to be finalized and provide additional relief.

Significantly, the Act also requires employers with fewer than 500 employees to provide paid sick leave and expanded family leave for employees.  Employers with 500 or more employees are not subject to these requirements.

The key employment-related provisions of the bill are summarized below.  These provisions will become effective within 15 days (April 2, 2020) – employers must act promptly to ensure that their policies comply with these new requirements.

Emergency Paid Sick Leave

Under the Act, employers with fewer than 500 employees will be required to provide paid sick leave to any employee who is:

  • subject to a coronavirus quarantine or isolation order or who has been advised by a health care provider to self-quarantine due to coronavirus concerns;
  • experiencing symptoms of coronavirus and is seeking a medical diagnosis;
  • providing care for a family member who is self-isolating due to a diagnosis of coronavirus, experiencing symptoms of coronavirus and needs to obtain medical diagnosis or care, or quarantining due to exposure or exhibition of symptoms; or
  • caring for a child whose school or place of care is closed, or the child care provider of the child is unavailable, due to coronavirus.

Full-time and part-time employees are eligible for paid leave under the Act.  Full-time employees are to receive 80 hours of sick leave, and part-time workers are entitled to leave equal to the number of hours they work, on average, over a 2-week period.

The amount of pay employers are required to provide under the Act depends on the reason for an employee’s leave.  Employees taking leave for themselves must be paid at their regular rate up to a cap of $511 per day and a total $5,110.  Employees taking leave to care for a family member must be paid at two-thirds of their regular rate, with a cap of $200 per day and a total of $2,000.

Notably, the sick leave required under the Act must be provided in addition to any paid leave already provided by employers.  Employers cannot require a worker to use any other available paid leave before using the sick leave required under the Act.

Finally, employers will be required to post a new notice containing information regarding the emergency sick leave provisions of the Act.  The U.S. Department of Labor will create a model notice within the next week.

Emergency Family and Medical Leave Expansion

In addition to the new paid sick leave obligations, the Act amends the Family and Medical Leave Act (FMLA) and requires that employers with fewer than 500 workers must provide up to 12 weeks of family and medical (FML) leave for employees unable to work or telework because they have to care for a child if the child’s school or place of care has been closed, or if the child care provider of that child is unavailable due to a coronavirus emergency.  To be eligible for FML leave under the Act, employees must have been employed for at least 30 days.

Under this provision, the first 10 days of leave may be unpaid, although a worker may choose to use accrued vacation days or other available medical, sick or PTO leave for those days.  After the initial 10 days, workers on FMLA leave must be paid at two-thirds of their regular rate. The paid leave under this provision is capped at $200 per day and $10,000 in total.

In most cases, as required by the existing FMLA leave requirements, the new expanded FML leave under the Act is job-protected and an employer must return the employee to the same or equivalent position upon their return to work.  The Act, however, provides an exception for employers with less than 25 employees if (1) the employee’s job no longer exists due to economic conditions or other changes in the employer’s operating conditions caused by the coronavirus pandemic, and (2) the employer makes reasonable efforts to restore the employee to an equivalent position.

Potential Exemptions

Importantly, under the Act, the Secretary of Labor is authorized to issue regulations exempting: (1) certain health care providers and emergency responders from paid leave benefits, and (2) small businesses with fewer than 50 employees from the newly added paid leave requirements “when the imposition of such requirements would jeopardize the viability of the business as a growing concern.”

Employer Tax Credits

The Act provides for a series of refundable tax credits for employers providing paid emergency sick leave or paid FMLA.  Specifically, employers will be entitled to a refundable tax credit equal to 100 percent of qualified sick or family leave wages required by the Act.  These tax credits will be allowed against the employer portion of Social Security taxes; however, if the credit exceeds the employer’s total Social Security taxes for all employees for any calendar quarter, the excess credit will be refundable to the employer.

Next Steps for Employers

Promptly review the Act, which is available here.  Employers need to assess which provisions are applicable to them and determine how to comply.  There will be new regulations and additional legislation in the near future, so it is essential to stay on top of these developments.  We are closely monitoring these matters and will provide updates.


Please contact either John Clifford at FortneyScott (jclifford@fortneyscott.com) or your FortneyScott attorney on how these changes affect your company’s compliance obligations.

DOL & EEOC Nominees Nearing Confirmation

The Senate Committee on Health, Education, Labor & Pensions (HELP Committee) moved to send the nominations of Scott Mugno (OSHA), Cheryl Stanton (Wage & Hour), and Janet Dhillon (Chair, EEOC) to the Senate floor in a party line vote.  In the recent past, clearing this hurdle has not always led to quick approval by the Senate.

Nonetheless and depending on the Senate’s legislative schedule, political leaders in these important employment-related agencies may soon be in place. The HELP Committee’s action comes in the wake of growing criticism about the overall lack of confirmed political leadership at DOL and EEOC.

FortneyScott will continue to monitor any updates related to nominations at employment based agencies.

Rulings Establish Precedent, but Judges Aren’t Forever

In a surprisingly narrow (albeit witty) per curiam decision, the Supreme Court vacated a ruling of the 9th Circuit that held it was impermissible under the Equal Pay Act (EPA) to determine a salary differential solely on the basis of prior salary. Fresno County Superintendent of Schools v. Aileen Rizo.

In the original case, the District Court ruled that under the Equal Pay Act “a factor other than sex” included using prior salary to determine pay.  On appeal – and on re-hearing by an en banc panel of 11 judges – the 9th Circuit held that relying on such a factor could not be sustained under the EPA.  Although all the judges on the panel agreed that Rizo’s case should go forward, the court splintered in arriving at a rationale for the decision.  The only opinion that garnered as many as 5 votes held that reliance on prior pay was wrong because it perpetuated sex-based pay gaps when women change jobs.  However, that opinion was written and joined by the late Stephen Reinhardt, who died before the decision could be issued.

That unfortunate event gave the Supreme Court an opportunity to vacate the case without addressing the vexing issue of the meaning of the EPA – an issue that has split a number of appellate circuits and which seems ripe for Supreme Court review.  The grounds on which the Supreme Court’s ruling was based was simply that Judge Reinhardt could not be counted among those who support the 9th Circuit’s ruling because he died before the decision was issued.  This was an impermissible exercise of judicial power from beyond the grave.  As an unidentified wag on the High Court wrote: “federal judges are appointed for life, not for eternity.”

The 9th Circuit will likely appoint a new en banc panel and issue on new ruling, perhaps on similar grounds.  In the meantime, the Supreme Court can continue to evade an important ruling on the reach and meaning of the Equal Pay Act at a time when efforts to amend it are before the Congress – again.

OFCCP to Issue 2019 CSALs; Focused Reviews Are Announced

The OFCCP has just announced that they are, “on schedule to post its next Corporate Scheduling Announcement List (CSAL) in OFCCP’s FOIA Library in mid-to-late March 2019.”  As a result, OFCCP will soon be issuing notices to 3,500 federal contractors in the next month.  In the past, CSALs, which are alerts from OFCCP informing contractors that their establishment has been selected for an audit, were mailed directly to the contractor. Now the agency will post the CSALs on its website with contractors responsible for learning on their own if they are to be audited.

The Agency also announced that 500 of the CSALs would be for a new kind of targeted compliance evaluation – a focused review.  These focused reviews are aimed at ensuring compliance not only with Executive Order 11246 but particularly with Section 503 of the Rehabilitation Act and the Vietnam Era Veterans’ Readjustment Assistance Act (“VEVRAA”), that is, the laws designed, in large part, to protect individuals with disabilities.  The focused review will always include on-site interviews with compliance managers and protected employees, as well as reviewing recruiting, hiring, and accommodations data.  To view a copy of the scheduling letter that will be used for OFCCP’s focused reviews, click here.

Register here to join a complimentary FortneyScott “Lunch & Learn” webinar: Preparing for OFCCP Focused Reviews, to be presented on February 27, 2019 at 12 noon, EST.

There will also be changes to the traditional compliance review.  Once the scheduling letters are received, contractors will have 30 days in which to submit their Affirmative Action Plans (AAPs) and the other items required by the scheduling letter and itemized listing.  In order to facilitate a timely submission, the assigned compliance officer will contact the contractor within 15 days of the contractor’s receipt of the Scheduling Letter to offer technical assistance.

OFCCP will grant a one-time 30-day extension for submission of supporting data related to the EO 11246, VEVRAA and Section 503 AAPs, provided the contractor:

  1. Requests the extension prior to the initial 30-day due date for the AAPs; and
  2. Timely submits the basic EO 11246, Section 503 and VEVRAA AAPs within the 30-day period after receiving the Scheduling Letter and Itemized Listing.

Failure to submit AAPs and/or supporting data timely, with approved extensions, will result in an immediate Show Cause Notice.

Please contact your FortneyScott attorney or send an email to info@fortneyscott.com for more information on this new extension policy or for assistance in preparing AAPs and responses to Scheduling Letters.  As more information about the focused reviews becomes available, it will be posted on this site.

New OFCCP Directive Establishes Voluntary Enterprise-wide Program

The OFCCP issued its latest directive, Directive 2019-04, on February 13, 2019, outlining its new Voluntary Enterprise-wide Review Program (VERP). The new program is designed to facilitate and confirm “enterprise-wide (corporate-wide) compliance by high-performing contractors and those aspiring to reach the top through individualized, corporate-wide compliance assistance.”

Contractors selected to participate in the VERP will be removed from the pool of contractors scheduled for compliance evaluations. There will be two-tiers of contractors: the top tier will include top-performing contractors with corporate-wide Diversity and Inclusion programs; the second tier will be contractors who are OFCCP compliant but need individualized compliance assistance to become top performers.  Criteria for the top tier will be more stringent.

To participate in the program, contractors must demonstrate that they meet established criteria that verify not only basic compliance with OFCCP’s requirements, but a demonstrated commitment to and application of successful equal employment opportunity programs on a corporate‐wide basis. A “top-tier” contractor can remain in the program for a period of five years while those at the second level can remain in the program for three years and receive individualized compliance assistance to become a top performer.  Any contractor selected must agree during that period to provide periodic reports and information to OFCCP through which OFCCP can confirm the contractor maintains a workforce free of discrimination or other material violations and also agree that OFCCP retains the right to conduct individual and/or third party complaint investigations to assure “the contractor abides by all terms of the agreement.”  It is not yet clear how OFCCP will make the distinction between “top-tier” and “second level” contractors.

Beginning in FY 2020, applicants will apply electronically online. They will then be subject to the OFCCP corporate headquarters compliance review and compliance reviews of other establishments. Contractors who do not qualify for the program will be returned to the pool of contractors for audit.

OFCCP states that this directive enables the agency to “blend its compliance evaluation and compliance assistance activities to work with high-performing contractors toward a mutual goal of sustained, enterprise-wide (corporate-wide) compliance, outside OFCCP’s neutral establishment-based scheduling process” as well as complementing the goals in its Early Resolutions Procedures.

House Education & Labor Committee Hosts a Joint Subcomittee Hearing on the Proposed Paycheck Fairness Act

Another important plank in the Democrats’ legislative agenda was given an early hearing on Wednesday, February 13, 2019.  A joint hearing on the proposed Paycheck Fairness Act (H.R. 7, S. 270) was held at that time by the House Subcommittees on Civil Rights and Human Services and on Workforce Protections.  An earlier version of Paycheck Fairness Act was passed by the House in 2008 and 2010, but never passed the Senate.  A similar fate is all but certain in this instance, but one purpose of offering the Act now was to set an agenda for the future.

The latest version of Paycheck Fairness Act would amend the Equal Pay Act of 1963 by substantially limiting the affirmative defenses, increasing protections from retaliation, prohibiting employers from asking for or using prior salary to set current pay, and allowing recovery of compensation and punitive damages. In addition, like its predecessor proposals, it instructs EEOC to collect pay data from employers and also to collect “compensation data and other employment-related data (including hiring, termination, and promotion data) disaggregated by the sex, race, and national origin of employees.” OFCCP is again directed to implement a similar survey to be given to half of its nonconstruction contractor establishments each year. The bill also instructs OFCCP not to use multiple regression or anecdotal evidence in its compensation discrimination cases. It further directs the Department of Labor to establish negotiation training for girls and women and a national pay equity in the workplace award among other salary related requirements.

The hearing included testimony from Rep. Rosa L. DeLauro (D-CT), a co-sponsor of the bill; Rep. Eleanor Holmes Norton (D-DC); and Rep. Don S. Breyer, Jr. (D-Va.); Fatima Goss Graves, CEO and President of the National Women’s Law Center; Camille Olson, Partner at Seyfarth Shaw; Kristin Rowe-Finkbeiner, CEO of Moms Rising, and Jenny Yang, former EEOC Chair and Partner of Working Ideal.

As noted, the bill will in all likelihood pass the House but, as in the past, will fail in the Senate at this time. Click here for written transcripts of the witnesses’ testimony and video of the joint subcommittee hearing.