The act will become effective on 2 April 2020 through to 31 December 2020 and contains two main components – Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act.
Emergency Paid Sick Leave
Private employers with less than 500 employees and all government employers must provide two weeks of paid sick leave to their employees (including part-time employees). The leave must be provided in instances where an employee:
- Is subject to a federal, state, or local quarantine or isolation order related to COVID-19
- Has been advised by a health care provider to self-quarantine due to concerns related to COVID-19
- Is experiencing symptoms of COVID-19 and seeking medical diagnosis
- Is caring for an individual who is subject to a quarantine order or has been advised to self-quarantine
- Is caring for a son or daughter and the child’s school or place of care has been closed, or the childcare provider is unavailable due to COVID-19 precautions
- Is experiencing any other substantially similar condition
Paid sick leave is to be calculated based on the greater amount of the employee’s regular rate of pay or the applicable minimum wage rate. There is a two-tiered pay rate:
- If the employee’s sick leave is for reasons 1, 2, or 3 above, the pay is calculated based on the full amount the employee would have been paid (capped at $511 per day).
- If the leave is for items 4, 5, or 6 above, the pay rate is two-thirds of the full pay amount (capped at $200 per day)
Self-employed individuals are also eligible for paid sick leave, however the payment will be made through a tax credit.
Emergency Family and Medical Leave Expansion Act
This act applies to employees unable to work or telework due to a need for leave to care for a child under the age of 18 if the child’s school or place of childcare has been closed/is no longer available due to a public health emergency. Employees must have been employed for at least 30 days in order to be eligible and only employers with less than 500 employees are covered.
Those eligible can take up to 12 weeks of the emergency leave. The first two weeks will be unpaid (employees can substitute vacation leave, personal leave, or sick leave for the unpaid leave). The remaining 10 weeks will be paid at a rate of at least two-thirds of the employees’ regular rate of pay (must not exceed $200 per day).
Payroll Tax Credit
In order to help employers with the costs associated with providing paid sick leave and paid family and medical leave, the legislation provides businesses with a payroll tax credit for providing the required leave. Federal, state, and local government employers are not eligible for the payroll tax credits.
