We recently hosted a webinar regarding the newly passed CARES Act. As a resource to our clients and community, we’ve made the webinar public, as well as the questions and answers we’ve received on this subject.
We will continue to do our best to pass on and disseminate general information to our community. If you have a general question related to the CARES Act you’d like us to answer on this post, please email us at firstname.lastname@example.org.
If you feel your question is asking for a specific opinion for your company or organization, please email Peter Rowe or Diana Durham directly and we can determine if it may be necessary to have a specific engagement for research and an opinion.
Questions Asked & Answered
What is the proof an employer can reasonably request regarding an employee’s election to stay home to take care of their kids? Is proof required?
Per the DOL, if an employer intends to claim the tax credit for either the Paid Sick Leave or Paid FML leave, then they need to retain appropriate documentation for their records. Examples of notifications include: Dr’s note showing you or someone you are caring for has been tested or has COVID-19, notice that has been posted on a government, school, or daycare website, published in a newspaper or an email from an employee or official of the school or child care provider.
Can the employee continue to accrue leave while using Emergency Leave?
Just as an employee would not accrue sick or vacation time while out on any other leave, they would not be entitled to accrue leave during Emergency Leave since the employee isn’t actively working.
If we need to cut salaries to help cashflow, will this affect the eligibility CARES SBA Loan? Even if it’s for the month of April, 1 month?
It doesn’t seem to impact eligibility, just the forgiveness under the Paycheck Protection Program. Please review the PPP Information Sheet.
Do we submit the payroll amount for the 12 month period prior to the loan date?
We are hearing from our banker relationships to be ready with this data, possible the 941’s. We are also understanding the banks are assisting existing customers first, they will have the best information for you.
Can an employer require employees to telework 40 hours week, but reduce their pay? Any differences between Salary Exempt employees and Hourly employees?
An employer can reduce the wages of an employee, however, there are a couple of things to consider. For hourly employees, wages can’t be reduced below federal/state minimum wage (whichever is higher). Hourly employees should continue to clock in/out as they would if they were working in the office. For salaried employees, wages can’t be reduced below FLSA salary threshold ($35,568 annually). Salaried employees must be paid their entire weekly wage regardless of the number of hours they work.
Are the health care workers and health care offices exempt from this Emergency FMLA thing?
Per the DOL guidelines, a health care provider is anyone employed at a doctor’s office, hospital, health care center, clinic, post-secondary educational institution offer health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home. home health care provider, any facility that performs lab or medical testing, pharmacy, or any similar institution, employer, or entity.
How do you defer social security and other payroll taxes?
Eligible Employers will report their total qualified leave wages and the related credits for each quarter on their federal employment tax returns, usually Form 941, Employer’s Quarterly Federal Tax Return. Form 941 is used to report income and social security and Medicare taxes withheld by the employer from employee wages, as well as the employer’s portion of social security and Medicare tax.
Please review the included link for the IRS Tax Credits for Required Leave.
For employees that can work remotely – is the only way that they could qualify for the Emergency Paid Sick Leave/Family Leave is if they are sick themselves?
Per the DOL guidelines – An employee is unable to work and eligible for leave if the employer has work for you and one of the COVID-19 qualifying reasons prevents you from being able to perform that work, either under normal circumstances at your normal worksite or by means of telework.
If an employer allows for work outside of normal business hours, then you are able to work and leave is not necessary unless a COVID-19 reason prevents you from working that schedule.
Employees may be eligible for intermittent Paid Family Leave if an employer allows it and an employee is unable to telework a normal schedule of hours due to your child being home from school or without childcare.
Can employees defer their DCFSA contributions if their child’s care facility is closed?
Yes, this is a qualifying event as the billable rate has been changed to 0. Similar to summer recess.
If we did not furlough employees OR continue to pay them to stay home, or if a seasonal employee gets sick from the virus – Does the employer have to continue to pay the seasonal employee X under FMLA after their normal end of season employment given the following?
If an employee is working, whether at your office or teleworking, then they are eligible for paid sick leave and/or paid family leave if they have a qualifying COVID-19 reason. If an employee (this includes full-time, part-time, and temporary) is working, then they are eligible starting 4/1 for paid sick leave. If they have been an employee for 30 days or more, then they are also eligible for paid family leave.
Follow-up question on seasonal employees. If an employer furloughs or lays off an employee on or after 4/1, then the employee is not eligible for either paid leave effective the date the employee is no longer working.
Follow-up question if a seasonal employee is normally laid off of work on April 30th. If an employee is on a paid leave when an employer closes the worksite, the employer must pay the paid leave through the date of closure. Once the worksite is closed, an employee is no longer eligible for paid leave since they are no longer working.
- USC = US Chamber of Commerce.
- SBA = Small Business Association
- DOL = Department of Labor
- IRS = Internal Revenue Service
- Tres = US Treasury
- CMS = Centers for Medicare and Medicaid Services
- EEOC = Equal Employment Opportunity Commission
- WHO = World Health Organization
- CDC = Centers for Disease Control and Prevention