Congress Left Big Gaps In The Paid Sick Days And Paid Leave Provisions Of The Coronavirus Emergency Legislation

In a March 4 Health Affairs blog on paid medical and family leave, I forecasted: “Slowly but inexorably paid leave is gaining political momentum. However, the chances of federal paid leave legislation in 2020 are close to nil.”   

What a difference a pandemic makes. Federally funded paid sick days and one type of paid leave are core elements of emergency pandemic legislation enacted in March. Those provisions went into effect April 2 and expire December 31, 2020. They will help limit coronavirus contagion and save lives. 

Unfortunately, the Families First Coronavirus Response Actas significant gaps that put millions of families and workers at risk of infection and financial insecurity.  

An effort is underway, led by small business, consumer advocacy, and public health groups—to press Congress to fill those gaps in upcoming coronavirus-related legislation. One state thus far, New York, has filed a lawsuit challenging the Department of Labor’s rules, issued on April 1, for implementing the Families First Act. 

The pandemic has shone a bright light on the faults in our health care system. One of those is a lack of federally guaranteed paid sick days and paid leave. The US is the only wealthy country that does not guarantee both.

As a result, roughly a quarter of US workers have no access to paid sick days, and only 19 percent of civilian (non-government) workers have access to paid family leave through their employer to care for a new child or ill family member.

Politically, the debate over paid time off from work has played out along ideological lines. Democrats in Congress support broad rights and national policy while Republicans favor more targeted and limited approaches, with an emphasis on private-sector initiatives and state’s rights. (Eleven states and the District of Columbia mandate paid sick day laws. Eight states and DC have comprehensive paid leave laws.)  

This political divide was readily apparent as the Families First Act, enacted on March 18, was being finalized. In the end, Republicans largely prevailed—limiting the scope of coronavirus-related paid sick days and paid leave.

However, as with any long-term fight, battles are won and lost. In this case, Republicans may have handed Democrats ammunition in an election year and beyond.

“This moment could be a turning point in how the public and lawmakers understand the need for and the benefits of paid family and medical leave and paid sick days,” Vicki Shabo, a senior fellow at the New America Foundation in Washington, DC, told me.  

Who Got Left Out? 

The details of the paid sick days and paid leave benefits in the Families First Act are at the end of this blog post. Here are the four main elements for which corrective legislation is being urgently sought:

1. Companies with 500 or more workers are exempt from providing the paid sick days and paid leave benefits specified in the law.

The justification for this large employer exclusion is that most such companies already offer paid sick days and leave, and thus they don’t need federal (tax dollar) subsidizes.  

In fact, the exemption leaves some 60 million workers—roughly half the nation’s full-time workforce—carved out of the law’s protections, according to the National Partnership for Women and Families. That’s because those workers’ employers either offer no paid sick days or fewer than 10 days. 

As for extended paid leave, most large companies provide that only for parents with a new baby.

The large company exclusion could worsen unemployment rates as well; workers who still have jobs but who take time off because they get sick from coronavirus or have to care for a sick spouse, parent, or child, risk losing their jobs. 

Congress could rectify this gap by eliminating the exemption for large businesses. 

2. The Families First law permits firms with 50 or fewer employees to seek an exemption from the Department of Labor if they think their business will be adversely affected by offering paid sick days or paid leave.

This provision would have made some sense if businesses were footing the bill for the emergency time off, but they aren’t. The federal government is paying most of the tab, via tax credits.

Moreover, the Department of Labor made this exemption worse on April 6 when it issued rules that allow small businesses to exempt themselves without first justifying their choice to the agency. They only need to keep the paper work for later review.  

About 34 million people work for businesses with 50 or fewer workers. The majority of small firms offer either zero or fewer than 10 paid sick days. Very few offer extended paid leave. The small business exemption means the workers for these companies have no federal guarantee of paid time off if they or a family member gets sick. 

Congress could either eliminate the small business exemption or require firms to document their hardship need before they can be exempted. 

3. The Families First law requires companies with more than 50 and fewer than 500 employees to offer up to 60 work days (12 work weeks) of extended leave to parents who need to care for children at home because of school or daycare closures if they don’t have the option to work from home.

This narrowly drawn paid leave provision means that workers affected by the virus themselves or needing to care for a spouse or parent sickened by the virus (or who have been told to quarantine) are not permitted paid leave beyond 10 paid sick days.   

The justification for limiting this benefit was not based on any public health or financial consideration, according to experts who tracked the legislative process and my reporting. 

Rather, it was a political decision. Long opposed to a national paid leave policy that encompasses medical self-care and care of family members (often called family leave)—instead of just parental leave—Republican leadership in the House and Senate didn’t want to set a precedent.

That outcome mirrors a fierce debate last year that culminated in the Federal Employees Paid Parental Leave Act, the first ever expansion of paid parental leave to two million federal workers. Democrats had included paid medical and family leave in the bill, but Republicans stripped it out of the final legislation.

As with the small business exemption, the omission of extended paid medical and family leave puts tens of millions of workers at risk of losing their jobs if they take more than 10 days of time off to quarantine, recover from coronavirus, or care for a family member who is recovering. 

Congress could extend 60 days of extended paid family and medical leave for all workers.

4. The Families First law allows health providers and emergency responders to be exempted by the Department of Labor.

The justification for this measure: Hospitals, clinics, nursing homes, and emergency responder firms (public or private) may need to assure that workers show up at this time of high need and crisis.     

That’s understandable but the exemption means that around 13 million workers and their families have no guaranteed access to paid sick days or paid leave. Media reports of committed—but also stressed—health workers feeling compelled to come to work even if they know they may have been exposed to the virus have stirred widespread concern.

Repeal or changes to the exemption for health providers and emergency response workers should be considered. 

Concessions

Republicans agreed to a few concessions related to paid time off in the final version of the Families First Act and the Coronavirus Aid, Relief, and Economic Security (CARES) Act signed into law on March 27. Among them: 

• Workers laid off since March 1 and then rehired would be eligible for paid parental leave if they had worked for the company for at least 30 days.
• Self-employed people can receive advance tax credits—instead of having to wait to be reimbursed for the cost of paid sick days and paid leave.

The Details

The following reflect provisions in the Families First Coronavirus Response Act and the CARES Act. 

Paid Sick Days

• Full-time workers with a coronavirus diagnosis, those seeking testing because they have COVID-19 symptoms, or those who are advised by a health care provider or public official to self-quarantine receive 80 hours (10 eight-hour days).
• Those who must take time off to care for someone who is sickened by the virus, must be quarantined, or to care for a child whose school is closed also receive 80 hours (10 eight-hour days).
• Part-time workers are eligible for sick days equal to the number hours they work on average over a two-week period.
• This applies to all workers for public-sector employers of any size.
• This applies to private-sector workers at firms with 500 or fewer full-time equivalent employees.
• Self-employed people are covered.
• Companies with 50 or fewer workers can claim an exemption to the Department of Labor if they think their business would suffer from the mandate.
• An exemption for health care workers and first responders is permitted.
• Pay during sick days taken is set at a worker’s regular rate if they are the one who is infected and sick.
• Pay for workers caring for another ill, quarantined person or child is set at two-thirds of regular wages or salary.
• For one’s own care, the maximum compensation covered by government funds cannot exceed $511 per day and $5,110 total. Employers can contribute amounts above these limits if they choose to.
• For sick days taken to care for another family member, the tax credit cannot exceed $200 per day and $2,000 total.
• Self-employed people taking paid sick days get a 100 percent tax credit for leave to care for their own illness and 67 percent if they take leave to take care of a family member.
• The federal government will pay 100 percent of the costs of the benefit through refundable tax credits against payroll taxes or against income taxes for self-employed individuals.
• Employers are barred from replacing workers taking coronavirus-related sick days.
• Workers are protected against retaliation, such as a demotion, if they take sick days.

Paid Extended Leave

• Workers employed for at least 30 days can take up to 60 work days of paid leave if they need to care for a child younger than 18 years of age because of school or daycare closures.
• Workers would have to use their 10 days of coronavirus emergency paid sick days first, or 10 days’ worth of any other accrued personal, medical, or sick leave. That would yield them a net of 50 extended paid leave days.
• Only workers employed by firms with fewer than 500 workers are eligible.
• Firms with fewer than 50 employees can claim an exemption from the Department of Labor.
• Pay to be covered by tax credits is set at not less than two-thirds of the employee’s regular rate of pay, up to $200 per day, and $10,000 total per worker. Employers can contribute more if they choose.
• Workers are guaranteed their job back. Exception: Firms with fewer than 25 employees do not have to restore a worker who took leave if the position was eliminated due to new economic conditions.
• Companies that have so-called multi-employer collective bargaining agreements can avoid providing paid leave if they make contributions to a multi-employer fund that provides equivalent paid leave benefits.

In their understandable rush to respond to the crisis, lawmakers created access to paid sick days and paid leave that is profoundly unfair—with arbitrary limits and winners and losers. Correcting this mistake should be a high priority.