COVID-19, otherwise known as the coronavirus, has evolved into a pandemic that has been wreaking havoc across the country and around the globe. To help assist individuals and businesses with the pending crisis, lawmakers have been enacting various pieces of legislation, including the recently passed Families First Coronavirus Response Act.
The Act was signed into law this past week and will have an impact on both small businesses and individuals who are employed by those businesses. Essentially, the Act mandates that small business employers who have less than 500 employees provide their employees with temporary paid leave. Moreover, under the new law, small business employers are able to take advantage of certain tax credits in order to pay for these new benefits.
If you currently own a small business, California small business attorney Claire Kalia of Kalia Law P.C. can answer all of your questions regarding the Families First Coronavirus Response Act and can assist you with implementing the new law in your business. Please contact our offices today for all of your California business law needs.
Required Paid Leave for Employees
Under the Act, the government mandates that small business employers provide their employees with paid sick leave on an emergency basis. The amount of paid sick leave is limited to $511.00 each day and can last for a maximum of ten days (i.e., a total of $5,110.00). The sick leave must be made available to an employee who is currently in coronavirus quarantine or who is in the process of obtaining a diagnosis for the virus.
Under the Act, employees of small businesses are also eligible to obtain a maximum of $2,000.00 (or a maximum of $200.00 per day for a period of ten days), in order to provide care for a child who is not able to attend daycare or school because of recent closures. The benefits may also be used to care for a family member who is currently under home quarantine.
Finally, pursuant to the Act, employees of small businesses can take a maximum of 12 weeks of family leave (during which time their jobs are protected), when the employee – or the employee’s family member – has been quarantined. The same is true if an employee’s child’s daycare center or school is closed because of the pandemic. In either of these instances, the small-business employer must pay the employee a minimum of two-thirds of his or her regular pay ($200.00 per day maximum). This limit is subject to a cap of $10,000.00 worth of family-leave payments for each employee of the business.
Tax Credits Offered to Small Businesses under the Act
Under the newly passed law, small businesses are entitled to a tax credit for payments made to employees under the Act. The employer can pursue a tax credit that is equal to 100 percent of all family leave payments and qualified emergency sick leave payments. It should be noted, however, that only payments which are made up until December 31, 2020 (and starting within 15 days of the Act’s March 18, 2020 passage date), are eligible for the tax credit.
Speak with an Experienced California Business Attorney about Your Coronavirus-Related Legal Issue Today
Attorney Claire Kalia can help you learn more about the impact of newly passed coronavirus legislation on your small business. To schedule a free case evaluation and legal consultation with a California small business lawyer, please call us at (650) 701-7617 or contact us online to learn more about how we can help.
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