Unemployment Benefits and Paid Leave

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Connecting Displaced Workers to Jobs in the Detroit Region

The Detroit Regional Chamber is connecting workers displaced by the COVID-19 outbreak. Several organizations are hiring large numbers of employees. Below you will find openings in essential industries that have ramped up hiring locally. View available jobs.

Unemployment Benefits Expanded – View an Unemployment 101 Guide

Gov. Whitmer signed an executive order to expand eligibility for unemployment benefits in effect from March 16 through April 12. Michigan’s Unemployment Insurance program provides temporary income to workers who have lost their job through no fault of their own.

UIA Extends Call Center Hours, Adds Staff to Better Serve Customers

The Michigan Unemployment Insurance Agency (UIA) is adding staff and hours to better serve an unprecedented increase in customers filing unemployment claims as a result of COVID-19. The UIA has extended call center hours by an hour every day 8 a.m. – 6 p.m. Monday-Friday and it remains open from 7 a.m. – 2 p.m. on Saturday.  Customers in the call center and online chat queues before closing time will have their calls or chats resolved that day.

Online Filing Schedule at Michigan.gov/UIA: Customers are encouraged to use off-peak times 8 p.m. – 8 a.m.

 



Videos to Help File a Claim
The Unemployment Insurance Agency has a series of how-to videos to help navigate the unemployment system and assist you with filing a claim. View the full playlist of videos for employees here.

All Eligible Workers Will Receive Benefits
The UIA assures every eligible worker in Michigan who applies for unemployment benefits will receive them. Workers have 28 days from their last day of work to apply for benefits. Additionally, claims will be back-dated to reflect the date on which the claimant was laid-off. If there are continued technical issues with a workers’ account, the UIA will allow additional time to ensure benefits are paid.

EMPLOYERS

How Can Unemployment Insurance Help My Business?

Work Share is a program that permits employers to maintain operational productivity during declines in regular business activity instead of laying off workers.

EMPLOYEES

How Do I Apply For Unemployment Insurance Benefits?

The Michigan Web Account Manager (MiWAM) is the UIA’s system for filing your unemployment insurance claim and managing your UIA account online.

 


Paid Leave Benefits

View the U.S. Chamber of Commerce Paid Leave Employer Guide

This week the Department of Labor issued new regulations for implementing the leave requirements under the Families First Coronavirus Response Act (FFCRA). The regulations track the guidance that has already been issued. The DOL also added more entries under their FAQs, the most interesting of which deal with staffing companies (#74) and seasonal employees with irregular hours (#75).   View an infographic that breaks this down.

  • “Paid sick leave” – means paid leave under the Emergency Paid Sick Leave Act.
  • “Expanded family and medical leave” – means paid leave under the Emergency Family and Medical Leave Expansion Act.

The Families First Coronavirus Response Act created new temporary paid sick leave and paid Family and Medical Leave Act (FMLA) programs that are 100% reimbursable by the federal government. The effective date of both programs is April 1 and they expire on December 31, 2020.

Both programs are in addition to any leave you already offer.

The key numbers to remember with these paid leave programs are 500 and 50.
  • If you have fewer than 500 employees, your business is required to provide paid leave under both programs
  • If you have under 50 employees, though, you may be exempted from the requirement to provide leave under both programs (see below)

The Department of Labor has issued clarifying guidance (available at www.dol.gov/agencies/whd/pandemic) and will continue to publish more information.

In the meantime, here is the information you need to know now.

Which employees are eligible?

Eighty hours of paid sick leave are available to any employee without regard to the duration of employment if they are unable to work or telework because they:

  • are subject to a government quarantine or isolation order;
  • have been advised to self-quarantine;
  • are seeking a medical diagnosis, or
  • are caring for someone with one of those three conditions.

Leave can also be taken if an individual cannot work or telework because of a need to care for a child whose school has closed or whose regular caregiver is unavailable because of Coronavirus.

How much will employees receive?

While taking paid sick leave, employees will receive their regular rate of pay up to a maximum of $511 per week or $5,110 in the aggregate.

This is reduced to 2/3 their regular rate of pay if they are caring for a family member or child whose school is closed or caregiver is unavailable with a maximum of $200 per day (or $2,000 in aggregate).


Family and Medical Leave Act Program

Which employees are eligible?

To be eligible for paid FMLA leave, an employee must have been on your payroll for 30 days prior to taking leave. In addition, paid FMLA leave is only available if an employee is unable to work or telework because of a need to take care of a child because of a school closure or their regular child care provider is unavailable due to Coronavirus.

How much will employees receive?

Eligible employees may take up to 12 weeks of leave.

  • The first two weeks of that can be unpaid (presumably the employee would be covered underpaid sick-leave for those two weeks).
  • After that, the employee is eligible for 10 weeks of paid FMLA.

While taking paid FMLA leave, the employee will receive 2/3 of his/her regular rate of pay up to a maximum of $200 per day (or $10,000 in aggregate).

For more guidance, please click here to visit the IRS website.

Restoration to the Previous Position: For businesses with fewer than 25 employees, it is not necessary to restore the employee to his/her previous position after paid FMLA leave is taken if the position no longer exists because of the public health emergency and the employer makes reasonable efforts to restore the employee to a similar position.


Exemptions

What if I have fewer than 50 employees… Am I exempt?

Under the current Department of Labor guidance, you can be exempt only if leave is being requested because of a school closure or because the child’s regular caregiver is unavailable due to Coronavirus and if this leave would jeopardize the viability of the small business as a going concern.

This exemption is available if an authorized officer of the business certifies that at least one of the following is true:

  • Providing leave would result in expenses and financial obligations exceeding existing revenues and cause the business to cease operating,
  • The absence of the employee would entail a substantial risk to the operation of the business because of their specialized skills, knowledge of the business, or responsibilities,
  • You cannot find other workers to perform the work of the employee, and that work is required for the business to operate at a minimal capacity

What if I am in the health care business… Am I exempt?

Businesses whose employees are healthcare providers or emergency responders may elect to exclude such employees from paid sick leave and paid FMLA leave.

The definition is fairly broad. Visit www.dol.gov/agencies/whd/pandemic/ffcra-questions for specific definitions of those terms.

Do I have to provide paid sick or paid FMLA leave if my business is closed?

No. If you close due to a lack of business or because of a federal, state, or local directive, you do not have to provide paid leave. In this case your employees would likely be eligible for unemployment compensation. This is the case whether you lay off or furlough employees.


Reimbursement

How will my business be reimbursed for this leave?

Costs associated with the paid sick and paid family leave programs are 100% reimbursable by the federal government through a refundable tax credit up to the maximum wages allowed (e.g. $511 or $200 per day), which is also applicable to the self-employed.

  • The Treasury Secretary is provided with regulatory authority to help with cash flow issues, for example by waiving penalties for failing to deposit payroll taxes in anticipation of the credit and by providing advances to employers
  • For questions, please call the Department of Labor helpline at (866) 487-9243 (866-4US-WAGE)

More Information from the American Society of Employers:

Emergency Leave 
The bipartisan bill provides for emergency paid-leave provisions that would require employers to provide paid sick time for the following reasons:

(1) The employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
(2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
(3) The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
(4) The employee is caring for an individual who is subject to an order as described in reason for use (1) or has been advised as described in reason for use (2) (as described above).
(5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed or the childcare provider of such son or daughter is unavailable, due to COVID-19 precautions.
(6) The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

This requirement exempts employers with more than 500 employees from the paid-leave requirement. However, all employees, regardless of the duration of employment or full- or part-time status, are eligible if they meet one of the above-listed reasons.

Full-time employees would be eligible for up to 80 hours of paid emergency leave. Part-time employees would be eligible to receive the number of hours worked, on average, over a two-week period. The leave would terminate immediately once the reason for the leave has ended, and the employee would have to return to work for his or her next scheduled shift.

If the bill is passed, employers would be required to post a notice of the new law with their other required postings. The Secretary of Labor would make a model notice available within seven days of the date the law is enacted.

FMLA Expansion 
This bill also expands FMLA rights for the duration of the pandemic crisis.  This bill would apply to all employers with less than 500 employees. There is no minimum employee number.  Employees with less than 50 employees may be eligible for an exemption if the obligations would jeopardize the viability of the business as a going concern.  What that means is still unclear.

This bill would expand employee FMLA under this situation to those employees who have been employed for at least 30 days.  Normal FMLA requirement is 1,250 hours over a 12-month period.
 

An employee can take leave for caring for an “individual.”  This term “individual” is, though, undefined.  In the original House bill, the term was very expansive to include grandparents, domestic partners, etc. 

FMLA eligibility has been expanded to cover a “qualifying need related to a public health emergency.”  This situation is defined as “[i]Instances where the employee is unable to work (or telework) due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable, due to a public health emergency.”  Note that this include situations of telework. 

This law does have a special rule which would allow an employer who is a health care provider or an emergency responder to exclude employees from the new amendments to the FMLA. 

How Paid Leave Works 
The first 10 days for which an employee takes leave could consist of unpaid leave. An employee could elect to substitute any accrued vacation leave, personal leave, or medical or sick leave for unpaid leave. Employers could not require the employee to make the substitution.   

After the 10, days, employers would be required to pay for the leave an amount that is not less than 2/3 of an employee’s regular rate of pay and the number of hours the employee would otherwise be normally scheduled to work or the number of hours calculated for employees who have varying schedules.  For full-time employees, it would be a total of 80 hours. Part-time employees would receive a prorated amount.

It is unclear whether intermittent leave is allowed under this bill.

In addition, there are special rules for multi-employer plans that appear to give these employers more compliance flexibility than is provided to other employers.

Amount of Pay 
The amount of pay depends on which reason the time off is used.  Specifically, covered reasons (1) through (3) above must be paid at the 100% rate, while covered reasons (4) through (6) above can be paid at the 2/3 rate. 

In addition, PST payments can be capped as follows: (I) $511 per day and $5,110 in the aggregate for covered reasons (1) through (3) and (II) $200 per day and $2,000 in the aggregate for covered reasons (4) through (6).  However, while an employer appears able to pay an employee an amount that is greater than the above caps, the employer would not receive any corresponding additional tax credit.
 

The paid leave can be capped at $200 per day and $10,000 in the aggregate. 

Job Restoration 
As a general rule, an employee who is taking FMLA must have their job restored. However, the law’s job restoration requirements (in Section 104(a)(1) of the FMLA) would not apply to employees of an employer with fewer than 25 employees where the following conditions are met: 

  1. The employee takes leave under the public health emergencyprovision. 
  2. The position held by the employee when the leave commenced does not exist due to economic conditions or other changes in operating conditions of the employer that affect employment and are caused by a public health emergency during the leaveperiod; 
  3. The employer makes reasonable efforts to restore the employee to a position equivalent to the position that the employee held when the leave commenced, with equivalent employment benefits, pay, and other terms and conditions ofemployment; 
  4. Where the employer’s reasonable efforts under subparagraph (C) fail, the employer makes reasonable efforts for a one-year period beginning on the earlier of the date of the qualifying need or 12 weeks following the leave’s commencement, to contact the employee if an equivalent position becomes available.

Accrual of Paid Sick Leave 
Accrued paid sick leave would not carryover from one year to the next. 

Employee Notice to Company 
When an employee uses public health emergency leave related to school or childcare closures (see above) and the leave is foreseeable, an employee must provide the employer with such advance notice of leave as is practicable.  Otherwise, notice is similar to FMLA notice (which in practice is at the time or after the employee has need for it). 

Posting requirements
Employers are required to post a notice of the new law with their other required postings. The Secretary of Labor would make a model notice available within seven days of the date the law is enacted.

Coordination with other Leave Policies 
The sick leave provided would be in addition to any existing employer-provided sick leave and employers may not change such paid leave policy on or after the date of enactment to avoid the provision. In addition, an employer could not require, as a condition of providing paid sick time that the employee involved search for or find a replacement employee to cover the hours during which the employee is using paid sick time. 

Further, an employer may not require an employee to substitute any [public health emergency] leave.

Employees could use the additional sick time first. An employer could not require an employee to use other paid leave provided by the employer before the employee uses the paid sick time.

This law does not preempt any state or local paid sick leave laws; therefore, employers need to be careful of not violating those laws which may be even broader for usage in this situation.  For example, Michigan Paid Medical Leave would also apply in this situation, and in the case of school closures.  It is unclear whether it would run concurrently or in addition with this leave.

Refundable Tax Credits 
The bill would provide refundable payroll tax credits, subject to certain limitations, through 2020 to employers to cover wages paid to employees while they take time off under the bill’s sick leave and family leave programs, for up to 10 days.  The sick leave credit would be for wages up to $511/day or $200/day if the sick leave is to care for a family member or child following the child’s school closing.  The family leave credit would be for wages up to $200/day ($10,000/maximum) while the employee is receiving paid leave.  

The bill would also provide for a similar refundable credit against the self-employment tax for up to 10 days.  One difference between employer and self-employed is that self-employed individuals could receive a family leave credit for as many as 50 days multiplied by the lesser of $200 or their average self-employment income.  

In determining the total amount of an employer’s qualified sick leave wages paid for a calendar quarter, the total number of days that the employer can take into account with respect to a particular employee for that quarter cannot exceed 10 days minus the total number of days taken into account with respect to such employee for all previous quarters. 

The amount of the paid sick leave credit that is allowed for any calendar quarter cannot exceed the total employer portion of FICA Tax imposed on all wages paid by an employer to all of its employees during such quarter. If the amount of the credit that would otherwise be allowed is so limited, the amount of the limitation is treated as an overpayment of tax by the employer, the same as if the employer had actually overpaid the employer’s portion of FICA Tax.  Accordingly, the IRS will pay or credit to the employer the amount of the deemed overpayment.  Also, an employer who receives a credit for PST must include the amount of the credit in gross income. 

This approach is intended to prevent the employer from realizing a double benefit (i.e., a windfall) — one being the receipt of the credit and the other being a tax deduction for the paid sick leave wages. This will not nullify the tax credit, but by adding the amount of the credit to gross income, it offsets the tax deduction. 

An employer must exclude any wages taken into account in determining the paid sick leave credit when determining the paid family and medical leave tax credit under Internal Revenue Code Section 45S.  For any discussion of tax credits, please refer to your accountant and legal counsel. 

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