The Department of Labor, the Internal Revenue Service, and the U.S. Treasury Department has announced that as of March 20, 2020, covered employers (those with 500 or fewer employees) can begin taking advantage of the two new refundable payroll tax credits that are designed to immediately and fully reimburse employers, dollar-for-dollar, for the cost of providing COVID-19-related leave to their employees.
Many states and counties have issued “shelter in place” orders already, and more such orders are expected in the coming days and weeks. Employers need to know that the Emergency Paid Sick Leave Act (“EPSLA”) entitles an employee of a covered employer to receive paid sick leave from their employer because the “they are subject to Federal, State, or local quarantine or isolation orders related to COVID-19”.
While Dallas County was the first large county to issue such an order, which went into effect 11:59 pm on March 23, 2020, we expect other large counties throughout Texas such as Denton, Collin, Tarrant, Travis, and Harris to issue similar restrictions in the next few days. These restrictions are intended to help “flatten the curve” to allow healthcare providers and hospitals to better ready for and treat those who are COVID-19 positive. Dallas County’s Order is currently set to expire at 11:59 pm on April 3, 2020, however it is highly anticipated that Judge Jenkins will extend the Order beyond that April 3rd date; it is unknown how long of an extension(s) may be ordered.
For now, employers need to know that their employees are entitled to receive paid time off for time they are not working pursuant to the Emergency Family and Medical Leave Expansion Act (“EFMLEA”) and the Emergency Paid Sick Leave Act (“EPLSA”). Notably, EPLSA entitles employees who work for employers with fewer than 500 employees to be paid Emergency Paid Sick Leave if they are “subject to a Federal, State, or local quarantine or isolation order related to COVID-19”. This paid time off is in addition to, and not a replacement for, any paid time off the employee may otherwise have access to through their employer’s accrual or other system that provides paid time off (e.g., vacation pay, sick leave, etc.).
Please see our alert from March 23, 2020 for more information on all circumstances that entitle employees to paid leave related to COVID-19, the calculation of such pay, and the caps that apply.
Employers who properly handle payment of this paid leave will be eligible for payroll tax credits.
This alert is for informational purposes only and should not be considered legal advice. Please consult with your legal counsel regarding any specific situation.
For further guidance on the legal issues facing employers regarding COVID-19, contact:
Board Certified Labor & Employment by the Texas Board of Legal Specialization
Links to Resources:
U.S. Government Coronavirus information website:
World Health Organization Coronavirus website:
CDC Coronavirus website:
Texas State Department of Health:
Dallas County Health Department:
Department of Labor Coronavirus Resources:
OSHA Covid-19 resources website:
OSHA Guidance on Preparing Workplaces for Coronavirus:
EEOC Coronavirus information: