Last night President Donald Trump signed into law H.R. 6201 (the "Bill"), a relief package initially introduced in the U.S House of Representatives that includes free testing for COVID-19 and emergency leave for workers. The Bill provides: (i) up to 2 weeks of paid sick leave to anyone who is either subject to federal, state or local quarantine, showing symptoms, exposed to the virus, seeking medical diagnosis, or trying to get a test or preventive care; and (ii) up to 12 weeks of paid family and medical leave for employees affected by the virus, to care for an individual subject to quarantine, or to care for a son or daughter whose school or child-care facility is closed due to coronavirus.
Sick leave is to be paid at the usual pay rate and family leave is to be paid at two-thirds of the usual pay rate. The sick leave is capped at $511 per day and paid family leave at $200 per day, with some benefits containing certain quarterly caps. To offset costs for employers, the Bill provides a tax credit to be applied to what the employer pays for each employee's social security. The Department of Labor may exempt employers with fewer than 50 workers if the payment would jeopardize the viability of the business. Gig workers and self-employed workers would have a tax credit available.
These benefits would be in place for a year and part-time employees are covered in the equivalence of the number of hours typically they work during a two-week period. Employers with 500 or more employees are excluded from the Bill because they usually have sick or emergency leaves in place. These provisions apply to employers in Puerto Rico, subject to the limitations contained in the Bill.
We note the Bill also includes certain items specific to Puerto Rico and U.S. territories, including a $100 million increase in nutrition assistance programs for emergency grants, and a 6.2% increase in the Federal Medical Assistance Percentage, reducing the amount that Puerto Rico will need to contribute for certain federal health programs, such as Medicaid.
A follow-up stimulus package is expected during the next few days or the following week to address the needs of small businesses struggling during this crisis, while also offering some type of cash assistance to U.S. citizens.
In addition, the Puerto Rico Senate and House approved House Bill 2428 (the P.R. Bill), which may soon be signed into law, creating a 20-day emergency leave without pay. This leave would be available during declared emergencies, if the employees is sick or suspected of being sick because of the epidemic that caused the state of emergency. As per the P.R. Bill, the employee would use his/her vacation leave once his/her regular sick leave is exhausted. If the vacation leave is exhausted, the employee would be entitled to the emergency leave. By agreement between the employee and employer, the employee may use his sick leave with pay, then use the 20-day emergency leave, and if additional time is needed, the employee will be allowed to use any unused accrued vacation.
Do not hesitate to contact us should you need assistance in tailoring your business' response to this crisis. Our Firm will remain available to all our clients. Our attorneys are monitoring actions by the Federal Government, the Commonwealth of Puerto Rico, and local municipalities as additional measures are put into place to mitigate and lessen the extent of this crisis. At Goldman Antonetti & Cordova LLC, we look forward to providing client-focused assistance on how to respond to current events to minimize negative effects on your business.