Trump Signs Families First Coronavirus Response Act into Law

Breaking news: After the House passed the Families First Coronavirus Act (H.R. 6201) on March 14, the Senate was expected to sign it the next day.

But after several amendments, it passed a majority Senate earlier this afternoon on March 18. This evening, Donald Trump supported and signed it into law.

What it Covers

The legislation will provide several key benefits to employees. One of the biggest is allowing up to two weeks of fully paid sick leave for those with the coronavirus. For those taking care of sick family members or with children out of school (66 percent of the country has closed down schools as of the time of this writing), employees can be paid two-thirds of their pay for two weeks. It also allows for free coronavirus testing for everyone who needs a test regardless of their insurance provider or status.

You can read more on the specifics and eligibility requirements here.

Where the Bill Falls Short

The National Restaurant Association sent a letter to Majority Leader Mitch McConnell and Democratic leader Charles Schumer on March 15 urging the Senate to make several changes to the bill. With nearly 16 million hospitality workers employed by mainly small businesses, the NRA asked that the employee paid sick leave financial burden be placed on the onus of the federal government instead of business owners.

Currently, the way the bill is written, businesses would be permitted to pay for employee time off and recoup the cost from federal tax credits the next year. The number one issue restaurants and bars are facing is cash flow. To be mandated to close with little to no revenue from to-go and delivery food sales, it's impossible to think many will be able to survive another cost.

In a recent survey conducted by the Nightclub & Bar Show, 25 percent of bar and restaurant owner respondents said they would not be able to last more than two weeks without sales. Another 34 percent said they wouldn't survive if this went on for a month. Some places, such as Denver, CO, have implemented an eight-week mandated closure and experts are suggesting the worst is still ahead of us.

The NRA also asked for national targeted economic measures to allow for assistance with:

  • allowing businesses to defer mortgage, lease and loan obligations;
  • tax credits for businesses that are retaining employees;
  • targeted grants that would go directly to businesses;
  • allowing businesses to delay, defer, or forgo tax obligations;
  • expanded access to effective, efficient and affordable federal and conventional loans;
  • fixing the Qualified Improvement Property (QIP) technical correction, so businesses can (a) amend their returns and receive money back that they effectively overpaid in taxes, and (b) receive the benefit of bonus depreciation, as a stimulus measure.

The National Federation of Independent Business (NFIB), another small business advocacy group, had opposition they were pushing until the very end: 

To be clear, neither group is advocating against employee benefits. They are fighting to make sure businesses have enough cash to stay afloat and to take the onus off already strapped employers to claim exemption. The NFIB is running a webinar on March 20th to discuss this more.

Where Do We Go From Here

The law will go into effect 15 days from today, April 2, 2020. We will be discussing the law with employee benefits experts and employers in the coming days to determine how it will affect your business. Congress has said more bills are coming to help Americans, and we need to be diligent in reaching out to our local city, county, and state legislators to put the needs of our industry ahead of big corporations to make sure people are bailed out before companies.

Stay tuned as this story is updated with more information. 

Note: This story was updated with more information regarding the bill and NFIB.