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How Do I Get Employees to Come Back to Work?

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Written by Haley Paul
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COVID-19 EMPLOYER UPDATE

UPDATED June 5, 2020

As Texas has slowly reopened over the course of the last month, one of the greatest challenges facing employers is getting employees back to work. Many Texas workers have found that they are making more on unemployment benefits than they made while working. In particular, the extra $600 per-week benefit introduced by the CARES Act has, without question, disincentivized employees from returning to work when called back in. Other workers are simply reluctant to return to work due to fear of contracting COVID-19 in the workplace. Most businesses need employees to operate, so the question then becomes, how do we compel employees to come back to work?

Create a Safe Work Environment

If you are having trouble getting employees to come back, your first step should be to find out why they are hesitating to return. If health and safety is the primary concern, reassuring your employees of the steps you are taking can go a long way. Letting employees know that you have consulted and are following CDC and OSHA guidelines, along with any specific steps you are taking to reduce the transmission of COVID-19 at your workplace, is a great way to start.

If an employee informs you that the or she is in a vulnerable category, you should engage in the interactive process and discuss other possible reasonable accommodations that will better protect this specific employee.

Ultimately, unless the employee is in a vulnerable class, simply being fearful of returning to work during the COVID-19 pandemic is not enough to entitle an employee to remain at home, for purposes of unemployment and federal leave laws, or otherwise.

Advise Employees of Potential Consequences of Refusal to Return to Work

If an employee refuses to return to work because they are making more on unemployment, the Texas Workforce Commission has advised that such refusal constitutes unemployment fraud and encourages employers to report any such job refusal. Employers may send the information to twc.fraud@twc.state.tx.us or call 1-800-252-3642.

Before employers report the job refusal/fraud, they should counsel the employee or former employee (depending on whether the employee was furloughed or temporarily laid off) and give them a final chance to return to work. Employers should explain that, the employee will likely lose unemployment benefits once the job refusal is reported to the TWC and may be responsible to pay back the benefits obtained because of the fraud—it is also possible a finding of fraud could make the employee ineligible to receive any future unemployment benefits or worse, could result in criminal prosecution. In any event, the employee’s continued refusal will likely result in the employee being out of a job AND be ineligible to receive UI benefits.

Note that the TWC has stated that,

Each UI benefits case is currently evaluated on an individual basis. However, because of the COVID-19 emergency, the following are reasons benefits would be granted if the individual refused suitable work.

Reason for refusal:

  • At High Risk – People 65 years or older are at a higher risk for getting very sick from COVID-19 (Source: DSHS website).
  • Household member at high risk – People 65 years or older are at a higher risk of getting very sick from COVID-19 (Source: DSHS website).
  • Diagnosed with COVID – The individual has tested positive for COVID-19 by a source authorized by the State of Texas and is not recovered.
  • Family member with COVID – Anybody in the household has tested positive for COVID-19 by a source authorized by the State of Texas and is not recovered and 14 days have not yet passed.
  • Quarantined –Individual is currently in 14-day quarantine due to close contact exposure to COVID-19.
  • Child care – Child’s school or daycare closed and no alternatives are available (On June 3, 2020, Governor Abbott announced Phase III to Open Texas and child-care services and youth camps may now be open at full capacity. However, some childcare centers or youth camps are electing to stay closed or operate at a lower occupancy rate, based on demand).

Any other situation will be subject to a case by case review by the Texas Workforce Commission based on individual circumstances.

TWC FAQs About Unemployment Insurance Benefits Related to COVID-19 (emphasis added). In other words, if the employee refuses to come back to work, but one of those circumstances is present, they can refuse to return to work and still keep their unemployment benefits.

There are undoubtedly individuals that are taking advantage of the situation, but there are also individuals with legitimate health concerns or familial situations that make returning to work a true burden. Because of this, communication between the employer and current or former employees is crucial. Employers must balance their need for labor with the health and safety concerns of their employees.


These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation.

Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical Leave Act and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.


 

Topic: Employment Law
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Governor Abbott announces plan to “Reopen Texas”

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Written by Haley Paul
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COVID-19 EMPLOYER UPDATE

UPDATED April 17, 2020

In a press conference this afternoon, Governor Greg Abbott announced that he has signed three Executive Orders outlining his plan to “reopen Texas,” one of which includes the formation of a Strike Force to Open Texas to monitor and develop the “reopening” strategy. The Strike Force will bring together nationally recognized medical experts with public and private sector leaders who will advise the Governor on safely and strategically reopening business in the State of Texas. A copy of this Executive Order can be found here: Strike Force to Open Texas. Governor Abbott also announced a plan for “Retail to Go” through a second Executive Order. In particular, “[s]tarting at 12:01 a.m. on Friday, April 24, 2020, retail services that are not ‘essential services,’ but that may be provided through pickup, delivery by mail, or delivery to the customer’s doorstep in strict compliance with the terms required by DSHS” may resume operations as outlined in the Executive Order. This Order also included the following directive that schools will remain closed through the end of the 2019-2020 school year:

In accordance with the Guidelines from the President and the CDC, schools shall remain temporarily closed to in-person classroom attendance by students and shall not recommence before the end of the 2019-2020 school year. Public education teachers and staff are encouraged to continue to work remotely from home if possible, but may return to schools to conduct remote video instruction, as well as perform administrative duties, under the strict terms required by the Texas Education Agency. Private schools and institutions of higher education should establish similar terms to allow teachers and staff to return to schools to conduct remote video instruction and perform administrative duties when it is not possible to do so remotely from home.

A copy of this Executive Order can be founder here: Strategic Reopening of Select Services.
The Governor issued a third Executive Order concerning hospital capacity and personal protective equipment (PPE) needed for the COVID-19 response. A copy of this final Executive Order can be found here: Hospital Capacity During COVID-19.
During the Press Conference, Governor Abbott also announced that state parks will reopen on Monday, April 20, 2020. He advised that face masks must be worn and that individuals must continue to observe social distancing guidelines (of a six-foot radius) and prohibited the gathering of groups larger than five.
Notably, Governor Abbott discussed that employees should not be “coerced into returning to work” and advised that employees should feel safe in returning to work. He encouraged employers to implement the “very best strategies” to reduce the transmission of COVID-19. The Texas Department of State Health Services has issued guidance to assist employers on preparing to return to work and it can be located here: https://www.dshs.texas.gov/coronavirus/.
In addition, if your business is preparing to return to work, please review our Guidance on Returning to the Workplace in the Face of COVID-19 published earlier this week.

These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation.
Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical Leave Act and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.

Topic: Employment Law
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Returning to the workplace in the face of COVID-19

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Written by Morgan N. Muñoz
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COVID-19 EMPLOYER UPDATE

UPDATED April 15, 2020

Local, State, and Federal officials are discussing plans to begin lifting social distancing restrictions over the coming weeks. Businesses shut down by such restrictions are already making plans to reopen. But it will not be business as usual when operations resume. Employers should start thinking through new employment complications that are likely to accompany employees’ return to work and should make a plan for protecting employees from the virus while at work. Screening Employees for COVID-19 Symptoms The Equal Employment Opportunity Commission (the “EEOC”) has provided some helpful guidance for employers navigating the challenges that COVID-19 poses for the workplace. COVID-19 has been declared an “international pandemic” by the World Health Organization, and because of the concern of community spread transmission, employers are encouraged to take additional precautions to prevent the spread of the virus. Currently, employers may ask employees who report feeling ill or call in sick if they have any of the symptoms of COVID-19. Employees exhibiting symptoms of the virus should leave the workplace. Fever is one of several symptoms that an infected person may exhibit, and for that reason, the EEOC is permitting employers to take their employees’ temperatures. If an employer chooses to perform temperature checks, these checks should be performed consistently amongst all employees so as not to discriminate on the basis of specific characteristics. Employers may also ask employees about any travel and follow CDC advice before allowing traveling employees to return to work. Employers may also require employees who have been out of the office because of potential infection to provide medical documentation certifying fitness for duty before permitting them to return to work. Any information gathered by employers regarding employees’ medical status or condition must be kept confidential and maintained separately from the employees’ personnel files. OSHA/CDC Cleaning Protocol The Occupational Safety and Health Administration has identified risk levels based on workplace settings.
  • Very High and High Exposure Risk:
    • Healthcare workers performing aerosol-generating procedures, healthcare or laboratory personnel collecting or handling specimens of known or suspected COVID-19 patients; healthcare delivery, medical transport workers, and support staff exposed to known or suspected COVID-19 patients.
    • Morgue workers performing autopsies on the bodies of people who are known to have or are suspected of having COVID-19 at the time of their death.
  • Medium Exposure Risk:
    • Workers who require frequent and/or close contact (i.e., within 6 feet) with people who may be infected with COVID-19, but who are not known or suspected COVID-19 patients.
  • Lower Exposure Risk:
    • Workers who do not require contact with people known to be, or suspected of being, infected with COVID-19 or frequent close contact (i.e., within 6 feet) with the general public. Workers in this category have minimal occupational contact with the public and other coworkers.
Employers are obligated to provide their workers with personal protective equipment needed to keep them safe while performing their jobs. The type of equipment will vary based on the risk levels above. OSHA recommends establishing policies and practices for social distancing by implementing flexible worksites (e.g. telework), flexible work hours (e.g. staggered shifts), increasing physical space between employees, and between employees and customers at the worksite, downsizing operations, delivering services remotely (e.g. phone, video, or web), and delivering products through curbside pick-up or delivery. If a person who is suspected of having COVID-19 or confirmed of same has been in your facility, the Centers for Disease Control recommend:
  • Closing off areas visited by the ill persons and opening outside doors and windows to ventilate the area for 24 hours before beginning to clean/disinfect.
  • Cleaning staff should clean and disinfect all areas such as offices, bathrooms, common areas, shared electronic equipment (e.g., touch screens, keyboards, remote controls) used by the ill persons, focusing especially on frequently touched surfaces.
Further guidance on cleaning and disinfection of community facilities may be found on the CDC’s website at www.cdc.gov and on the Department of Labor website at www.dol.gov/coronavirus. Requests for Leave COVID-19 is not going anywhere, and neither are the new leave laws passed by the federal government—at least for a while. The Families First Coronavirus Response Act (or “FFCRA”, which is in effect until December 31, 2020) created two types of paid leave for COVID-19 related reasons. Employers must post a notice that outlines these new employee rights under the FFCRA (the Department of Labor has published a notice that meets all necessary requirements: https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf) and should have a plan in place for responding to requests for leave, including knowing what documentation to request to substantiate the need for leave. For information on eligibility requirements and documentation required for leave under the FFCRA, see our April 7, 2020 Employer Update: Department of Labor Guidance on Paid Leave Under the Families First Coronavirus Act. Requests to Continue Work from Home and Refusals to Return to Work One issue that employers may face once social distancing restrictions are lifted is that employees may be hesitant to return to work. Employees may request to continue to work from home or may refuse to return to work altogether for a variety of reasons. Employers should keep in mind that in addition to the new leave laws addressed above, there are other existing employment laws tofollow. If an employee is at particular risk for COVID-19, a doctor may advise the employee to continue to work from home or continue on unpaid leave as an “accommodation” under the Americans with Disabilities Act. Importantly, the EEOC has already determined that indefinite leaves of absence are not “reasonable” accommodations and employers need not permit such leaves of absence. If, on the other hand, a physician suggests a particular time frame and it is of a reasonable duration, employers should carefully consider permitting such leave. If employees have been ordered to return to work and they do not qualify for leave under one or more of the situations listed above (or if they have exhausted their leave), employees may be terminated for job abandonment. However, before termination, employers should issue a written notice to the employee explaining the date at which the employee must return to work in order to avoid termination and should include a clear warning that the employee will be terminated for misconduct (i.e. the employee will not be entitled to unemployment benefits) if the employee does not return to work as ordered. If the employee is currently receiving unemployment benefits, the employer should notify the Texas Workforce Commission that the employee was ordered to return to work and refused to do so.
These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation. Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical Leave Act and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.
 

Topic: COVID-19
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Department of labor guidance on paid leave under the families first coronavirus response Act

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COVID-19 EMPLOYER UPDATE

UPDATED April 7, 2020

On April 1, 2020, the Department of Labor (“DOL”) Wage and Hour Division issued new regulations in order to aid in interpretation under the Families First Coronavirus Response Act (“FFCRA”). The FFRCA entitles employees to paid leave under two separate provisions: (i) the Emergency Paid Sick Leave Act (“EPSLA” or “Paid Sick Leave”); and (ii) the Emergency Family Medical Leave and Expansion Act (“EFMLEA” or “Expanded FMLA”) .

Applicability

  • Which businesses must comply withFFCRA?
    • All private employers with fewer than 500 employees (and some public employers).
  • Which employees count towards the 500-employee threshold?
    • Full-time employees
    • Part-time employees
    • Employees on leave
    • Temporary employees who are jointly employed with another employee
    • Day laborers supplied by a temporary placement agency
  • Which individuals do not count towards the 500-employee threshold?
    • Independent contractors
    • Employees who are on furlough or laid off
    • Employees outside of the United States

Employer’s Notice Obligation

  • Employers are required to keep posted a notice of the FFCRA requirements. An employer may also satisfy this requirement by emailing or mailing the notice to employees. The notice requirement applies even to businesses who may qualify for the small employer exemption.
  • A model notice is available at https://www.dol.gov/agencies/whd/posters.

Employee Eligibility for Leave

FFCRA
  • Paid Sick Leave (EPSLA) - Employee is eligible immediately upon his hire date
  • Expanded FMLA (EFMLEA) - Employee is eligible if he has been on the employer’s payroll for 30 calendar days

FFCRA Leave Entitlements

Helpful Guidance for Interpreting FFCRA Leave (Applies to Paid Sick Leave and Expanded FMLA)
  • Are employees entitled FFCRA leave if an employer offers telework?
    • No, the employee is not entitled to FFCRA paid leave if:
      • The employer has work for the employee to perform;
      • The employer permits the employee to perform that work from the location where the employee is waiting; and
      • There are no extenuating circumstances, such as serious COVID-19 symptoms, that may prevent the employee from performing that work.
  • Are employees entitled FFCRA leave if an employer closes his business?
    • No, if an employer does not have work available for an employee, then it does not have to provide FFCRA paid leave.
    • This analysis remains the same regardless of whether the employer closed his business due to a downturn or due to a stay-at-home order.
      • Example: If an employee is subject to a stay-at-home order, but his employer is not currently in operation, then the employee is not entitled to FFCRA leave because the employee would not be able to work even if he was not subject to the stay-at-home order.
  • Are employees who are on FFCRA leave entitled to continued health care benefits?
    • Yes, the employer must continue coverage under its group health care plan on the same terms as if the employee did not take leave.
    • If the employer provides a new health plan while the employee is on FFCRA leave, it must give the employee notice of the new plan so that the employee may elect to change coverage.
    • If the employment relationship would have terminated, then the employer does not have to maintain health benefits (i.e. employee does not return from leave or the employer closes its business).
The following circumstance is 1 of 6 reasons that an employee may qualify for Paid Sick Leave, and it is the only reason an employee may qualify for leave under the Expanded FMLA. (i):The employee is caring for his or her child whose school or child-care provider is unavailable due to COVID-19 precautions:
  • Are employees entitled FFCRA leave if they have alternative childcare available?
    • No, an employee is not entitled to FFCRA leave if another suitable individual is available to care for the child, such as a co-parent or other usual care provider.
  • Which types of child-care closures entitle an employee to FFCRA leave?
    • Schools, pre-schools, and day care facilities
    • Before and after school care programs
    • Summer programs or camps
The following circumstances are the remaining reasons that an employee may qualify for Paid Sick Leave. Note that these circumstances do NOT qualify an employee for leave under theExpanded FMLA. (ii): The employee is subject to a Federal, State, or local quarantine or isolation order:
  • What types of orders entitle employees to Paid Sick Leave?
    • The regulations define “Federal, State, or local quarantine or isolation order” broadly to include quarantine, isolation, containment, shelter-in-place, or stay-at-home orders issued by any Federal, State, or local government authority that cause the Employee to be unable to work even though the employer has work that the Employee could perform but for the order. This also includes when a Federal, State, or local government authority has merely advised categories of citizens (e.g., of certain age ranges or of certain medical conditions) to shelter in place, stay at home, isolate, or quarantine.
(iii): The employee has been advised by a health care provider to self-quarantine:
  • Are employees entitled Paid Sick Leave if they have decided to self-quarantine?
    • No. An employee cannot receive FFCRA paid leave in order to self-quarantine unless he has been advised by a health care provider to do so based on the fact that the employee:
      • has COVID-19;
      • may have COVID-19; or
      • is particularly vulnerable to COVID-19.
(iv): The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis:
  • Are employees entitled FFCRA paid leave if they experience symptoms or are otherwise suspect that they have COVID-19?
    • An employee cannot receive FFCRA paid leave unless they are affirmatively taking steps to obtain a medical diagnosis.
    • An employee is entitled to FFCRA paid leave while awaiting the test results.
      • If an employee does not meet the criteria for testing but is advised by a health care provider to self-quarantine, then that employee is entitled to leave.
(v): The employee is caring for an individual who is subject to a Federal, State, or local quarantine or isolation order, or caring for an individual who has been advised by a health care provider to self-quarantine:
  • Are there any criteria for the relationship that an employee must have before being entitled to FFCRA paid leave in order to care for an individual?
    • Yes, the employee must have a personal relationship (i.e. family member, roommate) that creates an expectation that the employee would care for that person if he was under quarantine.
(vi): 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
  • There has been no interpretive guidance for this qualifying event.

Small Employer Exemption

  • Does my business qualify for an exemption from paying FFCRA paid leave?
    • Small businesses with less than 50 employees may be eligible for an exemption from some of the paid leave requirements if the DOL determines that compliance would “jeopardize the viability of the business as a going concern.” A business with less than 50 employees does not automatically qualify merely based on size alone.
  • What criteria qualifies a business for an exemption per the DOL?
    • An authorized officer of the business determines that the absence of the employee requesting leave would:
      • Cause the employer’s expenses to exceed available business revenue;
      • Pose a substantial risk to the operation of the business because of that employee’s specialized skill; or
      • Prevent the employer from operating at minimal capacity because the employer cannot find a capable replacement
  • How does my business request an exemption?
    • Any employer that denies an employee’s request for leave pursuant to the small employer exemption must document and retain the determination by its authorizing officer how it meets the criteria for that exemption. Currently there is no approval process, and the DOL is instructing employers not to send the documentation.
  • If it is determined that my business qualifies for the exemption, does this mean that my business does not have to pay any of the new paid leave entitlement under the FFCRA?
    • NO, if the employer is deemed exempt by the DOL, this only excuses employer from providing paid leave under a) the Expanded FMLA and b) the Paid Sick Leave if the employee’s need for leave is to take care of a child whose childcare is unavailable due to COVID-19. Consequently, even if the employer is deemed exempt, it must pay leave if the reason for leave is for one of the other 5 qualifying reasons enumerated in the EPSLA.

Documentation

  • What documentation must an employee provide to his employer to support FFCRA paid leave?
    • A signed statement containing:
      • Employee’s name;
      • Date(s) for which leave is requested;
      • COVID-19 qualifying reason for leave; and
      • Statement that the employee is unable to work or telework because of the COVID-19 reason.
The DOL requires the following additional documentation to support that COVID-19 is the qualifying reason for leave:

Emergency Paid Sick Leave Act

Qualifying Reason
  • The employee is subject to a Federal, State, or local quarantine or isolation order
  • The employee has been advised by a health care provider to self-quarantine
  • The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis
  • The employee is caring for an individual who is subject to an order as described in subparagraph (i) or has been advised as described in paragraph (ii)
  • The employee is caring for his child whose school or child-care provider is unavailable due to COVID-19 precautions
  • The employee is experiencing any other substantially similar condition specified by theSecretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor
Required Documentation
  • Name of the government entity that issued the quarantine or isolation order
  • Name of the health care provider that advised the employee to self-quarantine
  • No DOL guidance advising of additionally required documentation
  • Depending on the reason for the request, the documentation required in subparagraph (i) or subparagraph (ii)
  • Name of the child being cared for; (b) name of the school or child-care provider that is closed; and (c) a statement that no other suitable person is available to care for the child
  • No DOL guidance advising of additionally required documentation

Emergency Family Medical Leave Expansion Act

Qualifying Reason
  • The employee is caring for his child whose school or child-care provider is unavailable due to COVID-19 precautions
Required Documentation
  • (a) Name of the child being cared for; (b) name of the school or child-care provider that is closed; and (c) a statement that no other suitable person is available to care for the child

Limitations on Amount of FFCRA Leave

  • Does an employee receive additional Paid Sick Leave if he changes employers?
    • No, each individual is entitled up to 80 hours of paid leave under the EPSLA. A new employer is only required to provide the employee with any sick leave remaining for that individual up to the 80 hours.
  • Does an employee’s use of other FMLA leave count towards the 12 weeks of EFMLEA leave?
    • Yes, employees may only use 12 weeks of Expanded FMLA leave between April 1, 2020-December 31, 2020, and any leave taken under the FMLA during that time must be deducted from the leave available under the Expanded FMLA.

Recordkeeping

  • Is my business required to retain documentation of requests for FFCRA paid leave?
    • Yes, an employer must maintain documentation for 4 years, regardless of whether the leave was granted or denied. Even an employee’s oral statement supporting paid leave must be documented and retained.

Tax Credits

  • Employers who pay FFCRA paid leave may be reimbursed through refundable tax credits for (i) wages paid under both Paid Sick Leave and Expanded FMLA (up to the aggregate caps), and (ii)the costs to maintain health care coverage under a group plan.
  • In order to claim tax credits from the Internal Revenue Service (“IRS”), employers should retain the following documentation for four years:
    • Documentation to show how the employer calculated FFCRA paid leave;
    • Documentation to show how the employer calculated the amount of qualified health plan expenses;
    • Copies of completed IRS Forms 7200 submitted to the IRS;
    • Copies of completed IRS Forms 941 submitted to the IRS; and
    • Documents needed to support the request for tax credits pursuant to IRS procedures. Visit https://www.irs.gov/forms-pubs/about-form-7200 and https://www.irs.gov/pub/irs-drop/n-20-21.pdf for an explanation on how to claim tax credits.

Enforcement

The DOL will not bring enforcement actions against any public or private employer for violations of the Act occurring within 30 days of the enactment of the FFCRA, i.e. March 18 through April 17, 2020, provided that the employer has made reasonable, good faith efforts to comply with the Act.
These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed.The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation. Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical Leave Act and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.
 

Topic: Employment Law
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U.S. treasury department office of public affairs – press release

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COVID-19 EMPLOYER UPDATE

UPDATED March 31, 2020

Earlier today, the U.S. Department of Treasury issued a PRESS RELEASE which provides an additional summary of the CARES Act and includes links to the Small Business Administration (SBA) website and the U.S. Department of Treasury website where you will find a link to the Paycheck Protection Program Loan Application form and other helpful information. Go to www.treasury.gov/cares to find the application form. Please note that lenders will not be ready to receive or process loan applications until they receive additional guidance from the SBA. The PRESS RELEASE is reprinted below.
U.S. Treasury Department Office of Public Affairs Press Release: March 31, 2020 Contact: Treasury Public Affairs, (202) 622-2960 With $349 Billion in Emergency Small Business Capital Cleared, Treasury and SBA Begin Unprecedented Public-Private Mobilization Effort to Distribute Funds WASHINGTON – Following President Trump’s signing of the historic Coronavirus Aid, Relief, and Economic Security (CARES) Act, SBA Administrator Jovita Carranza and Treasury Secretary Steven T. Mnuchin today announced that the SBA and Treasury Department have initiated a robust mobilization effort of banks and other lending institutions to provide small businesses with the capital they need. The CARES Act establishes a new $349 billion Paycheck Protection Program. The Program will provide much-needed relief to millions of small businesses so they can sustain their businesses and keep their workers employed. “This legislation provides small business job retention loans to provide eight weeks of payroll and certain overhead to keep workers employed,” said Secretary Mnuchin. “Treasury and the Small Business Administration expect to have this program up and running by April 3rd so that businesses can go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved on the same day. The loans will be forgiven as long as the funds are used to keep employees on the payroll and for certain other expenses.” “This unprecedented public-private partnership is going to assist small businesses with accessing capital quickly. Our goal is to position lenders as the single point-of-contact for small businesses – the application, loan processing, and disbursement of funds will all be administered at the community level,” said Administrator Carranza. “Speed is the operative word; applications for the emergency capital can begin as early as this week, with lenders using their own systems and processes to make these loans. We remain committed to supporting our nation’s more than 30 million small businesses and their employees, so that they can continue to be the fuel for our nation’s economic engine.” The new loan program will help small businesses with their payroll and other business operating expenses. It will provide critical capital to businesses without collateral requirements, personal guarantees, or SBA fees – all with a 100% guarantee from SBA. All loan payments will be deferred for six months. Most importantly, the SBA will forgive the portion of the loan proceeds that are used to cover the first eight weeks of payroll costs, rent, utilities, and mortgage interest. The Paycheck Protection Program is specifically designed to help small businesses keep their workforce employed. Visit SBA.gov/Coronavirus for more information on the Paycheck Protection Program.
  • The new loan program will be available retroactive from Feb. 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020.
Loan Terms & Conditions
  • Eligible businesses: All businesses, including non-profits, Veterans organizations, Tribal concerns, sole proprietorships, self-employed individuals, and independent contractors, with 500 or fewer employees, or no greater than the number of employees set by the SBA as the size standard for certain industries
  • Maximum loan amount up to $10 million
  • Loan forgiveness if proceeds used for payroll costs and other designated business operating expenses in the 8 weeks following the date of loan origination (due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs)
  • All loans under this program will have the following identical features:
    • Interest rate of 0.5%
    • Maturity of 2 years
    • First payment deferred for six months
    • 100% guarantee by SBA
    • No collateral
    • No personal guarantees
    • No borrower or lender fees payable to SBA
Visit treasury.gov/cares for more information on SBA’s assistance to small businesses.
These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation. Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical Leave Act and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.
 

Topic: SBA
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Montgomery county issues "stay home, stop the spread" orderessential businesses remain exempt from stay home

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Written by Stuart W. Lapp
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COVID-19 EMPLOYER UPDATE

UPDATED March 27, 2020

As of today, Montgomery County, Texas has officially issued a “Stay Home, Stop the Spread” Order – effective from11:59 p.m. March 27, 2020 until 11:59 p.m. April 12, 2020. Like similar orders issues by many other States, Counties, and Cities, Montgomery County residents are ordered to stay at their place of residence except for “Essential Activities”. The Stay at Home, Stop the Spread Order requires all businesses except “Essential Businesses” to cease all activities at facilities located within Montgomery County.
The Montgomery County order includes a mandatory curfew throughout all of Montgomery County, starting at 11:59 p.m. every night and ending at 6:00 a.m. the following morning for all persons not performing Essential Government Functions, working for or traveling to or from an Essential Business, seeking emergency medical care, or traveling through the county from onecounty to another.
The Montgomery County order expands the definitions of several Essential Businesses describedin the Harris County stay-at-home order as follows:
  • “Essential Healthcare Operations” now includes businesses that provide food, shelter and social services, and other necessities of life to the economically disadvantaged or otherwise needy individuals.
  • “Essential Retail” now includes:
    • Catering, so long as it is for an Essential Business or Essential Government Function; and
    • Businesses that sell firearms or gun ranges.
  • “Professional Services” now includes:
    • Crisis counseling facilities or emergency adult and/or youth services; and
    • Any non-profit or NGS providing critical assistance to the residents of Montgomery County as a result of a Disaster Declaration.
The below chart is a guide for businesses to assist in determining whether your business is considered an “Essential Business.” It is compiled from guidance issued by the Cybersecurity and Infrastructure Security Agency (CISA), the State of California, and Dallas County. It is not intended to be a directive, nor an exhaustive list.

Essential Businessses

Healthcare/Public Health

  • Healthcare operations, including hospitals, clinics, dentists, pharmacies, pharmaceutical and biotechnology companies, other healthcare facilities, healthcare suppliers, mental health providers, substance abuse service providers, blood banks, medical research, laboratory services, pharmacies, or any related and/or ancillary healthcare services (including security for such operations)
  • Manufacturers, technicians, logistics and warehouse operations, and distributors of medical equipment, personal protective equipment, medical gases, pharmaceuticals, blood and blood products, vaccines, testing materials, laboratory supplies, cleaning, sanitizing, disinfecting or sterilization supplies, and tissue and paper towel products
  • Home-based and residential-based care for seniors, adults, or children
  • Veterinary care and all health and welfare services provided to animals
  • DOES NOT INCLUDE fitness and exercise gyms and similar facilities
  • DOES NOT INCLUDE elective medical, surgical, and dental procedures

Essential Government Functions

  • All services provided by local governments needed to ensure the continuing operation of the government agencies to provide for the health, safety and welfare of the public, including personnel in emergency management, law enforcement, Emergency Management Systems, fire, and corrections, EMT, 911 call center employees
  • Assistance programs and government payments
  • Shall be performed in compliance with social distancing requirements of six feet, to the extent possible

Essential Critical Infrastructure

  • Work necessary to the operations and maintenance of the 16 critical infrastructure sectors as identified by the National Cybersecurity and Infrastructure Agency (CISA)
  • Shall be performed in compliance with social distancing requirements of six feet, to the extent possible
  • Should implement screening precautions to protect employees,and all activity shall beperformed in compliance with social distancing guidelines

Essential Retail

  • Food service providers, including grocery stores, warehouse stores, big-box stores, bodegas, liquor stores, gas stations and convenience stores, farmers’ markets that sell food products and household staples
  • Food cultivation and manufacturing/processing, including farming, fishing, and livestock
  • Businesses that ship or deliver groceries, good, or services directly to residences
  • Restaurants and other facilities that prepare and serve food, but only for delivery or carry out
  • Schools and other entities that typically provide free services to students or members of the public on a pick-up and take-away basis only
  • The restriction on delivery and carry out does not apply to cafes and restaurants located within hospital and medical facilities
  • Laundromats, dry cleaners, and laundry service providers
  • Gas stations, auto-supply, auto and bicycle repair, hardware stores, and related facilities
  • Businesses that supply productsneeded for people to work from home

Providers of Basic Necessities to Economically Disadvantaged Populations

  • Businesses that provide food, shelter, and social services, and other necessities of life for economically disadvantaged or otherwise needyindividuals

Essential Services Necessary to Maintain Essential Operations of Residences or Other Essential Businesses

  • Trash and recycling collection, processing,and disposal;mail and shipping services; building cleaning and maintenance; warehouse/distribution and fulfillment; storage for essential businesses; funeral homes, crematoriums, and cemeteries
  • Plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operations of residences and Essential Businesses
  • Professional services, such as legal or accounting services, when necessary to assist in compliance with legally mandated activities
  • Businesses that supply other essential businesses with the support of supplies needed to operate

News Media

  • Newspapers, television, radio, and other media services

Childcare Services

  • Childcare facilities providing services that enable employees exempted to work as permitted

These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you andStibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation.
Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical LeaveAct and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.

Topic: COVID-19
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Coronavirus aid, relief, and economic security (cares) act update

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Written by Haley Paul
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COVID-19 employer update

UPDATED March 27, 2020

As discussed in our March 26, 2020 Employer Update, the U.S. Senate passed the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Today the CARES Act was passed by the U.S. House of Representatives and was immediately signed into law by President Trump. We have provided a summary of the Act and its key components, with respect to employers, below.

Emergency EIDL Grants

  • Which businesses qualify for the Program?
    • Applicable to businesses that have 500 or fewer employees
      • The term employee includes individuals employed on a full-time, part-time, or other basis
    • Includes sole proprietors, independent contractors, and eligible self-employed individuals
    • Expands allowable uses to include: payroll costs; costs of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums; employee salaries, commissions, or similar compensations; interest on mortgage obligations; rent; utilities; interest on other debt obligations incurred before the covered period
  • What are the specific requirements for the Program?
    • Eligible businesses may receive a grant not to exceed $10,000
    • Required to make good faith certification that the employer has been affected by COVID-19 and will use funds to retain workers and maintain payroll and other debt obligations
    • No requirement that applicant is unable to obtain credit elsewhere
    • Coverage period January 31, 2020 through December 31, 2020
    • Business MUST be operational on January 31, 2020
    • Must be used for:
      • Providing sick leave due to COVID-19
      • Maintaining payroll to retain employees during disruption/slowdown
      • Covering increased costs due to interrupted supply chains
      • Paying rent/mortgage payments
      • Repaying obligations that cannot be met due to revenue losses
  • How does an eligible business apply for a grant?
    • Within 10 days of enactment, the SBA will publish procedures for application and minimum requirements
  • Does the Grant have to be repaid?
    • No. However, if an eligible business subsequently receives a loan under the Paycheck Protection Program, the amount of the grant will be deducted from the loan forgiveness amount

Small Business Loan Forgiveness (“Paycheck Protection” Program)

  • Which businesses qualify for the Program?
    • Applicable to businesses that have 500 or fewer employees 
      • The term employee includes individuals employed on a full-time, parttime, or other basis
    • Includes sole proprietors, independent contractors, and eligible self-employed individuals
    • Expands allowable uses to include: payroll costs; costs of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums; employee salaries, commissions, or similar compensations; interest on mortgage obligations; rent; utilities; interest on other debt obligations incurred before the covered period
  • What are the specific requirements for the Program?
    • Eligible businesses may take out loans up to $10 million (subject to a formula tied to payroll costs) and can cover employees making up to $100,000 per year
    • Required to make good faith certification that the employer has been affected by COVID-19 and will use funds to retain workers and maintain payroll and other debt obligations
    • No requirement that applicant is unable to obtain credit elsewhere
    • No personal guarantee or collateral is required for the loan o No pre-payment penalty
    • Business must maintain its March 24, 2020 employment levels through September 30, 2020 as much as practicable, and in any case shall not reduce its employment levels by more than 10%
  • As a small business, does the Act incentivize me to keep employees on payroll?
    • Yes. The portion of the loan used for covered payroll costs, interest on mortgage obligations, rent, and utilities would be forgiven on a tax-free basis as long as the employer does not: 
      • Reduce its number of employees during the 8-week covered period compared to the prior year; or
      • Reduce employee’s pay by more than 25% during the 8-week covered period 
    • No reduction if the employer rehires or increases the employee’s pay within the specified time period
  • Where will I get my loan?
    • The loans will be available through banks and credit unions that already participate in the Small Business Administration’s 7(a) loan program 
  • What interest rate will be applied to the loan?
    • No more than 4%
  • When do loan repayments begin? 
    • No sooner than 6 months after disbursement of the loan funds but no later than 12 months o Repayment deferment includes principal, interest and fees
  • What amount of the loan is eligible for forgiveness?
    • The forgiveness period is a period of 8 weeks from the date the loan is approved
    • The portion of the loan used to pay qualifying expenses during the 8-week period is eligible for forgiveness, up to the full amount of the loan principal
    • The amount forgiven will be reduced if the employer reduces its workforce during the 8-week period
    • The employer may rehire any employees who have already been laid off due to the COVID-19 crisis without penalty
  • When will the loan be forgiven? 
    • No later than 90 days after submission of documentation required for loan forgiveness

Employee Retention Credit

  • Who is eligible for the Employee Retention Credit and what amount of credit may be claimed?
    • Eligible employers who partially or fully suspend operations due to orders from appropriate governmental authority are allowed a credit against employment taxes equal to 50% of qualified wages (up to $10,000 in wages) for each employee

Expansion of Unemployment Benefits (“Relief for Workers Affected by Coronavirus Act”)

  • Who is eligible for the program’s unemployment benefits?
    • While unemployment is normally not available for those who are self-employed, those individuals are now entitled to benefits under the Relief Act
    • An individual who is unemployed, partially unemployed, or unable or unavailable to work because: 
      • Individual diagnosed with COVID-19 or experiencing symptoms and seeking a medical diagnosis of COVID-19 
      • Member of the individual’s household has been diagnosed with COVID19 
      • Individual is providing care for a family member with COVID-19 
      • Child or other person in the household in which the individual has primary caregiving responsibility is unable to attend school or another facility that is closed due to COVID-19 and such care is required for the individual to work 
      • Unable to reach place of employment because of quarantine 
      • Individual has been advised to self-quarantine by a health care provider and is unable to reach the place of employment
      • Individual was scheduled to commence employment and does not have a job or is unable to reach the job as a result of COVID-19 
      • Individual has become the breadwinner or major support for a household because the head of household died as a direct result of COVID-19 
      • Individual has to quit as a direct result of COVID-19
      • Individual’s place of employment is closed as a direct result of COVID-19 
      • Individual is self-employed, is seeking part-time employment, does not have sufficient work history, or otherwise would not qualify for regular unemployment or extended benefits under State or Federal law
  • Who is not eligible for the Relief Act’s unemployment benefits?
    • An employee who is able to telework with pay
    • An individual receiving other paid leave benefits
  • How does the Relief Act increase my unemployment benefits?
    • Individuals will not only receive the usual calculation of benefits from the State, but the federal government has allocated an additional $600 per week of unemployment for up to four months for each individual
    • All eligible workers will receive an additional 13 weeks of unemployment benefits, not to exceed 39 weeks 
  • Have the procedures for collecting unemployment changed?
    • A one-week waiting period before receiving benefits is customary in many states, but the federal government has incentivized states to waive that requirement
  • How long are the increased unemployment benefits available?
    • Benefits will cover the period of unemployment between January 27, 2020- December 31, 2020

Recovery rebates

  • Who is eligible for a recovery rebate?
    • All U.S. residents who are not the dependent of another taxpayer and have a work-eligible Social Security Number, whose taxable income falls under one of several predetermined amounts
  • How much money can I expect to receive?
    • Individuals earning $75,000 (or heads of household earning $112,500) or less will receive $1,200 with an additional $500 for every qualifying child 
    • Married couples earning $150,000 or less will receive a total of $2,400
    • Payments decrease for individuals earning above $75,000 or married couples earning above $150,000. Individuals making more than $99,000 or married couples earning $198,000 will not receive the direct cash payments
    • A formula to determine an individual or families’ expected rebate is attached as Schedule A
  • What year is my income based on to determine eligibility for the direct cash payments?
    • For those that have not yet filed their 2019 tax return, 2018 income will be used
  • Do I need to take any action to receive the payments?
    • No, there is no specific action you need to take
  • Is the payment subject to income taxes?
    • No.

These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation.

Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical Leave Act and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.


 

SCHEDULE A

“RECOVERY REBATE FORMULA”

R = recovery rebate amount

K = number of qualifying dependents 16 years old or younger

G = adjusted gross income for 2019 (unless you haven’t filed your tax return for 2019, in which case taxable income for 2018)

For individuals not filing as head of household who made $75,000 or less 

R = [1,200 + (500 x K)]

For individuals not filing as head of household who made more than $75,000

R = [1,200 + (500 x K)] – [(G – 75,000) x .05]

For heads of household who made $112,500 or less

R = [1,200 + (500 x K)]

For heads of household who made more than $112,500

R = [1,200 + (500 x K)] – [G – 112,500) x .05]

For married filing jointly who made $150,00 or less

R = [2,400 + (500 x K)]

For married filing jointly who made more than $150,000

R = [2,400 + (500 x K)] – [(G – 150,000) x .05]


 

Topic: Employment Law
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WORKPLACE POSTER REQUIREMENTS and NEW EFFECTIVE DATE

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COVID-19 employer update

UPDATED MARCH 26, 2020

Stibbs & Co., P.C. published an Employer Update on March 20, 2020 which outlined key provisions of the recently enacted Families First Coronavirus Response Act (“FFCRA” or “the Act”). At the time of that update, it was anticipated that the Act would take effect on April 2, 2020. Since then, the Department of Labor’s Wage and Hour Division has published further guidance explaining Paid Sick Leave and the expansion to the Family Medical Leave Act (“FMLA”). Most importantly, theD epartment of Labor changed the effective date of the Act to April 1, 2020. Employers should be aware of the NEW EFFECTIVE DATE of the Act. The FFCRA requires that employers who are covered by the Act post a specific notice related to the benefits extended to employees covered by the FFCRA. Section 5103 of the Act states that, “[e]ach employer shall post and keep posted, in conspicuous places on the premises of the employer where notices to employees are customarily posted . . . .” a copy of the notice.Employees who are currently working remotely will not see a notice posted at their office so employers may also comply with the requirement by posting the notice on their company’s internal or external website, e-mailing, or mailing it to the employee. As of this date, employers are required to give notice only to current employees. Providing notice to employees who have already been laid-off is not required. Violations of the provisions of the FFCRA will be subject to penalties and enforcement by the Department of Labor’s Wage and Hour Division. A link to the workplace poster i s provided below. (A separate poster which applies only to federal employees can be accessed here)

CORONAVIRUS AID, RELIEF, and E CONOMIC SECURITY ACT (“CARES Act”)

Late last night, the United States Senate passed an Economic Stimulus Bill – the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) - which will, among other things, expand unemployment coverage, provide small business loans, and provide stimulus payments for individuals. The CARES Act has not yet been passed by the U.S. House of Representatives nor signed into law by the President. Both are expected to occur before the end of the day tomorrow. During these extremely difficult times, Stibbs & Co., P.C. is focused on our firm’s number one priority, Helping Businesses Succeed®. We are monitoring the CARES Act at all stages and will provide concise insight on how it will affect your business. Should you have any questions related to the information above, please contact our office.

Helpful links:

https://www.dol.gov/agencies/whd/posters https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave  
These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or tax advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed. Employers should consult their tax advisors concerning the application of tax laws to their particular situation. Employers are also encouraged to seek legal counsel prior to taking actions to avoid violations of federal or state employment laws including, but not limited to, the Family Medical LeaveAct and its expansion under the Families First Coronavirus Response Act, the Fair Labor Standards Act, the Texas Payday Law, Texas small employer health insurance laws, new hire reporting laws, the Texas Commission on Human Rights Act, various EEO laws covered by Title VII of the Civil Rights Act of 1964, Occupational Safety and Health Administration laws, the Immigration Reform and Control Act, EEO-1 reporting requirements, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the National Labor Relations Act, the Worker Adjustment Retaining Notification Act, and the Employee Retirement Income Security Act of 1974.
 

Topic: Employment Law
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Essential businesses exempt from shelter in place activities

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COVID-19 EMPLOYER UPDATE

UPDATED March 24, 2020

As of today, Harris County has officially issued a stay-at-home/work safe order. Many other States, Counties, and Cities have issued orders directing individuals to shelter at their place of residence. In Texas, the list includes, but is not limited to, the Cities of Houston, Austin, Dallas, Fort Worth, and San Antonio along with the Counties of Bell, Bexar, Collin, Dallas, Galveston, Harris, Hunt, McLennan, and Rockwall. Such shelter-in-place/stay-at-home orders require all businesses except “Essential Businesses” to cease all activities at facilities located within the county/city. In the event that your County or City issues a shelter-in-place/stay-at-home order, the below chart is a guide for businesses to assist in determining whether your business is considered an “Essential Business.” It is compiled from guidance issued by the Cybersecurity and Infrastructure Security Agency (CISA), the State of California, and Dallas County. It is not intended to be a directive, nor an exhaustive list.

Essential Businessses

Healthcare/Public Health

  • Healthcare operations, including hospitals, clinics, dentists, pharmacies, pharmaceutical and biotechnology companies, other healthcare facilities, healthcare suppliers, mental health providers, substance abuse service providers, blood banks, medical research, laboratory services, pharmacies, or any related and/or ancillary healthcare services (including security for such operations)
  • Manufacturers, technicians, logistics and warehouse operations, and distributors of medical equipment, personal protective equipment, medical gases, pharmaceuticals, blood and blood products, vaccines, testing materials, laboratory supplies, cleaning, sanitizing, disinfecting or sterilization supplies, and tissue and paper towel products
  • Home-based and residential-based care for seniors, adults, or children
  • Veterinary care and all health and welfare services provided to animals
  • DOES NOT INCLUDE fitness and exercise gyms and similar facilities
  • DOES NOT INCLUDE elective medical, surgical, and dental procedures

Essential Government Functions

  • All services provided by local governments needed to ensure the continuing operation of the government agencies to provide for the health, safety and welfare of the public, including personnel in emergency management, law enforcement, Emergency Management Systems, fire, and corrections, EMT, 911 call center employees
  • Assistance programs and government payments
  • Shall be performed in compliance with social distancing requirements of six feet, to the extent possible

Essential Critical Infrastructure

  • Work necessary to the operations and maintenance of the 16 critical infrastructure sectors as identified by the National Cybersecurity and Infrastructure Agency (CISA) (below graphic)
  • Shall be performed in compliance with social distancing requirements of six feet, to the extent possible
  • Should implement screening precautions to protect employees, and all activity shall be performed in compliance with social distancing guidelines

Essential Retail

  • Food service providers, including grocery stores, warehouse stores, bigbox stores, bodegas, liquor stores, gas stations and convenience stores, farmers’ markets that sell food products and household staples
  • Food cultivation and manufacturing/processing, including farming, fishing, and livestock
  • Businesses that ship or deliver groceries, good, or services directly to residences
  • Restaurants and other facilities that prepare and serve food, but only for delivery or carry out
  • Schools and other entities that typically provide free services to students or members of the public on a pick-up and take-away basis only
  • The restriction on delivery and carry out does not apply to cafes and restaurants located within hospital and medical facilities
  • Laundromats, dry cleaners, and laundry service providers
  • Gas stations, auto-supply, auto and bicycle repair, hardware stores, and related facilities
  • Businesses that supply products needed for people to work from home

Providers of Basic Necessities to Economically Disadvantaged Populations

  • Businesses that provide food, shelter, and social services, and other necessities of life for economically disadvantaged or otherwise needy individuals

Essential Services Necessary to Maintain Essential Operations of Residences or Other Essential Businesses

  • Trash and recycling collection, processing, and disposal; mail and shipping services; building cleaning and maintenance; warehouse/distribution and fulfillment; storage for essential businesses; funeral homes, crematoriums, and cemeteries
  • Plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operations of residences and Essential Businesses
  • Professional services, such as legal or accounting services, when necessary to assist in compliance with legally mandated activities
  • Businesses that supply other essential businesses with the support of supplies needed to operate

News Media

  • Newspapers, television, radio, and other media services

Childcare Services

  • Childcare facilities providing services that enable employees exempted to work as permitted

These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed.
 

Topic: Essential Businesses
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Commercial lease considerations & other issues in light of COVID-19

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Important information regarding

This memorandum is being issued in light of recent circumstances concerning COVID-19. These circumstances are constantly changing on a daily basis. The information provided herein is based on the current information known at this time (March 23, 2020).

What is a Force Majeure clause?

A force majeure clause is a provision included in contracts to remove liability for natural or unavoidable catastrophes that interrupt or prevent a party from fulfilling his/her obligations under the contract. There is not one form/standard force majeure clause; that is to say, force majeure clauses vary from one contract to another

Why is this important?

Almost all commercial leases contain a force majeure clause. As a tenant, you may be entitled to invoke your rights under the force majeure clause in your lease if there is a force majeure event that prevents you from performing under the lease, including your ability to pay rent. Bear in mind, however, some landlords carve out a tenant’s obligation to pay rent in the event of a force majeure, meaning some tenants may still be obligated to pay rent even if a force majeure event has occurred.

Can I invoke force majeure now?

It depends on what the language in the force majeure clause says. If you have decided to cut back business hours or elected to take any other action to help prevent the spread of the virus but which, in turn, has resulted in a reduction in cash flow, these acts likely do not constitute a force majeure. This is because financial hardships generally do not qualify as force majeure events. If, on the other hand, your state, local, or municipal government authorities issue a “shelter-inplace” or similar order, or if you have been personally diagnosed with COVID-19 and/or have been ordered by a medical professional to self-quarantine, these situations could constitute a force majeure event depending on what your lease says. Note that the clause may also have steps which may be required to invoke the force majeure clause, such as providing written notice within a certain number of days after the force majeure event occurs.

Should I approach my landlord now?

It is recommended that you approach your landlord sooner rather than later to request a temporary abatement of rent, especially if the force majeure clause in your lease has a carve out for rent payments. A 90-day abatement would be ideal. In return, you as tenant could offer to extend your lease by 3 months (or longer) on the back end, thus creating an incentive for the landlord. Alternatively, you can attempt to negotiate a reduction in the rent amount. If you and your landlord come to an agreement, it is important to memorialize this agreement in writing to protect your legal interests.

What issues could I face in approaching the landlord?

When discussing rent issues with your landlord, be cognizant of what you put in writing. It is important not to imply that you will soon be unable to pay rent or that you plan to stop paying rent, as these statements could be construed as an anticipatory breach on your part. To avoid this potential problem, it is recommended that your initial contact with your landlord be made via phone rather than in writing so that the issues can be discussed verbally.

What other options do I have?

You may also want to consider contacting your insurance carrier to determine what types of coverage you have in relation to business impacts from COVID-19.

Are there any other issues I should be aware of?

A recent Bill was passed that expands employee protections under the Emergency FMLA Expansion Act and establishes a new Emergency Paid Sick Leave Act. The FMLA expansion entitles employees to 12-weeks of job-protected leave, most of which must be paid, to care for the employee’s child whose school is closed or if the childcare provider is unavailable due to public health concerns. Whereas employers with less than 50 employees were previously exempt from the FMLA, simply having fewer than 50 employees does not, on its own, exempt you from complying with this Bill. The Emergency Paid Sick Leave Act applies to all employers with fewer than 500 employees. Employees are entitled to paid sick leave under 6 qualifying circumstances related to COVID19. How much pay an employee is entitled to depends on whether they are part-time or full-time. While there are caps on the amounts required to be paid, it could have a significant impact on small business.
These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or medical advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you and Stibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed.
 

Topic: Real Estate
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COVID-19 employer update

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Written by Morgan N. Muñoz
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UPDATED March 20, 2020

The Coronavirus pandemic is an unprecedented world-wide crisis. Eve nts are happening very quickly and the response by Federal, State and local governmental officials is evolvingrapidly. It is our goal to provide current and relevant information in a format that is (hopefully) easy to understand to help you make informed decisions that are in the best interest of your business and your employees. However, due to the rapidly changing nature of the crisis and the resultant response, it is impossible to provide real time information in usable form. This is the latest information available as of the date of this update.

Families First Coronavirus Response Act:

  • Enacted into law on March 18, 2020
  • Effective April 2, 2020-December 31, 2020
  • Applies to employers with fewer than 500 employees
  • Two paid leave provisions1.
    • Emergency Paid Sick Leave Act2.
    • Emergency FMLA Expansion Act:
  • A business with fewer than 50 employees may be exempt if the provisions “would jeopardizet he viability of the business as a going concern.”
    • The Department of Labor has yet to issue regulations on this exemption, so it is unclear how this exemption will be applied, but expect that it will be very narrow.

Emergency Paid Sick Leave Act:

  • Which employees qualify for paid sick leave under the Act?
    • The following are entitled to employer paid sick leave, an employee:
      • subject to a Federal, State, or local quarantine or isolation order related to COVID–19;
      • that has been advised by a health care provider to self-quarantine due to concerns related to COVID–19;
      • experiencing symptoms of COVID–19 and is seeking a medical diagnosis;
      • caring for an individual who is subject to an order as described in category no.1 or has been advised as described in category no. (2);
      • Сaring for a son or daughter, if the school or place of care of the son or daughter has been closed, or the child-care provider of such son or daughter is unavailable, due to COVID–19 precautions; and/or
      • 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.
  • What are the key provisions under this part of the Act?
    • Employer paid sick time is available for immediate use no matter how long the employee has been employed by employer
    • The employee is entitled to take up to the following hours of leave:
      • Full time employees – 80 hours
      • Part time employees – the number of hours that employee works on average over a 2-week period
    • The employee’s sick leave pay is based on his/her rate of pay:
      • If the leave is for the employee’s own medical condition, it is paid at a rate of 100% of the employee’s regular rate, subject to a cap of $511/day or $5,110 total.
      • If the leave is for the employee to act as a caregiver, it is paid at 2/3 the employee’s regular rate or minimum wage, whichever is greater, subject to a cap of $200/day or $2,000 total.
    • If the employee is unable to work, remotely or otherwise, because of one of the qualifying circumstances listed above, the employer must provide sick leave pay.
    • The employer cannot require the employee to first use other paid leave.
    • If the employee does not need the emergency paid sick leave, it does not accrue into the next year.

Emergency FMLA Expansion Act:

  • Which employees qualify for the expanded FMLA leave under the Act?
    • NOTE: This provision of the Act was narrowed significantly from the original version of the bill.
    • An employee may take FMLA leave if 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.
      • The term “public health emergency” means an emergency with respect to COVID–19 declared by a Federal, State, or local authority.
  • What are the key provisions under this part of the Act:
    • An employee qualifies for this Emergency FMLA if he/she has been employed for 30 calendar days.
    • The first ten days of FMLA leave may be unpaid, subject to the following:
      • The employee may elect to use their employer paid sick leave under the Emergency Paid Sick Leave Act; or
      • The employee may elect to use their accrued, unused paid time off under any existing company policy.
    • The next 10 weeks must be paid at 2/3 of the employee’s regular rate of pay, but the pay is capped at $200/day and $10,000 total.
    • If a business has fewer than 25 employees, the employer does not have to reinstate the employee if:
      • The employee takes the Public Health Emergency Leave;
      • 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 period of leave;
      • The employer makes reasonable efforts to restore the employee to a position equivalent to the position the employee held when the leave commenced, with equivalent employment benefits, pay, and other terms and conditions of employment; and
      • If the reasonable efforts of the employer under subparagraph (C) fail, the employer makes reasonable efforts to contact the employee if an equivalent position becomes available.

Employee Medical Inquiries and Examinations:

  • Can an employer require employees to undergo a temperature check?
    • Yes. The EEOC has advised, based on CDC guidance, that COVID-19 poses a direct threat in the workplace, and it is permissible for the employer to perform temperature checks—and send employees home that are running a fever. Employers should monitor State and local authorities to determine when a direct threat no longer exists.
  • Can an employer send an employee home who is displaying influenza symptoms?
    • Yes. The EEOC, following CDC guidance, advises employers to do so.
  • Can an employer ask employees if they have influenza symptoms?
    • Yes. But the employer must maintain the employee's illness as a confidential medical record.
  • Can an employer ask employees if they have traveled to locations that the CDC or public health officials have advised not to travel?
    • Yes. And the employer may follow the CDC advice regarding when the employee is safe to return to work.

Furloughs versus Layoffs:

  • What is furlough and how do they operate?
    • Furloughs are mandatory suspensions from work without pay. Furloughs are temporary, by nature, and can last for as long or as short as necessary.
      • For employees who are not exempt from overtime laws (ex. hourly employees and employees who do not fall into one or more overtime exemption), furloughs can be by the day. For example, you may reduce a worker to working one or two days in a week and only pay them for the hours worked.
        • Note that a reduction in hours may result in the employees’ entitlement to unemployment benefits based on the reduced hours.
      • For employees that are exempt from overtime laws (employees who meet the salary and other requirements for one or more exemption), furloughs must be by the week. You may not reduce a salaried, exempt employee’s hours and pay them for a partial week.
        • Be very cautious with furloughs for salaried, exempt employees. If they work for even a few minutes, they are entitled for their salary for the entire week. Otherwise, you risk losing the exemption in the future. For similar reasons, we do not advise converting salaried, exempt employees over to hourly.
  • What is the difference between furloughs and layoffs, if the furlough will require a complete suspension of all work?
    • The two operate very similarly under the present circumstances. Both methods mean that the employee will no longer be working and, therefore, will not earn any compensation. Accordingly, both methods entitle employees to unemployment benefits. Furloughs can be advantageous from the perspective that some health insurance benefits plans will permit the employee to be covered for a longer period(although, some plans will require employees to be active, so be sure to check with your plan provider for how a furlough will affect your employees’ benefits). Furloughs also provide employees with an expectation that their work will resumeand make for a more seamless transition back. On the other hand, furloughs often require more monitoring to ensure that employees are not working—even checking emails—otherwise you must pay the employee for the time worked (and for a salaried employee, that means the entire week) or risk a F air Labor Standards Act claim.
  • Does the WARN Act require that I provide notice of an intent to do layoffs in light of COVID-19?
    • Unfortunately, the answer to this question is maybe. In general, the federal WARN Act requires employers with over 100 employees (not counting those who have worked less than six months in the last 12 months and those who work an average of less than 20 hours a week) to provide 60 days-notice of mass layoffs or a plant closing. However, the WARN Act has a few exemptions that could apply under the circumstances. If you are considering a layoff and believe the WARN Act might apply, it is important to seek legal counsel beforehand.
      • Note that the following states have adopted their own “mini-WARN” acts: California, Connecticut, DC, Georgia, Hawaii, Illinois, Iowa, Maine, New Hampshire, New Jersey, New York, Tennessee, Vermont, and Wisconsin.

Employer Options to fund paid medical leave required by the Families First Coronavirus Response Act:

  • How can an employer afford to provide the required paid leave to employees?
    • The Act has provided a dollar-for-dollar tax credit to be administered on a quarterly basis in connection with the payment of payroll taxes;
    • If the employer does not have the cash flow to make the payments up front, employers may apply for a Small Business Administration Disaster Loan;
    • If providing paid sick leave will “ jeopardize the viability of the business,” and the employer has fewer than 50 employees, the employer may be able to receive anexemption. We are closely monitoring the Department of Labor website and will give more information on how to claim the exemption once such information is made available.

Useful links:

Texas Division of Emergency Management- Economic Injury Disaster Loans

Texas Workforce Commission- COVID-19 Resources for Employers

CDC- Resources for Businesses and Employers

Department of Labor- Coronavirus Resources


These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or medical advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you andStibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed.
 

Topic: Employment Law
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Important information for employers – coronavirus

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Written by Haley Paul
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My employees are requesting to work from home, how should I handle such requests?

With school closures and frequently changing CDC recommendations on social distancing, more employers are faced with questions concerning telecommuting and remote work. Before you decide whether to voluntarily allow employees to work from home or adopt a remote work policy, you should consider the following:

  1. Do your business operations allow for a temporary work-from-home model? Perhaps some roles could be effectively transitioned to remote positions for the time being, whileothers cannot. Even reducing the number of individuals that must work in the office or other work location, can decrease potential exposure to the virus. (If remote work is not an option for any position, consider other alternatives like working on a reduced staff and allowing individuals to rotate shifts and increase cleaning protocols.)
  2. Do you have the technological capabilities to work from home? There are many cyber-threats to consider. If you do not have a good protocol in place, you should not transition to a work-from-home model until you are certain that your connectivity is secure and reliable. If you do not already have a system in place, it may be difficult to implement one now. Talk to your IT firm or internal IT team and see what it would take to get you to that point.

If the answer to both of those questions is yes, then we would highly encourage you to consider a temporary work-from-home model.

Am I required to give my employees paid time off?

There is no Texas or federal law that requires private-sector employers to provide paid time off to employees. There are federal leave laws that may apply to the situation. However, if you have promised paid time off in a written policy or agreement, the leave is an enforceable part of the wage agreement under Texas Payday law and you must comply with your policy as written. If you do not have a written policy, then at the current time, you are not required to provide paid time off. However, there may be circumstances that have created a policy from your past practice. If you have given paid time off in the past (despite the absence of a written policy or agreement), be sure to be consistent with your past precedent.

House Bill H.R. 6201, known as the Families First Coronavirus Response Act, was passed by the United States House of Representatives on Saturday, March 14, 2020. The Act greatly changes employers’ obligations as to paid time off, as it pertains to employees who test positive for COVID-19 or are caring for others who are impacted by COVID-19. For more information on House Bill H.R. 6201, see the FAQs below.

Families First Coronavirus Act (H.R. 6201)

On March 14, 2020, the United States House of Representatives passed the Families First Coronavirus Act. The bill has not yet been passed by the United States Senate and is subject to change. If passed by the United States Senate, this bill could go into effect fifteen days after its passage. This bill is designed to expand employees’ sick leave benefits related to COVID-19. While this bill has bipartisan support, key provisions of the bill are being negotiated and subject to change. The emergency bill is set to expire December 31, 2020.

  • Does this law apply to my business?
    • The Emergency Coronavirus Bill applies only to employers with fewer than 500 employees. However, employers with fewer than 50 employees may potentially qualify for an exemption.
  • What benefits are employers required to provide?
    • Currently, the Family Medical Leave Act (FMLA) does not prevent employers from laying off an employee so long as the decision for the termination is not due to the fact that the employee took leave under the FMLA. However, the new bill may provide greater protections.
    • The new bill requires employers to provide 12 weeks of leave to employees who are unable to report for work due to COVID-19. Employers must be aware that unlike most FMLA leave, the proposed law protects employees who have been employed for thirty (30) days, and the employer must pay some of the employee’s leave.
    • Additionally, the bill requires employers to provide paid sick leave to full and part-time employees who qualify for leave due to COVID-19. This paid sick leave is in addition to the sick leave that the employer provides to the employee.
  • What circumstances qualify for leave due to COVID-19?
    • Employees who must isolate because of a diagnosis of COVID-19; employees who are quarantined (including self-quarantine) at the instruction of a health care provider, employer, or government official to prevent the spread of COVID-19; employees who are caring for another person who has been diagnosed with COVID-19 or is waiting on a diagnosis; or employees who are caring for a child or other individual who is unable to care for themself due the COVID-19 related closing of their school, childcare facility, or other care program.
  • Do employers have to pay employees who cannot report to work due to business closures?
    • Currently under the Fair Labor Standards Act (FLSA), you do not have to pay an employee who cannot report for work. While the details of the bill are still being worked out, it appears that an employer unable to remain open due to Covid-19 does not have to pay its employees who are not working due to the closure. However, depending on the employee’s status under the FLSA, an employer may have an obligation to pay the employee.
  • Does the government or the employer pay for the employee’s leave?
    • The employer must pay for the employee’s leave benefits, but the bill provides the employer with potential tax credits.
  • Can an employer send an employee home who reports feeling ill?
    • Yes, the employer may ask the employee if he or she is experiencing influenza symptoms. The employer must still maintain the confidentiality of the employee.
  • Does the employer have to continue paying the employee’s health insurance benefits if the employee is on unpaid leave?
    • The Texas Payday Law permits employers to require the employees to pay their portion of the premiums while on leave, but the employer may also pay the premium and deduct the employee’s portion once the employee returns from leave. If the employer chooses to pay the employee’s premium, the employer should have the employee sign a written acknowledgement that these payments are an advance, and once the employee returns to work, the employee’s portion of the premiums will be deducted from his or her paycheck.

These materials are made available by Stibbs & Co., P.C. for informational purposes only, do not constitute legal or medical advice, and are not a substitute for legal advice from qualified counsel. The laws of other states and nations may be entirely different from what is described. Your use of these materials does not create an attorney-client relationship between you andStibbs & Co., P.C. The facts and results of each case will vary, and no particular result can be guaranteed.

Topic: COVID-19