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Department of labor guidance on paid leave under the families first coronavirus response Act

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Written by Morgan N. Muñoz
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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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