NEW COVID-19 Employer Pay/Leave Regulations

Update April 1, 2020: At the time of our initial post, the federal government had not defined health care providers or emergency responders. In a new FAQ sheet, the Department of Labor has defined both classifications:

https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

FAQ 56:  Who is a “health care provider” who may be excluded by their employer from paid sick leave and/or expanded family and medical leave?

For the purposes of employees who may be exempted from paid sick leave or expanded family and medical leave by their employer under the FFCRA, a health care provider is anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions.

This definition includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities institutions to provide services or to maintain the operation of the facility. This also includes anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments. This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is a health care provider necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.

To minimize the spread of the virus associated with COVID-19, the Department encourages employers to be judicious when using this definition to exempt health care providers from the provisions of the FFCRA.

FAQ 57:  Who is an emergency responder?

For the purposes of employees who may be excluded from paid sick leave or expanded family and medical leave by their employer under the FFCRA, an emergency responder is an employee who is necessary for the provision of transport, care, health care, comfort, and nutrition of such patients, or whose services are otherwise needed to limit the spread of COVID-19. This includes but is not limited to military or national guard, law enforcement officers, correctional institution personnel, fire fighters, emergency medical services personnel, physicians, nurses, public health personnel, emergency medical technicians, paramedics, emergency management personnel, 911 operators, public works personnel, and persons with skills or training in operating specialized equipment or other skills needed to provide aid in a declared emergency as well as individuals who work for such facilities employing these individuals and whose work is necessary to maintain the operation of the facility. This also includes any individual that the highest official of a state or territory, including the District of Columbia, determines is an emergency responder necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.

To minimize the spread of the virus associated with COVID-19, the Department encourages employers to be judicious when using this definition to exempt emergency responders from the provisions of the FFCRA.

New COVID-19 Employer Pay/Leave Regulations
Taking Effect April 1, 2020
(What We Know So Far)

DOL has revealed that they are pushing the effective date of the new Coronavirus leave entitlements up from April 2 to April 1.  Read DOL’s FAQ’s here https://www.dol.gov/agencies/whd/pandemic/ffcra-questions.  Please note the Department of Labor has also released/posted the required poster that all covered employers must post “in a conspicuous place” on their premises (or e-distribution).  Available here:  http://: https://www.dol.gov/agencies/whd/pandemic.

If you have questions about what you should do now Contact Us.

The legal and public health landscape surrounding the Coronavirus continues to change on a daily (and sometimes hourly) basis. Over the last couple of days alone, new legislation has been passed and new announcements have been made by the federal government with critical ramifications for most U.S. employers. Summaries of what we do (and don’t) know – so far and as best we can tell – about the new laws and guidance follow below.

As always, additional guidance is possible (and, we hope, likely) but employers will need to make case-specific decisions in the face of unavoidable uncertainties. Consult with legal counsel for additional assistance. 

 ‌Emergency Paid Sick Leave Act
(1 of 2 New Leave Laws)

Beginning April 1, 2020, and lasting through December 31, 2020:  all private employers (including non-profits) with less than 500 employees and all public employers must provide up to 80 hours of paid job-protected sick leave to employees who cannot work (onsite or remotely) due to specific coronavirus-related reasons.

What We Know: 

• Employees can take this paid sick leave when they are:

• 1. Subject to a governmental quarantine or isolation order related to COVID-19;
  2. Advised by a health care provider to self-quarantine due to COVID-19 concerns;
  3. Experiencing COVID-19 symptoms and seeking medical diagnosis;
  4. Caring for an individual subject to a federal, state or local quarantine or isolation order or advised by a health care provider to self-quarantine due to COVID-19 concerns;
  5. Caring for the employee’s child if the child’s school or place of care is closed or the child’s care provider is unavailable due to public health emergency; or
  6. 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.
     • • Leave for the first three reasons (i.e., those relating to the employee’s own needs) must be paid at the employee’s regular rate and are capped at $511 per day and $5,110 total per employee.
       • Leave for the last three (i.e., those relating to the employee caring for others) must be paid at two-thirds of their regular rate and are capped at $200 per day and up to $2,000 total.
       • The Secretaries referenced in Item 6 above have yet to issue any guidance or specifications regarding “other substantially similar condition[s].”

• There is no minimum duration of employment required for employees to be eligible for this paid sick leave.  Eligibility begins upon hire or April 1, 2020, whichever is later.
• This paid sick leave does not carry over “from year to year,” and any unused portion is not payable upon termination.
• Paid sick leave for employees with part-time or irregular schedules is based on the average number of hours the employee worked for the six months prior to taking paid sick leave. Those employed for less than six months are entitled to the average number of hours they would normally be scheduled to work over a two-week period.
• Employees  eligible for Emergency FMLA (see below) can – if they choose – use this paid sick leave during/instead of the initial 10 days of otherwise unpaid Emergency FMLA.
• Employers of “health care providers” and “emergency responders” can exclude those employees from this paid sick leave entitlement.
• The Secretary of Labor may issue regulations to exempt small businesses with fewer than 50 employees from this paid sick leave entitlement “when the imposition of such requirements would jeopardize the viability of the business as a going concern.”
• A notice must be posted in the workplace, and the Secretary of Labor is expected to develop and make available a model notice by March 25, 2020.
• Damages for violations of this law are the same as those under the Fair Labor Standards Act (broadly speaking, double the amount of lost wages plus the claimant’s attorney fees).

What We Don’t Know (Plus Our Predictions): 

• Does the first of the six reasons for leave listed above apply to employees who choose (or are instructed by their employers) to be off work based solely on a public health authority’s general recommendation that those in a certain area or community avoid gatherings? Probably not.  That statute requires an “order,” not a recommendation, request, advisement, etc. 
• Can employers require employees to provide documentation substantiating their need for leave? Probably, but can the employee realistically acquire it, and what can employers do if employees can’t or don’t?  Consider developing simple employee-executed certification forms instead (if you decide you really can’t just take their word for it).    
• Can an otherwise eligible employee take their leave intermittently, on a reduced-schedule basis, or otherwise in more than one increment? The text of the statute suggests this leave is only available once per employee, whether they use the maximum entitlement or not.  However, that interpretation arguably conflicts with the underlying rationale of the law and may be changed or clarified under forthcoming agency guidance.
• Who qualifies as an “excludable” health care/emergency responder employee? The emergency act incorporates the FMLA’s existing definition of “health care provider,” which includes doctors of medicine or osteopathy as well as other physicians, nurse practitioners, and certain other professionals identified by the Secretary of Labor. The new act does not define “first responders”as law enforcement, EMTs, and other rescue workers.
• Importantly, the exclusion provisions apply to employees who are health care providers or first responders; it does not broadly permit an organization that employs health care providers or first responders to exclude all employees regardless of their job functions or duties.  Presumably then, certain “support staff” and others who do not regularly provide direct care (e.g., employees in the billing or dietary departments) cannot be excluded and remain entitled to the paid leave.  Organizations who provide health care/emergency response services may need to determine employee eligibility on an individualized (or position-by-position) basis.

When/how are employees counted for purposes of determining the 500-employee coverage threshold? The most logical read is that the count is determined as of the time of any given employee’s leave request.  In other words, an employer “near” the 500-employee mark may fluctuate “in and out” of coverage.  Presumably, the Department of Labor will adopt an approach similar to that called for under the FMLA and require employers to honor/adhere to leave requirements for employees once out on leave regardless of whether the employer subsequently loses coverage under the new law “mid-leave.”

 Emergency Family Medical Leave Act Amendments
(2 of 2 New Leave Laws)

Beginning April 1, 2020, all private employers (including non-profits) with less than 500 employees and all public employers must provide up to 12 workweeks of combined paid and unpaid job-protected FMLA leave to employees who cannot work (onsite or remotely) because of the need to care for their child under 18 years old arising from coronavirus-related school closures or lack of childcare.

What We Know: 

• This Emergency FMLA (EFMLA) extension applies to all employers with less than 500 employees. The “traditional” FMLA requirement that employers have 50 or more employees does not apply to EFMLA.
• Employees are eligible for EFMLA after 30 calendar days of employment (they need not meet the more demanding length of service and hours-worked requirements that continue to apply for “traditional” FMLA).
• An individual employee may not qualify for EFMLA (because they have no qualifying childcare-related need) but still qualify for “traditional” FMLA leave – under all the applicable traditional standards – if the employee or a qualifying family member has coronavirus (or any other condition) that constitutes a “serious health condition.”
• Employees who are eligible for both FMLA and EFMLA may take a combined total of 12 weeks of leave for all qualifying reasons. In other words, an employee who has already used 4 weeks of FMLA has 8 weeks of EFMLA available.
• The first 10 days of EFMLA can be unpaid, unless:

1. 1. The employee is eligible for and elects to use emergency paid sick leave (i.e., leave granted under the new law discussed above); or
   2. The employee has and elects to use another form of paid time off that the employer has previously/otherwise made available.

• After the first 10 days, full-time employees generally must receive two-thirds of their regular rate of pay for the number of hours they would otherwise be normally scheduled, capped at $200 per day and $10,000 total.
• Paid EFMLA for employees with part-time or irregular schedules is based on the average number of hours the employee worked for the six months prior to taking EFMLA. For those employed less than six months, EFMLA is based on the average number of hours the employee would normally be scheduled to work according to the reasonable expectation at hiring.
• Employees are entitled to reinstatement to an equivalent position at the conclusion of EFMLA under the same terms and conditions as traditional FMLA, unless the employer has less than 25 employees. Employers with fewer than 25 employees need not reinstate if:

1. 1. The employee’s position no longer exists due to an economic downtown or other circumstances caused by a public health emergency during the period of EFMLA, and
   2. The employer makes reasonable attempts to return the employee to an equivalent position for up to a year after the EFMLA.

• Employers of “health care providers” and “emergency responders” can exclude those employees from EFMLA application.
• The Secretary of Labor may issue regulations to exempt small businesses with fewer than 50 employees from this paid sick leave entitlement “when the imposition of such requirements would jeopardize the viability of the business as a going concern.”
• Employees must provide notice of their need for EFMLA “as soon as practicable.”

What We Don’t Know (Plus Our Predictions): 

• Can EFMLA be taken intermittently or on reduced-schedule basis? Currently, it appears the answer is “yes.”  Early drafts of the law limited EFMLA to “consecutive” or “block” leave, but that restriction is absent from the enacted version. 
• Can employers require employees to provide documentation substantiating their need for leave? Presumably, yes, as under traditional FMLA leave.  But keep in mind that, under traditional FMLA rules governing certification of absences based on health conditions, employers cannot require employees to submit a doctor’s note for individual instances/uses of intermittent FMLA once the leave has been designated in the first instance. By analogy, even if employers can require documentation from a school/childcare provider to support EFMLA at the outset, they likely cannot require additional documentation for subsequent intermittent absences. 
• Who qualifies as an “excludable” health care/emergency responder employee? See the discussion under the Emergency Paid Sick Leave Act section above.
• When/how are employees counted for purposes of determining the 500-employee coverage threshold? See the discussion under the Emergency Paid Sick Leave Act section above.

Can employees presumptively be held accountable under existing call-off/reporting rules as is the case with “traditional” FMLA?  Not really.  Or at least not yet.  Employers’ ability to enforce their existing requirements for reporting absences under “traditional” FMLA stems from Department of Labor regulations that have not yet been extended (and may never be extended) to EFMLA. 

 Tax Credits For Paid Sick Leave and EFMLA

Employers will be entitled to a refundable tax credit against the employer portion of Social Security taxes they would otherwise in an amount up to 100% of the qualified sick leave wages and EFMLA paid under the two new laws above.  The government has not yet discussed any documentation requirements for establishing entitlement to these tax credits, though employers should obviously be diligent in making and maintaining accurate records both to claim the credits and satisfy recordkeeping/audit requirements applicable to each of the laws.

As written, the new tax credits are available to both for-profit and non-profit employers alike, though it is unclear how a non-profit who “owes” employees more paid leave than the employer owes in payroll tax will be able to account for the difference.  Employers should carefully monitor announcements from the U.S. Treasury and Internal Revenue Service which – along with the Department of Labor – are working to issue emergency guidance as soon as possible.

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