The U.S. Department of Labor Issues New Regulations Implementing the Family First Coronavirus Response Act
On April 1, 2020, the U.S. Department of Labor’s Wage and Hour Division published its temporary ruleFN1 issuing regulations to implement and clarify protections provided by the Emergency Paid Sick Leave Act (“EPSLA”) and Emergency Family and Medical Leave Expansion Act (“EFMLEA”), which are both part of the recently passed Families First Coronavirus Response Act (“FFCRA”) in response to the coronavirus disease 2019 (“COVID-19”).FN2 The rule went into effect on April 1, 2020 and is effective through December 31, 2020. The following is a summary of the regulation’s key clarifications implementing the FFCRA:
Telework
Under the FFCRA, employees who are teleworking for COVID-19 related reasons are required to record and be compensated for all hours actually worked, including overtime, in accordance with the requirements of the Fair Labor Standards Act (“FLSA”).FN3 “Telework” is defined as “work the Employer permits or allows an Employee to perform while the Employee is at home or at a location other than the Employee’s normal workplace.” The regulations provide that an employee is able to telework, and not entitled to paid sick leave, if (a) his or her Employer has work for the Employee; (b) the Employer permits the Employee to work from the Employee’s location; and (c) there are no extenuating circumstances (such as serious COVID-19 symptoms) that prevent the Employee from performing that work.FN4
For example, the DOL’s guidance provides that if a law firm permits its lawyers to work from home, an order to stay at home would not prevent a lawyer from working, and therefore may not take paid sick leave as a result. That employee would, however, be entitled to paid sick leave in the event there are other extenuating circumstances relating to an isolation order, such as a power outage, preventing him or her from teleworking.
Paid Leave Entitlements
Section 826.20 of Title 29 of the Code of Federal Regulations describes the circumstances under which a covered employer must provide paid sick leave and/or expanded family and medical leave to an eligible employee.FN4 The regulations provide that an employee is only entitled to paid sick leave if the qualifying reasons for paid sick leave is the but for cause of their inability to work or telework.
One reason an employee may only take paid sick leave if their inability to work or telework is because he or she is subject to a Federal, State, or local COVID-19 quarantine or isolation order (including orders to shelter in place, stay at home, or otherwise restrict their mobility). An employee subject to one of these orders may not take paid sick leave if the employer does not have work for the employee, because the employee would be unable to work even if he or she were required to comply with the quarantine or isolation order.
For example, if a coffee shop closes temporarily or indefinitely due to a downturn in business related to COVID-19, it would no longer have work for its employees. Therefore, a coffee shop employee who is subject to a stay-at-home order would be unable to work even if he were not required to stay home, and therefore, he may not take paid sick leave because his inability to work is due to the closure of his place of employment rather than his need to comply with the order.
The regulations further clarify that an employee may only take paid sick leave to care for an individual with whom the employee has a personal relationship with, such as an immediate family member, roommate, or “similar person with whom the employee has a relationship that creates an expectation that the employee would care for the person if he or she self-quarantined or was quarantined.” Additionally, an employee is only entitled to paid sick leave if they are unable to work due to a need to care for his or her son or daughter, if no other suitable person—such as a co-parent or co-guardian—is available to during the leave period.FN5 In either circumstance, an employee is not entitled to take paid sick leave if the employer does not have work for the employee.
Covered Employers
Private employers with fewer than 500 employees at the time an employee requests to take leave must provide paid sick leave and expanded family and medical leave to their employees.FN6 Whether an employer has 500 or fewer employees is determined by how many employees it has on the date the qualifying leave is requested.
For example, if an employer has 450 employees on April 20, 2020, and an employee is unable to work and requests emergency leave related to COVID-19, then the employer must provide paid sick leave. If, however, the employer hires new employees to the point that it exceeds the 500 employee threshold, the employer is not required to provide paid sick leave to a different employee who is unable to work for the same reason starting on the date the employer employs 501 employees.
Joint or integrated employers must combine employees to determine whether they meet the 500 or fewer employees threshold, and the FLSA’s test for joint employer status applies in determining who is a joint employer for purposes of coverage, and the FMLA’s test for integrated employer status applies in determining who is an integrated employer, under both the EPSLA and the EFMLEA.
Small Business Exception
Small private employers with fewer than 50 employees are exempt from the FFCRA’s requirements to provide paid sick leave and expanded family and medical leave to care for his or her child whose school or place of care is closed, or child care provider is unavailable, when such leave would jeopardize the viability of the business as a going concern.FN7 The regulations clarify that a small business may deny paid sick leave or expanded family and medical leave under three circumstances:
such leave would cause the small employer’s expenses and financial obligations to exceed available business revenue and cause the small employer to cease operating at a minimal capacity;
the absence of the employee or employees requesting such leave would pose a substantial risk to the financial health or operational capacity of the small employer because of their specialized skills, knowledge of the business, or responsibilities; or
the small employer cannot find enough other workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services the employee or employees requesting leave provide, and these labor or services are needed for the small employer to operate at a minimal capacity.
If a small employer decides to deny such benefits, they are required to document the facts and circumstances to justify the denial, and must retain such records in its own files for four years.FN8
Health Care Coverage
An employee who takes qualifying leave is entitled to continued coverage under the employer’s group health plan on the same terms as if the employee did not take leave. Family coverage must be maintained while the employee is taken paid sick leave or expanded family and medical leave, and if an employer provides a new health plan, benefits, or makes any changes in coverage, an employee who is taking leave is entitled to the new or changed plan/benefits to the same extent as if the employee was not on leave.FN9
Intermittent Leave
Generally, an employee may take paid sick leave or expanded family and medical leave intermittently—i.e., in separate periods of time, rather than one continuous period—only by agreement between the employer and employee; such agreement does not have to be in writing as long as the parties have a clear and mutual understanding.FN10
On-site Intermittent Leave: For employees required to work on-site, upon agreement by the parties, an employee may utilize intermittent leave in any increment of time agree to, in order to care for their son or daughter whose school or place of care is closed, or child care provider is unavailable due to COVID-19. An employee may not, however, take intermittent paid sick leave if the need for such leave is a result of any other qualifying reason, such as: a government-issued quarantine or isolation order; an advisement by a health care provider to self-quarantine; to care for an individual who is under quarantine or isolation; or the employee has a substantially similar condition specified by the Secretary of Health and Human Services at any point between April 1, 2020 and December 31, 2020.
Telework Intermittent Leave: Employees permitted to telework may take intermittent leave to the extent agreed upon by the employer, for any qualifying reason, but only when the employee is unable to telework because of a COVID-19 related reason.
Sequencing of Paid Leave
The DOL’s rules clarify that employers are prohibited from requiring, coercing, or unduly influencing an employee to use another source of paid leave before taking paid sick leave or expanded family and medical leave. However, an eligible employee may elect to use, or an employer may require that an employee use, leave the employee has available under the employer’s policies to care for a child, such as vacation or personal leave or paid time off, concurrently.FN11
If expanded family and medical leave is used concurrently with another source of paid leave, then the employer has to pay the employee the full amount to which the employee is entitled under the employer’s preexisting paid leave policy for the period of leave taken—even if that amount is greater than $200 per day or $10,000 in the aggregate. But the employer’s eligibility for tax credits is still limited to the cap of $200 per day or $10,000 in the aggregate.
Takeaway
Employers are encouraged to continually monitor newly enacted laws and regulations related to the response and relief of COVID-19 and to reach out to the attorneys at Campbell Litigation, P.C. to resolve questions regarding compliance with all laws, orders and regulations relating to COVID-19.
Footnotes:
FN1: See 29 CFR Part 826, Paid Leave under the Families First Coronavirus Response Act, https://www.dol.gov/sites/dolgov/files/WHD/Pandemic/FFCRA.pdf
FN2: For additional information regarding the FFCRA, see our previously published post, Trump Signs the Families First Coronavirus Response Act Aimed to Relieve COVID-19’s Impact on Employees, published on March 19, 2020, https://www.rockymountainemployersblog.com/blog/2020/3/19/trump-signs-the-families-first-coronavirus-response-act-aimed-to-relieve-covid-19s-impact-on-employees
FN3: See 29 C.F.R. § 826.10(a); see also 29 CFR 785.11-13; 785.48; 29 U.S.C. 206, 207; and 29 CFR Part 778.
FN4: See 29 C.F.R. § 826.20(a).
FN5: See 29 C.F.R. § 826.20(a)(5)-(6).
FN6: See 29 C.F.R. § 826.40(a).
FN7: See 29 C.F.R. § 826.40(b)(1).
FN8: See 29 C.F.R. § 826.40(b)(2).
FN9: See 29 C.F.R. § 826.110.
FN10: See 29 C.F.R. § 826.50.
FN11: See 29 C.F.R. § 826.160(c); see also § 826.23.