The Department of Labor ("DOL") has updated the guidance it previously issued regarding the Families First Coronavirus Response Act, which goes into effect on April 1, 2020. We wrote about the new law here. We summarize the guidance, including the updates, below. Employers can also access the DOL's model notice for employers to post, which can be found here.
- The guidance expands on the meaning
of an employer with 500 employees, including:
- The employer should look at headcount at the time the employee would take the leave;
- The count extends to those employed within the US and its territories;
- The count should extend to capture all categories of employees – full time, part-time; temporary employees who are jointly employed by it and another employer (regardless of whether the jointly-employed employees are maintained on only the employer's payroll or another employer's payroll); and day laborers supplied by a temporary agency (regardless of whether the employer is the temporary agency or the client firm if there is a continuing employment relationship);
- Independent contractors are not included in the count;
- If a corporation has an ownership interest in another corporation, the two corporations are separate employers unless they are joint employers under the Fair Labor Standards Act. If those entities are found to be joint employers, all of their common employees must be counted;
- In general, two or more entities are separate employers unless they meet the integrated employer test under the Family and Medical Leave Act. If two entities are an integrated, then employees of all entities making up the integrated employer will be counted.
- The guidance also expands on the
50-employee small business exemption. In short, if the employer can
meet certain criteria set forth in the guidance, it can claim the
exemption. It does not have to file a written application to avail
itself of the exemption. More specifically:
- The exemption may apply to an employer, including a religious or non-profit organization with fewer than 50 employees related to COVID-19 school closure or child-care related leave "when doing so would jeopardize the viability of the small business as a going concern."
- To claim this exemption, an
authorized officer of the business has determined that one of the
following would occur:
- The provision of paid sick leave or expanded family and medical leave would result in the small business's expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
- The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
- There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
- The DOL will observe a temporary period of non-enforcement for 30 days after the Act takes effect, as long as the employer has acted reasonably and in good faith to comply with the Act. Good faith exists when the employer remedies a violation and makes the employee whole as soon as practicable, the violations were not willful, and the DOL received a written commitment from the employer to comply with the law in the future.
- An employer must comply with the FFCRA beginning on April 1, 2020 and the benefits are not retroactive.
- The guidance confirms that employees taking leave related to child care are entitled to up to $12,000 in the aggregate -- $2,000 for the 2 weeks of paid sick leave plus $10,000 for the 10 additional weeks of paid FMLA leave.
- Employees are not eligible for paid
sick leave or expanded FMLA in the following instances, but may be
eligible for unemployment insurance:
- Employees who are no longer working due to a workplace closure that occurred prior to April 1, 2020.
- The worksite closed after April 1, 2020, but before the employee could take leave, even if they have future leave planned.
- Where the worksite closed while the employee was on leave, then the employee would not be entitled to any additional leave.
- Employees who are no longer working due to a furlough or a permanent or temporary workplace closure that occurs on or after April 1, 2020.
- Employees who are working reduced hours are not entitled to use paid sick leave or expanded FMLA for the hours that they are no longer scheduled to work.
- In addition to tax credits for leave benefits provided under the Act, employers are also entitled to dollar for dollar reimbursement through a tax credit for amounts paid or incurred to maintain health insurance coverage.
- Employers may pay employees more than the FFRCA requirements, but cannot claim, and will not receive the tax credits for the excess amount paid to employees.
- If an employer agrees, an employee may telework and take paid sick leave intermittently for a qualifying reason under the Emergency Paid Sick Leave Act. Similarly, an employee may telework and take intermittent FMLA leave to care for a child due to school or childcare closures.
- An employer and employee can agree that the employee works or teleworks his or her normal amount of hours but outside of the employer's regular business hours, for example, late at night or early in the morning. The DOL encourages flexibility and voluntary arrangements, particularly related to telework and intermittent leave. However, if an employee is still unable to telework due to a qualifying reason, then the employee is entitled to leave.
- For employees taking paid sick leave, employers should request and retain documentation, including the employee's name, qualifying reason for requesting leave, statement that the employee is unable to work, including telework, and the date(s) for which leave is requested. Documentation of the reason for the leave will also be necessary, such as the source of any quarantine or isolation order, or the name of the health care provider who advised the employee to self-quarantine. Retention of this documentation is important if the employer plans to claim tax credit under the FFCRA.
- For employees using expanded FMLA, employers should request and retain documentation as if dealing with a conventional FMLA request. Retention of this documentation is also important if the employer plans to claim tax credit under the FFCRA.
- Employers should post the DOL model notice on an electronic portal or circulate the notice via email so that it is accessible to employees working remotely.
We will continue to update this post as the DOL releases additional guidance. The complete guidance can be accessed here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
