DOL Publishes Regulations For The FFCRA
The Department of Labor (“DOL”) has published a temporary rule issuing regulations for the Families First Coronavirus Response Act (“FFCRA”), which went into effect on April 1, 2020. The regulations are available here. It is important to note that in some cases, the regulations and the DOL’s recent “Question and Answer” (“Q&A”) guidelines impose requirements and practices on employers that were not apparent when the FFCRA passed. Therefore, employers should revise any policies and strategies to comply with these new regulations.
These regulations are generally consistent with the 59 Q&As that the DOL issued related to the FFCRA over the last week, which are available here. Baird Holm previously issued guidance on how employers should calculate the 500-employee threshold, calculation of hours worked, rate of pay, and the DOL’s poster, based on the DOL’s initial Q&As, here.
The following highlights some of the more important takeaways from the regulations.
Small Business Exemption
Employers with fewer than 50 employees may seek an exemption from providing the child-care related Emergency Paid Sick Leave and Expanded Family Medical Leave (“Expanded FMLA”) to an employee if the obligations would jeopardize the viability of the business. Under the regulations and DOL guidance, a small business may claim this exemption if “an authorized officer” of the business has determined that these obligations 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 such 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 such leave and these labor or services are needed for the small business to operate at a minimal capacity.
To elect this small business exemption, the employer must document that a determination has been made pursuant to the above criteria. The DOL continues to insist that small businesses do not send any materials to the DOL when seeking the exemption, but rather retain the records in its files.
Notably, it does not appear that this exemption is one that can be invoked for the entire organization, but instead must be determined on an employee-by-employee basis. In the “Discussion” preface to the regulations, the DOL states “[f]or reasons (1), (2), and (3), the employer may deny paid sick leave or expanded family and medical leave only to those otherwise eligible employees whose absence would cause the small employer’s expenses and financial obligations to exceed available business revenue, pose a substantial risk, or prevent the small employer from operating at minimum capacity, respectively.” Additionally, the regulation text clarifies that employers must still post the required poster “[r]egardless of whether a small employer chooses to exempt one or more employees.” For this reason, employers will need to make a case-by-case determination of whether an employee’s request for leave to care for a son or daughter necessitates an exemption.
Exclusion of Employees Who Are “Health Care Providers” or “Emergency Responders”
Contrary to the FFCRA’s original language, the regulations and the DOL Q&As now detail two separate definitions of the term “health care provider.” If you recall, under the original FFCRA language, the Emergency Paid Sick Leave provisions referenced the definition of “health care provider” as defined by the FMLA (which is fairly limited). Similarly, that same FMLA definition was presumed to apply to the Expanded FMLA provisions.
The regulations now include two (2) different definitions. For all aspects of the FFCRA except the possible exclusion of “health care providers or emergency responders” from the FFCRA’s benefits, the term “health care provider” is defined as it is in the FMLA.
For the optional exclusion of “health care providers,” however, the DOL regulations, specifically § 826.30(c),adopt a significantly more expansive view than the FMLA definition. Specifically, under the new regulations, a “health care provider:”
[I]s anyone employed at any doctor’s office, hospital, health care center, clinic, postsecondary 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 these institutions described above to provide services or to maintain the operation of the facility where that individual’s services support 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.
Importantly, the definition does not simply include individuals who themselves provide care, but also “anyone employed” at an institution that provides medical care, and anyone who contracts with such institutions to provide services or maintain operations of the facility. In the “Discussion” preface to the regulations, the DOL states the term “health care provider” includes “not only medical professionals, but also other workers who are needed to keep hospitals and similar health care facilities well supplied and operational.”
With this in mind, while health care institutions are not themselves specifically exempted from the FFCRA’s requirements, the practical effect of the regulations is that potentially all of their employees could be if they are necessary to keep the institution well supplied and operational. This means that a health care institution would still have to comply with the notice and posting requirements provided by the FFCRA, even if none of its employees would be able to take it.
The DOL’s regulations also provide that, “[t]o minimize the spread of COVID-19, the Department encourages employers to be judicious when using this definition to exempt health care providers and emergency responders from the provisions of the FFCRA.” This could be interpreted as asking employers to exempt as many individuals as possible from the paid leave rights to ensure health care institutions are fully staffed to provide care during the pandemic. However, the “minimize the spread of COVID-19” may also indicate the opposite—that employers should exempt only a few key groups of employees (thus providing more employees with the right to take leave) in order to ensure more can stay home to minimize the spread of the virus.
We note further that the FFCRA also allows for employers to exempt employees who are “emergency responders.” The regulations define such term as:
[A]nyone necessary for the provision of transport, care, healthcare, comfort and nutrition of such patients, or others needed for the response to 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, child welfare workers and service providers, 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 whom 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.
Additionally, from a practical perspective, there is nothing in the FFCRA or the regulations which appear to prevent employers from choosing to exempt employees from one of the FFCRA paid leave benefits but not the other. Indeed, the Emergency Paid Sick Leave and Expanded FMLA Acts are separate sections in the FFCRA, and each includes the exemption option for employers. In other words, an employer may decide to exempt certain employees from the Emergency Paid Sick Leave benefits, but not the Expanded FMLA benefits, or vice versa. It may also choose to exempt some health care providers or emergency responders, but not others. However, if an employer does not elect to exclude an otherwise-eligible person, the employee would be entitled to the Emergency Paid Sick Leave and Expanded FMLA.
Finally, nothing in the FFCRA or the regulations appear to prevent an employer from exempting employees only for a limited duration. For instance, an employer could seemingly exempt certain health care providers from the FFCRA benefits for the next two (2) months while hospitals are overrun with patients, but then reevaluate whether such exemption is still necessary after that period expires. Considering that these benefits are available until December 31, 2020, it is logical that, as circumstances change, the exemption may not be required during that entire period.
“Subject to a Quarantine or Isolation Order”
An employee subject to a “quarantine or isolation order” is only eligible for Emergency Paid Sick Leave if being subject to one of the orders prevents him or her from working or teleworking. The regulations provide that a quarantine or isolation order includes quarantine, isolation, containment, shelter-in-place, or stay-at-home orders issued by any Federal, State, or local government authority that cause an employee to be unable to work even though his or her employer has work that the employee could perform but for the order. An employee subject to one of these orders may not take Paid Sick Leave where the employer does not have work for the employee. This is because the employee would be unable to work even if he or she were not required to comply with the quarantine or isolation order.
Moreover, as more states begin issuing “shelter-in-place” or “stay-at-home” orders, employees who work for businesses deemed “essential” for purposes of such orders will likely be ineligible for Paid Sick Leave because they are not prevented from working because of the order. If anything, they are required to keep working.
The regulations further consider a quarantine or isolation order to include when a Federal, State, or local government authority has 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, causing those categories of employees to be unable to work even though their employers have work for them.
“Advised by a Health Care Provider to Self-Quarantine”
An employee can take Emergency Paid Sick Leave upon a health care provider’s recommendation only if a health care provider advises the employee to self-quarantine based on a belief that (1) the employee has COVID-19; (2) the employee may have COVID-19; or (3) the employee is particularly vulnerable to COVID-19. The employee must also show that following the advice of a health care provider to self-quarantine prevents the employee from being able to work, either at the employee’s normal workplace or by telework.
Seeking Medical Diagnosis for COVID-19
The regulations further clarify that an employee can take Emergency Paid Sick Leave if he or she seeks a medical diagnosis after experiencing any of the following symptoms:
- Dry cough;
- Shortness of breath; or
- Any other COVID-19 symptoms identified by the CDC.
Any such leave is limited to time the employee is unable to work because the employee is taking affirmative steps to obtain a medical diagnosis, such as making, waiting for, or attending an appointment for a test for COVID-19.
“Caring for an Individual”
An employee may take Emergency Paid Sick Leave if needed to care for an “individual” who is subject to a quarantine or isolation order, or has been advised by a health care provider to self-quarantine. The regulations provide significant guidance as to who qualifies as an “individual” for whom care is needed. Specifically, an “individual” is limited to an employee’s immediate family member, a person who regularly resides in the employee’s home, or a 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 were quarantine or self-quarantined. Notably, an “individual” does not include persons with whom the employee has no personal relationship.
Additionally, an employee can only take leave under this qualifying reason if the employee is unable to perform work or telework for the employer, and if the individual depends on the employee to care for him or her, and is either:
- Subject to a quarantine or isolation order; or
- Has been advised to self-quarantine by a health care provider because of a belief that—
- the individual has COVID-19;
- the individual may have COVID-19 due to known exposure or symptoms;
- the individual is particularly vulnerable to COVID-19.
An employee would not be able to take such leave unless, but for a need to care for the individual, the employee would be able to perform work or telework for the employer.
Care for a “Son or Daughter”
The regulations make clear that an employee may take paid leave if he or she is unable to work or telework due to a need to care for a son or daughter whose school or place of care has closed for reasons related to COVID-19, only if no other suitable person is available to care for the son or daughter during the period of such leave.
Additionally, as we pointed out in a prior newsletter alert, the Emergency Paid Sick Leave and Expanded FMLA used two different definitions of “son or daughter.” In order to assure consistency between the two Acts, the regulations clarify that “son or daughter” is an employee’s own child, which includes his/her biological, adopted, or foster child, stepchild, a legal ward, or a child for whom the employee is standing in loco parentis. It further clarifies that the definition includes individuals under the age of 18, and a son or daughter who is 18 years of age or older who (1) has a mental or physical disability, and (2) is incapable of self-care because of that disability.
Unable to Telework
Keep in mind that the Emergency Paid Sick Leave and Expanded FMLA are only available to employees who are unable to work or telework due to a qualifying need. The regulations now define the term “telework” as follows:
The term “Telework” means 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. An Employee is able to Telework 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. Telework may be performed during normal hours or at other times agreed by the Employer and Employee.
For instance, if an employee has been subject to a quarantine or isolation order, and he or she still feels healthy enough to telework, Paid Sick Leave would not be applicable. Or, if an employee needs to care for children because of school or childcare closures, but the children are old enough that the employee can still telework or work outside their normal hours, then Paid Sick Leave and/or Expanded FMLA may not be applicable.
The point is, to the extent an employee is able to telework while caring for their child or due to any of the other qualifying reasons, paid sick leave and expanded family and medical leave are not available.
Generally, the regulations now permit employees to take Emergency Paid Sick Leave and Expanded FMLA intermittently, but only in certain circumstances, and if the employer and employee agree.
Emergency Paid Sick Leave
The regulations now permit employees who are teleworking, or who normally work from home, to use the Paid Sick Leave on an intermittent basis, as long as the employer allows it. Employers and employees can agree to allow leave to be taken intermittently in any increment, whether 60 minutes, 90 minutes, 4 hours, etc. This intermittent leave can be used for any of the FFCRA’s qualifying reasons.
Notably, though, employees who must go to a worksite (i.e., they are not teleworking) may only take paid sick leave on an intermittent basis to care for the employee’s son or daughter whose school or place of care is closed (and only then with the employer’s permission).
Leave cannot be taken intermittently by employees who are not teleworking if the leave is being taken because:
- The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
- The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
- The employee is caring for an individual who either is subject to a quarantine or isolation order related to COVID-19 or has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; or
- The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.
Because intermittent leave is not available, an employee must take the leave in full-day increments. In such circumstances, the employee must use the permitted days of leave consecutively until the employee (1) uses the full amount of his or her Emergency Paid Sick Leave allotment, or (2) no longer has a qualifying reason to take the leave.
If the employee no longer has a qualifying reason for taking paid sick leave before he or she exhausts the paid sick leave, the employee may take any remaining paid sick leave at a later time, until December 31, 2020, if another qualifying reason occurs.
The DOL encourages employers and employees to collaborate to achieve maximum flexibility. Therefore, if employers and employees agree to intermittent leave on less than a full work day for employees taking paid sick leave to care for their child due to school/daycare closures, the DOL is supportive of such voluntary arrangements.
The Expanded FMLA leave may also be taken on an intermittent basis but only with an employer’s permission.
Use of Paid Leave Concurrently with Expanded FMLA
If an employee has already exhausted his or her Emergency Paid Sick Leave, and then seeks to take Expanded FMLA, all or part of the first 10 days (or first two weeks) of the Expanded FMLA may be unpaid. In such case, the employee may elect to use any other earned paid leave under the employer’s established policies, and such leave would run concurrently with the unpaid portion of the Expanded FMLA.
While the employer cannot require an employee to substitute paid leave for the paid portions of Expanded FMLA, the employer and employee can agree to have paid leave supplement Expanded FMLA pay so that the employee receives the full amount of his or her normal pay. For example, an employee and employer may agree to supplement the Expanded FMLA by substituting one-third hour of accrued vacation leave for each hour of Expanded FMLA. If the employee and employer do not agree to supplement paid leave in this manner, the employee will remain entitled to all the paid leave which is earned or accrued under the terms of the employer’s plan for later use.
Additionally, an employee may elect to use, or an employer may require that an employee use, earned vacation, PTO, or personal time available under the employer’s policies, concurrently with Expanded FMLA. If an employee elects or the employer requires, concurrent leave, the employer must 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, as opposed to the 2/3rds amount.
Twelve (12) Total Weeks of FMLA
The regulations make clear that the Expanded FMLA leave under the FFCRA is not available to employees in addition to traditional FMLA leave that may have already been available. Rather, an employee is only entitled to 12 weeks of total FMLA leave in a 12-month period, and an employee’s use of FFCRA’s Expanded FMLA leave counts against that total.
With that said, an employee can only take a maximum of 12 workweeks of Expanded FMLA during the period in which the leave may be taken (April 1, 2020 to December 31, 2020) even if that period spans two FMLA leave 12-month periods. For example, if an employer’s twelve-month period begins on July 1, and an employee took 7 weeks of Expanded FMLA in May and June of 2020, the employee could only take up to 5 additional weeks of Expanded FMLA between July 1 and December 31, 2020, even though the first 7 weeks of Expanded FMLA fell in the prior 12-month period.
Who is an “Eligible Employee” for Expanded FMLA?
The regulations mirror the DOL’s Q&As which consider an employee to be eligible for the Expanded FMLA if the employer had him or her on its payroll for the 30 calendar days immediately prior to the day the employee’s leave would begin. The regulations further add, however, that an employee would also be eligible for Expanded FMLA if the employer laid them off on or after March 1, 2020, and then rehired or otherwise reemployed the employee on or before December 31, 2020, so long as the employee had been on the employer’s payroll for 30 or more of the 60 calendar days prior to the date the employee was terminated.
Full-Time vs. Part-Time Employees
The Emergency Paid Sick Leave Act provisions under the FFCRA indicate that full-time employees are entitled to 80 hours of paid sick leave for qualifying reasons, but do not define “full-time.” The regulations, however, clarify that a “full-time employee” is an employee who is normally scheduled to work 40 or more hours per week. A part-time employee, is therefore an employee scheduled to work less than 40 hour per week.
With this in mind, an employer who considers employees to be “full-time” even if they work less than 40 hours would only be obligated to pay employees paid sick leave for the number of hours the employee would normally work in a two-week period (so not a full 80 hours). For example, an employee with a regular weekly schedule of 30 hours per week would be considered “part-time” for purposes of the Emergency Paid Sick Leave Act, and only be entitled to pay for a total of 60 hours during the two-week period. This is the case even if the employer still considers them “full time” under its own definition.
In contrast, the Expanded FMLA does not distinguish between full- and part-time employees, but the number of hours an employee normally works each week will affect the amount of pay the employee is eligible to receive.
Employee Notice of Need for Leave
Employers may require employees to follow reasonable notice procedures, but cannot require notice to be provided in advance. Notice may only be required “after the first workday (or portion thereof) for which an Employee takes Paid Sick Leave or Expanded Family and Medical Leave.” After that first workday, it is reasonable for an employer to require notice as soon as practicable under the facts and circumstances of the particular case. If an employee fails to give proper notice, the regulations encourage employers to give him or her notice of such failure and an opportunity to provide the required documentation before denying the leave request.
Documentation of Need for Leave
With regard to the content of notice, an employee must provide the employer with documentation containing the following information:
- Employee’s name;
- Date(s) for which leave is requested;
- Qualifying reason for the leave; and
- Oral or written statement that the employee is unable to work because of the qualified reason for leave.
With regard to requests for paid leave, employees must also provide one of the following (depending on the qualifying reason for the leave):
- The name of the government entity that issued the quarantine or isolation order.
- The name of the health care provider who advised the Employee to self-quarantine due to concerns related to COVID-19.
- Either the name of the government entity that issued the quarantine or isolation order to which the individual being cared for is subject; or the name of the health care provider who advised the individual being cared for to self-quarantine due to concerns related to COVID-19.
- If the leave is to care for a child out of school/day care, (a) the name of the son or daughter being cared for; (b) the name of the school, place of care, or child care provider that has closed or become unavailable; and (c) a representation that no other suitable person will be caring for the son or daughter during the period for which the employee takes leave.
Because Expanded FMLA leave is only available for purposes of caring for a child out of school/day care, an employee need only provide the information listed in (4) above.
An employer may also request an employee to provide such additional material as needed for the employer to support a request for tax credits pursuant to the FFCRA. An employer is not required to provide leave if materials sufficient to support the applicable tax credit have not been provided.
Employers must retain documentation related to the employee’s need for leave, regardless of whether the leave was granted or denied, for four (4) years.
If an employer denies an employee’s request for leave pursuant to the small business exemption, the employer must document its authorized officer’s determination that the prerequisite criteria for that exemption are satisfied and retain such documentation for 4 years.
The regulations instruct private sector employees who intend to claim a tax credit under the FFCRA to retain the following documentation for 4 years:
- Documentation to show how the employer determined the amount of Paid Sick Leave and Expanded FMLA paid to employees who are eligible for the credit, including records of work, telework, and Paid Sick Leave and Expanded Family and Medical Leave;
- Documentation to show how the employer determined the amount of qualified health plan expenses that the employer allocated to wages;
- Copies of any completed IRS Forms 7200 that the employer submitted to the IRS;
- Copies of the completed IRS Forms 941 that the employer submitted to the IRS or, for employers that use third party payers to meet their employment tax obligations, records of information provided to the third party payer regarding the employer’s entitlement to the credit claimed on IRS Form 941, and
- Other documents needed to support its request for tax credits pursuant to IRS applicable forms, instructions, and information for the procedures that must be followed to claim a tax credit. For more information, please consult https://www.irs.gov/newsroom/covid-19-related-taxcredits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs.
Return to Work
The regulations clarify that an employee who takes paid leave under either the Emergency Paid Sick Leave Act or the Expanded FMLA are entitled to restoration to the same or equivalent position. However, employees are not protected from employment actions, such as layoffs, that would have affected the employee regardless of whether he/she took leave. This means an employer can lay off employees for legitimate business needs (such as the closure of a worksite). In such case, the employer would have to demonstrate that the employee would have been laid off even if he/she had not taken leave.
The regulations also state that the FMLA’s “key employee” restoration exception may also apply to leave taken under the Expanded FMLA.
Additionally, as detailed in prior articles, an employer with fewer than 25 employees would not have interfered with the employee’s FMLA right to restoration if the following conditions are met:
- The employee took Expanded FMLA;
- The position held by the employee when the leave commenced no longer exists due to economic or operating conditions that affect employment due to COVID-19 related reasons during the period of the 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;
- The employer makes reasonable efforts to contact the employee if an equivalent position becomes available; and
- The employer makes reasonable efforts to contact the employee for one (1) year beginning either on the date the leave related to COVID-19 reasons concludes, or the date 12 weeks after the leave began, whichever is earlier.
Workplace Closures, Layoffs, and Reduced Hours
Finally, while not included in the regulations, the DOL’s Q&A guidance provides helpful clarity on the effect of workplace closures, layoffs, and reduced hours, on an employee’s right to take FFCRA paid leave. Employers that close their worksites and send employees home without pay (whether before or after April 1, 2020) are not required to provide paid leave under the FFCRA. Similarly, employers that lay off or furlough employees (whether before or after April 1, 2020) are not required to provide paid leave under the FFCRA. Likewise, employers that reduce employee hours because they do not have available work are not required to provide paid leave for the hours that are no longer available to the employees. In each instance, employers should encourage employees to contact their state unemployment office.
Indeed, the DOL FAQs clarify that an employee who receives paid leave benefits under the FFCRA will likely be ineligible for unemployment, unless state law specifically allows for partial benefits to workers whose hours or pay have been reduced.
As you are well aware, the FFCRA’s paid leave obligations went into effect April 1, 2020. While the DOL has established a temporary non-enforcement period from March 18, 2020 – April 17, 2020, in which it will not enforce the FFCRA’s obligations against employers who have made reasonable, good faith efforts to comply with the FFCRA, employers should nevertheless review the regulations, and the DOL’s FAQs to finalize their paid leave policies and strategies as soon as possible.