As a quick reminder, the Families First Coronavirus Response Act (FFCRA) provides two types of leave (and this is a gross oversimplification) (1) 80 hours of paid leave to full time employees for various COVID-19 related reasons and (2) 12 weeks of leave (10 of which are paid) to full time employees who cannot work because their children are out of school or they have no child care due to COVID-19 related reasons.
The Department of Labor (DOL) has been releasing patchwork guidance. We addressed some of this guidance on March 25, and now have additional guidance to cover. This will be a more comprehensive look at the DOL’s guidance as it exists at this moment in time.
Effective Date.
The effective date is April 1. It will apply to leave taken between April 1 and December 31, 2020, only. There is no entitlement to this leave before April 1 or after December 31.
The Lingo.
The FFCRA has many acts within it, two of which we have been highlighting – the Emergency Paid Sick Leave Act (EPSLA) (the 80 hours) and the Emergency Family and Medical Leave Expansion Act (EFMLEA) (the 12 weeks). The DOL uses these terms:
“Paid Sick Leave” means paid leave under the Emergency Paid Sick Leave Act.
“Expanded family and medical leave” means paid leave under the Emergency Family and Medical Leave Expansion Act. (Note: For ease, we will refer to this as Expanded FML.)
What is A Covered Employer?
Focusing on private employers, a covered employer is a private sector employer with fewer than 500 employees. The DOL construes coverage very broadly. If you think you are not covered because you employ 500 employees or more, you should carefully review FAQ No. 2 on this topic. FAQ No. 2 addresses issues like how you count employees (e.g., part-time, day laborers, etc.) and corporate structure issues (e.g., when two entities are considered a single employer).
Isn’t there a Small Business Exemption?
Yes there is, but it is limited. You recall, the language to date has been if it would jeopardize the viability of the business as a going concern. The DOL was directed to provide guidance. It has now done so.
If you are an employer (including a religious or nonprofit) that employs fewer than 50 employees, you may be exempt from providing Paid Sick Leave and/or Expanded FML only in the case of an employee who cannot work because their child’s school or child care provider is unavailable due to COVID-19 reasons.
To qualify for this limited exemption, an authorized officer of the business must determine at least one of the following is true:
- The provision of Paid Sick Leave or Expanded FML 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 FML 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 FML, and these labor or services are needed for the small business to operate at a minimal capacity.
If you will be relying upon this exemption to deny an employee either Paid Sick Leave or Expanded FML, you will want to document the information upon which you based your decision at the time.
This exemption does not apply to any of the other reasons an employee may be entitled to Paid Sick Leave.
Posters for Covered Employers.
All private sector employers with fewer than 500 employees (and certain public sector employers) are required to “post and keep posted, in conspicuous places on the premises of the employer where notices to employees are customarily posted” the notices prepared by the DOL. Even if you believe you are an employer who may be eligible for the “small business exemption,” you are a covered employer and are required to post this notice.
The DOL has prepared two notices for this purpose (now also in Spanish):
Employee Rights: Paid Sick Leave and Expanded Family and Medical Leave under FFCRA
In Spanish
Federal Employee Rights: Paid Sick Leave and Expanded Family and Medical Leave under FFCRA
In Spanish
By April 1, you should download and post the appropriate poster(s) for your workforce. If you are teleworking, you are to provide notice in a reasonable means to communicate the information to your employees; for example, email, direct mail, or posting to an accessible intranet.
What Employees are Eligible?
For the Paid Sick Leave, all of your employees are immediately eligible.
For the Expanded FML, your employees must be employed (on your payroll) at least 30 calendar days prior to their first day of leave. The DOL guidance makes clear that a person who has been placed at your business as a temporary employee and then hires on with your company can count their earlier service towards this 30 calendar day eligibility requirement.
The DOL guidance also states that not only are your full time and part time employees covered but also “joint employees” working on your site temporarily and/or through a temp agency. Certain health care providers and or emergency responders may be exempted.
For what Reasons Can an Eligible Employee Get Paid Sick Leave?
The reasons listed in Paid Sick Leave law (the EPSL) are:
- 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 is subject to an order described in subparagraph (1) or has received the advice described in paragraph (2).
- The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID-19 precautions.
- 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.
For Expanded FML, there is only one reason:
the employee is unable to work (or telework) due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child care provider of such son or daughter is unavailable, due to a public health emergency (aka COVID-19).
Unfortunately we do not yet have further guidance on what some of the terms mean, such as an “isolation order.”
What is a Full Time Employee versus a Part Time Employee under these Laws?
Only the EPSLA (the 80 hours) talks about full time versus part time employees. Under that law, a full time employee is one normally scheduled to work 40 or more hours per week. A part time employee is normally scheduled to work fewer than 40 hours per week.
The EFMLEA (the 12 weeks) does not talk in those terms.
How Much Leave Can a Full Time Employee Take?
Let’s start with the basics. The leave comes into play only if the person cannot work, and that includes teleworking. If you have instituted social distancing policies or other measures requiring employees work from home, these paid leaves do not apply to those persons working from home. They apply only if an employee cannot work.
If an employee cannot work and it is due to one of the reasons listed above for Paid Sick Leave, the amount paid to a full time employee for the 80 hours varies based upon the reason.
In its new guidance, the DOL provides this advice to employees:
If you are taking Paid Sick Leave because you are unable to work or telework due to a need for leave because you (1) are subject to a Federal, State, or local quarantine or isolation order related to COVID-19; (2) have been advised by a health care provider to self-quarantine due to concerns related to COVID-19; or (3) are experiencing symptoms of COVID-19 and are seeking medical diagnosis, you will receive for each applicable hour the greater of:
- your regular rate of pay,
- the federal minimum wage in effect under the FLSA, or
- the applicable State or local minimum wage.
In these circumstances, you are entitled to a maximum of $511 per day, or $5,110 total over the entire Paid Sick Leave period.
If you are taking Paid Sick Leave because you are: (1) caring for an individual who is subject to a Federal, State, or local quarantine or isolation order related to COVID-19 or an individual who has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; (2) caring for your child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; or (3) experiencing any other substantially-similar condition that may arise, as specified by the Secretary of Health and Human Services, you are entitled to compensation at 2/3 of the greater of the amounts above.
Under these circumstances, you are subject to a maximum of $200 per day, or $2,000 over the entire two week period.
With regard to Expanded FML, the DOL provides this guidance to employees:
If you are taking [Expanded FML], you may take Paid Sick Leave for the first ten days of that leave period, or you may substitute any accrued vacation leave, personal leave, or medical or sick leave you have under your employer’s policy. For the following ten weeks, you will be paid for your leave at an amount no less than 2/3 of your regular rate of pay for the hours you would be normally scheduled to work. The regular rate of pay used to calculate this amount must be at or above the federal minimum wage, or the applicable state or local minimum wage. However, you will not receive more than $200 per day or $12,000 for the twelve weeks that include both Paid Sick Leave and [Expanded FML] when you are on leave to care for your child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons.
In total, one employee may take only the 80 hours of Paid Sick Time and the 12 weeks of Expanded FML (2 weeks of which are unpaid and 10 weeks of which are paid). There is no double dipping. If an employee wanted to maximize their protected leave, they could use the 80 hours only for non-child-care reasons and use the Expanded FML for child care reasons – taking the first two weeks either as unpaid or using other company-provided paid time before moving to the paid Expanded FML benefit.
What about a Part Time Employee (Scheduled for Less than 40 hours Per Week)?
For the Paid Sick Leave, the employer simply uses the number of hours the employee is regularly scheduled to work over a two-week period. For example, if an employee regularly works 8:30-5:00 with a one-hour unpaid lunch break each week, that would equal 37.5 hours each week for a total entitlement to 75.0 of Paid Sick Leave under the law.
If the employee does not have a regular schedule or if the schedule varies, the employer may use a 6-month average to calculate the daily average and use that number for 10 days. (Further guidance exists if neither of those methods works.)
What if the Employee is Regularly Scheduled for More than 40 Hours?
The maximum Paid Sick Leave any employee can use is 80 hours. That employee may be able to use more hours in the first calendar week based upon their schedule, but they cannot use more than 80 hours in total.
If the employee is taking Expanded FML, the normal rules under the FMLA apply. At that point, the entitlement is based upon weeks – not hours.
Special Considerations on the Employee’s “Regular Rate” of Pay.
The general guidance is that the regular rate should be the average of the employee’s regular rate over a period of up to 6 months prior to the date of the leave.
If the wages include commissions, tips, piece rates, etc., those need to be included in the calculation. The Guidance defers in great part to the FLSA rules on the calculation of regular rate.
Can the Employee Take the Leave Intermittently?
Teleworking.
If the employer agrees, yes. (Note: We encourage employers not to request any employee who is actually ill to work, even telework.)
At Work.
No if the leave is because the employee is (i) subject to a Federal, State, or local quarantine or isolation order related to COVID-19; (ii) has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; (iii) is experiencing symptoms of COVID-19 and seeking a medical diagnosis; (iv) 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 (v) is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services. You must take the full Paid Sick Leave or until you no longer qualify for the Paid Sick Leave, in full day increments.
Yes if the employer agrees and the leave is because the employee’s child’s school or child care is unavailable due to COVID-19 related reasons.
What Information Can I Request or Require from My Employee?
The answer is not entirely clear. The DOL advises an employee must provide to their employer documentation “as specified in applicable IRS forms, instructions, and information.” But the IRS has not yet released any forms, instructions, or information.
With regard to the leave related to Expanded FML, an employer may request information such as a notice or information from the school or provider that it is unavailable due to COVID-19. This could be as simple as a news clipping or notice from a website or a handwritten letter. Employers should retain this information should they need it later for their application for, or support of, the tax credit.
Note: Very early on, the CDC urged employers to be more lax in requiring notes from doctors based upon a public health concern that employees would simply not be able to get in to see a doctor – for COVID-19 or any other reason. We suspect this will remain the case for the foreseeable future.
What Records Must I Keep?
Be mindful that these are payroll issues so you must keep accurate records of time worked, deductions, and the like. Although many business have embraced telework and for excellent public health reasons, that will not relieve you of the obligation to record time worked, especially for all nonexempt employees.
The Family and Medical Leave Act also has recordkeeping requirements. The Expanded FML is really just an amendment to that law – one which does not amend the recordkeeping requirements. So you will need to keep track of ordinary, mundane FMLA things. For those of you already administering FMLA programs, you should be aware of these records. For those of you new to the FMLA, it is an administrative challenge. You must keep track of the qualifying reason for the leave (kept confidential in most instance) as well as of the days/hours of the absence, the amount of time used, amount of time remaining, etc. You may want to consult counsel to ensure you are meeting your obligations.
If you are reaching “agreements” with employees on issues such as intermittent leave or number of hours generally worked with exempt employees, get these agreements in writing (email should suffice) so you have a record of them.
If you will be claiming tax credits for amounts paid under the Paid Sick Leave and/or the Expanded FML, the IRS will also have requirements (though they are not entirely clear at this time).
Interplay with the Original FMLA
The Guidance provides additional insight into how the Expanded FML works with the original FMLA. The overriding rule is that the original FMLA works as it did. It provides for unpaid leave to be provided by covered employers (under the old rules) to eligible employees (under the old rules). Those are not expanded. To clear up one misconception: this law does not convert all FMLA leave to paid leave.
The Guidance also makes clear that an employee taking Expanded FML has the same health insurance protection as employees on FMLA have. To recap, employees on FMLA (and Expanded FML) will be kept on their group health coverage during those leaves on the same terms as if they had continued to work – same coverages, same contributions.
For an example of the interplay, a person who becomes very ill with COVID-19 might qualify for 80 hours of Paid Sick Leave and then qualify for additional unpaid leave under the original FMLA as having a “serious health condition.” In that case, your normal FMLA policy would apply to the unpaid FMLA leave.
So, lessons clarified from the guidance are:
- An employee’s use of FMLA (original or Expanded FML) has no bearing on their right to use Paid Sick Leave (the 80 hours). Those are two separate and distinct laws.
- If you are an employer already covered by the original FMLA, the Expanded FML is simply another category you will be administering under that policy (with some exceptions like the 30-day waiting period before an employee is eligible to take it).
How does an employer with an existing FMLA Policy integrate Expanded FML?
The Guidance has provided insight on entitlement which is important both to employers and to employees. The Expanded FML is simply another category of the entitlement to 12 weeks of leave. As we know, an eligible employee has the right to up to 12 weeks in a 12 month period (that 12-month period to be determined by the employer; most common form chosen is probably the rolling 12-month period). Under the original FMLA, a person could use the 12 weeks for a variety of reasons. Now, the COVID-19 reason – needing to be home because the employee’s child’s school or childcare is unavailable due to COVID-19 – is one of those reasons. That reason does not grant to the employee an additional 12 weeks.
Understand that your employees will get the 12 weeks just as they do under your present policy. Here is the example given by the DOL:
For example, assume you are eligible for preexisting FMLA leave and took two weeks of such leave in January 2020 to undergo and recover from a surgical procedure. You therefore have 10 weeks of FMLA leave remaining. Because [Expanded FML] is a type of FMLA leave, you would be entitled to take up to 10 weeks of expanded family and medical leave, rather than 12 weeks. And any expanded family and medical leave you take would count against your entitlement to preexisting FMLA leave.
Conversely, if an employee has taken no leave under your FMLA policy and needs Expanded FML, that will count toward their total FMLA entitlement. Here is the example the DOL gives:
For example, assume you take four weeks of [Expanded FML] in April 2020 to care for your child whose school is closed due to a COVID-19 related reason. These four weeks count against your entitlement to 12 weeks of FMLA leave in a 12-month period. If you are eligible for preexisting FMLA leave and need to take such leave in August 2020 because you need surgery, you would be entitled to take up to eight weeks of FMLA leave.
In this scenario, the first two weeks of the Expanded FML would be unpaid under the EFMLEA. The employee receives no pay unless (i) the employee had not used the Paid Sick Leave for any other reason in which case they could use their Paid Sick Leave concurrently with the first two weeks of Expanded FML or (ii) the employer allows and the employee chooses to use another form of available paid leave such as PTO. An employer cannot force the employee to take paid leave for those two weeks. The Expanded FML is paid under the law for the third and fourth weeks.
Finally, remember, Expanded FML is available only through December 31, 2020.
Interplay of Paid Sick Leave, Expanded FML, and Your Paid Time Off Policies
And then there are your existing policies…. The basic rule is that the law goes first, meaning the Paid Sick Leave and Expanded FML are the first things to apply. An employer cannot force any of its policies in lieu of that or even on top of that. However, an employer can offer to allow an employee to supplement. Here’s how it can work:
If an employee takes Paid Sick Leave at their regular rate, there is nothing to do. That in essence makes the employee whole.
If, however an employee takes the Paid Sick Leave but, because of the category, it is paid at the 2/3rds rate, an employer could offer to allow the employee to use available employer-paid-leave to make up the difference. (No, you will not get a tax credit for doing so.) But, (i) the employer has to offer it and (ii) the employee has to agree. The same analysis would apply for the pay under the Expanded FML.
And More…
The 59 FAQs cover other issues including the right to reinstatement, where employees should go to file complaints, federal and public employers, multi-employer collective bargaining agreements, the limited exceptions for health care providers and emergency responders. We tried to cover those things which might impact the largest group of our readers.
We do not know if or when the DOL will issue additional guidance. We anticipate additional guidance on the tax credits. When further guidance is released, we will bring it to you.
By Kristen L. Brightmire, kbrightmire@dsda.com