Coronavirus pushing rapid changes in employer law
By Mike O’Brien bio Employer law is rapidly changing amid the coronavirus pandemic. For one thing, Congress has passed another coronavirus related law. The United States Department of Labor (DOL) has provided some helpful guidance and answered a number of questions about the recent expansion of the Family and Medical Leave Act (FMLA) and about […]
By Mike O’Brien bio
Employer law is rapidly changing amid the coronavirus pandemic. For one thing, Congress has passed another coronavirus related law. The United States Department of Labor (DOL) has provided some helpful guidance and answered a number of questions about the recent expansion of the Family and Medical Leave Act (FMLA) and about the new paid sick leave law, see: DOL FFCRA Q&A. Here are updates:
PAID LEAVE UNDER THE EMERGENCY PAID SICK LEAVE ACT (EPSLA): Employees of covered employers (private employers below 500 employees and certain public employers) are eligible for up to two weeks (80 hours) of paid sick leave for certain COVID-19 related reasons. If leave is because he/she is quarantined (by government order or a health care provider), and/or experiencing COVID-19 symptoms and seeking medical diagnosis, the employee gets his/her regular rate of pay, capped at $511/day and $5,110/aggregate (2-week period). If the employee needs leave to care for someone subject to a quarantine/isolation directive, or to care for a minor child whose school or child care provider is closed/unavailable for COVID-19 reasons, the employee gets 2/3 the regular rate of pay, capped at $200/day and $2,000/aggregate (2-week period). Here is a link to the DOL’s webpage on this topic: DOL FFCRA employee paid leave rights summary.
EMERGENCY FMLA EXPANSION ACT: Under the FMLA Expansion Act, employees get up to 10 weeks (plus EPSLA paid sick leave) of paid FMLA leave if the employee is unable to work because he/she needs to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19. Employees taking such expanded family medical leave are entitled to 2/3 their regular rate of pay, capped at $200/day and $12,000/aggregate (12-week period). Here is a link to the DOL’s webpage on this topic: DOL FFCRA employee paid leave rights summary.
TAX CREDITS FOR PAYMENTS MADE UNDER THE FAMILY FIRST CORONAVIRUS RELIEF ACT (FFCRA): Covered employers qualify for dollar-for-dollar reimbursement through tax credits for all qualifying wages paid under the FFCRA. Qualifying wages are those paid to an employee who takes leave under the Act for a qualifying reason. Applicable tax credits also extend to amounts paid or incurred to maintain health insurance coverage. While employers are free to pay employees in excess of the per diem and aggregate caps specified in the FFCRA, employers cannot claim, and will not receive tax credit for, any amounts paid in excess of FFCRA’s statutory limits. Here are links to guidance from the DOL: DOL FFCRA employee paid leave rights summary; DOL FFCRA Q&A.
NEW DOL NOTICE MUST BE POSTED BY COVERED EMPLOYERS: The FFCRA requires all covered employers to post in conspicuous places a notice describing the conditions under which such paid leave is available and the amount of available paid leave. Here is link to the poster: FFCRA poster. Here is a link to a DOL Q&A explaining how to post the notice in various ways: FFCRA poster Q&A. Employers should post the posters no later than April 1, 2020.
PAID LEAVE MAY BE TAKEN INTERMITTENTLY IN SOME SITUATIONS: Questions 20-22 from the DOL FAQs make clear that intermittent leave is available in some situations, but only if the employer agrees. The DOL explains that intermittent paid sick leave and intermittent paid expansion act leave is available to care for a child as the result of a school closure, “but only with your employer’s permission.” For teleworking employees, intermittent paid sick leave is also available for all other qualifying paid sick leave reasons, e.g., if the employee is subject to a quarantine/isolation order, is experiencing symptoms of COVID-19, or is caring for someone in that situation. The DOL provides this helpful example of how to apply such intermittent leave for a teleworking employee: “You may take intermittent leave in any increment, provided that you and your employer agree. For example, if you agree on a 90-minute increment, you could telework from 1:00 PM to 2:30 PM, take leave from 2:30 PM to 4:00 PM, and then return to teleworking.” However, intermittent paid sick leave is not available to an employee working at the employer’s worksite (i.e., for non-teleworkers) if the employee is subject to a quarantine or isolation order, is experiencing symptoms of COVID-19, or is caring for someone in that situation. This makes good sense, because such intermittent leave for a non-teleworking employee could lead to the spread of COVID-19. For more information, see: DOL FFCRA employee paid leave rights summary.
DOL GUIDANCE RELATED TO WORKSITE CLOSURES AND FURLOUGHS: The DOL has provided guidance regarding worksite closures and furloughs and their impact on FFCRA leave. If an employer closes a worksite—before or after FFCRA’s effective date (April 1, 2020)—employees are not entitled to paid FFCRA leave and such employees should look to unemployment insurance benefits. DOL says this is true even if the closure is temporary. If an employer closes a worksite while an employee is on FFCRA leave, the employer pays for leave used before the closure, but as of the date of the closure the employee is not entitled to paid leave under FFCRA. Furloughs are more complicated. The DOL says a furloughed employee does not get FFCRA paid leave. It is unclear if that conclusion applies to a furloughed employee who then contracts COVID-19 and is staying home by directive. DOL does not clearly address this point. In this situation, employers must choose to grant paid leave or deny it. Both are reasonable readings of the FFCRA, but both carry risks. If an employer grants paid leave in such a situation, DOL cannot penalize it for failure to provide leave, but the employer might not get tax credits. If the employer denies paid leave, and DOL or a court determines this is not the proper reading of FFCRA, a DOL investigation may loom over the employer’s head. Hopefully, the DOL will clarify this specific issue. Here is a link to the DOL’s webpage on this topic: DOL FFCRA employee paid leave rights summary.
DOCUMENTATION: Questions 15 and 16 from the DOL guidance FAQs for the new COVID-19 FMLA and paid sick leave laws include some interesting information on gathering documentation. In essence, they say document coronavirus-related FMLA leave as you would other FMLA leave. Moreover, DOL says for the new paid sick leave, you must require your employee to provide you with appropriate documentation in support of the reason for the leave, including: the employee’s name, qualifying reason for requesting leave, statement that the employee is unable to work, including telework, for that reason, and the date(s) for which leave is requested. DOL says if you want to seek applicable tax credits, documentation must support the application. See: DOL FFCRA employee paid leave rights summary.
30 DAYS OF AMNESTY: The DOL recognizes that well-meaning employers will make some mistakes executing on the new paid leave laws. In its recently published “Employer Paid Leave Requirements” summary, the DOL states that there will be a 30-day amnesty period starting April 1, 2020 (the effective date), “so long as the employer has acted reasonably and in good faith to comply with the Act.” As a result, if an employer violates these laws during the first 30 days, an employer may avoid a DOL enforcement action by showing its violation resulted from a “good faith” error. Such good faith will exist “when violations are remedied and the employee is made whole as soon as practicable by the employer, the violations were not willful, and the Department receives a written commitment from the employer to comply with the Act in the future.” See: DOL FFCRA employee paid leave rights summary.
CARES ACT PROVIDES STIMULUS, INCLUDING PAYROLL LOANS: The recently passed Coronavirus Aid, Relief, and Economic Security (CARES) Act is intended to provide much need emergency funding, and economic stimulus to individuals and businesses. The more than $2 trillion rescue financial package provides assistance to many stakeholders seriously impacted by COVID-19, including businesses, healthcare providers, and most Americans. While the specific details are forthcoming, some highlights include: (i) special rules for use of retirement funds; (ii) $500 billion for loans and assistance to businesses, states, and municipalities; (iii) $349 billion in low-interest small business loans that may be used to cover payroll obligations and may be partially forgiven; (iv) delay of employer payroll tax payments; and (v) employee retention tax credits. Recipients of SBA-guaranteed loans under the Paycheck Protection Program could apply for loan forgiveness over eight weeks for eligible payroll costs and for mortgage interest, rent, and utility payments. Loan forgiveness would be reduced for businesses that lay-off employees or cut their pay. (This portion of our update was drafted by Jones Waldo tax attorney Geoff Gunnerson. If you have questions about the CARES Act or how to obtain its benefits, Geoff would be happy to assist you. You may email Geoff at firstname.lastname@example.org. Watch for additional guidance on the CARES Act in subsequent updates.)
EEOC ISSUES/UPDATES COVID-19 GUIDANCE: The Equal Employment Opportunity Commission (EEOC) also is issuing guidance to employers on COVID-19 issues. Some of this EEOC guidance is new, see: EEOC COVID-19 Q & A and What you should know about the ADA, the rehabilitation act, and COVID-19. Some of it is pandemic-related guidance issued several years ago but updated and still relevant to this pandemic, see: Pandemic preparedness in the workplace and the ADA. All three of these EEOC guidance documents are helpful as employers deal with COVID-19 issues in the workplace.
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