On Saturday, March 28, 2020 the Department of Labor (DOL) released further guidance on the implementation of the provisions of the Families First Coronavirus Recovery Act (FFCRA). This guidance provides greater detail for employers as to how to apply provisions of the law to their operations.
The following is an overview of their guidance:
PRIVATE EMPLOYER SIZE
Private employers with less than 500 employees are subject to the FFCRA provisions. Employers should use the number of employees on the day the employee’s leave would start to determine whether the employer has fewer than 500 employees for purposes of providing expanded family and medical leave and paid sick leave. All employees must be counted.
SMALL EMPLOYER EXEMPTION
Small employers, including a religious or nonprofit organization, may be exempt from the FFCRA provisions related to school closures if providing the paid leave would jeopardize the viability of the small business as a going concern.
Small employers may claim this exemption if the employer has less than 50 employees, the leave is requested due to a school or childcare closure, AND an authorized officer of the business has determined that:
- 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.
“HEALTH CARE PROVIDER” AND “EMERGENCY RESPONDER” EXEMPTIONS
Health Care Provider
For the purposes of employees who may be exempted from the FFCRA paid leave provisions, a health care provider is anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary 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.
The definition includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities to provide services or to maintain 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.
To minimize the spread of the virus associated with COVID-19, the DOL encourages employers to be judicious when using this definition to exempt health care providers from the provisions of the FFCRA.
For the purposes of employees who may be excluded from FFCRA paid leave, an emergency responder is an employee who is necessary for the provision of transport, care, health care, comfort, and nutrition of patients, or whose services are otherwise needed to limit the spread of 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, 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 that 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.
To minimize the spread of the virus associated with COVID-19, the DOL encourages employers to be judicious when using this definition to exempt emergency responders from the provisions of the FFCRA.
**This guidance does not offer a blanket exemption for all types of employers listed above.
DOCUMENTATION FOR FFCRA PAID LEAVE
Employees are required to provide appropriate documentation to support the need for FFCRA leave.
Emergency Paid Leave Sick Act (EPSLA)
Employees requesting leave must provide documentation to include:
- employee’s name;
- qualifying reason for requesting leave;
- statement that the employee is unable to work, including telework, for that reason, and;
- date(s) for which leave is requested.
The reason for the leave should be documented as well, such as the source of any quarantine or isolation order, or the name of the health care provider who has advised the employee to self-quarantine.
Examples of documentation would include: a copy of the federal, state or local quarantine or isolation order related to COVID-19 applicable to the employee or written documentation by a health care provider advising the employee to self-quarantine due to concerns related to COVID-19.
Emergency Family and Medical leave Expansion Act (EFMLEA)
Employees requesting leave to care for his or her child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19, must provide documentation. Examples: a notice that has been posted on a government, school, or daycare website, or published in a newspaper, or an email from an employee or official of the school, place of care, or child care provider.
This requirement also applies when the first two weeks of unpaid leave run concurrently with paid sick leave taken for the same reason.
Note: Documentation for leave allowed for by EPSLA and EFMLEA should be retained by the employer for tax credit substantiation purposes.
BUSINESS CLOSURES AND FFCRA REQUIREMENTS
In their guidance, the DOL provides information on specific situations for employers who face temporary closures and how to manage FFCRA leave and unemployment. Those include:
- Employer closure BEFORE April 1, 2020. An employer that has closed its doors before April 1, 2020 and is no longer paying employees due to lack of work is not required to pay FFCRA leave. However, employees may be eligible for unemployment. This is true whether the employer closes the worksite for lack of business or because it is required to close pursuant to a federal, state, or local directive.
However, if an employer is paying employees pursuant to a paid leave policy or state or local requirements, employees are not eligible for unemployment.
- Employer closure ON OR AFTER April 1, 2020. An employer that closes on or after April 1, 2020 is not required to pay FFCRA leave, even if the leave was requested prior to the closure. This is true whether the employer closes the worksite for lack of business or because it was required to close pursuant to a federal, state or local directive.
- Employer closure while employees are on FFCRA leave. An employer that closes while employees are on FFCRA leave must pay for any paid FFCRA leave used before the employer closed. As of the date of closure, employees are no longer entitled to paid sick leave or expanded family and medical leave, but may be eligible for unemployment. This is true whether the employer closes the worksite for lack of business or because the employer was required to close pursuant to a federal, state or local directive.
- Employer remains open but imposes a furlough on or after April 1, 2020. An employer that remains open but furloughs employees due to lack of work is not required to pay FFCRA. However, employees may be eligible for unemployment.
- Employer closure on or after April 1, 2020 but intends to reopen. An employer that closes the worksite on or after April 1, 2020 but intends to reopen is not required to pay FFCCRA leave, even if closed for a short period of time. However, employees may be eligible for unemployment. This is true whether the employer closes the worksite for lack of business or because it was required to close pursuant to a federal, state, or local directive. If the employer reopens and employees resume work, employees would then be eligible for paid sick leave or expanded family and medical leave as warranted.
- Reduction of scheduled hours. If an employer reduces employees scheduled work hours, the employer is not required to pay FFCRA leave for the hours the employee is no longer scheduled to work. This is because the employees are not prevented from working those hours due to a COVID-19 qualifying reason, even if the reduction in hours was somehow related to COVID-19.
Employees may take FFCRA leave if a COVID-19 qualifying reason prevents the employee from working a full schedule. The amount of leave in this case is computed based on the employee’s work schedule before it was reduced.
Unemployment benefits while receiving FFCRA
If an employer provides FFCRA leave employees are not eligible for unemployment. However, each state has its own unique set of rules; and DOL recently clarified additional flexibility to the states to extend partial unemployment benefits to employees whose hours or pay have been reduced. Therefore, individuals should contact their state workforce agency or state unemployment insurance office for specific questions about eligibility.
The DOL has defined telework as an employer permitting or allowing an employee to perform work while at home or a location other than the normal workplace. Telework is work for which normal wages are paid and should not be compensated under the paid leave provisions of the FFCRA.
“Unable to work, including telework” means that an employee is unable to work if the employer has work and one of the reasons set forth under the FFCRA prevents an employee from being able to perform that work.
If the employee and employer agree that work will be performed for the normal number of hours but outside of a normal schedule, then the employee is able to work and paid leave is not necessary unless a reason set forth under the FFCRA prevents the employee from working that schedule.
To the extent an employee is able to telework while caring for a child, FFCRA paid leave is not available.
Leave is available to employees in telework and normal worksite situations. Here is an overview of both situations:
Both EPSLA and EFMLEA leave may be taken intermittently as allowed by the employer.
Intermittent leave may be taken in any increment, provided that both the employee and employer agree. Example: Employer and employee agree on a 90 minute increment, employee 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.
It depends on why the employee is taking paid sick leave and whether the employer agrees. Paid sick leave for qualifying reasons related to COVID-19 must be taken in full-day increments. It cannot be taken intermittently if the leave is being taken because:
- Employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
- Employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
- Employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
- 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
- Employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.
Once an employee begins taking paid sick leave for any of the above reasons, the employee must continue to take the paid sick leave each day until either (1) the full amount of paid sick leave is used or (2) the employee no longer has a qualifying reason for taking paid sick leave.
If employees do not use the entire two weeks of paid leave under EPSLA, they can take any remaining EPSLA at a later time for a qualifying reason until December 31, 2020, if another qualifying reason occurs.
If EPSLA leave is needed to care for a child whose school or place of care is closed, or whose child care provider is unavailable, because of COVID-19 related reasons the leave can be taken intermittently. Example: If a child is at home because his or her school or place of care is closed, or child care provider is unavailable, because of COVID-19 related reasons, the employee may take paid sick leave on Mondays, Wednesdays, and Fridays to care for the child, but work at the normal worksite on Tuesdays and Thursdays.
CONTINUATION OF HEALTH INSURANCE COVERAGE
Employers must continue group health insurance coverage for employee FFCRA leave under the same terms and conditions as if the employee was actively at work. Employees must continue to make normal premium contributions during the leave.
If employees do not return to work at the end of the FFCRA leave, employers may be able to allow employees to remain on the active coverage per carrier or stop loss carrier requirements. If employees are no longer eligible due to a reduction in hours or termination, employees should be offered COBRA, which generally applies to employers with 20 or more employees or state continuation (if applicable).
COORDINATION WITH EMPLOYER PROVIDED PAID SICK LEAVE
Employees cannot use employer provided paid leave and FFCRA leave concurrently. However, employers may agree to supplement FFCRA leave with any available employer provided leave.
Example: If an employee is receiving 2/3 of normal earnings from paid sick leave or expanded family and medical leave under the FFCRA and the employer permits, the employee may use employer-provided paid leave to get the additional 1/3 of normal earnings so that full normal earnings for each hour are received by the employee.
Employers are not required to permit an employee to use existing paid leave to supplement the amount received from paid sick leave or expanded family and medical leave. Employers cannot claim and will not receive tax credits for supplemental amounts. In addition, employers cannot require that employees use employer provided paid leave.
CARE FOR A CHILD
Under the FFCRA, a “son or daughter” is the employee’s own child, which includes biological, adopted, or foster child, stepchild, a legal ward, or a child for whom the employee is standing in loco parentis—someone with day-to-day responsibilities to care for or financially support a child.
In addition, a “son or daughter” would include an adult son or daughter who has a mental or physical disability AND is incapable of self care due to that disability.
TOTAL FMLA LEAVE IN A 12-MONTH PERIOD
Employers covered by FMLA prior to April 1, 2020 are NOT required to provide EFMLEA in addition to regular FMLA. Employees are allowed a TOTAL of 12 workweeks in a 12-month FMLA period. If an employee has taken some, but not all, of the 12 workweeks of allowable leave under FMLA during the current 12-month period as determined by the employer, employees may only take the remaining portion of the leave available. Also, if an employee has already taken 12 workweeks of FMLA during the 12-month period, the employee may not take additional EFMLEA.
Example: Employee is eligible for preexisting FMLA and took 2 weeks of leave in January 2020. The employee would have 10 weeks of FMLA leave remaining. And any EFMLEA leave taken would count against the employee’s entitlement to preexisting FMLA leave.
If an employer only becomes covered under the FMLA on April 1, 2020, this analysis does not apply.
FULL-TIME vs. PART-TIME EMPLOYEES
Under the EPSLA a full-time employee is an employee who is normally scheduled to work 40 or more hours per week. A part-time employee is an employee who is normally scheduled to work less than 40 hours per week.
Under the EFMLEA, full-time and part-time employees are not distinguished and pay would be based on the number of hours an employee normally works each week.
This further guidance from DOL is designed to help employers properly implement the FFCRA. For specific implementation, employers are strongly encouraged to work with their tax professionals or legal counsel to determine how to operationalize this guidance.