DOL Provides Guidance for Exemption from Paid Sick Leave and Extended Family Leave Under the FFCVA

The U.S. Department of Labor ("DOL") has published guidance anticipating its forthcoming regulations regarding exemption from Emergency Paid Sick Leave and Expanded Paid Family and Medical Leave requirements for businesses with fewer than fifty employees.

Under the guidance, an employer with fewer than fifty employees may claim exemption from the requirements if they "would jeopardize the viability of the small business as a going concern." To establish exempt status, an authorized officer of the business must determine that:

1. 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;

2. 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

3. 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 not require employers to submit document supporting the exemption but will require documentation of the authorized officer's determination.

There is risk in making this decision. First, the guidance is not yet a regulation and could change (especially if there is a change of administrations after the presidential election, which will occur well within the time employees could bring claims). Second, it remains to be seen how and when an employer's determination can be second-guessed. Failure to provide leave if required can result in civil damages and penalties under the FFCRA and its underlying laws. As always, we recommend consulting with counsel when making important decisions under state and federal employment laws.

The DOL's guidance, which is changing often, can be found here. The law and its benefit requirements take effect on Wednesday, April 1, 2020.

DOL Publishes Mandatory Model FFCRA Notice to Employees

The United States Department of Labor has released its Model Notice to employees explaining Paid Sick Leave and Expanded Family and Medical Leave rights under the Families First Coronavirus Response Act.

The language of the Act is not clear as to whether all employers must post the notice, or whether only employers with fewer than 500 employees are required to do so (though the DOL's Frequently Asked Questions suggest that only covered employers must post the notice). In either event, employers must post the notice “in conspicuous places on the premises where notices are customarily posted.” These would be places employers usually display things like all-in-one labor posters and wage orders.

We also recommend that employers place the notice on their employee portals or online (with other employment rights and benefits information) when applicable. This is particularly important while employees are working remotely during the pandemic. (The DOL's Frequently Asked Questions also comment that employers may mail or e-mail the notice to employees, though this is not mentioned in the law.)

Employers are not required to provide notices directly to employees, but the Model Notice should be posted before April 1, 2020 (the date the Act becomes effective). Future regulations may permit employers to substitute their own similar notice, but these rules will not be published until some time in April or later.

Significantly, the Model Notice does not advise employees that employers with fewer than fifty employees may opt out of the Act’s paid family leave requirements if they meet certain criteria. These criteria will be in regulations promised by the DOL for April but are currently unknown. This means employers must post the notice without knowing whether they qualify for the opt-out.

The Model Notice can be viewed here, and the DOL FAQ can be viewed here. Additional information regarding COVID-19 issues is published at the DOL's COVID-19 and the American Workplace page, here.

DOL Issues Initial Guidance Under the Families First Coronavirus Response Act

The U.S. Department of Labor has issued initial guidance on various issues under the Families First Coronavirus Response Act, publishing a Fact Sheet for Employers (here), a Fact Sheet for Employees (here), and a Questions and Answers document (here) addressing some of the questions posed by businesses and their workers over the past week.

The March 24 guidance does not contain any of the agency’s draft regulations or its anticipated notice to employees, which will be released soon. The guidance is not legally binding but could be persuasive to courts and other agencies due to the DOL’s oversight role under the Act.

The Fact Sheet for Employees covers basic qualification, length of leave, and pay issues under both the Emergency Paid Sick Leave and Expanded Family Medical and Leave portions of the new law. It also reiterates that Paid Sick Leave is available immediately to employees upon hire, while Expanded Family and Medical Leave requires workers to have been employed for 30 days. Other important issues, such as when employers with fewer than 50 employees may be excused from certain parts of the law, are left to future regulations that are “expected [in] April 2020.”

The Fact Sheet for Employers is similar but contains a few important details. First, it clarifies that employees are not required to use the Emergency Paid Sick Leave benefit during the first two weeks of Expanded Family and Medical Leave (saving it, perhaps, for later in the year) but may “elect to substitute any accrued vacation leave, personal leave, or medical or sick leave.” Second, it reiterates that leave does not carry over from year to year (which makes sense, as the law sunsets on December 31, 2020) and is not cashed out at termination. Third, it promises that a model notice to employees will be published by March 25, 2020.

The guidance also notes that employers of Health Care Providers or Emergency Responders may elect to exclude such employees from leave under the Act, but it does not define these terms. “Health Care Provider” presumably has the same meaning as under the Family Medical Leave Act, which includes physicians, podiatrists, dentists, clinical psychologists, optometrists, chiropractors, Nurse Practitioners, nurse-midwives, clinical social workers, physician assistants, certain religious practitioners, and – more broadly – any provider from whom an employer or its group health plan will accept “certification of the existence of a serious health condition … for benefits.” See 29 C.F.R. § 825.125.

“First Responder” presumably has the same meaning used under the federal Fair Labor Standards Act, which includes law enforcement and correction/probation personnel, park rangers, firefighters, emergency medical and rescue personnel (paramedic, EMT, etc.) and other similar employees. See DOL Fact Sheet No. 17.

The Questions and Answers sheet addresses several important issues under the new law, including:

· The paid leave provisions apply only to leaves between April 1 and December 31, 2020 – and is not retroactive (so paid leave provided before April 1 will not count toward the minimums and will not be reimbursable under its tax-refund program);

· The 500-employee maximum includes only employees in the United States, including joint employees but excluding independent contractors, and “integrated employers” may aggregate their employees toward the threshold;

· Employers with fewer than 50 employees must “document” why they meet the exemption criteria (to be addressed in April regulations) but will not be required to submit materials directly to the DOL;

· Employers follow the methods described in the Act to determine part-time employees’ benefit, and overtime is included when calculating any employee’s usual schedule (though the maximum benefit is capped at 80 hours);

· The “regular rate” of pay used for benefit calculation refers to an employee’s regular rate of pay (calculated the same way regular rate is calculated for overtime) over the past six months; and

· Employees have been employed for 30 days if they were on the employer’s payroll 30 days prior to the day leave starts (regardless of time worked). Employees who worked as temporary employees may count that time toward the 30-day requirement.

We expect more guidance in the coming week, and a model notice within the coming

day.

The DOL’s landing page for today’s guidance can be viewed here.