On April 1, 2020, the U.S. Department of Labor (DOL) issued a 124-page "temporary rule" to help employers navigate the Families First Coronavirus Response Act (FFCRA).  The rule follows the FAQ's previously issued by the DOL (blogged about here) and provides additional clarification on employer coverage, the qualifying reasons for leave, documents required by employees asking for leave, and the documentation employers need to maintain.
 
Background
 
As we blogged about here, the FFCRA is the federal mandate that requires certain employers to provide employees with Paid Sick leave and Paid Family leave.  In summary, employers with 500 or fewer employees must provide employees up to 80 hours of Paid Sick leave. Eligible employees will receive full pay (subject to a cap) if unable to work or telework because theemployee is personally sick or quarantined due to COVID-19. The FFCRA provides 80 hours of partial Paid Sick leave (2/3 pay, subject to a cap) to care for affected family members, including children home due to school or childcare closures.
 
These same employers (less than 500 employees) must also provide employees who are unable to work or telework up to 10 weeks of Paid Family leave at 2/3 pay to care for children whose schools or child care centers have closed due to COVID-19.
 
Covered private employers are eligible to be reimbursed through tax credits for amounts paid to employees for Paid Sick leave wages and Paid Family leave wages and for allocable costs to maintain health care coverage for employees on leave. Further information on tax credits is available here.
 
Clarification provided by the DOL's new Rule:
  1. What if I had 600 employees in March, but my business now has 450 employees due to layoffs?
As noted above, the Paid Sick leave and Paid Family leave apply to private employers with fewer than 500 employees. That determination is made at the time an employee would take leave. If an employee requests leave on a date when the employer employs 450 active employees, the employer is subject to the FFCRA. If the employer then goes out and hires 75 new employees, an employee who requests leave after those hires would not be entitled to take leave.
 
In counting how many employees an employer has, include full- and part-time employees, employees on leave, temporary employees who are jointly employed by the employer and another entity, and day laborers supplied by a temporary placement agency. Do not count independent contractors or employees who have been laid off or furloughed without being reemployed. Also, exclude employees working outside the U.S. The test for determining joint employment is the same used under the Fair Labor Standards Act (FLSA).
 
2. Can all small businesses with less than 50 employees claim the exemption from the Paid Family leave (school closure) pay requirements?
 
No. The Paid Family leave rule includes a provision exempting businesses with fewer than 50 employees for whom granting leave would "jeopardize the viability of the business as a going concern."  These exempt small businesses may not need to provide up to 10 weeks off at partial pay (Paid Family leave) to care for children whose schools or child care centers have closed due to COVID-19 if certain conditions are met.
The rule lays out three circumstances that qualify an employer for this exemption, all centering on whether absences would disrupt companies' operations. Under the rule, these small businesses will not have to provide leave if doing so would raise expenses above revenue such that the employer would "cease operating at a minimal capacity"; the absence would "pose a substantial risk" to the employer's financial health or operations because of the requesting worker's skills, knowledge or duties; or the employer can't find enough workers to perform the work of the employee requesting an absence.
 
If an employer believes it qualifies for the small business exception under the law, the employer shall document the determination by its authorized officer that it is eligible for such exemption and retain such documentation for four years.  Employers using this exemption should not send supporting materials or documentation to the DOL, but rather should retain such records for their own files.  However, such employers are not exempt from the two-week Paid Sick leave requirement unless the worker is requesting time off to care for a child whose school has closed.
 

3. Can employees request Paid Sick Leave due to a general State or Local "Stay Home" Order?


 
Technically yes, but keep reading. The law lays out six "qualifying reasons" that trigger the two-week Paid Sick Leave benefit, including if they can't work because of a quarantine or isolation order or have COVID-19 symptoms and are seeking a diagnosis. For the complete list of qualifying reasons, see our blog post here

 
Many employers have asked: "What if a worker is under a State or Local isolation or Stay Home order?" Answer: Workers can utilize Paid Sick Leave if they are isolated because of "a broad range of governmental orders," including stay-at-home orders or mandates that "otherwise restrict" their mobility.
 However, employees will only qualify for paid leave if: (1) they cannot work or telework, and (2) the order is what prevents them from working.  In other words, a worker can't take Paid Sick Leave or Paid Family Leave if they can telework or if they would not have work (due to furlough or business shutdown) even without the isolation order (nor will employees qualify for paid leave if the business is closed due to a shutdown order).
 
4. Does the Rule provide any clarification about wage & hour issues while nonexempt employees temporarily telework? 
 
Yes. The rule clarifies that employers are not required to pay employees for unreported hours while teleworking unless the employer knew or should have known the employee was working off the clock. In addition, the FLSA's presumption that employees are working continuously throughout the workday (except during the unpaid meal period) does not apply to telework for COVID-19-related reasons. The DOL believes that applying the "continuous workday" rule in this circumstance would discourage the flexibility employees need to be able to perform their work at unconventional times.
 
5. Can FFCRA Paid Sick leave and Paid Family leave be used intermittently?

Yes, if the employer and employee agree to intermittent leave. The rule explains that workers can use Paid Sick leave and Paid Family leave intermittently by mutual agreement with the employer.
In other words, employees are not entitled to intermittent leave unless the employer agrees. Any decision regarding intermittent leave should be applied fairly and consistently.
 
6. Can I require employees to utilize accrued Vacation / PTO days while utilizing Paid Sick leave and Paid Family leave?

Employers cannot require that employees to utilize accrued paid time off during the 80 hours of Paid Sick 
leave. It is the employee's choice. Employers CAN require that employees utilize accrued paid time off at the same time they take partially Paid Family leave to care for a child. In other words, you can apply accrued PTO to bring the employee from 2/3 pay to full pay.
 
7. Does Paid Family leave count against the employee's 12 week FMLA allotment for traditional reasons?
 
Yes.  Any leave taken pursuant to Paid Family leave counts against the 12 workweeks of FMLA leave to which employees are otherwise entitled. So if an employee has used part of their 12 weeks of unpaid FMLA, they would only be entitled to the remainder for extended family leave. The rule also clarifies that if an employee takes Paid Sick leave concurrently with the first two weeks of Paid Family leave, which otherwise would be unpaid, those first two weeks do count toward the 12 workweeks in the 12-month period.
 
8. What documentation should I require from an employee requesting Paid Sick Leave and Paid Family Leave?
 
The rule explains that an employee must provide a written request for Paid Sick Leavee, including the following:
 

a. Employee's name;

b. Date(s) for which leave is requested;

c. Qualifying reason for the leave;

d. Statement that the Employee is unable to work or telework because of the qualified reason for leave;

e. Name of the government entity that issued the quarantine or isolation order (if applicable);

f. Name of the health care provider who advised the employee or family member to self-quarantine due to concerns related to COVID-19 (if applicable).

g. Any available notice or documentation, such as a quarantine order.

 

To take Paid Family leave due to a school closure, an employee must also provide:
  1. The name of the child or children being cared for;
  2. The name of the school, place of care, or child care provider that has closed or become unavailable due to COVID-19;
  3. A statement that "no other suitable person is available to care for the child during the period of requested leave";
  4. For care of a child older than 14, a statement that special circumstances exist requiring the employee to provide care;
  5. Any available notice/documentation of a school closure or childcare closure, which may include an email, website announcement, or other published notice of closure or unavailability from an employee's child's school or child care provider.
In addition, employers must maintain documentation showing: (1) how the employer determined the employee's "regular rate of pay" (which must factor in non-discretionary bonuses), (2) how the employer determined the amount of leave granted, and (3) how the employer determined the amount of qualified health plan expenses that it allocated to wages. All documentation (including quarterly tax documents) must be retained for four years, regardless whether leave was granted or denied. 
 
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