Kasper & Frank LLP
Countdown to Compliance: FAQs on Complying with New Fed. COVID-19-Related Sick Pay & Leave Mandates
On March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act, which requires certain employers to provide emergency paid leave under the Family and Medical Leave Act and emergency paid sick leave benefits under the Emergency Paid Sick Leave Act.
Our firm’s legal update yesterday described key provisions of the two new laws that mandate protected employee leave and sick pay benefits under certain circumstances [link]. This update provides answers to some key compliance questions.
We will be hosting a complimentary webinar to provide more compliance information and answer compliance questions “live” on this and all other COVID-related human resources matters. We will send an invitation shortly with additional information.
Help! Please give us a quick summary of the legal obligations.
There are two new federal laws that provide certain benefits to COVID-affected eligible employees.
The federal Family and Medical Leave Act (FMLA) has been expanded to provide a new type of leave. Private sector employers with fewer than 500 employees must provide employees who have been employed for at least 30 calendar days with up to 12 weeks of job-protected FMLA leave for “a qualifying need related to a public health emergency.” This “qualifying need” is limited to circumstances where the employee is unable to work or telework due to a need to care for a minor child if the child’s school or place of childcare has been closed or the childcare provider is unavailable due to a public health emergency. A public health emergency is a COVID-19-related emergency declared by a federal, state or local authority.
The federal Emergency Paid Sick Leave Act is a new law mandating paid sick time for employees. It requires covered employers to immediately provide employees with up to 80 hours of paid sick leave for use under the following circumstances:
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 healthcare 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 subject or advised to isolate or quarantine.
The employee is caring for a son or daughter whose school or place of care is closed or childcare provider is unavailable due to COVID-19 precautions; or
The employee is experiencing any other substantially similar conditions specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.
When do the laws become effective? Both laws become effective April 2, 2020 and expire on December 31, 2020.
We are a private sector employer with related and separate legal entities. How do we determine if we have “fewer than 500 employees”?
Separate business entities will be deemed to be parts of a single employer for purposes of FMLA and possibly the emergency sick leave law if they meet an “integrated employer” test. A determination of whether or not separate entities are an integrated employer is not determined by the application of any single criterion, but rather the entire relationship is to be reviewed in its totality. Factors considered in determining whether two or more entities are an integrated employer include:
Interrelation between operations.
Centralized control of labor relations; and
Degree of common ownership/financial control.
Consult with your legal counsel to help make this determination.
Is there any relief for private sector employers who have fewer than 50 employees?
For the new public emergency FMLA leave, the law exempts private sector employers with fewer than 50 employees from civil FMLA damages in an FMLA lawsuit. This means smaller employers are shielded from being liable for back pay or liquidated damages. Additionally, the Secretary of Labor has the authority to exempt small business with fewer than 50 employees from the public health leave requirement when the leave requirement would “jeopardize the viability of the business as a going concern.”
The definition of “employer” under the Emergency Paid Sick Leave Act is more complex. Among other requirements, the employer must be engaged in interstate commerce. It’s possible that smaller, private sector employers may not meet this threshold requirement. Additionally, like under the public health emergency FMLA leave law, the Secretary of Labor has the authority to exempt small businesses with fewer than 50 employees from the emergency sick leave requirement when it would “jeopardize the viability of the business as a going concern.”
Consult your legal counsel to help make determinations related to smaller size private sector employers.
The law doesn’t take effect until April 2, 2020. Can we give benefits (either sick time or protected leave now) and get credit before the effective date of the new laws?
Likely no. Leave or sick pay benefits provided before the laws’ enactment dates likely cannot be credited against the legal obligations under the new laws.
We already provide sick pay benefits under our company policy and California state and local laws. Do we have to provide more sick leave to a California employee?
Probably. The legal entitlements to new sick pay benefits is under federal law. The law doesn’t expressly give employers the ability to “offset” this federal obligation with sick pay already provided due to state and local legal requirements and/or employer policy.
How much pay is required during public emergency FMLA leave?
The first 10 days of public emergency FMLA leave are unpaid, but an employee may, at the employee’s option, substitute accrued paid leave, including emergency paid sick leave. Based on the language of the law, an employer likely cannot require the employee to use accrued paid leave during the 10-day period, but the employee can voluntarily elect to use it.
The remaining 10 weeks are paid at 2/3 of the employee’s regular rate, for the number of hours the employee would otherwise be scheduled to work. The maximum payment is capped at no more than $200 per day and $10,000 total.
How do all of the pay obligations work together, especially since California and other jurisdictions already require paid sick leave?
This is a complicated question, especially because the sick leave laws in California are very different than the new federal Emergency Paid Sick Leave Act. For example, sick pay in California must be paid at statutorily defined rates and is not subject to daily or aggregate pay caps. Additionally, California employers generally cannot force use of legally-required California sick leave even though the federal FMLA allows for substitution of paid time. Because this is complicated and each employer situation is unique, consult with your legal advisor to determine how all of the applicable laws work together for your Company’s unique circumstances.
Are there “sequencing” rules for when an employer can require use of federal emergency sick leave benefits?
Yes. The federal emergency sick leave law requires that the employer allow the employee to first use sick leave provided for under this federal law and then use any remaining accrued paid leave under an employer’s policy. The employer cannot require the employee to use accrued leave under an employer policy first.
Can we require doctor notes (i.e., medical certification) to support an employee’s request for sick leave or public emergency FMLA leave?
The COVID-19 pandemic has caused this to be a very difficult question to answer. Employers who are subject to the San Diego County Public Health Order effective March 17, 2020 have been required to suspend “any policy or procedure requiring doctor verification for sick or other leave approval.” So, San Diego employers cannot subject any public emergency FMLA leave or emergency sick leave to receipt of a doctor note.
Employers outside of San Diego county need to consult any applicable public health order for guidance.
Separate from the issue of public health orders, it does not appear that employers can ask for medical certification for public health emergency FMLA leave and it’s unclear from the statutory language whether it can be requested for federal emergency sick leave.
Can employers get reimbursed from the federal government for the paid sick leave benefits and paid FMLA leave?
Yes. The new law provides for a series of refundable tax credits for employers providing paid emergency sick leave or paid FMLA.
Does an employee have job restoration rights at the end of public emergency FMLA leave?
Yes, depending on size of the private employer and circumstances. Public emergency FMLA leave requires that employers restore employees to the same or equivalent position upon their return to work. However, the new law includes an exception to this requirement for employers with fewer than 25 employees if the employee’s position no longer exists following leave due to operational changes occasioned by a public health emergency. If the small employer does not return the employee because of operational changes, the employer must make reasonable efforts to contact a displaced employee for up to one year after they are displaced if an equivalent position becomes available.