We previously provided you with an overview of the Families First Coronavirus Response Act (“FFCRA”). The purpose of this article is to help you understand the recent guidance from the U.S. Department of Labor (“DOL”) regarding the application of the FFCRA. This is a fluid situation and we will continue to provide updates as we learn more.
Generally, the FFCRA expands rights under the Emergency Family and Medical Leave Expansion Act (“FMLA”) and imposes new requirements under the Emergency Paid Sick Leave Act within FFCRA. The FFCRA goes into effect on April 1, 2020.
The updated DOL guidance can be found at https://www.dol.gov/agencies/whd/pandemic/ffcra-questions. Below are a few key takeaways:
- The guidance indicates that a state-mandated “stay at home,” “shelter in place” or other similar titled state orders would not qualify for paid leave under the FFCRA. Therefore, it appears that employees who cannot work due to Illinois’ Shelter in Place Order do not qualify for benefits under the FFCRA, unless that leave is due to the employee caring for a child whose school or place of care is closed (or childcare provider is unavailable) for reasons related to COVID-19.
- If an employer closes its worksite prior to April 1, 2020, its employees are not entitled to benefits under the FFCRA. If an employer closes its worksite after April 1, 2020, its employees are only entitled to benefits under the FFCRA earned prior to the worksite closing.
- Employers are required to keep records when an employee receives benefits under the FFCRA. Employers that provide paid sick leave and expanded family and medical leave wages required by the FFCRA are eligible for reimbursement of the costs of that leave through refundable tax credits. If an employer intends to claim a tax credit under the FFCRA for payment of the paid sick leave or expanded family and medical leave wages, employers should retain appropriate documentation in their records. Employers should consult Internal Revenue Service (IRS) applicable forms, instructions, and information for the procedures that must be followed to claim a tax credit, including any needed substantiation to be retained to support the credit.
- Additionally, if an employee takes expanded family and medical 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, an employer may require the employee to provide additional documentation in support of such leave, to the extent permitted under the certification rules for conventional FMLA leave requests. For example, this could include a notice that has been posted on a government, school, or day care website, or published in a newspaper, or an email from an employee or official of the school, place of care, or child care provider. The employer must retain this notice of documentation in support of expanded family and medical leave, including while the employee may be taking unpaid leave that runs concurrently with paid sick leave if taken for the same reason.
- An employee must provide the employer documentation in support of the paid sick leave as specified in applicable IRS forms, instructions, and information. The employee may be required to provide additional documentation if the employee takes expanded family and medical leave to care for his or her child as discussed above.
- Generally, intermittent leave is not available under the Act, except for child care issues and only if the schedule can be agreed upon with the employer.
- Reductions in hours, layoffs, or terminations due to lack of work do not qualify for benefits under the FFCRA.
- As with FMLA, health care coverage must be continued during the leave period, with the employee continuing to make his or her normal contributions.
- An employee may choose whether to use the paid sick leave or other leave benefits from the employer. However, only leave under the FFCRA will be eligible for the tax credits.
- Paid sick leave does not count against an employee’s 12 weeks of FMLA, unless the leave is for child care. For example, if an employee takes paid sick leave concurrently with the first two weeks of expanded family and medical leave, which may otherwise be unpaid, then those two weeks count towards the 12 workweeks in the 12-month period as required by FMLA. However, if an employee takes two weeks paid sick leave because he or she has been advised by a health care provider to self-quarantine related to COVID-19 or because he or she is experiencing COVID-19 symptoms and is seeking a medical diagnosis, then those two weeks will not count against the employees 12 weeks of FMLA leave.
- In most instances, employees are entitled to be restored to the same or an equivalent position upon return from paid sick leave or expanded family and medical leave. Thus, an employer is prohibited from firing, disciplining, or otherwise discriminating against an employee because they took paid sick leave or expanded family and medical leave. Nor can an employer fire, discipline, or otherwise discriminate against an employee because the employee filed any type of complaint or proceeding relating to these Acts, or have or intend to testify in any such proceeding. However, the restoration requirement may be relaxed for employers with fewer than 25 employees in certain circumstances.
- The Department of Labor provides some initial guidance on the small business exception related to non-compliance related solely to child care issues. In summary, an employer with fewer than 50 employees can claim it is exempt from providing the benefits related to child care, if:
- 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.
At this point, the DOL is allowing employers to make this determination. It is unclear how this process will be formalized in the future. Notably, if an employer improperly denies benefits related to child care issues, it may subject itself to a claim by the employee.
The attorneys at Reno & Zahm LLP continue to monitor COVID-19-related legislation and we will provide regular updates. Please contact us with any questions. We are here to help you make it through these challenging times.