Families First Coronavirus Response Act: 10 Takeaways from the DOL’s Preliminary Rule
April 7, 2020
On April 1, 2020 the Department of Labor issued a preliminary rule to implement FFCRA’s Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family Medical Expansion Act (EFMLEA). The rule takes immediate effect and will expire on December 31, 2020. This article summarizes the key components of the preliminary rule.
Question 1: Which Employers Are Subject to the FFCRA?
The FFCRA applies to private employers with fewer than 500 employees and certain public employers. Whether an employer has less than 500 employees is dependent on the number of employees at the time an employee would take leave.
When determining their number of employees, employers should include full-time and part-time employees, employees on leave, temporary employees who are jointly employed by the employer and another employer, and day laborers supplied by a temporary placement agency. Independent contractors that provide services for an employer do not count towards the 500-employee threshold, nor do employees who have been laid off or furloughed and have not subsequently been reemployed. Employees must also be employed within the United States.
Question 2: Under What Conditions Are Employees Eligible for Emergency Paid Sick Leave?
Employees are eligible for emergency paid sick leave (“EPSL”) if they:
1) Are subject to a federal, state or local quarantine or isolation order related to COVID-19.
The temporary rule clarifies that a quarantine or isolation order includes a broad range of governmental orders, including orders that advise some or all citizens to shelter in place, stay at home, quarantine, or otherwise restrict their own mobility. However, an employee may only take paid sick leave for this reason if the order prevents the employee from working or teleworking.
In addition, the employee may not take paid sick leave if the employer does not have work for the employee, even if the reason why the employer does not have work for the employee is because the business has closed pursuant to a stay at home or similar order.
For example, if a coffee shop closes temporarily due to a downturn in business related to COVID-19, it would no longer have any work for its employees. A cashier previously employed at the coffee shop who is subject to a stay-at-home order would not be able to work even if they were not required to stay at home. As such, the cashier may not take paid sick leave because their inability to work is not due to their need to comply with the stay-at-home order, but rather due to the closure of his place of employment.
2) Have been advised by a healthcare provider to self-quarantine for a COVID-19 related reason.
The advice to self-quarantine must be based on a health care provider’s belief that the employee has or may have COVID-19 or is particularly vulnerable to COVID-19.
In order to qualify for sick leave, the self-quarantine must also prevent the employee from working, either at the employee’s normal workplace or by telework.
3) Are experiencing symptoms of COVID-19 and are awaiting diagnosis.
Symptoms include fever, dry cough, shortness of breath, or other symptoms identified by the U.S. Centers for Disease Control and Prevention.
Paid sick leave taken for this reason is limited to the time the employee is unable to work because they are taking affirmative steps to obtain a medical diagnosis. For example, an employee experiencing COVID-19 symptoms may take paid sick leave for time spent making, waiting for, or attending an appointment for a test for COVID-19.
The employee may not take paid sick leave to self-quarantine without seeking a medical diagnosis.
4) Experiencing any substantially similar condition specified by the Department of Health and Human Services.
The temporary rule does not address what constitutes a substantially similar condition and the Department of Health and Human Services (HHS) has not yet identified any “substantially similar condition” that would allow an employee to take paid sick leave. If HHS does identify any such condition, the Department of Labor will issue guidance explaining when an employee may take paid sick leave on this basis.
5) Are unable to work because they are caring for an individual who is subject to a quarantine or isolation order or who has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
EPSL may not be taken to care for someone with whom the employee has no personal relationship. Rather, the individual being cared for must be an immediate family member, roommate, or a similar person with whom the employee has a relationship that creates an expectation that the employee would care for that person.
6) Are caring for a child if the child’s school or childcare provider is unavailable.
An employee may only take paid sick leave to care for their child when the employee needs to, and actually is, caring for their child. Generally, an employee does not need to take such leave if another suitable individual, such as a co-parent or the usual childcare provider, is available to provide childcare.
A child is an individual under 18 years old, except for a child who (1) has a mental or physical disability, and (2) is incapable of self-care because of that disability.
Question 3: How do Employers Calculate the Pay for an Employee Who Takes EPSL?
Covered employers must provide paid sick leave to full and part-time employees for the COVID-19 related reasons described in Question 2. The temporary rule offers the following guidance regarding how to calculate sick leave benefits:
A full-time employee is an employee who works at least 80 hours over two workweeks, or at least 40 hours each workweek, while a part-time employee is an employee who is normally scheduled to work fewer than 40 hours each workweek or who on average works fewer than 40 hours each workweek.
Full-time employees are entitled to 80 hours of paid sick leave.
If a part-time employee has a regular weekly schedule, they are entitled to paid sick leave equal to the number of hours that they are normally scheduled to work over two workweeks. For example, an employee who works 60 hours every two weeks is entitled to a maximum of 60 hours of paid sick leave.
If a part-time employee works a variable weekly schedule, the hours of paid sick leave the employee is entitled to is fourteen times their average daily hours, calculated over a six-month period. If they have not been employed for six months, the employee is entitled to fourteen times the average number of hours the employee and employer agreed the employee would work when hired.
If an employee takes emergency paid sick leave for reasons 1-3 in Question 2, related to an employee’s own COVID-related medical condition, employers must pay employees at either their regular rate of pay, federal, state, or local minimum wage (whichever is higher), up to $511 per day ($5,110 in the aggregate).
If an employee takes emergency paid sick leave for reasons 4-6 in Question 2, employers must pay employees at two-thirds their regular rate of pay, federal, state, or local minimum wage (whichever is higher), up to $200 per day (and $2,000 in the aggregate).
Question 4: Under What Conditions is an Employee Entitled to EFML Benefits?
An employee who has been employed by their employer for at least 30 calendar days may take up to twelve workweeks of expanded family and medical leave, the first two of which are unpaid, between April 1, 2020 and December 31, 2020 because:
They are unable to work due to a need to care for their child whose school or place of care has been closed, or whose childcare provider is unavailable, for reasons related to COVID-19.
An employee will only qualify for this leave if, but for a need to care for an individual, they would be able to perform work for their employer, either at their normal workplace or by telework. As noted above, an employee will not qualify for leave where the employer does not have work for them.
The first two weeks of EFML is unpaid, although an employee can elect to use EPSL in lieu of unpaid leave. After the employee’s first two weeks of unpaid EFML, the employer must pay the employee two-thirds their average regular rate multiplied by the employee’s scheduled number of hours for each day of leave taken, although not more than $200/day ($10,000 in the aggregate). When determining the employee’s scheduled number of hours, employers should use the same method described in Question 3.
How EFML Benefits Interact with Other Types of Leave:
When an employee qualifies for both EPSL and EFML benefits, an employee may first use the two weeks of paid leave provided by the EPSLA. An employee may also substitute any accrued vacation, personal, or sick leave they have accrued through their employer. This leave runs concurrently with the first two weeks of unpaid EFML.
After the first two weeks of EFML, an eligible employee may elect to use, or an employer may require that an employee use, leave the employee has available under the employer’s policies to care for a child, such as vacation or personal leave or paid time off, concurrently with EFML.
If expanded family and medical leave is used concurrently with another source of paid leave, then the employer has to pay the employee the full amount to which the employee is entitled under the employer’s preexisting paid leave policy for the period of leave taken, even if that amount is greater than $200 per day or $10,000 in the aggregate.
Question 5: How Do Employers Calculate the Regular Rate for FFCRA Benefits?
Under the FFCRA, the regular rate used to compute pay for paid sick leave and expanded family and medical leave is calculated based on either the employee’s entire period of employment or the six month period ending when the employee takes leave, whichever is less, and the number of hours worked for each workweek. An employee’s overtime pay, commissions, tips, and piece rates are incorporated into the regular rate for purposes of the FFCRA to the same extent that they are included in the calculation of the regular rate under the Fair Labor Standards Act.
Question 6: Is an Employee Who Has Been Laid-Off or Furloughed Eligible for EPSL or EFML?
No. The temporary rule emphasizes that an employee may not take EPSL for any of the reasons described above or expanded family and medical leave (EFML) if their employer does not have work for them to perform. So, if an employee’s workplace is shut down and the employee is not teleworking, whether due to a federal, state or local order, or due to business circumstances, the employee is not eligible for FFCRA benefits because the employer does not have work for the employee to perform.
Question 7: Are Small Employers Exempt from Select EPSL and EFML Requirements?
Some small employers, including religious and non-profit organizations, with fewer than 50 employees may qualify for an exemption from the FFCRA’s paid sick leave due to school, place of care, or childcare provider closings or unavailability and expanded family and medical leave requirements if:
Such leave would cause the employer’s expenses and financial obligations to exceed available business revenue and cause the employer to cease operating at a minimal capacity;
The absence of the employee(s) requesting leave would pose a substantial risk to the financial health or operational capacity of the employer because of their specialized skills, knowledge of the business, or responsibilities; or
3) The employer cannot find enough other workers who are able, willing, qualified, and available at the time and place needed, to perform the services the employee(s) requesting leave provides, and these services are needed for the employer to operate at a minimal capacity.
If the employer decides to deny paid sick leave or expanded family and medical leave to an employee, the employer must document the facts and circumstances that justify such denial. The employer should not send this documentation to the Department, but rather should retain such records for its own files. When in doubt, we recommend employers pay employees their paid sick or expanded family and medical leave benefits: the EPSLA provides that that employers who fail to provide paid sick leave have failed to pay minimum wages in violation of the Fair Labor Standards Act.
Question 8: Can Employees Take Intermittent FFCRA Leave?
Employees may take intermittent leave under the FFCRA, provided they and their employer agree leave can be taken intermittently. The employee and employer do not need to memorialize their agreement in writing although in the absence of a written agreement, there must be a clear and mutual understanding that the employee may take intermittent leave. Intermittent leave can be taken in any increment, provided the employee and employer agree.
While employers and employees can agree to intermittent use of EPSL when an employee is telecommuting, employees who report to an employer’s worksitemay nottake leave intermittently for reasons 1-5 in Question 2, since those are circumstances in which a person has been, or may be, exposed to COVID. In these circumstances, the Department of Labor has determined that risk that the employee might spread COVID-19 to other employees is too high to justify intermittent leave.
Employers and employees can agree to intermittent use of EFML even when the employee is working on-site.
Question 9: What Notice Must Employees Provide Before Taking Leave & What Documentation Should Employers Require?
If an employee needs to take leave under FFCRA, an employer can require that they follow reasonable notice procedures after the first workday (or portion thereof) an employee takes paid sick leave for any reason (aside from caring for a child whose school or place of care has closed). Whether a procedure is reasonable will be determined under the facts and circumstances of each particular case, although it will be reasonable for the employer to require the employee to comply with the employer’s usual and customary notice and procedural requirements for requesting leave, absent unusual circumstances. If an employee fails to give proper notice, the employer should give them notice of the failure and an opportunity to provide the required documentation prior to denying the request for leave.
An employee must provide his or her employer documentation in support of paid sick leave or expanded family and medical leave. Such documentation must include a signed statement containing the following information: (1) the employee’s name; (2) the date(s) for which leave is requested; (3) the COVID-19 qualifying reason for leave; and (4) a statement representing that the employee is unable to work or telework because of the COVID-19 qualifying reason. Depending on the reason for the leave request, the employee may also be required to provide:
The name of the government entity that issued the quarantine or isolation order to which the employee is subject.
The name of the health care provider who advised them to self-quarantine.
The name of the child being care for; the name of the school, place of care, or childcare provider that closed or became unavailable; and a statement representing that no other suitable person is available to care for the child during the period of requested leave.
Employers should retain all documents provided pursuant to FFCRA leave requests (whether granted or denied) for four years. If an employee provided oral statements to support their request for leave, the employer is required to document and retain such information for four years.
The Department of Labor has also advised employers to retain the following in order to claim tax credits from the IRS:
Documentation to show how the employer determined the amount of paid sick leave and expanded family and medical leave paid to employees that are eligible for the tax credit, including records of work, telework, EPSL, and EFML;
Documentation to show how the employer determined the amount of qualified health plan expenses that the Employer allocated to wages;
Copies of any completed IRS Forms 7200 that the employer submitted to the IRS;
Copies of the completed IRS Forms 941 that the employer submitted to the IRS or, for employers that use third-party payers to meet their employment tax obligations, records of information provided to the third-party payer regarding the employer’s entitlement to the credit claimed on IRS Form 941; and
Other documents needed to support its request for tax credits pursuant to IRS applicable forms, instructions, and information for the procedures that must be followed to claim a tax credit.
Additional information regarding employer tax credits is available here.
Question 10: Can Health Care Providers and Emergency Responders be Excluded from FFCRA Leave Requirements?
Employers may exclude employees who are health care providers or emergency responders from EPSL and EFML requirements.
A healthcare provider is defined as 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 individual employed by an entity that contracts with any of these institutions described above to provide services or to maintain the operation of the facility where that individual’s services support the operation of the facility. For example, someone who produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, etc.
An emergency responder is defined as anyone necessary for the provision of transport, care, healthcare, comfort and nutrition of such patients, or others needed for the response to 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, paramedics, and 911 operators.
To minimize the spread of COVID-19, the Department encourages employers to be judicious when exempting health care providers and emergency responders from the provisions of the FFCRA.
Further reading. The Department of Labor (the “Department”) has issued a series of guidance on the FFCRA including:
Families First Coronavirus Response Act: Questions and Answers, available here;
COVID-19 and the Fair Labor Standards Act: Questions and Answers, available here;
COVID-19 and the Family and Medical Leave Act: Questions and Answers, available here;
Sample notices for federal and non-federal employees;
FFCRA Notice – Frequently Asked Questions, available here;
Field Assistance Bulletin 2020-1: Temporary Non-Enforcement Period Applicable to the Families First Coronavirus Response Act (FFCRA), available here; and
Webinar: The Families First Corona Virus Response Act (FFCRA), available here, and associated slides.
For further information, contact Kurker Paget LLC.