It is certainly not often that major legislation is enacted that requires employers, particularly “small” employers, to comply with vastly different benefit laws in the span of two weeks. We cannot think of another example of such a situation, hence the reason we’ve read the word “unprecedented” an unprecedented amount lately. Those who do not regularly work within the HR world have difficulty imagining the scope of the Families First Coronavirus Response Act (FFCRA) and its two paid leave components, the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family Medical Leave Extension Act (EFMLEA), and how those laws completely alter the landscape for human resources professionals, particularly those HR professionals who work for “small” employers and are probably the only HR professional at the business. Or, perhaps you are a business owner who does not even have an HR professional on staff. As much-needed as the FFCRA is to mitigate the impact of COVID-19 on businesses, employees and families, its provisions are complex and there is precious little time to get a handle on the nuances of the law.
For the past two weeks, we been helping clients with very specific questions about how to apply this law in their workforce and have navigated those questions with the resources available… a Questions and Answers page authored by the Department of Labor (DOL). Until yesterday afternoon, that and the statute text were about it. Well, we now have regulations that guide us on many, but not all, specifics of the law that were released yesterday, April 1st. What follows are some of the answers provided by the DOL’s regulations (29 CFR 826) that I believe are worth noting 1:
Q: Am I a private employer with fewer than 500 employees?
A: You would think the answer would be “yes or no”, and for some lucky employers it is, but what if you own several businesses? Are the employees of different entities combined for purposes of determining the “under 500” employee threshold?
First, all part-time, full-time and temporary employees located within the United States (or its territories or possessions), that are employed by the employer as of the date the employee requests leave, are counted for the purposes of the threshold. This includes employees who are on leave at the time but does not include employees who have either been furloughed or laid off prior to that date.
As for whether or not to combine different entities, the default rule is that separate corporate entities are separate employers unless they are joint employers (under the Fair Labor Standards Act) or integrated employers (under the Family Medical Leave Act). The joint and/or integrated employer analysis is extremely fact-specific but at its most basic it evaluates common control of the entities, common ownership, integrated HR, and several other factors.
Q: Does leave under the Family Medical Leave Act (FMLA) and EFMLEA run separately or concurrently, or neither?
A: There are not two buckets of leave for FMLA and EFMLEA. If you are an employer that is already subject to FMLA, an employee who has already used all of their FMLA leave (based upon your regular FMLA 12-month period) at the time they request EFMLEA, they are not eligible for EFMLEA leave unless and until such time that they become FMLA eligible again and the employee otherwise qualifies for EFMLEA leave on or before December 31, 2020. And vice versa. However, the employee would be eligible for leave pursuant to the EPSLA regardless of their use of regular FMLA leave.
Q: How do I document an employee’s request for leave under the EPSLA and the EFMLEA?
A: The IRS has issued guidance regarding that very issue, and the DOL speaks to this as well. Per the IRS, an employer must substantiate an employee’s need for leave pursuant to either the EPSLA or EFMLEA, with a document that includes the following:
- The employee’s name;
- The date(s) for which leave is requested;
- A statement of the COVID-19 related reason the employee is requesting leave and written support for such reason; and
- A statement that the employee is unable to work, including by means of telework, for such reason.
The IRS further specifies that:
“In the case of a leave request based on a quarantine order or self-quarantine advice, the statement from the employee should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine, and, if the person subject to quarantine or advised to self-quarantine is not the employee, that person’s name and relation to the employee.
In the case of a leave request based on a school closing or child care provider unavailability, the statement from the employee should include the name and age of the child (or children) to be cared for, the name of the school that has closed or place of care that is unavailable, and a representation that no other person will be providing care for the child during the period for which the employee is receiving family medical leave and, with respect to the employee’s inability to work or telework because of a need to provide care for a child older than fourteen during daylight hours, a statement that special circumstances exist requiring the employee to provide care.”
The employer should also keep records showing the calculation of the amount paid to each employee pursuant to either leave law. All records related to the payment of leave under either the EPSLA or EFMLEA should be maintained for 4 years.
Q: I have less than 50 employees, am I exempt from the EPSLA and/or the EFMLEA?
A: No. There is an exemption for employers with fewer than 50 employees if the
“imposition of such requirements would jeopardize the viability of the business as a going concern.”29 CFR 826.40(b)
So, what does that mean? The regulations provide some guidance but leave much to interpretation as well. What we know is that an officer of the business must determine that either of the following apply:
- The leave requested 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(s) requesting leave would entail a substantial risk to the financial health or operational capabilities of the business because of their specialized skills, knowledge of the business, or responsibilities; or
- There are not enough 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(s) requesting leave, and the labor or services are needed for the small business to operate at a minimal capacity.
It is our belief that these exemptions will be construed strictly. However, there are likely situations that will arise that may necessitate evaluating these regulations with regards to an employee or group of employees.
Q: Does a statewide shelter-in-place order provide the basis for leave under the EPSLA?
A: We do not enjoy giving this answer, but “it depends.” For practical purposes, in the State of Ohio where there is a shelter-in-place order in effect, but “essential businesses” are permitted to operate, the “shelter-in-place” order allows employees of those businesses to travel to and from work.
In Ohio, the general order itself would not be a reason justifying leave under the EPSLA for employees of those businesses. The State of Ohio also permits non-essential businesses to operate via telework, so an employee of a non-essential business would not be able to use the “shelter-in-place” order to justify EPSLA leave if the employee were required to telework and had no other reason for requesting the leave. The analysis would depend on the language of the particular general mandate in place.
Q: Can employees take leave under either Act on an intermittent basis?
A: It depends on whether the employee is required to report to the employer’s worksite or is teleworking.
- If reporting to the worksite – An employee may not take leave under the EPSLA intermittently unless it is for the purpose of caring for a minor son or daughter whose school/daycare is closed or whose childcare provider is unavailable due to COVID-related reasons, and only then if the employer agrees.
- If teleworking – An employee may take leave under the EPSLA intermittently with an agreement between the parties regardless of the EPSLA-qualifying reason.
For either work locations an employee may take EFMLEA leave on an intermittent basis if the employer agrees. The DOL specifies in its guidance that it encourages employers and employees to work together and find solutions that benefit both parties regarding leave on an intermittent basis.
1 This is of course not an in-depth discussion of the entire law but addresses some of the frequent questions We’ve fielded from clients.