DOL Issues Additional Guidance on Paid Leave Requirements

The Department of Labor (DOL) has updated its guidance on the new paid leave requirements under the Families First Coronavirus Response Act (the Act), which takes effect on April 1. The guidance addresses a number of key questions from employers, as summarized below.

More information about the Act is available in CAPLAW’s March 20 News Alert: Paid Leave Under COVID-19 Response Act.

Register here for a webinar tomorrow, March 31 from 12:30 pm - 2:00 pm EDT discussing the paid leave requirements and new DOL guidance. Submit questions in advance of the webinar here.

Furloughs and Government-Ordered Shutdowns. Many employers have asked their employees to stay home, or have furloughed their employees, due to the shutdown of worksites or the lack of available work, on a temporary basis. Some of the employees who have been ordered to stay home are unable to telework. In such cases, even if the employer intends to reopen at some time in the future, the furloughed or non-working employees are not eligible for Emergency Sick Leave or Emergency FMLA Leave. However, they may be eligible for unemployment insurance benefits. This is true even if the employer was required to reduce operations or close pursuant to a federal, state or local directive, such as a “stay-at-home” order. Employees should contact their state workforce agency or unemployment insurance office for specific questions about their eligibility.

Reduced Operations. If employees are working at reduced hours because their employer does not have work for them, they may not use Emergency Sick Leave or Emergency FMLA Leave to make up the hours that they are no longer scheduled to work, even if the employer’s reduction of their hours was somehow related to COVID-19. If employees are working at reduced hours due to a qualifying reason, they are eligible for Emergency Sick Leave or Emergency FMLA Leave. The amount of leave to which they will be entitled is computed based on their work schedule before it was reduced.

Definition of “Son or Daughter”. One of the qualifying reasons for Emergency Sick Leave and Emergency FMLA Leave under the Act is if the employee is caring for a son or daughter whose school or childcare provider has been closed or is unavailable due to COVID-19 precautions. Under the Act, a “son or daughter” means the employee’s own child, which includes their biological, adopted, or foster child, their stepchild, a legal ward, or a child for whom they are standing in loco parentis--someone with day-to-day responsibilities to care for or financially support a child. For additional information about in loco parentis, see Fact Sheet #28B. The DOL has also clarified that a “son or daughter” is also an adult son or daughter (i.e., one who is 18 years of age or older), who (1) has a mental or physical disability, and (2) is incapable of self-care because of that disability. For additional information on requirements relating to an adult son or daughter, see Fact Sheet #28K.

Eligibility for Paid Leave and Unemployment Benefits. If a covered employer is providing an employee with Emergency Sick Leave or Emergency FMLA Leave, the employee is typically not eligible for unemployment insurance. However, each state has its own unique set of rules; the DOL recently clarified that states have additional flexibility (UIPL 20-10) to extend partial unemployment benefits to workers whose hours or pay have been reduced. Therefore, individuals should contact their state workforce agency or unemployment insurance office for specific questions about their eligibility.

Documentation of Qualifying Reason for Paid Leave. Covered employers are eligible for reimbursement of the costs of Emergency Sick Leave and Emergency FMLA Leave through refundable tax credits. The DOL advises employers that intend to claim a tax credit to retain appropriate documentation in its records. Covered employers should consult applicable Internal Revenue Service (IRS) 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. The IRS has not yet issued these forms and instructions, but CAPLAW will issue an alert when they do. Employers are not required to provide leave if employees have not provided the materials the IRS forms deem sufficient to support the applicable tax credit.

If an employee takes Emergency FMLA 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 also 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, an employer could request the employee submit 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.

Please also note that all existing certification requirements under the FMLA remain in effect if an employee is taking leave for one of the existing qualifying reasons under the FMLA. For example, if an employee takes leave beyond the two weeks of Emergency Sick Leave because their medical condition for COVID-19-related reasons rises to the level of a serious health condition, they must continue to provide medical certifications of the serious health condition under the FMLA if required by their employer (see Fact Sheet #28G).

Taking Leave Intermittently if Employee is Teleworking. For employees who are able to telework but cannot work their regular schedules due to a qualifying reason, employers are permitted to allow employees to take Emergency Sick Leave or Emergency FMLA Leave intermittently. Employees may take intermittent leave in any increment, provided that the employer agrees. For example, if the two parties agree to a 90-minute increment, an employee could telework from 1:00 PM to 2:30 PM, take leave from 2:30 PM to 4:00 PM, and then return to teleworking. The DOL encourages collaborative arrangements between an employer and employee to combine telework and intermittent leave.

Taking Leave Intermittently if Employee is Working at Regular Worksite. For employees who are reporting to their regular worksites (as opposed to teleworking), Emergency Sick Leave for any of the following qualifying reasons due to COVID-19 may not be taken intermittently and must be taken consecutively in full-day increments, if the employee:

• Is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;

• Has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;

• Is experiencing symptoms of COVID-19 and seeking a medical diagnosis;

• Is caring for an individual who either is subject to a quarantine or isolation order related to COVID-19 or has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; or

• Is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.

For the above qualifying reasons, Emergency Sick Leave must be taken until the employee either (i) exhausts the full amount of leave available, or (ii) no longer has a qualifying reason for taking Emergency Sick Leave. If the employee has any unused Emergency Sick Leave remaining, s/he may use it at a later time, before December 31, 2020, for another qualifying reason.

For employees who are reporting to their regular worksites but need to take Emergency Sick Leave or Emergency FMLA Leave due to the need to care for a child, the employer and employee may agree to a schedule that allows the employee to take leave intermittently.

Supplementing Paid Leave Wages with Existing Paid Leave. If the employer agrees, an employee may choose to use existing paid vacation, personal, medical, or sick leave from the employer’s existing paid leave policies to supplement the amount the employee receives from Emergency Sick Leave or Emergency FMLA Leave, up to the employee’s normal earnings. For example, if an employee is receiving 2/3 of their normal earnings from Emergency Sick Leave or Emergency FMLA Leave and the employer agrees, the employee may use pre-existing employer-provided paid leave to receive the additional 1/3 of the employee’s normal earnings. However, an employer is not required to permit this. Further, the employer is not entitled to a tax credit for any paid leave that is not required to be paid or exceeds the limits set forth under the Act.

An employer may not require an employee to supplement wages from existing paid leave. The employee must agree to use any such existing paid leave in this way.

Continuing Health Insurance Coverage. For employees taking Emergency FMLA Leave, if the employer provides group health coverage elected by the employee, the employer must continue to provide group health coverage on the same terms as if the employee continued to work during the Emergency FMLA Leave period. The employee generally must continue to make any normal contributions to the cost of health coverage. See Fact Sheet #28A: Employee Protections Under the FMLA.

For employees taking Emergency Sick Leave, the employer must continue the employee’s health coverage as well, including counting any leave used towards a waiting period for eligibility, if applicable.

Full-Time vs. Part-Time Employees. For purposes of Emergency Sick Leave, a full-time employee is an employee who is normally scheduled to work 40 or more hours per week, and a part-time employee is an employee who is normally scheduled to work fewer than 40 hours per week. Thus, for example, if a CAA’s regular workweek is 35 hours, an employee who is deemed “full-time” under the CAA’s policies and works 35 hours would actually be considered a “part-time” employee for purposes of Emergency Sick Leave. Part-time employees are entitled to take the number of Emergency Sick Leave hours equal to the number they work, on average, over a 2-week period. This means that a 35-hour employee would be entitled to take up to 70 hours of sick leave (assuming the employee typically works 70 hours over a 2-week period).

For Emergency FMLA Leave, the concept of full-time and part-time employees only affects the amount of pay the employee is eligible to receive. For example, an employee who is normally scheduled to work 35 hours per week would be entitled to be paid for all scheduled hours, at a rate of 2/3rds the employee’s regular rate of pay.

Employees are Eligible for up to 12 Total Weeks of FMLA Leave. The DOL clarified that employees may take a total of 12 workweeks of leave during a 12-month period under the FMLA, including Emergency FMLA Leave. Any Emergency FMLA Leave taken counts against the employee’s total FMLA leave entitlement. After December 31, 2020, an employee is only entitled to take regular FMLA leave. For example, assume an employee takes four weeks of Emergency FMLA Leave in April 2020 to care for a child whose school is closed due to a COVID-19 related reason. These 4 weeks count against the employee’s entitlement to 12 weeks of FMLA leave in a 12-month period, leaving 8 remaining weeks.

Note that employees are entitled to Emergency Sick Leave regardless of how much leave they have taken under the FMLA. Emergency Sick Leave is not a form of FMLA leave and therefore does not count toward the 12 workweeks in a 12-month period cap. But note that if an employee takes Emergency Sick Leave concurrently with the first two weeks of Emergency FMLA Leave, which would otherwise be unpaid, then those 2 Emergency Sick Leave weeks count towards the 12 FMLA leave weeks in a 12-month period.

Exemption for Employers with Fewer than 50 Employees. The DOL also provided guidance on when an employer (including a nonprofit organization) with fewer than 50 employees may claim the small business exemption from providing (1) Emergency Sick Leave due to school or place of care closures or child care provider unavailability for COVID-19 related reasons and (2) Emergency FMLA Leave due to school or place of care closures or child care provider unavailability for COVID-19 related reasons, when doing so would jeopardize the viability of the small business as a going concern.

A small employer may claim this exemption if an authorized officer of the business has determined that:

1. The provision of Emergency Sick Leave or Emergency FMLA 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;  

2. The absence of the employee or employees requesting Emergency Sick Leave or Emergency FMLA 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  

3. 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 Emergency Sick Leave or Emergency FMLA Leave, and these labor or services are needed for the small business to operate at a minimal capacity.

Note that with respect to Emergency Sick Leave, this exemption is only available with respect to employees taking leave to care for a child whose school or child care provider is unavailable due to COVID-19.

For additional guidance on the paid leave requirements, see the remainder of the DOL’s FAQ.

This News Flash is part of the Community Services Block Grant (CSBG) Legal Training and Technical Assistance (T/TA) Center. It was created by Community Action Program Legal Services, Inc. (CAPLAW) in the performance of the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Community Services Cooperative Agreement – Grant Award Number 90ET0467-03. Any opinion, findings, conclusions, or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the U.S. Department of Health and Human Services, Administration for Children and Families.

The contents of this news flash are intended to convey general information only and do not constitute legal advice. Any communication through this publication or through CAPLAW’s website does not constitute or create an attorney-client relationship. If you need legal advice, please contact CAPLAW or another attorney directly.