On March 24, 2020, the Department of Labor issued its first published guidance relating to the Emergency Paid Sick Leave (EPSL) and Emergency FMLA (EFMLA) established under the Families First Coronavirus Response Act (FFCRA). For a full explanation of the FFCRA, please see our prior blog. The three guidance documents from the DOL are available here, here and here.

The most notable piece of information is that the law is going into effect a day earlier than anticipated—on April 1, 2020. Thus, the FFCRA will apply to leave taken by employees between April 1, 2020, and December 31, 2020 (when the law sunsets). Unfortunately for employers, the guidance also indicates that regulations are not anticipated until April 2020, which means employers will have no time to review and digest regulations before the law becomes effective.

The guidance largely repeats the language of the statutes, but the DOL did provide some new, and helpful, guidance:

• Counting employees toward the 500 employee threshold:
• Employers must count not only their own employees, but also any employees jointly employed by another employer, whether on your payroll or another company’s. For example, this would likely include employees of a temporary staffing agency that provide services to you. All common employees will be counted as employees of both joint employers. The test in determining whether two employers are “joint employers” is the test used by the DOL under the FLSA.
• In addition, two or more related entities in a corporate family will have their employees aggregated if they are an “integrated employer.” This is the test used under the FMLA to determine whether an employer meets the 50-employee threshold.
• Note to employers: both the “joint employer” and “integrated employer” tests are very fact-specific and complicated, taking into account a number of different factors.
• To take advantage of the small business exemption in cases where offering leave would jeopardize the viability of the business as a going concern, the DOL indicates that an employer should document the reasons the business meets the criteria set forth by the DOL—which will not be explained until the regulations are issued. Employers are instructed not to file anything with the DOL at this time seeking an exemption.
• In calculating the pay due, overtime hours are counted up to the cap. However, the employer does not need to include the overtime premium in the amount paid. Regardless of overtime, only 80 hours total may be used. An employee therefore could use 50 hours in Week 1, but then would only be entitled to 30 hours in Week 2.
• The overall cap for pay and tax credit for EFMLA is now stated as $12,000, not $10,000.
• The guidance clarifies that even if an employee needs leave for two separate reasons—for example, the employee must self-quarantine and also has to care for a child who is off school—the total number of hours used cannot exceed 80 in the first two weeks, and the total number of weeks of leave cannot exceed 12.
• The law will not be retroactive, and employers will not be able to seek tax credits for leave provided before April 1, 2020.
• To determine if an employee has been employed for at least 30 days under EFMLA, the employer must count the number of days the employee was on the payroll before his or her request for leave. Time spent as a temporary employee would count toward the 30-day period.

Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.

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