Following its detailed and frequently updated FAQs on the Families First Coronavirus Response Act (FFCRA), discussed in detail here, the Department of Labor issued temporary regulations on April 1, providing further guidance on the mechanics and nuances of the FFCRA. If you have been following our previous alerts, much of the content of the new regulations is consistent with the previously issued FAQs.

Here are key points of clarification and additional guidance from the new regulations governing Employee Paid Sick Leave (EPSL) and FMLA-Public Health Emergency (FMLA-PHE) Leave:

Determining < 500 Employees at Time of Leave

For private employers seeking guidance on whether the FFCRA applies, the regulations clarify that the “fewer than 500 employees” threshold is not measured at one particular point in time going forward. Rather, it is measured at the time a particular employee requests FFCRA covered leave, so that coverage may change when different employees seek leave at different times. If there are hires or layoffs that raise or reduce the workforce above or below 500 employees, employer coverage may arise or end. Independent contractors, employees who have been furloughed, and those outside the U.S. do not count. Temporary employees and those who are employed through staffing agencies do count.

Quarantine or Isolation

The regulations provide that for the purposes of EPSL, a quarantine or isolation order includes “shelter-in-place, or stay-at-home orders issued by any Federal, State, or local government authority that cause the Employee to be unable to work,” even if work is otherwise available to the employee. If no work is available to the employee, because of the stay-at-home order or business conditions, or the employee has been furloughed, the leave is not available.

It also covers a government order that has advised categories of citizens (e.g., certain age ranges or certain medical conditions) to shelter in place, stay at home, isolate, or quarantine. For example, on April 1, Florida’s Governor Ron DeSantis signed such an Executive Order, mandating that the following individuals stay at home and take all measures to limit the risk of exposure to COVID-19: senior citizens and individuals with a significant underlying medical condition—such as chronic lung disease, moderate-to-severe asthma, serious heart conditions, immunocompromised status, cancer, diabetes, severe obesity, renal failure and liver disease. Further, this leave is available to an employee whose health care provider has advised the employee to self-quarantine because he or she is “particularly vulnerable to COVID-19.”

80 Hours of EPSL

Full-time (40 hour) employees are eligible for 80 hours of EPSL, and part-time employees are entitled to a pro-rated portion based on their normal work schedule or, if working a variable scheduled, based on a six-month average. The DOL regulations clarify that this entitlement is for “one time use,” meaning that an employee who has used some or all of the entitlement while working for one employer is entitled only to the balance, if any, while working for any other employer.

12 Weeks of FMLA-PHE Leave

All employees, regardless of the length of employment, are entitled to EPSL for qualifying reasons. Employees employed for at least 30 days and certain rehired employees are eligible for up to 12 workweeks of FMLA-PHE Leave. There is no need for the employee to meet other FMLA eligibility criteria, such as employment for 12 months or 1250 hours, to obtain FMLA-PHE Leave.

The regulations provide that an employee is eligible for no more than 12 total workweeks of combined FMLA and FMLA-PHE Leave during the employer’s usual leave year, including any FMLA leave used prior to the pandemic. Even where the FMLA-PHE breaks across two employer leave years, an employee cannot receive more than 12 total workweeks of FMLA-PHE from April 1, 2020 through December 31, 2020. An employee who has exhausted the full 12 weeks of FMLA leave (including using it before the pandemic) still is entitled to two weeks of EPSL.

Sequencing Leave

An employee may elect to use the two weeks of EPSL before any other form of paid leave. Employers cannot require employees to use other forms of paid leave first.

The situation is different for the 12 workweeks available for FMLA-PHE Leave. The DOL adopted the “concurrent usage” rule applicable to FMLA leave such that employers can require, or employees may elect, concurrent usage of paid time off with FMLA-PHE Leave, in which case the employee must be paid full pay for each day of such concurrent usage. This includes accrued paid vacation leave, personal leave, or family leave. Payroll tax credits, however, only apply to the FFCRA-mandated portion of the pay, i.e. two-thirds of the regular rate up to $200 a day.

Intermittent Leave

Employees have no right to use either EPSL or FMLA-PHE Leave intermittently or on a reduced work schedule basis, unless the employer and employee agree. Absent agreement, FFCRA leave must be used consecutively, although the employee is permitted to use one consecutive period of leave for a qualifying reason and then take a second consecutive period for another reason, subject to the maximum of FFCRA leave amounts (two weeks of EPSL and 12 weeks of FMLA-PHE).

Agreements to use FFCRA leave intermittently should include an agreement over the increment (e.g., full day), which may vary from the increment used for FMLA leave. The DOL regulations do not permit an agreement for intermittent usage for in-person work, where the reason is other than a school closure or unavailability of childcare. Because the other reasons all relate to exposure or symptoms, the DOL determined that allowing employees to come in and out of work would foster the spread of the disease. On the other hand, telework can be done intermittently for any covered reason, again if agreed between the employer and employee.

FLSA Exempt Status

The DOL regulations clarify that taking EPSL or FMLA-PHE Leave does not impact an employee’s status or eligibility for any FLSA exemption. This includes permissible intermittent usage which could result in a reduction of the weekly salary.

Amount of Pay

For non-exempt employees, pay is calculated using a six-month weighted average of the employee’s regular rate at the time leave is to be taken. This method involves determining the weekly regular rate for each week over the prior six-month period and then determining the average, weighing the workweeks based on the number of hours worked in each week. If the hours are constant across workweeks and if there are no wage supplements such as longevity, shift differentials, or bonuses, this is a simple arithmetic average. If the hours vary, or there are additional elements of pay beyond just hourly wages, the calculation is more complicated. Note again that the average is determined when the leave is to commence, so that it will change with time.

Small Business Exemption for Employers With < 50 Employees

Employers with fewer than 50 employees may obtain an exemption from providing either EPSL or FMLA-PHE Leave if an authorized officer of the employer has determined and documented that providing the paid leave would jeopardize the viability of the business as a going concern. This can include a hardship related to providing the leave to a specific employee or providing the leave generally, depending on the circumstances. This can result in granting leave to some employees, but denying it to others based on the financial impact. Although the small business must document the determination, there is no requirement that the employer send this documentation to the DOL. No particular form of documentation is required, as long as the documentation establishes one of the requisite bases for exemption.

Prospective Application Only

Employees have no right or entitlement to receive retroactive reimbursement or compensation under the FFCRA for unpaid leave taken prior to April 1, 2020, for COVID-19 related absences. Nor may employers count as FFCRA leave any leave time prior to that date.

The DOL will allow employers, in response to the FFCRA, to change their paid time off policies prospectively, including terminating or modifying any voluntary paid leave policy on or after April 1, 2020. This would not apply to paid time off under state or local law or pursuant to collective bargaining agreements.

Job Restoration

The FFCRA incorporates the FMLA’s requirement to restore employees to the same or an equivalent job. The “key employee” exception for return to work rights applies only to FMLA-PHE Leave, as does the exception for employers with fewer than 25 employees, when certain conditions are met, such as the position no longer exists due to economic conditions or change in operating conditions of the employer caused by COVID-19. Employees on FFCRA leave remain subject to employment actions, such as layoffs, if such action would have occurred notwithstanding the leave.

Notice of Employee’s Request for Leave

Employers may require employees to comply with an employer’s usual and customary notice and procedural requirements for requesting leave. For EPSL and FMLA-PHE related to child care, the employee must provide notice of the need for leave as soon as practicable. For all other EPSL reasons, employees are encouraged to notify employers of the need for leave as soon as practical, but reasonable notice will be determined on a case-by-case basis.

Oral statements containing information for the employer to determine whether the requested leave is covered by FFCRA will suffice, but must be documented by the employer and maintained pursuant to recordkeeping requirements noted below. For this reason, it is suggested that employers develop leave request and documentation forms. A sample form can be found on Ballard Spahr’s COVID-19 Resource Center.

An employer may deny an employee’s request for leave for failure to provide proper notice, but should first give the employee notice of the failure and an opportunity to provide the required documentation. Leave also may be denied for failure to provide required documentation to substantiate the leave reasons (discussed below).

Documentation Supporting Need for Leave

In addition to the employee’s name, dates for which leave is requested, qualifying reason for leave, and an oral or written statement that the employee is unable to work or telework, because of the qualifying reason, the regulations further specify the required documentation based on the reason for leave. In each instance, the information may be provided by the employee and does not require any further certification, such as by a health care provider:

• For leave requested pursuant to an order to isolate or quarantine—identify the government entity that issued the order.
• For leave based on advice of a health care provider to self-quarantine—the name of the health care provider; and, if the leave is to another individual, the identity of and relation to the individual.
• Although not mentioned in the documentation rules, the DOL regulations define an “individual” as someone with whom the employee must have a personal relationship. Examples: an immediate family member, a person who regularly resides in the employee’s home, or a similar person with whom the employee has a relationship that creates an expectation the employee would care for that person if quarantined.
• For leave due to a school closure or unavailability of childcare—(1) the name of the child; (2) the name of the school, place of care or child care provider that closed or is unavailable due to COVID-19; and (3) a statement that no other suitable person is available to care for the child during the period of requested leave.

In addition, under IRS guidance issued on the same date as the DOL regulations, an employer can require that, if a child is over 14 years old and care is during daylight hours, the employee provide a statement of “special circumstances” requiring the employee to provide care.

As noted above, if information needed to support a request for tax credits is not provided by the employee, even after being notified and failing to cure the deficiency, the employer is not required to provide paid leave under the FFCRA.

Recordkeeping

Under DOL regulations and IRS guidance, an employer must retain all documentation pertaining to EPSL and FMLA-PHE for four years after the date on which the tax becomes due or is paid, whichever comes later. Documentation must be available for IRS review. This recordkeeping requirement includes the authorized officer’s determination, and supporting documents, that the employer is eligible for a small business exemption (fewer than 50 employees), and specified records to support the employer’s claim for tax credits. As mentioned above, employers are required to memorialize oral statements provided by employees, such as a request for leave or statement supporting the need for leave, which becomes part of the required records.