Federal Paid Leave Questions:
Do I have to pay employees if they are not working?
Ordinarily the rule is that Hourly employees are paid only for the time they actually work. But the newly enacted Family First Coronavirus Response Act (FFCRA) may require small employers to provide two weeks (10 days) of emergency paid sick leave. In addition, FFCRA may require paid FMLA leave to take care of a child when their school or daycare has been closed.
Salaried exempt employees must still be paid their normal salary as long as they performed any work within the workweek. The only exception is if the employee chooses to stop working for personal reasons, including for a self-imposed quarantine; however, they may then qualify for emergency paid sick leave or paid leave to care for a child under the FFCRA.
NOTE: If an exempt employee is required to quarantine under public health codes or because the employee is sent home from work by the employer, they must be paid their usual salary if they have performed any work within the workweek.
Is there a small business exemption for federal emergency paid sick leave or paid FMLA leave?
Under the FFCRA, small businesses with fewer than 50 employees may qualify for an exemption from providing paid sick leave and/or expanded family and medical leave, due to the closure of a child’s school or place of care related to a COVID-19 public health emergency, if doing so would jeopardize the viability of the business.
FFCRA delegates authority to the Secretary of Labor to decide what businesses qualify.
The Secretary of Labor says that a business with fewer than 50 employees qualifies if providing paid leave to an employee (due to closure of their child’s school or daycare) would jeopardize the viability of the business as a going concern.
To claim this exemption the business must determine that at least one of the following applies:
- Cash-Flow Problems. The provision of paid sick leave or expanded family and medical 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;
- Substantial Risk to Financial Health or Operational Capabilities. The absence of the employee or employees requesting paid sick leave or expanded family and medical 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
- Insufficient Workers Available. 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 paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
There is no requirement to expressly seek DOL’s approval prior claiming the exemption. But, DOL guidance advises businesses should maintain documentation for the reasons they’ve claimed exemption.
NOTE: Health care providers and emergency responders are exempt from paid FMLA requirements. Fisher Phillips provides further guidance on these exemptions here.
What documentation should I require from an employee claiming paid leave?
It is prudent to require employees who are out to provide written a attestation as to the reason for their leave so that you can confirm whether it qualifies.
DOL guidance provides that employers should keep records confirming: (1) the name of the employee; (2) the qualifying reason for requesting leave; (3) a statement that the employee is unable to work, including telework, for that reason; (4) the dates for which leave is requested; and (5) associated documentation, which may include a copy of a government quarantine or isolation order, written documentation from the healthcare provider, and or documentation that employee’s child is unable to attend school or daycare as a result of a COVID-19 closure. For school and daycare closures, employees should document the name of the school or daycare provider, as well as the name of the child, and obtain a statement that no other suitable person is available to provide care.
DOL guidance urges employers to maintain a copy of notice posted on a government, school or daycare website, or published in a newspaper. Alternatively, an email or letter from an employee or official of the school or place of care will suffice.
NOTE: Employers should maintain these records, especially if they intend to claim tax credits for payment of federal paid sick leave and or paid FMLA.
How do I provide required notice to employees about paid leave?
Employers may satisfy the notice requirements of the law by emailing or direct mailing the notice to employees, or posting the notice on an employee information internal or external website. Since the law only applies to current employees, the notice does not have to be shared with laid-off individuals.
You can obtain the notices free of charge by contacting DOL’s Wage and Hour Division at 1-866-4-USWAGE (1-866-487-9243) or you can download and print the notice yourself.
How will the new federal paid leave laws be enforced?
There are penalties for non-compliance; however, good faith mistakes will not be penalized in the first 30 days. This means employers should be striving for compliance and remedying any mistakes as soon as possible.
Under what circumstances does an employee receive emergency paid sick leave?
Beginning no later than April 1, 2020 and throughout the rest of the year, covered employers must provide paid emergency sick leave to any employee—regardless of how long they have worked—who is unable to work for any one of the following reasons:
- The employee is subject to a federal, state, or local quarantine or an isolation order related to COVID-19.
- The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
- The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis.
- The employee is caring for an individual who is subject to a federal, state, or local quarantine or isolation order related to COVID-19.
- The employee is caring for an individual who has been advised by a health care provider to self-quarantine due to the concerns related to COVID-19.
- The employee is caring for his/her child in the event of school or daycare closure due to COVID-19, or if the childcare provider of the son or daughter is unavailable due to COVID-19 precautions.
- The employee “is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.”
If my employees are unable to work because of a government ordered business closure, will they qualify for paid leave under the FFCRA?
DOL defines a government “quarantine or an isolation order” broadly to cover “stay at home” and “shelter in place” orders that require closure of non-essential businesses, as well as orders requiring specific workers to stay home (i.e., requiring individuals to self-quarantine when they return from another state, or requiring individuals with certain conditions to remain on lock-down). Accordingly, the presumption is that employees are entitled to paid sick leave if they are unable to work remotely under these orders.
Yet there is no requirement to provide paid leave if there would be no work available to the employee during the time in question. For example, a business that closes (temporarily or indefinitely) due to a downturn in business is not required to provide paid leave during this time. DOL explains that if the business would not be able to remain open due to lack of customers it would not have to provide paid leave. DOL makes clear that this is true even if a government stay at home order is the reason for which the business is unable to attract customers. Fisher Phillips offers further insights here.
Will I have to provide paid leave if the employee has been furloughed?
No. An employee who has been laid-off or furloughed, will not be eligible for paid federal leave. But they should qualify for unemployment insurance.
How many hours of emergency paid sick leave do I need to provide?
Fulltime employees are entitled to a total of 80 hours (i.e., two weeks) of paid emergency paid sick leave. Part-time employees are entitled to paid sick leave to cover their average hours worked in a typical two-week period. If hours vary from week to week, employers should look to the average of hours worked over the prior six months as a guide. For new hires, emergency paid sick leave should be granted based on any agreement about weekly hours at the time of hire. If there was no agreement, paid leave should be based on a reasonable estimate of weekly hours.
At what rate must I pay an employee taking emergency paid sick leave?
The amount of emergency paid sick leave depends on the reason for which leave is taken:
School closures: If the employee is unable to work because they must care for their child due to closure of schools or daycares, they are entitled to 2/3rd their usual rate of pay or salary. But federal emergency paid sick leave is capped at $200 per day and $2,000 over ten days.
Care for an Individual subject to mandatory quarantine: If the employee is unable to work because they must care for an individual who is subject to a federal, state or local quarantine or isolation order, they are entitled to 2/3rd their usual rate of pay or salary. But federal emergency paid sick leave is capped at $200 per day and $2,000 over ten days.
Employee is subject to a mandatory quarantine: If the employee is unable to work because they are subject to a federal, state or local quarantine or isolation order, they are entitled to their usual wage or salary subject to a cap of $511 per day or $5,110 over ten days.
Employee is advised to quarantine by a health care provider: If the employee is unable to work because their health care provider has advised that they self-isolate, they are entitled to their usual wage or salary subject to a cap of $511 per day or $5,110 over ten days.
Employee is experiencing symptoms and seeking diagnosis: If the employee is unable to work because they are experiencing symptoms and seeking diagnosis of a suspected COVID-19 case, they are entitled to their usual wage or salary subject to a cap of $511 per day or $5,110 over ten days.
NOTE: The pay requirements are based on the employee’s usual wages or salary over a typical two-week period; however, sick leave pay may not be lower than required minimum wage in your jurisdiction. For example, some employers pay tipped employees less than the state/local minimum wage because ordinarily they make-up the difference in tips. (This is known as a “tip credit”). The employee’s ordinary wage might be something like $5.00 per hour, while state/local minimum wage might be significantly higher. In that scenario paid sick leave must be paid out at the highest applicable minimum wage rate.
What if I choose to provide full pay when I’m only required to provide 2/3rds pay?
An employee is only entitled to 2/3rds of their usual pay when they take leave for the purpose of providing care to an individual subject to a mandatory quarantine or when providing care for a child as a result of a COVID-related school or daycare closure. But there is nothing stopping an employer from providing full pay if they choose. In any event, they may only pursue tax credits for 2/3rds of the employee’s usual wage or salary.
Do I have to provide emergency paid sick leave for overtime hours?
Yes, if the employee typically works more than 40 hours in a week; however, DOL guidance provides that the employer need not provide “premium” pay for overtime hours where the employee is drawing emergency paid sick leave. And in any event, the employer is permitted to cap paid sick leave pay at 80 hours over two weeks.
What if I provided paid sick leave prior to April 1, 2020?
Paid leave provided prior to April 1, 2020 will not count to fulfill your obligation to provide emergency paid sick leave under the FFCRA.
Can I require an employee to exhaust accrued PTO time and sate/local paid sick leave before providing federal emergency paid sick leave?
No. The FFCRA prohibits employers from requiring an employee to exhaust accrued PTO or state/local paid sick leave.
Do I have to give emergency paid sick leave if I already provide PTO or if I am already required to provide paid sick leave by state/local law?
Employees are entitled to utilize federal emergency paid sick leave before using state or local paid sick leave, or accrued PTO.
Can I require my employees to use PTO?
It depends on state law. Generally, employers may require exempt or non-exempt employees to use accrued PTO if they are taking leave for personal reasons, as in the case of a self-imposed quarantine. In any event, employers are prohibited from requiring an employee to use PTO before using federal emergency paid sick leave time.
While DOL provides that “[n]o employer shall require, coerce, or unduly influence an employee to use another source of paid leave before taking expanded family and medical leave[,]” DOL regulation provides that “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 paid FMLA time
Am I required to allow intermittent leave?
DOL does not require intermittent leave under the FFRCA; however, an employee may be allowed to take intermittent leave if there is an agreement between the employee and the employer. For example, ABC Corp. might agree to allow Kate to take a few hours of paid sick leave or paid FMLA in the afternoons so she can homeschool her children during the COVID crisis, assuming that their schools are closed and she has no other suitable person to help her.
NOTE: Intermittent leave is generally permissible (with an agreement) for employees who are teleworking. For employees who must report to a worksite, intermittent leave is permissible if the reason for intermittent leave is to provide care for a child due to a school or daycare closure. But intermittent leave is not permissible for leave taken for other reasons. Fisher Phillips providers further guidance here.
Am I required to pay for an employee out on leave after they have exhausted federal emergency paid sick leave?
Yes, if the employee has unused state or local paid sick leave, or if the employee has unused PTO.
Additionally, the FFCRA has amended the Family Medical Leave Act (FMLA) to require paid leave to qualifying employees who are unable to work because their children are unable to attend school or daycare as a result of COVID-19. Under these new rules the employer must begin providing FMLA for these parents at 2/3rds the employee’s usual rate of pay or salary; however, the benefit is capped to $200 per day and $10,000 in the aggregate.
NOTE: FMLA usually applies only to companies with 50 or more employees; however, under the FFCRA, paid FMLA leave requirements apply to small employers unless they qualify for an exemption.
When does an employee qualify for paid FMLA leave?
Any employee who has worked for at least 30 days is entitled to take job protect FMLA leave to care for a child when their school or daycare is closed as a result of the COVID-19 pandemic. This applies to any business with fewer than 500 employees.
How long must I provide paid FMLA for employees caring for children home from school or daycare as a result of COVID-19?
FMLA provides job protected leave for up to 12 weeks for qualifying employees. While the FMLA does not usually provide for paid leave, the FFCRA requires employers to begin paying for leave related to child-care after the employee has been out of work for ten days as a result of a school or daycare closure. Required paid FMLA leave must cover 2/3rds the employee’s usual wage or salary and is capped at $10,000 over 12 weeks.
NOTE: An employer may choose to provide full pay but is not required. In any event, they may only pursue tax credits for 2/3rds of the employee’s usual wage or salary.
If an employee takes FMLA leave and asks to return to work, what are my obligations as an employer?
Under prior FMLA law, the employee must be restored to either their former position or an equivalent position. A position is equivalent only if it virtually identical to the employee’s previous position, including pay, benefits, job duties, schedule, and worksite. The returning employee must be reinstated immediately once the employee reports back for duty. However, the employer may require the employee to provide advance notice of a return date. Reinstatement may not be required if the employee can no longer perform an essential function of the job – in which case they may be entitled to reasonable accommodations under the ADA.
DOL regulation allows an exemption from the usual reinstatement rules for employers with fewer than 25 employees if the following four conditions are met:
- The employee took leave to care for his or her son or daughter whose school or place
- of care was closed or whose child care provider was unavailable;
- The employee’s position no longer exists due to economic or operating conditions that (i) affect employment and (ii) are caused by a public health emergency (i.e., due to
- COVID-19 related reasons) during the period of the employee’s leave;
- The employer has made reasonable efforts to restore the employee to the same or an equivalent position; and
- The employer makes reasonable efforts for a year to contact the employee if an equivalent position becomes available
How long should I maintain paid leave records?
DOL requires employers to maintain paid leave records—including any determination that the business is exempt from providing paid leave—for at least four years. But it may be advisable to maintain these records longer. You should consult your CPA or tax attorney.