Welcome to the second installment discussing the theme Staffing Your Business During a Global Health Pandemic. The Families First Coronavirus Response Act (FFCRA) requires employers to provide paid leave to employees suffering from certain COVID-19 related circumstances. However, employers and employees alike have struggled to implement the paid leave requirements. This article will provide some practical guidance in areas where businesses are struggling.
Laws typically change in a slow and onerous fashion, but the COVID-19 pandemic has sparked rapid evolution in all areas of life and work. The law is no exception. When the FFCRA became law, business leadership teams were left to read and interpret for themselves pages of small-font legalese. Throughout this crisis, the business attorneys at Fausone Bohn have been advising businesses on things like paid leave requirements, reductions in staff and hours, employee retention strategies, and more. If you need help navigating this minefield, contact me to discuss relief available for your business and its workers.
The Basics– Covered Employers and Eligible Employees
There are two main provisions of the FFCRA related to employee COVID-19 leave–Expanded Family & Medical Leave and Emergency Paid Sick Leave. These sections apply to private businesses with fewer than 500 employees. For expanded FMLA, workers must have 30 calendar days of employment to qualify. For emergency paid sick leave, there is no minimum employment period. In each case, both full-time and part-time employees may be eligible for leave.
FFCRA Leave Only Applies When the Employer has Work Available
Businesses are still struggling to apply the law to their particular employee situations. If you only take one thing away from this article, please remember this key concept:
An employee is not entitled to FFCRA leave if the employer does not have work available. This is true even if the workplace is closed as the result of a government directive.
Businesses should first determine whether they even have work available for employees to perform. If not, then FFCRA leave is simply not available. This includes situations where a business has instituted temporary or permanent layoffs or in cases where the business simply has no work and is not scheduling employees. (But in order to keep workers on payroll, employers should consider pursuing the Paycheck Protection Program created under the CARES Act.)
Employees are ONLY Entitled to Leave for Certain Reasons
Just because an employee uses the words “unable to work” and “COVID-19” in the same sentence doesn’t mean he or she can take advantage of the FFCRA. Employers should know that expanded FMLA leave is limited to those employees that are unable to work or telework due to childcare issues caused by school or daycare closures because of COVID-19.
The emergency paid sick leave section also lists specific situations in which paid leave is available. These situations include when:
- 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 the above conditions.
- The employee is caring for a child whose school or place of care has been closed, due to COVID–19 precautions.
The Devil’s in the Details
Although the above points may seem straight forward, at least one reason for leave is causing confusion among Michigan employers. The FFCRA requires that emergency paid sick leave be provided to employees who are “subject to a Federal, State, or local quarantine or isolation order related to COVID–19.”
On March 23, 2020, Governor Whitmer announced Executive Order (EO) 2020-21, commonly known as the “Stay Home, Stay Safe” Order. This EO temporarily suspends non-critical activities and business operations.
This is not a “traditional” quarantine or isolation order. First, the EO does not discuss quarantine or isolation strategies. And other guidance from both Michigan and the CDC suggest that isolation and quarantine are more targeted approaches that deal with single identified individuals or well-defined groups that may have actually been exposed to a contagious disease. In contrast, EO 2020-21 is a broad, statewide directive that doesn’t take these individual circumstances into account.
However, regulations published by the Department of Labor clarify that shelter-in-place and stay-home orders are quarantine or isolation orders for purposes of emergency paid sick leave.
But the DOL has also indicated that, despite their confusing definition, paid leave is not available for workers whose employers have reduced or stopped operations as the result of the Governor’s order. Why not? Because (technically) the employee is unable to work due to the employer being shut down, not due to the “quarantine or isolation” order.
Many voices on social media have contributed to confusion surrounding this issue by casually throwing around the word “quarantine”. Yet under Governor Whitmer’s Stay Home, Stay Safe Order, most workers likely do NOT qualify for emergency paid sick leave (although they may qualify for another reason).
This issue was also addressed in the DOL Question and Answer #25:
If your employer closes after the FFCRA’s effective date (even if you requested leave prior to the closure), you will not get paid sick leave or expanded family and medical leave but you may be eligible for unemployment insurance benefits. This is true whether your employer closes your worksite for lack of business or because it was required to close pursuant to a Federal, State or local directive.
In other words, if your business has reduced or closed down its operations as the result of the Stay Home, Stay Safe order, then your laid-off employees are not entitled to FFCRA leave.
Why does it matter?
The FFCRA allows employers to recover up to 100% of the cost of paid FFCRA leave through payroll tax credits, making it a cost-neutral proposition. But employers that don’t follow these nuanced rules run the risk of being stuck with that bill. This is a mistake that businesses cannot afford to make, especially during this economic downturn. The good news is that with the right help, these mistakes are avoidable.
The business attorneys at Fausone Bohn, LLP have been assisting businesses with cash flow and staffing decisions during this unprecedented time, and we stand ready to assist with your needs. Contact me by clicking this link or calling or texting me at (734) 956-0113 to see how I can help with your business and employment law needs.