The U.S. Department of Labor’s Wage and Hour Division (WHD) announced its first set of guidance for employees and employers on the Families First Coronavirus Response Act (FFCRA) just before midnight on March Tuesday, March 24, 2020. Guidance was provided in the form of a Fact Sheet for Employees, a Fact Sheet for Employers and a Q&A Document (together, the “Guidance”), which explain how employers should count the number of their employees to determine coverage, how to count hours for part-time employees, and how to calculate the wages to which employees are entitled under the new Act.
Generally, the FFCRA provides employees who have been on the employer’s payroll continuously since at least March 2, 2020 prior to the effective date of April 1, 2020 of employers with 500 or fewer employees with the following benefits:
- Two weeks (up to 80 hours) of paid sick time at the employee’s regular rate of pay where the employee is unable to work because the employee is isolated or quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis; or
- Two weeks (up to 80 hours) of paid sick time at two-thirds the employee’s regular rate of pay because the employee is unable to work because of a bona fide need to care for an individual subject to isolation or quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or to care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor; and
- Up to an additional 10 weeks of expanded paid FMLA leave at two-thirds the employee’s regular rate of pay where an employee, who has been employed for at least 30 calendar days, is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19. The Guidance makes it clear that for these 10 weeks of paid leave, employers must include whatever hours the employee typically works during the period (including overtime hours).
The Guidance makes clear that when determining whether an employer has 500 or fewer employees, and is thus a “covered” employer under the Act, the employer includes: (i) all employees who are on leave; (ii) all temporary employees who are jointly employed by the employer and another employer – regardless of the payroll on which these employees are maintained; and (iii) all day laborers supplied by a temporary employment agency. Independent contractors under the Fair Labor Standards Act (FLSA) are not included. (Q&A No. 2)
The WHD notes that employees of separate corporate entities are not counted together unless the corporate entities are joint employers under the FLSA, as detailed in the Department’s new Joint Employer Rule (issued on January 12, 2020), and as explained in the Fact Sheet on the Joint Employer Rule. The Guidance further clarifies (citing the DOL’s Field Operations Handbook) that for companies that meet the four factor integrated employer test under the FMLA (common management, interrelation between operations, centralized control of labor relations, and degree of common ownership or financial control), all of their employees count toward this threshold.
The Guidance also notes that employers with fewer than 50 employees, if they meet the Department’s criteria – which is forthcoming – may elect the “small business exemption” to the FFCRA. The Department does not want small business employers to send any materials supporting a claimed exemption at this time to it for review.
For part-time employees, the amount of paid sick leave is determined by using the average number of hours for which the employee is regularly scheduled to work in a two-week period. If the part-time employee’s schedule varies or is unknown, the employer is to use the average hours worked in each week over the prior six-month period. The part-time employee is then entitled to paid sick leave in the amount of the average daily hours worked for up to two weeks, and is entitled to expanded family and medical leave for the same number of hours per day up to ten weeks thereafter. For example, if a part-time employee worked 4 hours per day on average over the prior six-month period, this employee would be entitled to up to 40 hours of paid sick leave over a two-week period (20 hours per week).
The Guidance explains the determination on the amount of pay available as follows:
If the employee is unable to work or telework due to a need for leave because the employee (1) is subject to a Federal, State, or local quarantine or isolation order related to COVID-19; (2) has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; or (3) is experiencing symptoms of COVID-19 and is seeking a medical diagnosis, the employer should pay the employee for each applicable hour, the greater of: (i) the employee’s your regular rate of pay (as determined under the FLSA), (ii) the federal minimum wage in effect under the FLSA, or (iii) the applicable State or local minimum wage.
In these circumstances, the employee’s pay is capped at no more than $511 per day, or $5,110 in total over the entire paid sick leave period.
Alternatively, if the employee is: (1) caring for an individual who is subject to a Federal, State, or local quarantine or isolation order related to COVID-19 or an individual who has been advised by a health care provider to self-quarantine due to concerns related to COVID-19; (2) caring for the employee’s own child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; or (3) experiencing any other substantially-similar condition that may arise, as specified by the Secretary of Health and Human Services, then the employer is required to provide an eligible employee compensation at two-thirds of the greater of the amounts identified above.
And, under these circumstances, the employee’s pay is capped at no more than $200 per day, or $2,000 in total over the entire two-week period.
Benefits under the FFCRA are not available until April 1, 2020, and the government provided tax credits will not be provided for paid sick leave awarded before April 1, 2020. The Guidance does make clear that employers cannot deny its other paid leaves provided to employees based on the FFCRA.
Finally, the Guidance clarifies that the Department poster explaining the FFCRA, which all employers subject to the Act are required to post for their employees by April 8, will be published by the end of this week. The Department also stated it will not utilize its enforcement mechanisms for the first thirty (30) days after the new paid leave laws are effective, but rather focus its resources on assisting with compliance.
For additional web-based resources available to assist you in monitoring the spread of the coronavirus on a global basis, you may wish to visit the CDC and the World Health Organization.