Member Article

The Families First Coronavirus Response Act (FFCRA) is designed to help employees and employers by providing paid sick and family leave reimbursed through a refundable tax credit for private employers, in addition to other relief. The FFCRA provides two types of paid leave to covered employees: paid sick leave under the Emergency Paid Sick Leave Act (EPSLA) and expanded family and medical leave under the Emergency Family and Medical Leave Expansion Act (EFMLA).

The FFCRA was signed into law on March 18, 2020, generating uncertainty amongst employers regarding the FFCRA paid leave provisions. Last week, the U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) published new guidance and supplemented its initial guidance to provide clarity on the paid leave provisions of the FFCRA. The updated guidance includes:

• FFCRA Questions and Answers;
• FFCRA Employee Rights Poster and Frequently Asked Questions regarding the poster;
• Fact Sheet: FFCRA Employee Paid Leave Rights;
• Fact Sheet: FFCRA Employer Paid Leave Requirements; and
• Field Assistance Bulletin 2020-1: Temporary Non-Enforcement Period for FFCRA

The FFCRA requires the DOL to promulgate regulations interpreting various provisions of the FFCRA. Although the new and updated guidance informs employers and employees of their responsibilities and rights under the FFCRA, the forthcoming DOL regulations will dictate specific implementation and compliance requirements for employers. The DOL states regulations are, “expected April 2020.” In the meantime, employers should look to the WHD guidance and their labor and employment counsel to plan and prepare for implementation of the FFCRA.

Essential updates provided by the new guidance are as follows:

Key Dates:

• The FFCRA’s paid leave provisions are effective April 1, 2020. This clarifies initial speculation and reports that compliance would be required by April 2, 2020.
• The FFCRA applies to leave taken between April 1, 2020, and Dec. 31, 2020. Because the paid leave provisions of the FFCRA are not retroactive, employers are not required to provide paid leave under the EPSLA or the EFMLA before April 1, 2020.
• The WHD will not bring enforcement actions for violations of the FFCRA between March 18, 2020 and April 17, 2020. To enable public and private employers who are covered by the FFCRA to come into compliance with the new statute, WHD will observe this temporary period of non-enforcement of the FFCRA, provided the employer has made reasonable, good-faith efforts to comply. Importantly, this does not delay employer compliance with the April 1, 2020, effective date. Field Assistance Bulletin 2020-1 provides additional details on the temporary non-enforcement period.

Covered Employers:

• Private-sector employers are only required to comply with the paid leave provisions if they have fewer than 500 employees.
  • Employers must include both full-time and part-time employees in the 500-employee threshold calculation.
  • The calculation does not include independent contractors and employees outside of the United States or any territory or possession of the U.S.
  • The calculation must include employees on leave, temporary employees who are jointly employed by another employer and day laborers supplied by a temporary agency.
• Joint and Integrated Employer Tests: Since the FFCRA was signed into law, speculation has circulated regarding the treatment of joint and integrated employers under the FFCRA. At this stage, the DOL is looking to the Fair Labor Standards Act (FLSA) and the Family Medical Leave Act (FMLA) to determine whether joint and integrated employers meet the 500-employee threshold under the FFCRA. Specifically, the WHD Questions and Answers states as follows:
  • Joint Employers: Where a corporation has an ownership interest in another corporation, the two corporations are separate employers unless they are joint employers under the FLSA. If two entities are found to be joint employers, all of their common employees must be counted in determining whether paid sick leave must be provided under the paid leave provisions of the FFCRA.
  • Integrated Employers: If two or more entities are an integrated employer under the FMLA, then employees of all entities making up the integrated employer will be counted in determining employer coverage. for purposes of expanded family and medical leave under the EFMLA Factors to be considered in determining if separate entities are an integrated employer include:
    • degree of common ownership or financial control.
    • centralized control of labor relations; and
    • interrelation between operations;
    • common management;

• Businesses with fewer than 50 employers may qualify for the FFCRA small business exemption. To elect this small business exemption, an employer should document why their business with fewer than 50 employees meets the criteria set forth by the DOL, which will be addressed in more detail in the forthcoming regulations.

Worksite Closures, Furloughs, and Reduced Hours:

• Employers are not required to provide paid leave under the FFCRA to employees in situations where:
  • A worksite is closed prior to April 1, 2020, for lack of business or because it is required to close pursuant to a Federal, State, or local directive;
  • An employer closes a worksite on or after April 1, 2020, but before an employee goes out on leave, even if the employee requested leave prior to the closure;
  • An employee is furloughed on or after April 1, 2020, because the employer does not have enough work for the employee; and
  • An employee’s hours are reduced because the employer does not have enough work for the employee to perform.
• If an employer closes while an employee is on paid sick leave or expanded family and medical leave, the employer must pay for any paid leave the employee used before the employer closed.

Multiemployer Collective Bargaining Agreements:

• An employer may satisfy its obligations under the FFCRA by making contributions to a multiemployer fund, plan, or other program. These contributions must be based on the amount of paid family and medical leave or hours of paid sick leave to which each of the employees is entitled under the FFCRA based on each employee’s work under the multiemployer collective bargaining agreement.
• An employer may satisfy its obligations under the FFCRA by other means, provided they are consistent with their bargaining obligations and collective bargaining agreement.

FFCRA Employee Rights Poster:

• Each covered employer must post a notice of the FFCRA requirements in a conspicuous place on its premises.
• An employer may satisfy this requirement by emailing or directly mailing this notice to employees, or posting this notice on an employee information internal or external website.

State and federal laws are rapidly evolving in response to the COVID-19 pandemic. For advice regarding how these FFCRA guidelines and other COVID-19-related obligations affect your business operations, please contact your Dinsmore labor and employment attorney.