Article Updated 4/30/2020
This article provides an update on Covid-19 employment law considerations for businesses.
Families First Coronavirus Response Act (FFCRA): Effective Date, Poster & Possible Further Changes
The Families First Coronavirus Response Act (FFCRA) provided that its effective date would be not later than April 2, 2020, but gave certain authority to the federal Department of Labor to specify an earlier date. DOL has now exercised its authority to establish an effective date of Wednesday, April 1, 2020, for the emergency paid sick leave (EPSL) and emergency family and medical leave provisions discussed in our previous article, available here.
DOL has also a published a poster for the new act, which should be displayed along posters for existing equal employment and wage/hour laws. The poster is available here. The poster was published with a larger set of explanatory materials (available here). The DOL explanatory material states that the posting requirement may also be satisfied by emailing or direct mailing this notice to employees, or by posting this notice on an employee information internal or external website. FFCRA poster questions are available here. This may be necessary for any employees who are teleworking.
We have also been asked if employees may be eligible for paid leave under FFCRA or unpaid leave under FMLA where they have a medical condition that makes them unusually vulnerable to Covid-19. DOL has now indicated that where such an employee is advised by a physician to self-isolate to avoid exposure to Covid-19, he or she will be eligible for EPSL under FFCRA. We see as yet no specific guidance whether such a case might be covered under FMLA, on the grounds that the employee has a serious health condition making them unable to perform their job. We still think it clear than an otherwise healthy employee who simply fears catching the virus (even an older employee) is not entitled to leave under FMLA. However, employers will want to evaluate whether jobs posing particular risks of Covid-19 exposure are safe for older employees, who may be more vulnerable on that basis alone.
DOL has adopted a non-enforcement policy for violations of FFCRA occurring within 30 days of the enactment of the FFCRA, i.e., March 18 through April 17, 2020. Bulletin available here. However, the non-enforcement policy is very limited in scope, because it requires that the employer has made reasonable, good faith efforts to comply with the Act. Employers with fewer than 50 employees are not subject to private enforcement of public health emergency FMLA leave.
DOL's non-enforcement policy also permits employers who are eligible for tax credits for EPSL or paid emergency FMLA but who have insufficient cash flow to make payment of sick leave or family leave wages as soon as possible, but not later than seven 7 calendar days after the employer has withdrawn an amount equal to the required paid sick leave and expanded family and medical leave wages from the employer's Federal payroll tax deposits or, to the extent such deposits are not sufficient, has received a refund of the credit amount from the IRS to cover the required wages.
Worker Adjustment and Retraining Notification Act (WARN)
Employers who contemplate layoffs caused by Covid-19 may need to comply with the WARN Act, which applies to employers with 100 or more full-time employees, or 100 or more total employees working a total of more than 4000 hours per week. An employment action spanning a window of time as long as 30-90 days will require 60 days' advance notice -- with certain exceptions -- if it affects more than 50 employees and substantially shuts down a work site or operating unit (a plant closing) or affects both more than 50 employees and at least one-third of the workforce at a single site.
Employers are relieved of the 60-day notice obligation if the event results from an "unforeseeable business circumstance," the employer gives as much notice as possible, and -- critically -- gives notice to employees explaining the reasons for the shorter notice. We have no doubt that Covid-19 is generally an "unforeseeable business circumstance," but as the crisis drags on, its consequences may become more and more foreseeable.
Additional information about the WARN Act is available here.
Fair Labor Standards Act (FLSA)
As we noted in our previous article, any layoffs of salaried exempt employees must usually be done in complete workweek increments, to comply with FLSA salary basis requirements (with certain exceptions). Regulation available here. Employers may also have the option to convert salaried employees to hourly, in lieu of layoffs. We think it may be important, to maintain FLSA salary basis in the long term, that such changes be indefinite in duration when adopted, and not explicitly temporary.
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We will write separately about additional issues under the ADA and the now-almost-passed federal stimulus bill, and then have another update in the coming weeks on laws affecting employment recently passed by the Virginia General Assembly. In general, new Virginia laws will take effect on July 1, 2020, if and as signed by Governor Northam.