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Nelson Mullins COVID-19 Resources

Nelson Mullins is continuing to monitor developments related to COVID-19, including guidance from the Centers for Disease Control (“CDC”); World Health Organization; various health officials; and federal, state, and local government authorities. The firm is taking appropriate precautionary actions and has implemented plans to ensure the continuation of all firm services to clients from both in office and remote work arrangements across in our 25 offices.

Nelson Mullins COVID-19 Resources

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March 25, 2020

DOL Issues Additional Guidance on FFCRA Paid Leave

By Bret A. Cohen, Ann E. Murray, Mitch Boyarsky, Jillian Hart

Yesterday, the Department of Labor issued Questions and Answers providing additional guidance on the Emergency Family and Medical Leave Expansion Act and the Emergency Paid Sick Leave Act (collectively “Emergency Leave”), which were signed into law as part of the Families First Coronavirus Response Act (“FFCRA”) on March 18.

We summarize the guidance below. The Nelson Mullins Labor and Employment and Employee Benefits Groups remain available to advise clients and employers on their obligations under the new legislation.

Effective Date

  • Emergency Leave is available beginning on and after April 1, 2020 through December 31, 2020 (when the Act expires).
  • The Emergency Leave requirements are not retroactive.
  • The Emergency Leave is available to an eligible employee who started a different non-Emergency Leave before April 1 so long as the reason for the leave now qualifies as Emergency Leave. 

Measuring the 500 Employee Limit

  • The Emergency Leave requirements only apply to businesses with fewer than 500 employees as of the date an employee takes leave.
  • Entities with overlapping ownership may only treat themselves as a separate employer if they can show that they are not “joint employers” under the FLSA (using the DOL Guidance on integrated employer relationships). 
  • All full-time and part-time employees in all states, Washington, D.C., and any U.S. Territory or possession count, including all employees on leave. Employees outside these U.S. locations are not counted.
  • Temporary employees who are jointly employed with another employer (e.g., a PEO, employee leasing company or temporary agency) must be counted by both entities.
  • Day laborers supplied by a temp agency must be counted by both the client and the temp agency if there is a continuing employment relationship. 
  • Independent contractors under the Fair Labor Standards Act do not count.
Small Business Exemption
  • Small businesses with fewer than 50 employees can seek an exemption from their Emergency Leave obligations if providing the Emergency Leave would jeopardize the viability of the employer as a going concern.
  • The DOL will be issuing regulations addressing this exemption in more detail, but the FAQs make clear that, until then, you should document the reasons but not submit anything to the DOL.
Employee Waiting Period for Emergency FMLA
  • An employee is eligible for emergency FMLA only if the employee has been on the payroll for at least 30 calendar days before the date employee’s leave would begin.
  • Employees who worked as a temporary employee who were or are later hired by the employer may count the prior days worked as a temporary employee toward this 30-day period.
  • There is no minimum waiting period that an employee must satisfy to qualify for paid sick leave.
Part-Time Employees
  • Part-time employees are entitled to leave equal to the employee’s average number of hours worked in a two-week period, based on the number of hours the employee is normally scheduled to work.
  • If the part-time employee’s normal hours are unknown or the employee’s schedule varies, you can use a 6 month average of the part-time employee’s daily hours. That employee may take paid sick leave for this number of hours per day for up to a 2 week period, and may take emergency FMLA for the same number of hours per day for up to 10 weeks thereafter. 
Determining Hours to be Paid
  • Under the emergency FMLA, an employer must pay an employee for all hours the employee would have been normally scheduled to work, including overtime (but without any premium for the overtime hours (e.g., time and a half pay rate)).[1]
  • The Emergency Paid Sick Leave Act only provides up to 80 hours of paid sick leave over a two-week period (once again, with no premium for overtime if more of those hours are in one week).
Amount of Pay
  • If an employee takes paid sick leave because the employee is (1) subject to a Federal, State, or Local quarantine or isolation order related to COVID-19; (2) advised by a health care provider to self-quarantine due to COVID-19; or (3) experiencing symptoms of COVID-19, the employee is entitled to receive 100% of his or her Regular Rate of Pay, as defined below. This leave amount is capped at $511 per day or $5,110 over the entire 10-day period.
  • If the employee takes paid sick leave because the employee is (1) caring for an individual subject to a Federal, State, or local quarantine or isolation order or self-quarantine related to COVID-19; (2) caring for the employee’s child whose school or place of care is closed or 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, the employee will receive 2/3 of his or her Regular Rate of Pay, as defined below. This leave amount is capped at $200 per day or $2,000 over entire 2 week period. 
  • If the employee takes emergency FMLA, the employee may take paid sick leave for the first 10 days of that leave period (if he or she qualifies) or may substitute any accrued vacation leave, personal leave, or medical or sick leave under your Company’s policies. For the following 10 weeks of emergency FMLA, the employee is entitled to receive 2/3 of his or her Regular Rate of Pay, as defined below. The combined cap on both paid sick leave and emergency FMLA for an employee who takes leave to care for the employee’s child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 would be $200 per day or $12,000 for the full 12 weeks of Emergency Leave.
Regular Rate of Pay
  • Regular Rate of Pay for purposes of Emergency Leave means the employee’s regular rate of pay, which cannot be less than the Federal minimum wage under FLSA or applicable State or local minimum wage. Regular Rate of Pay must include commissions, tips, and piece rates.
  • For this purpose, an employee’s regular rate is determined over a period of up to 6 months before his or her date of leave, or if the employee was employed less than 6 months before leave then the average of his or her regular rate of pay for each week worked. As an alternative, you can calculate an employee’s regular rate by adding all of the employee’s compensation over a period of up to 6 months before date of leave and divide this sum by all hours the employee actually worked during that same period. 
Multiple Events
  • The 2-week limit on paid sick leave applies cumulatively to any combination of qualifying reasons. An employee cannot claim multiple 2 week periods of paid sick leave.
Other FMLA Leave
  • Other leave for which the employee may qualify under the Family and Medical Leave Act remains unpaid.
  • Only the emergency FMLA that exceeds 10 days is paid. 

 

For additional information on COVID-19 related issues, please visit the Nelson Mullins COVID-19 resource page or contact a Nelson Mullins attorney.


[1] This raises the question of whether an employee who would not normally have been scheduled to work due to an employer’s decision to place a group of employees on unpaid leave of absence would be entitled to any payments during an Emergency Leave. While the employee could take the Emergency Leave if he/she qualifies, would any pay only become due once the employee’s unpaid leave of absence would have otherwise ended and thus the employee would have been expected to have been scheduled to work? More clarification on this point would be helpful, since many employers have already implemented unpaid leaves and furlough programs.