UPDATE: DOL Issues Families First Coronavirus Response Act Guidance on Employer Coverage and Obligations to Provide Paid Sick and Family and Medical Leave

Jason E. Reisman and Taylor C. Morosco

Yesterday evening, the U.S. Department of Labor (“DOL”) published its first round of guidance on the Families First Coronavirus Response Act (“FFCRA”), which takes effect on April 1, 2020.[1]

The guidance—provided in a Fact Sheet for Employees, a Fact Sheet for Employers, and Questions and Answers—answered some of the high-level questions employers have been asking. This update summarizes several of those important answers. However, more guidance is needed and expected in the coming days.

What is the FFCRA?

COVID-19 legislation that contains two key paid leave acts—the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act.

In a nutshell, the Emergency Paid Sick Leave Act entitles employees to paid sick leave when they cannot work or telework due certain COVID-19-related circumstances affecting the employee or someone for whom the employee is caring.[2] The Emergency Family and Medical Leave Expansion Act provides paid leave for employees caring for a child due to school or childcare provider closures related to COVID-19. For an overview of both Acts, check out Blank Rome’s Update.

When is a business covered by FFCRA?

When a business employs fewer than 500 employees within the United States. Continue reading “UPDATE: DOL Issues Families First Coronavirus Response Act Guidance on Employer Coverage and Obligations to Provide Paid Sick and Family and Medical Leave”

How Work Sharing Saves Labor Costs and Confronts Uncertainty

Emery Gullickson Richards

“Work sharing” allows employers to reduce employee wages or hours instead of doing a layoff or furlough by reducing the hours of retained employees subject to a specific plan created by the employer. Work sharing enables employees to keep their jobs while simultaneously receiving unemployment benefits to supplement the lost income. At present, 27 states have enacted work sharing programs (oui.doleta.gov/unemploy/docs/stc_fact_sheet.pdf), though the requirements and benefits vary from state to state.

What is work sharing? Work sharing, also called “short-term compensation,” should not be confused with job sharing, which allows two part-time employees to share one full-time job. Instead, “work sharing” refers to cutting workers’ hours to avoid cutting workers’ jobs, effectively sharing the burden across employees when an employer has to scale back labor costs due to financial pressures, such as those presented by the coronavirus COVID-19 pandemic. Reducing hours instead of reducing headcount saves money, saves morale, and saves the maximum number of employees for when business levels later return to pre-emergency levels. Continue reading “How Work Sharing Saves Labor Costs and Confronts Uncertainty”

New York Passes COVID-19 Relief for Affected Employees

Anthony A. Mingione

On Wednesday, Governor Cuomo signed into law a bill providing paid sick leave and job protections for employees in New York who are unable to work due to coronavirus COVID-19. The new law prohibits employers from terminating or penalizing employees who are absent from work while the government is recommending or mandating that people stay home to slow the spread of COVID-19.

The specifics of the leave available to employees will vary depending on the size and net income of the employer, although regardless of employer size, all employees subject to a mandatory or precautionary order of quarantine or isolation due to COVID-19 will be entitled to job protection during their absences.

      • Businesses with at least 100 employees must provide at least 14 days of paid sick leave during any mandatory or precautionary order of COVID-19 quarantine or isolation.
      • Businesses with between 11 and 99 employees (or with 10 or fewer employees but more than one million dollars in net income) must provide five days of paid sick leave. Once that is exhausted, those employers must provide their workers with access to short-term disability benefits and paid family leave for the period of quarantine/isolation.
      • Finally, employers with 10 or fewer employees and less than one million dollars in net income are not obligated to provide paid leave but must give their workers access to short-term disability benefits and paid family leave for the period of quarantine/isolation.

Continue reading “New York Passes COVID-19 Relief for Affected Employees”

California Suspends WARN 60-day Notice Requirement for COVID-19-Related Layoffs

Michael L. Ludwig

Citing the need to prevent or mitigate the spread of COVID-19, California Governor Newsom acknowledged that California employers have had to close rapidly without providing their employees the advance notice required under California law. Generally, the California WARN Act requires employers to give a 60-day notice to affected employees and both state and local representatives prior to a plant closing or mass layoff.

By Executive Order (see https://www.gov.ca.gov/wp-content/uploads/2020/03/3.17.20-EO-motor.pdf), California is suspending the 60-day notice requirement for an employer that orders a mass layoff, relocation, or termination at a covered establishment on the condition that the employer:

    1. provides the affected employees with a notice as described by the California WARN Act;
    2. provides as much notice as is practicable, including a brief statement of the basis for the reduced notice;
    3. undertakes the mass layoff, relocation, or termination because of COVID-19-related business circumstances that were not reasonably foreseeable; and
    4. includes specified language in the notice advising affected employees that they may be eligible for unemployment insurance.

The Labor and Workforce Development Agency will be providing guidance regarding implementation of the Order by March 23, 2020.

For the latest updates, please visit Blank Rome’s Coronavirus (“COVID-19”) Task Force page.

Uncharted Territory: Restaurant Survival Guidance Amid COVID-19 Pandemic

Alix L. Udelson

Across the United States, everyday life is being upended by the coronavirus COVID-19 pandemic. Due to a combination of strong advice from health officials for all Americans to practice social distancing measures, and similar laws and directives from state and local governments, businesses are being forced or called upon to shutter their doors for the foreseeable future. The restaurant industry—an industry especially dependent on daily cash flow and known for operating on low profit margins—is on the front line of this crisis, directly and instantaneously feeling the widespread ramifications of the current crisis.

In this unprecedented time, restaurants are looking to creative solutions to help blunt the impact of this pandemic on their businesses, employees, and communities. Continue reading “Uncharted Territory: Restaurant Survival Guidance Amid COVID-19 Pandemic”

Coronavirus Update: Senate Passes Virus Relief Bill, Plans for Even Bigger Stimulus

Jason E. Reisman and Andrew I. Herman

The Senate cleared the second major bill responding to the coronavirus pandemic, with lawmakers rushing to follow up with an additional economic rescue package that President Donald Trump’s administration estimates will cost $1.3 trillion. The 90-8 vote Wednesday, following House passage on Saturday, sends Trump a measure providing paid sick leave, food assistance for vulnerable populations and financial help for coronavirus testing. As the Senate voted, Republican and Democratic leaders were already working on the next proposal.

For the latest updates, please visit Blank Rome’s Coronavirus (“COVID-19”) Task Force page. 

Coronavirus Update: House Passes Bill for Paid Leave and Other Emergency Relief

Jason E. Reisman and Andrew I. Herman

On March 14, 2020, the U.S. House of Representatives passed legislation in response to the increasing disruption that coronavirus (“COVID-19”) is having on businesses and daily life. The Emergency Families First Coronavirus Response Act (H.R. 6201) includes several measures to address the significant impact of COVID-19 on employment for American workers and their families, including provisions for emergency paid leave and sick time, as well as funds and support for state unemployment compensation programs. To protect against the creation of “permanent” paid leave benefits and limit it to addressing the COVID-19 impact, this bill sunsets at the end of 2020.

On March 16, 2020, the House passed a “technical corrections” bill by unanimous consent, which included changes intended to address concerns that the legislation’s provisions for emergency paid leave and sick time would be devastating to small and midsize businesses.  

THE EMERGENCY FAMILY AND MEDICAL LEAVE ACT

The bill amends the Family and Medical Leave Act (“FMLA”) to provide employees of employers with fewer than 500 employees with the ability to take up to 12 weeks of job-protected leave on a partially paid basis under the FMLA if the employee is unable to work (or telework) due to a need to care for a child due to the closure of a school or place of care, or a childcare provider is unavailable, because of COVID-19 public health emergency.

Who is eligible for COVID-19 leave?

Any employee who has been employed for at least 30 calendar days by an employer with fewer than 500 employees. There is no minimum hours threshold like the normal FMLA eligibility requirement that an employee have worked at least 1,250 hours over the preceding 12 months.

How much must an employee be paid for COVID-19 leave?

The first 10 days of COVID-19 leave is unpaid. An employee can choose to use vacation or other paid time off during this period. A provision restricting employers from requiring employees to do so was removed in the bill’s “technical corrections.”

Employers must pay two-thirds of an employee’s regular rate of pay after the first 10 days of COVID-19 leave, but such pay is not to exceed $200 per day or $10,000 in the aggregate.

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