Tag Archives: COVID-19

Important Changes to FFCRA Leave Requirements – Including a Change to the Definition of Health Care Provider

On September 11, 2020, the U.S. Department of Labor (DOL) issued revised regulations addressing the availability of employee leave under the Families First Coronavirus Response Act (FFCRA). These regulations were issued in response to a federal court finding that the DOL exceeded its authority in its original regulations.

The FFCRA, created in response to the COVID-19 public health emergency, requires employers with fewer than 500 employees to provide their employees with paid sick leave (termed Emergency Paid Sick Leave or “EPSL”) and expanded family medical leave (referred to as Emergency Family Medical Leave of “EFML”). There are exemptions to the leave requirements.

In early spring, the DOL issued its initial regulations addressing a host of questions regarding the application and interpretation of the FFCRA. In those regulations the DOL clarified which employees counted as “health care providers” for purposes of one of the exemptions to the leave requirements. Several of the DOL’s regulations were challenged in federal court in New York. Recently, that court ruled that the DOL’s rules on the following topics were unlawful:

(1)  the broad definition of an employee who is a “health care provider”;

(2)  the requirement that an employer must consent to intermittent leave under FFCRA;

(3)  the requirement that an employer must have available work before an employee can receive either EPSL or EFML, which DOL had termed the “work availability requirement”; and

(4)  the types of notice and documentation an employee must provide before taking FFCRA leave.

Below is a summary of how the DOL addressed the foregoing issues.

Definition of Health Care

The DOL narrowed the definition of “health care provider.” Previously, an employee could be considered a “health care provider” for purposes of the exemption, if the employer was a health care provider—regardless of what role the employee played within the organization. Now, the term “health care provider” is defined as those employees who are already defined as “health care providers” for purposes of providing certifications under existing FMLA regulations, along with those employees who provide diagnostic, preventive, treatment or other services that are integrated with and necessary to health care and the provision of patient care, and if not provided, would adversely impact patient care.

The revised regulations clarify the types of services that are considered health care services or the provision of patient care:

  • Diagnostic: Includes taking or processing samples, performing, or assisting in x-rays or other diagnostic tests or procedures, and interpreting test or procedure results.
  • Preventive: Includes screenings, check-ups, and counseling to prevent illnesses, disease, or other health problems.
  • Treatment: Includes performing surgery or other invasive or physical interventions, prescribing medication, providing, or administering prescribed medication, physical therapy, and providing or assisting in breathing treatments.
  • Integrated: Those services that are “integrated with and necessary to diagnostic, preventive, or treatment services and, if not provided, would adversely impact patient care, including bathing, dressing, hand feeding, taking vital signs, setting up medical equipment for procedures, and transporting patients and samples.”

Beyond outlining the characteristics, the revised regulations provide a helpful, non-exhaustive list of exempt employees:

  • nurses, nurse assistants, medical technicians, and others directly providing diagnostic, preventive, treatment, or other integrated services;
  • employees providing such services “under the supervision, order, or direction of, or providing direct assistance to” a health care provider; and
  • employees who are “otherwise integrated into and necessary to the provision of health care services,” such as laboratory technicians who process test results necessary to diagnoses and treatment.

Conversely, the following employees should no longer be considered exempt from FFCRA leave entitlement:

  • IT professionals,
  • building maintenance staff,
  • human resources personnel,
  • cooks,
  • food services workers,
  • records managers,
  • consultants, and
  • billers.

Work Availability Requirement

The DOL did not change its position on the work availability requirement. DOL maintains its position that for an employee to take FFCRA leave, an employer must have work available for the employee to perform when the need for FFCRA leave occurs. If the employee is not scheduled to work—whether due to a furlough, business closure, or otherwise—there is no work from which to take leave.

The DOL did clarify that the employee’s FFCRA reason for leave must be the sole reason that he or she is not working. An employer cannot use work unavailability as a pretense to prevent an employee from taking EPSL of EFML leave.

Definition of “Intermittent Leave

Similarly, the DOL has not substantially altered its intermittent leave rule, even though the district court rejected the original regulation. The new regulations detail additional analysis for why the DOL reached the conclusion it did. A key point the DOL raises is that an employer should “balance the employee’s need for leave with the employer’s interest in avoiding disruptions by requiring agreement by the employer for the employee to take intermittent leave.”

Documentation and Notice Requirements

The DOL slightly adjusted the documentation rules to confirm that, like under the FMLA, an employee is not required to provide documentation before leave in every situation. Rather, an employee may provide documentation as soon as practicable.

Additionally, the DOL clarified that employees must provide the employer with notice as soon as practical when they seek EFML leave to care for a child whose school or place of care is closed. Thus, when an employee receives notice that school will be closed, the employee should notify their employer about the need for leave.

Concluding Thoughts

The change to the scope of the health care provider exemption is the most important change about which employers will have to address. Those in the health care industry should perform an analysis of employees’ job classifications to determine whether certain employees remain eligible to be exempt as “health care providers” under the revised definition. In light of the revised regulations, all employers should review their current leave practices and adjust accordingly.

Aside from the changes to the definition of health care provider, the revised regulations do not fundamentally change the DOL’s prior interpretation. Instead, the changes provide further clarification as to the basis for the DOL’s position. We suspect that the DOL promulgated these new regulations, in part, to support its position in later legal fights.

Attorney John Getty and legal clerk Kimbrell Hines contributed to this post.

For the Self-Employed the CARES Act Could Provide Too Much Liquidity: Simultaneous PPP and Unemployment Payments

Self-employed individuals may find themselves in a difficult situation because they have simultaneously received Paycheck Protection Program (“PPP”) loan and Unemployment benefits under the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. The CARES Act was enacted this past March with a primary goal of combating COVID-19-related shutdowns and layoffs. It made state unemployment insurance (plus an additional $600 per week through July 31, 2020) (“Unemployment”) available to self-employed individuals, among others, and offers that same group a forgivable PPP loan for their suffering businesses. Faced with the menu of liquidity and uncertainty within the CARES Act, many self-employed individuals immediately applied for both Unemployment and a PPP loan. The question they now face is whether receiving both benefits at the same time is permissible.

The Tension Between The PPP and Unemployment Benefits

While there is no explicit authority in the CARES Act prohibiting the simultaneous receipt of both PPP loan and Unemployment monies, keeping both is risky at best and could potentially be viewed as fraudulent at worst. This is because the receipt of one goes against the purpose and spirit of the other. Looking first at the PPP, its very goal is to allow businesses to keep their employee or employees on the payroll. In other words, the applicant needs the money to keep its business going and pay salaries and wages. It logically follows that a self-employed individual who receives a PPP loan is therefore considered fully employed, at least until the funds run dry.

On the other hand, an individual is only eligible for Unemployment benefits with respect to the CARES Act, where they become totally or partially unemployed (or furloughed) due to COVID-related reasons. These monies serve only as a bridge across gaps in employment. A recipient is therefore very arguably ineligible for Unemployment benefits where compensated work is made possible by PPP funds. This is to be distinguished from a situation where a self-employed individual received necessary Unemployment while waiting for PPP loan approval and disbursement or following the depletion of the PPP loan if it came first.  

Potential Consequences

Continuing to take Unemployment while benefiting from a PPP loan could potentially be, or appear to be, a fraudulent situation. The Department of Labor (“DOL”) has made clear that all states, including Florida, are to exercise due diligence to detect fraud and assess the accuracy of payments to eligible claimants. The Small Business Administration (“SBA”) is also prosecuting PPP loan fraud under federal civil and criminal statutes and has been vocal about the consequences of failing to return unnecessary PPP funds. Most individuals who have simultaneously received or are currently receiving monies from both programs are well-intentioned and unknowing recipients, but this may not save them from an accusation of wrongdoing and/or having to go through state or federal administrative proceedings.

Finally, even assuming one could carefully segregate their PPP funds for their business from their Unemployment, using only the Unemployment monies to pay themselves a salary and the PPP to pay all other eligible business expenses, the risk of losing eligibility for full or substantial loan forgiveness remains. At least 60 percent (previously 75 percent) of the PPP loan must be spent on payroll expenses (i.e., wages) to qualify for full loan forgiveness. When comparing the size of most PPP loans to Unemployment payment amounts, the importance of avoiding this risk becomes obvious. It also remains unclear whether such segregation of simultaneous benefits is possible.

Based on the foregoing, self-employed individuals who have received both PPP and Unemployment benefits to review their payouts for any overlap of funds and check with their legal/financial advisors on the best course of action in the event of any overlap.

Amounts Paid to Employees for Sick and Family Leave Wages Are to be Reported on W-2s

Yesterday, July 8, 2020, the Internal Revenue Service (“IRS”) issued Notice 2020-54, which provides guidance to employers on reporting qualified sick and family leave wages paid to employees under the Families First Coronavirus Response Act (FFCRA). Enacted this past March 2020, the FFCRA generally requires employers with fewer than 500 employees to provide paid leave due to certain circumstances related to COVID-19.  Notice 2020-54 directs employers to “separately state” each of the paid sick and family leave wage amounts either in Box 14 of Form W-2 or in a statement that accompanies the Form W-2.

The guidance provides employers with adaptable model language for use in the Form W-2 instructions for employees. An excerpt of that language is as follows:

“Included in Box 14, if applicable, are amounts paid to you as qualified sick leave wages or qualified family leave wages under the Families First Coronavirus Response Act. Specifically, up to three types of paid qualified sick leave wages or qualified family leave wages are reported in Box 14:

  • Sick leave wages subject to the $511 per day limit because of care you required;
  • Sick leave wages subject to the $200 per day limit because of care you provided to another; and
  • Emergency family leave wages.”

The Notice goes on to state that the wage amount required to be reported by employers on Form W-2 will provide self-employed individuals who are also employees with the information necessary to determine the amount of any sick and family leave equivalent credits they may claim in their self-employed capacities. We recommend that employers review the Notice’s model language for their Form W-2 instructions.

Watch On-Demand: Webinar on Novel Issues Relating to Employees Working Remotely

As more employees work from home, employers are facing questions about how to comply with employment laws in a manner that minimizes risks associated with remote work. Our Business Solutions team recently presented a webinar addressing many of the employment-related issues arising from remote work. The head of our Labor & Employment practice, Jennifer Fowler-Hermes and L&E attorney John Getty were joined by Brad Hall, a workers’ compensation defense attorney, to discuss a variety of topics, including how to properly track work hours, complying with employment laws, the importance of telework agreements, and whether and to what extent workers’ compensation laws apply. Watch it on-demand below.

 

Join Us for a Webinar on Business Basics

Every day is a new reality, especially in times of crisis, when the only constant seems to be change itself.

Whether dealing with challenges faced from COVID-19 or using the current time to plan new ventures, it is important to plan and implement strategies in line with today’s fluid business environment. Whether starting a new business or confirming that your existing business is on track, knowing the basics can help maximize your success.

Join Williams Parker attorneys Jennifer Fowler-Hermes and Elizabeth Stamoulis, accompanied by Kathy Hargreaves, CPA, CFP®, CPC®, of Kerkering and Barberio, for a virtual and interactive presentation covering:

• Basic business and employment documents
• Protecting intellectual property
• Properly classifying workers to avoid missteps
• Tax implications and proper tax registration

BUSINESS BASIC: GETTING IT RIGHT FROM THE START (OR IN THE MIDDLE)

Friday, June 12
10:00 – 11:00 a.m.

Sign Up >

Our Business Solutions team helps business owners and entities assess and manage risk, advise on tax and compliance issues, provide workout and turnaround guidance, and offer creditor, restructuring, and bankruptcy representation. We work with HR executives to assess potential employment liability; review, update, and advise on employment policies; defend employment law claims; and assist with regulatory guidelines. For those seeing opportunity amidst uncertainty, the firm offers start-up guidance on tax, employment, and intellectual property issues. Its attorneys assist commercial and residential landlords and tenants with abatements, deferments, amendments, forbearance, and help identify remedies, including business interruption insurance and updated lease provisions. Should litigation arise, the team is prepared to advocate on your behalf.

Florida’s Road to Recovery Begins

Late yesterday, on April 29, 2020, Florida’s Governor issued his Phase 1: Safe. Smart. Step-by-Step Plan for Florida’s Recovery in Executive Order 20-112 and clarifying FAQs, which will be effective 12:01 a.m. on May 4, 2020, until a new order is issued. Continue reading

Getting Back to Business – Handling Employees’ Return to Work

With re-openings on the horizon, businesses should prepare a plan for returning employees to work. In making such plans, employers should consider the various EEO laws, the Occupational Safety and Health Act (“OSHA”), the Paycheck Protection Program (“PPP”), the Families First Coronavirus Response Act (“FFCRA”), the Family and Medical Leave Act (“FMLA”), along with employers’ own PTO/vacation policies, and more. This summary provides a quick overview of several issues that employers should consider when developing a plan for their employees to return to work.

Some employers may plan to call back in employees in stages or waves as business permits. If so, those employers should take care that they decide which employees are part of the various stages or waves based on legitimate, non-discriminatory reasons. Civil rights statutes such as Title VII of the 1964 Civil Rights Act, the Age Discrimination in Employment Act, and the Florida Civil Rights Act still apply to all employment decisions–including decisions on who to bring back to work. Employers should avoid making decisions on who to return to work based on age, disability (actual or presumed), national origin, marital status, sex, pregnancy, or other protected characteristics. Continue reading

DOL Answers More Questions About Paid Sick Leave and Expanded Family and Medical Leave Under the FFCRA

On April 6, 2020, the U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) issued yet another series of questions and answers to provide additional guidance regarding the protections and relief offered by the new Families First Coronavirus Response Act (FFCRA). The DOL also reorganized its FFCRA questions page by categories (definitions, eligibility, coverage, application, and enforcement), in addition to its questions and answers by number.

As noted in our recent blog post, the FFCRA provides expanded paid and unpaid family and medical leave broader than the Family and Medical Leave Act of 1993 (FMLA) and paid sick leave to certain employees affected by COVID-19. In addition, it provides help for individuals and businesses impacted by the pandemic—like reimbursement through a refundable tax credit available to private employers. The FFCRA became effective April 1, 2020, and will expire at the end of the year. It is enforced by the WHD. Continue reading

Essential Services Added to Florida’s Safer-at-Home Executive Order

On April 9, 2020, Florida’s Department of Emergency Management issued a memorandum adding “essential services” for purposes of the Safer-at-Home Executive Order 20-91, which will be effective April 3 through April 30, 2020, and was recently clarified by FAQs.

The memorandum expands the list of “essential services” in Florida to include:

  • Employees at services and programs addressing mental health, substance abuse, domestic violence, and other urgent counseling – as long as social distancing guidelines are maintained;
  • Certain employees necessary for maintenance and preservation of theme parks and entertainment complexes, zoological parks and facilities, and aquarium facilities, that are closed to the general public; and
  • Employees at professional sports and media production with a national audience – including athletes, entertainers, production team, executive team, media team, and others necessary to facilitate including services supporting such production – only if the location is closed to the general public.

The Division of Emergency Management maintains the Governor’s Executive Order 20-91 Essential Services List online, but has not yet added these services to the list.

In compliance with the Safer-at-Home Order, Williams Parker remains dedicated to serving its clients and continues to advise and represent clients with respect to their legal matters. Our firm has launched a multidisciplinary task force of lawyers across the firm to advise on issues arising from COVID-19. This team is closely monitoring legal developments and guidance from federal, state, and local government and public health officials. For the latest updates, please visit our website.

Documents Employers Should Keep for COVID-19 Related Paid Leave

Under the Families First Coronavirus Response Act, covered employers are now required to provide Paid Sick Leave or Expanded Family and Medical Leave to employees affected by the COVID-19 public health emergency. (See our prior coverage of the paid leave under the Families First Act.) Recently, the Department of Labor (DOL) and the Internal Revenue Service (IRS) provided guidance to employers about what notice and supporting documents employees must provide employers to obtain such leave—presuming employees qualify. Based on the above-referenced guidance, below we address common questions on the notice and documentation requirements.

*Please note that this article presumes a general familiarity with the Paid Sick Leave or Expanded Family and Medical Leave provisions of the Families First Act. For a refresher on those provisions, please review the blog post linked above.

If an employee is sick and wants to use the new Paid Sick Leave, can an employer require them to give notice?

Yes, employers may require that employees follow reasonable notice procedures when taking Paid Sick Leave.

What would be considered reasonable notice procedures?

Absent unusual circumstances, what is reasonable will depend on the facts and circumstances of each situation. Generally, it will be reasonable for an employer to require an employee to comply with the employer’s usual and customary notice and procedural requirements for requesting leave.

How soon should an employee provide notice of the need for leave?

Although the DOL encourages employee to provide notice as soon as practicable, employees can provide notice up to the day after the need becomes apparent.

What if the employee fails to give notice?

An employer should notify the employee that they failed to give notice. Before denying the leave request, the employer should provide the employee a chance to submit the required information and documentation.

Who can give the notice: the employee or someone on their behalf? 

An employee or an employee’s spokesperson (e.g., spouse, adult family member, or another responsible party) – if the employee is unable to do so personally – can notify an employer about the need for leave.

What should this notice contain?

It is reasonable for an employer to require verbal notice along with enough information to determine if the requested leave qualifies for either Paid Sick Leave or Expanded Family and Medical Leave.

Can an employer require documentation from the employee to support the need for leave?

Yes, according to DOL guidance, an employer may require documentation but only the documents identified in the regulations.

What information and documents may an employer require from an employee?

Based on current guidance from the DOL and the IRS, an employer can request the following information and documents to support a request for leave:

  1. Employee’s name;
  2. Date(s) for which leave is requested;
  3. Qualifying reason for the leave;
  4. An oral or written statement that the employee is unable to work, including through telework, because of the qualified reason for leave; and,
  5. Depending on the qualifying reason for the leave, the employee must also provide the following information or documents:
    • If the leave is due to a qualifying quarantine or isolation order, then the employee must provide the name of the federal, state, or local government entity that issued such order;
    • If the leave is because the employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19, then the employee must provide the name of the physician that issued the self-quarantine guidance;
    • If the leave is because the employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis from a health care provider; it is uncertain what additional information an employee must provide since the regulations, at the moment, do not speak to this issue.
    • If the leave is because the employee caring for an individual who is subject to a qualifying quarantine or isolation order, then the employee must provide the name of the federal, state, or local government entity that issued such order;
    • If the leave is because the employee caring for an individual who has been advised by a health care provider to self-quarantine due to concerns related to COVID-19, then the employee must provide the name of the physician that issued the self-quarantine guidance;
    • If the leave is because the employee is caring for his or her child whose school or child care options have been closed or made unavailable for any time related to COVID-19, then the employee must provide:
      • The name of their son or daughter being cared for;
      • The name of the school, place of childcare, or childcare provider that has closed or become unavailable;
      • A representation that no other suitable person will be caring for the son or daughter during the period for which the employee takes Paid Sick Leave or Expanded Family and Medical Leave; and,
      • Concerning the employee’s inability to work or telework because of a need to provide care for a child older than fourteen during daylight hours, a statement that special circumstances exist requiring the employee to provide such care.

Can an employer authenticate the information supporting the employee’s request for leave?

The newest DOL regulations do not directly address this question. However, because the new laws expand the FMLA, there is an argument that DOL guidance on medical certification under the regular FMLA would apply to these new leaves—albeit the original regulations are not completely analogous.

Under the original regulations, employers’ representatives may contact a health care provider to clarify or authenticate that provider’s certification for the need for leave. It is important to note that a human resources professional, a leave administrator, or a management official must be the one to make the contact. An employee’s direct supervisor should never contact the employee’s health care provider to obtain authentication. However, to properly conduct an authentication, employers’ representatives need to provide the health care provider with a copy of the certification and confirming that the information contained on the certification form was completed or authorized by the health care provider who signed the document.

With the Paid Sick Leave or Expanded Family and Medical Leave, there is no signed certification that employers may authenticate in a manners similar to the original regulations. It may be that an authorized employer representative may contact one of the entities or individuals to verbally confirm that the information the employee provided because those steps match the spirit of the prior regulations—presuming no additional questions are asked.

Even if that is the case, there are likely practical concerns. Government agencies and health care providers are already taxed during this public health emergency; therefore, obtaining a timely response may be challenging.

What should an employer do if the employee provides the notice and supporting information verbally?

Employers likely should prepare a memorandum for the employee’s file confirming all of the information listed above along with the name of the employer’s representative who verbally received the notice and supporting information. Employers could then follow up with the employee for any further supporting documents to allow employers to obtain applicable tax credits.

Are there any other documents will an employer needs to maintain?

Yes, according to the IRS, it appears that employers—to support any tax credits—will need to maintain the records of the written or verbal statements described above. Additionally, the employer should maintain:

  1. Documents showing how the employer determined the amount of qualified sick leave or family leave wages paid to the employee—these documents would likely include the supporting payroll data along with a memorandum showing how the wage calculations were derived. (Remember that employees do not necessarily receive full compensation while on Paid Sick Leave or Expanded Family and Medical Leave under the Families First Act.)
  2. Documents showing how the employer determined the amount of qualified health plan expenses that the employer allocated to wages. (See IRS guidance at Question 31 for methods to compute this allocation.)
  3. Copies of any completed Forms 7200, Advance of Employer Credits Due To COVID-19, the employer submitted to the IRS.
  4. Copies of the completed Forms 941, Employer’s Quarterly Federal Tax Return, that the employer submitted to the IRS (or, for employers that use third party payers to meet their employment tax obligations, records of information provided to the third party payer regarding the employer’s entitlement to the credit claimed on Form 941).

How long will an employer need to maintain these documents?

An employer should maintain these records for at least four years.

Williams Parker has launched a multidisciplinary task force of lawyers across the firm to advise on issues arising from COVID-19. This team is closely monitoring legal developments and guidance from federal, state, and local government and public health officials. For the latest updates, please visit our website.