DOL Announces Temporary Rules for FFCRA Implementation; Informational Webinar to be Released on April 3, 2020

We have been keeping you informed of recent actions by the US Department of Labor to advise employers of their obligations under the recently enacted Families First Coronavirus Response Act (“FFCRA”). This has included the DOL’s creation of a “Questions and Answers” webpage for both employers and employees. (Click here, here and here.) On April 1, 2020, the DOL announced the issuance of its Temporary Rules regarding implementation of the FFCRA and what employers who are subject to it must do to ensure compliance. (Click here for DOL Press Release.)

The 124-page Temporary Rule (available here is essentially the implementing regulations that were addressed in general terms by the DOL on its Q&A webpage concerning the FFCRA. The DOL also detailed its reasoning in adopting the limited “small business” exception to FFCRA compliance. It explained that it was trying to balance the competing interests in making sure that FFCRA leave was as widely-available as possible for small business employees while trying to prevent such leave from having little to no value if the company went under so that its employees had no leave entitlement and/or no jobs to which to return.

Importantly for employers, the DOL’s Wage & Hour Division will be posting a pre-recorded webinar on Friday, April 3, 2020, to provide further details concerning the FFCRA, including informing employers how to comply their FFCRA obligations for those subject to it. The webinar should be accessible at the following page on Friday:  www.dol.gov/agencies/whd/pandemic

California employers should continue to monitor our blog for future updates concerning the FFCRA and other employment developments as a result of the COVID-19 pandemic. We also remind employers that they should seek legal advice to determine whether the FFCRA applies to their business, and if so, what steps to take to ensure compliance.

Webinar: Employing in the Age of COVID-19: What Employers Need To Know

  • When: Apr 6, 2020
Webinar:

Live presentation: Monday, April 6, 2020
Time: 10:00 AM – 11:30 AM PDT

Summary of Program

In the wake of the COVID-19 pandemic, employers are facing extraordinary challenges. This webinar addresses the most common questions employers are currently asking, as they attempt to provide a safe and secure workplace, while maintaining compliance with California and federal law.  We will provide an overview of the following topics during this free webinar:

  • Maintaining workplace safety
  • “Shelter in place” and what qualifies as an essential business
  • The Families First Coronavirus Response Act, FMLA, PTO and available tax credits
  • The Payroll Protection Act
  • The WARN act, furloughs, lay-offs, and salary reduction
  • Discussion of recent EEOC and DFEH announcements on COVID-19
  • Work-from-home policies and tips and traps for maintaining a remote workplace

The recorded presentation can be viewed on the Weintraub Tobin YouTube page.  Please note that information on COVID-19 -related legislation, regulations, and programs is changing and being updated constantly, including information presented in this webinar. Please check with your professional advisors to make sure you have the most updated information.

2nd UPDATE: DOL Again Updates Question & Answers Page for Families First Coronavirus Response Act

Last week, we alerted you to the fact that the US Department of Labor had issued a Question & Answers webpage, and subsequently updated it, to address numerous issues arising out of the passage of the FFCRA. (Click here and here.) Late Saturday night, the DOL again updated the “Questions and Answers” webpage and added more than 20 new questions and answers (## 38-59) regarding various issues under the FFCRA for both employers and employees. The DOL also revised its guidance regarding the types of documentation required to document FFCRA leave to simply the types of documents required and essentially punt the question to the IRS to provide forms/instructions for claiming the FFCRA tax credit. (## 15 & 16)

Here is a summary of the other various issues addressed by the DOL’s second update to the Q&A page:

  • Explains that the term “employee” for purposes of determining who is eligible for FFCRA leave shall have the same meaning as the term “employee” used in the FLSA. (#38):
    • “Employee” includes full-time employees (work 40 or more hours per week); part-time employees (less than 40 hours per week) and “joint employees”, provided that the employee has been employed for the required 30 days preceding the FFCRA’s effective date. (## 48 & 49)
  • Clarifies which employers are subject to the FFCRA as having less than 500 employees, although some small businesses (less than 50 employees) may be exempted from the FFCRA (#39):
    • Unlike regular FMLA, employers must count employees as of the date the employee is to take leave. (#50)
    • Small businesses (less than 50 employees) can be exempted from providing paid FFCRA leave if “authorized officer” determines one of the following:
    • Expense of compliance with FFCRA exceeds the company’s revenues and will cause business to cease even minimal operations;
    • Employee’s absence will cause substantial risk to company’s financial health and/or operational capabilities; or
    • Insufficient employees remaining to all company to meet minimal business operations. (## 58-59)
  • Defines “son or daughter” to mean any biological, adopted and/or foster child and can include children over the age of 18 if that child has a physical or mental disability and is unable to “self-care” because of the disability. (# 40)
  • Establishes a “hot line” for employees to call when they believe employer is not complying with FFCRA leave requirements. (## 41-42)
  • Describes an employee’s general right to return to work after taking FFCRA leave except in limited circumstance where employer can show hardship conditions to justify failure to return. (# 43)
  • Clarifies that employee can take FFCRA leave, and timing for such leave, even if employee has already exhausted FMLA leave. (## 44-45)
  • Allows time that employee is on FFCRA leave to count towards eligibility for employer-provided health coverage. (# 51)
  • Discusses FFCRA’s applicability to certain public-sector employees. (## 52-54)
  • Defines “health care provider” who can certify FFCRA leave as including “a licensed doctor of medicine, nurse practitioner or other health care provider” who is also allowed to issue FMLA certifications. (# 55)
  • Discusses which “health care providers” and “emergency responders” who an employer may exclude from paid leave but urges employers to be “judicious” in making these determinations so as to minimize the spread of COVID-19. (## 56-57)

California employers should continue to monitor our blog for future updates concerning the FFCRA and other employment developments as a result of the COVID-19 pandemic. We also advise employers to seek legal advice to determine whether the FFCRA applies to their business, and if so, what steps to take to ensure compliance.

Coronavirus Aid, Relief, and Economic Security (CARES) Act: Expansion of Unemployment Benefits Through the Pandemic Unemployment Assistance Program

On March 27, 2020, the $2 trillion Coronavirus Aid, Relief, and Economic Safety (CARES) Act was passed by the House of Representatives and signed into law by President Trump as the largest emergency aid bill in history. The CARES Act significantly expands unemployment benefits and comes on the heels of 3.3 million Americans having applied for unemployment benefits last week. In California specifically, there were 186,809 claims for unemployment benefits to the Employment Development Department last week.

The CARES Act includes a temporary Pandemic Unemployment Assistance program that is fully funded by the federal government. The assistance applies retroactively to January 27th and extends through December 31st, with a maximum of 39 weeks of assistance (inclusive of weeks when the employee received extended benefits or regular compensation). Individuals who are receiving paid sick leave or other paid leave benefits and those that can work remotely with pay are excluded from the program.

The program expands unemployment insurance to those who do not typically qualify, including gig economy workers who are classified as independent contractors and self-employed individuals. Specifically, benefits will be provided to any person who is unemployed or partially unemployed due to any of the following:

  • The individual has received a COVID-19 diagnosis, or is experiencing symptoms and seeking a medical diagnosis;
  • A member of the individual’s household has been diagnosed with COVID-19;
  • The individual is providing care for a family member or household member who has been diagnosed with COVID-19;
  • The individual is the primary caregiver for a another person in the household who is unable to attend school or another facility due to COVID-19;
  • The individual is unable to reach the workplace because of a quarantine imposed due to COVID-19;
  • The individual was scheduled to begin work, but could not do so because the place they were scheduled to begin work at has been shut down due to COVID-19;
  • The individual lives in a household where the head of household died directly due to COVID-19;
  • The individual’s workplace has been closed because of COVID-19.

Individuals who are furloughed, but have not fully been laid off, are also eligible for unemployment benefits.

Every individual receiving unemployment benefits will be provided $600 per week, in addition to the weekly benefit amount authorized under state unemployment compensation law, for up to four months. Additionally, the program provides an extra thirteen weeks of federally funded unemployment benefits through the end of the year to assist individuals who remain unemployed after state unemployment benefits are no longer available.

For the standard unemployment benefits that the state remains responsible for, the federal government will provide payments to the state to reimburse government agencies, nonprofits, and Indian tribes for fifty percent of the costs they incur through the end of the year to pay unemployment benefits. For those states that decide to pay recipients of unemployment benefits as soon as they become unemployed, rather than waiting a week, the federal government will provide funding to pay the first week of unemployment benefits. This is applicable in California, as Governor Newsom has waived the first week waiting period, meaning that people will receive a full two weeks of benefits on their first unemployment benefits check, as opposed to one week. Further, for those states that offer “short-term compensation” programs for employees who have their hours reduced, California being one of them, the federal government will pay one hundred percent of the costs incurred by the state through the end of the year.

The attorneys at Weintraub Tobin continue to wish you and your families good health during these difficult times. Please feel free to reach out to one of us if you have any questions regarding this expansion of unemployment benefits and how that may relate to your workforce.

DOL Updates Questions & Answers Page for Families First Coronavirus Response Act

Earlier this week, we advised you that the US Department of Labor had issued a Question & Answers webpage that addressed some issues arising out of the passage of the FFCRA, most importantly clarifying that it would become effective on April 1, 2020. (Click here.) Yesterday, the DOL updated that “Questions and Answers” webpage and added more than 25 new questions and answers regarding various issues under the FFCRA for both employers and employees. Here is a summary of the various issues addressed by the updated Q&A page:

  • Clarifies that the FFCRA creates a new paid leave as of April 1st and does not apply retroactively:
    • Employees are not entitled to FFCRA leave if:
      • Employer has closed work site and/or furloughed employee prior to April 1; 2020; or
      • Employer closes work site and/or furloughs employee after April 1, 2020 but before employee has started FFCRA leave.
  • Makes clear that FFCRA leave can be taken intermittently in certain circumstances related to having to take care of children who are subject to school/child care closures.
  • Only employees who have been on the employer’s payroll for at least 30 calendar days prior to the FFCRA’s effective date (i.e. as of March 2, 2020) are eligible for FFCRA leave.
  • Explains the types of documentation that an employer can require from an employee (and must maintain) in relation to FFCRA leave as well as the employee’s obligations to provide such documentation.
  • Employees are only eligible for FFCRA leave if they are unable to work (even remotely) as a result of COVID-19, which includes those employees required to stay-home by local authorities and are unable to work remotely. If an employer has work for the employee, and the employee can perform that work remotely, the employee is not eligible for the leave (absent having symptoms of, or caring for a family member with symptoms of COVID-19) just because they cannot report to their normal worksite.
  • Employees cannot receive both unemployment pay and FFCRA paid leave.
  • Although employers can consider paying employees on FFCRA leave an amount in excess to that required by the law, the employer will not be able to claim, or be entitled to receive, a tax credit for that excess amount.
  • Employers who are subject to multi-employer collective bargaining agreements may be able to satisfy their FFCRA obligations by making contributions to the multi-employer fund or plan under certain conditions.

California employers should continue to monitor our blog for future updates concerning the FFCRA and other employment developments as a result of the COVID-19 pandemic. We also advise employers to seek legal advice to determine whether the FFCRA applies to their business, and if so, what steps to take to ensure compliance.

San Francisco Issues New Guidance on San Francisco Paid Sick Leave During Pandemic; Financial Relief for San Francisco Employers

On March 24, 2020, the San Francisco Office of Labor Standards Enforcement issued guidance pertaining to the use of Paid Sick Leave under the San Francisco Paid Sick Leave Ordinance (PSLO).  This publication supersedes the OLSE’s guidance issued just last week. Employers should be aware of temporary changes in the PSLO rules specific to the current pandemic:

  1. No Doctor’s Notes for Duration of COVID-19 Local Health Emergency

Under normal circumstances, employers may require a doctor’s note to verify the need for sick leave of more than three consecutive work days.  For the duration of the COVID-19 “Local Health Emergency,” however, employers may not require a doctor’s note or other documentation for the use of paid sick leave taken pursuant to the San Francisco Paid Sick Leave Ordinance.

The rule will automatically revert to normal after the Local Health Emergency expires, or the OLSE revokes it sooner.

  1. Eligibility for Paid Sick Leave

The OLSE clarifies that employees who have been laid off, as opposed to furloughed, are not entitled to Paid Sick Leave.

Employees who are not ill and otherwise do not qualify for PSL (see item 3, below), but who have had their hours reduced or eliminated due to business slowdowns, are not entitled to use accrued paid sick leave to make up their lost pay.  Employees who remain scheduled to work may continue to use their accrued paid sick leave for any qualifying reason for any portion of their scheduled hours they are unable to work.

Note, however, that employers with 499 or fewer employees in San Francisco may need to provide employees who are unable to work or telework due to local, State or Federal quarantine or isolation orders, with up to 80 hours of Emergency Paid Sick Leave under the Families First Coronavirus Response Act, which takes effect April 1, 2020.  See https://www.dol.gov/agencies/whd/pandemic/ffcra-questions.

  1. Employee Use of Paid Sick Leave for Local Health Emergency Reasons

An employee may use accrued paid sick leave if he or she needs to take time off work because:

  • Public health officials or healthcare providers require or recommend that the employee isolate or quarantine him or herself;
  • The employee falls within the definition of a “vulnerable population” under the San Francisco Department of Public Health’s (DPH) March 6, 2020 guidelines or any subsequent updates.  As of March 6, 2020, a “vulnerable population” is a person who is 60 years old or older or a person with a health condition such as heart disease, lung disease, diabetes, kidney disease, or weakened immune system;
  • The employee takes time off work because the employee’s business or a work location temporarily ceases operations in response to a public health or other public official’s recommendation – subject to the “Eligibility for Paid Sick Leave” guidelines above;
  • The employee takes time off work because the employee needs to provide care for a family member who is not sick but who public health officials or healthcare providers have required or recommended isolate or quarantine; or
  • The employee takes time off work because the employee needs to provide care for a family member whose school, child care provider, senior care provider, or work temporarily ceases operations in response to a public health or other public official’s recommendation.
  1. Paid Sick Leave Not Paid Out at Separation

The OLSE also revised two of its FAQs, which clarify but do not represent a change in the law:

  • Employees are not entitled to a payout of Paid Sick Leave upon termination. However, if the employer uses a combined “PTO,” unlimited PTO, or vacation policy to comply with the SF PSLO (and does not separately track and accrue Paid Sick Leave for its employees) then the PTO is paid out upon separation. This is consistent with existing California law.
  • If there is a separation from employment, and an employee is later rehired by the employer within one year, previously accrued and unused paid sick leave must be reinstated, and the employee is entitled to use the previously accrued and unused paid sick leave and to accrue additional paid sick leave upon rehiring.

Financial Relief Available for Employers (Updated 3/30/2020)

As noted in my blog post last week, if employers pay their San Francisco employees for extra sick time (beyond the amount required by the SF PSLO), the City will reimburse $15.59 per hour for extra sick leave up to 40 hours, for up to 499 employees, through its new Workers and Families First Program.  Employers will need to pay their San Francisco staff the extra sick time at their regular rate before they can get reimbursed.

A step-by-step program guide has been published here, and the reimbursement application form is now available here.

Employers should apply for reimbursement as soon as possible once they have paid out sick time, because the funding is limited to $10 million and is first-come, first-served.

Additional financial relief for San Francisco businesses is available during the local COVID-19 emergency:

  • The City has deferred business taxes due April 30, 2020, for businesses with up to $10 million in gross receipts, for nine months with no interest or penalties.
  • The City is deferring collection of annual small business license and permit fees, for at least three months.
  • Water shut offs and late fees are being suspended for at least 60 days.
  • The City has declared a moratorium on commercial (and residential) evictions due to nonpayment until at least April 15, 2020, for small business and residents.

Please be sure to frequently check the Office of Economic and Workforce Development’s list of resources and financial assistance available, or contact one of the Labor and Employment attorneys at Weintraub for guidance.

DOL Issues Model Notice To Employees Of Rights Under Families First Coronavirus Response Act

In response to the COVID-19 pandemic, Congress recently passed the Families First Coronavirus Response Act (“FFCRA”). Among other things, the FFCRA requires certain employers to provide their employees with paid sick leave and expanded family and medical leave for specified reasons related to COVID-19. Employees’ leave rights under the FFCRA apply from April 1, 2020 through December 31, 2020.

The FFCRA requires that employers “post and keep posted, in conspicuous places on the premises of the employer where notices to employees are customarily posted, a notice, to be prepared or approved by the Secretary of Labor, of the [FFCRA’s requirements].”  The FFCRA also requires the Labor Secretary to create that model notice and make it publicly available within 7 days.

Today, the Department of Labor issued that notice. The document is entitled Employee Rights: Paid Sick Leave and Expanded Family and Medical Leave Under the Families First Coronavirus Response Act, and a copy of can be found on the DOL’s website here.

The notice contains summaries of employees’ paid leave entitlement amounts, an explanation of which employees are eligible, the qualifying reasons for which employees can use the leave, and information on the DOL’s enforcement mechanisms.

Consistent with other employment law posting obligations, employers should post this DOL notice in a conspicuous place where it can be easily read throughout the workday. Employers who have employees telecommuting should post the notice in an online portal where remote workers can easily access and read it, or alternatively email or otherwise electronically transmit a copy of the document to its remote workforce.

More information about the FFCRA can be found in our previous blogs here (summary of the new law), here (tax relief for employers), here (payroll tax credit and period of non-enforcement), and here (DOL Qs & As).  If you have any questions regarding the FFCRA or the impacts of the COVID-19 pandemic on your workplace, please do not hesitate to reach out to any of our Labor and Employment attorneys for guidance.

Federal Stimulus in Response to COVID-19

On Wednesday, March 25, the Senate and the White House reached a deal regarding a $2 trillion coronavirus economic stimulus package.

The Senate plans to vote on the legislation on March 25.  Then the House will need to pass it before it goes to the President to sign it into law.  For the House to pass it quickly on Wednesday, the vote would need to happen by a voice vote without any objections from any member of the House, otherwise the legislators will need to return to D.C. for a vote.  The House reconvenes on Thursday, March 26.

The text of the legislation has not been released.  Although details on the provisions are scant, sources indicate the legislation contains the following:

  • $500 billion for loans and assistance to companies, including $50 billion for loans to airlines and state and local governments
  • $350 billion in aid to small businesses, mostly in the form of loans through the Small Business Administration and banks; such loans used for payroll, mortgage, and rent expenses will be eligible for forgiveness
  • Direct payments to individuals in the amount of $1,200 for each adult, and $500 for each child under age 17 (subject to phase outs starting at the following amounts for the following types of taxpayers based on 2019 adjusted gross income (AGI): individuals with AGI of $75,000, couples filing jointly with AGI of $150,000, and heads of household with AGI of $112,500)
  • Unemployment insurance expanded to provide $600 per week for four months in addition to state benefits, and expanded eligibility to benefit more workers
  • Treasury oversight over who gets money and how they use it
  • Limits on companies receiving aid: prohibited stock buybacks during the term of the loan and the following year, limits on executive bonuses, required measures to protect workers
  • Required disclosure by Treasury Department regarding terms of loans or other aid to companies
  • Prohibitions on companies receiving aid where such companies are owned by certain politicians or government officials
  • $100 billion directly to hospitals and health care providers, $250 million in hospital grants, and payments for vaccines and test kits

We will be tracking these developments and providing updates.

Families First Coronavirus Response Act Takes Effect April 1, 2020

We have kept you advised of recent federal actions taken in response to the COVID-19 outbreak, including the passage of the Families First Coronavirus Response Act (“FFCRA”) which, among other things, provides paid family leave for certain employees. (See previous blogs at herehere, and here.) The FFCRA was to take effect “no later than 15 days” after being signed by the President. Given that it was signed on March 18, 2020, many legal commentators advised that it would take effect on April 2nd. The U.S. Department of Labor has now clarified that the FFCRA will instead take effect one day earlier on April 1, 2020.

Yesterday, the DOL issued a “Questions and Answers” webpage for the FFCRA. This Q&A page states: “The FFCRA’s paid leave provisions are effective April 1, 2020, and apply to leave taken between April 1, 2020 and December 31, 2020.” The Q&A page addresses a number of questions for both employers and employees, including which employers are subject to the FFCRA and calculating pay for purposes of complying with the FFCRA, such as computing hours for part-time employees and including overtime for full-time employees. The Q&A page also states that while there is an exemption for small businesses, the DOL will address that exemption in more detail in a future Q&A page.

We recommend that employers continue to monitor our blog for future updates concerning the FFCRA and other employment developments as a result of the COVID-19 pandemic. We also advise employers to seek legal advice to determine whether the FFCRA applies to their business, and if so, what steps to take to ensure compliance.

Webinar: The Impact of New Coronavirus Legislation on Business

  • When: Apr 2, 2020

On April 2, 2020, Chris Chediak and Jim Clarke of Weintraub Tobin joined with Jose Blanco and Brian Hoblit of CVF Capital Partners and Ben Brown of BFBA LLP to present a webinar on the implications of new laws, regulations, and initiatives in response to the COVID-19 pandemic, including the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Presenters covered economic forecasts, low-interest and potentially forgivable loans, tax benefits to privately-held companies, guidance for employers, and updates for real estate owners and landlords.

Details of various programs were still evolving the day of the presentation, and in fact, continue to do so.  Panelists and other professionals from the three presenting companies continue to monitor changes and update clients as new information becomes available.

You may find updated information here:

Weintraub Tobin COVID-19 Resources

CVF Capital Partners Blog

BFBA LLP  COVID-19 Updates

Webinar Resources:
  • Webinar PowerPoint (PDF)
  • PPP Application (PDF)
  • Loan Calculator (Excel)
  • Webinar Recording (YouTube) Please note that information on these issues is constantly changing and being updated, and some of the information presented in this webinar has already changed.  Please check with your professional advisors to make sure that you have the most recent information.