In March 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was passed by Congress and signed into law, providing various forms of significant economic relief for individuals and businesses; two of the more notable relief measures for workers were enhanced unemployment benefits and the Families First Coronavirus Response Act (FFCRA), which provides paid sick and family leave for eligible workers affected by COVID-19, fully funded by the federal government via tax credits.
With certain aspects of these benefits due to expire (e.g., the $600.00 Federal Pandemic Unemployment Compensation benefit expired July 31), both the House and the Senate have proposed additional legislation intended to supplement the earlier CARES Act stimulus package; however, no agreement has been reached.
Despite the lack of an agreement on additional COVID-19 aid, recent developments in both enhanced unemployment benefits and FFCRA are worth noting for employers as the economic impact of COVID-19 continues to be a challenge for many businesses and workers.
Enhanced Unemployment Benefits “Re-boot”
- An executive order recently signed by the president included a $400 re-boot of the extra unemployment bonus (previously) provided for under the CARES Act. $300 of the bonus payment is federally funded (through FEMA), with the remaining $100 funded by the states.
- Many states indicated that they would have a challenge with both the funding of the $100 as well as the systems/processes that would need to be updated in order to process the overall payments. As a result, states are permitted to count existing unemployment wages towards the $100 funding requirement.
- To date, nearly all U.S. states have received approval for the enhanced unemployment (including all New England states).
- Payments have begun/will begin soon for workers unemployed due to COVID-19 and receiving at least $100 per week in unemployment wages and are retroactive to August 1st.
- Funding is up to six weeks, with beyond that TBD and will be monitored week by week – many estimates have the funding running out sooner.
Developments and Potential Changes to the FFCRA
- FFCRA paid sick and family leave is still due to expire December 31.
- A Southern District NY federal court judge recently ruled that the United States Department of Labor (US DOL) had overstepped its authority in its Final Rule interpreting FFCRA. On September 11th the U.S. DOL responded, with any noted updates/changes effective September 16th:
- Work Availability – The FFCRA does not currently provide for paid sick leave if a worker’s employer is shut down due to COVID-19 and no work is available as a result – only when workers themselves have been ordered to stay home by a health care provider or government order. While the NY ruling allowed for FFCRA leave even if the worker’s business has suspended operations (and thus no work is available) the U.S. DOL reaffirmed that if no work is available due to a shutdown then FFCRA leave is not available.
- Definition of “Health-Care Provider” – Employers of “Health-Care Providers and Essential Workers” are currently permitted to exempt those workers from paid leave due to the nature of their work. The judge’s ruling found that exemption to be overly broad, stating that the exemption should only apply to those workers “essential to the provision of health care services” i.e. doctors, nurses, first responders. The U.S. DOL agreed, and thus the exemption has been narrowed to include only those providing health care services, including lab technicians etc. but not general support or non-healthcare duty roles.
- Intermittent Leave – Currently available under FFCRA only with “employer agreement,” the NY judge ruled that where “public-health considerations” are not part of the equation (i.e. where a parent must stay home because their child’s school is closed), eligible employees can take leave intermittently without employer consent. The U.S. DOL disagreed, reaffirming that employer approval can be required for intermittent leave – however, in “hybrid-learning” situations each day of school closure is considered its own “qualifying event” under FFCRA and thus does not constitute intermittent leave.
- Documentation – While the FFCRA allows employers to require employees to follow “reasonable” notice procedures, the Final Rule’s requirements are more stringent, requiring detailed information to be provided prior to FFCRA leave. The judges’ ruling effectively restores the less onerous requirements under FFCRA. The U.S. DOL agreed, indicating that employees must provide notice “as soon as practicable,” not necessarily prior to, FFCRA leave.
- Along these same lines the U.S. DOL recently clarified questions around FFCRA when a child’s school is open, operating remotely or in a hybrid model. More specifically, FAQs 98-100 indicate the following:
- Hybrid Learning (FAQ #98) – The DOL clarified that an eligible employee may take FFCRA leave on days when a child’s school is providing remote learning only.
- Voluntary Remote Learning (FAQ #99) – If a child’s school is otherwise open and a parent decides to still keep their child home for remote learning the parent would not be eligible for FFCRA leave.
- Transition to In-Person Learning (FAQ #100) – Once a school that has operated remotely provides in-person learning, FFCRA leave will not be available.
What Employers Should Be Thinking About
As has been the case for most of 2020, employers should continue to be vigilant in monitoring unemployment claims, providing bona fide return to work job offers in writing, and notifying state unemployment agencies when fraudulent unemployment claims are suspected.
An understanding of the many nuances of FFCRA leave is critical, as is continuing to keep an eye on legislative activity at both the state and federal levels. Employee handbooks (including leave policies and procedures) should also be reviewed to ensure that there is proper alignment with ever evolving employee rights, employer requirements and new models of when, where and how work is done.
We will continue to keep you informed as developments occur. If you have questions in the meantime, please reach out to us here.
See our previous article “Preparing for Emergence” for more information on what businesses can do now to better position themselves as states start reopening.