US Department of Labor Frances Perkins Building

On September 25, the U.S. Department of Labor (DOL) proposed regulations which, if adopted, would establish factors for determining whether an individual is an employee or independent contractor under the Fair Labor Standards Act (FLSA). The FLSA requires employers maintain certain records regarding employees and provide a federal minimum wage and overtime to nonexempt employees. (Please see here for a discussion about joint employer obligations under the FLSA).  Currently, the FLSA defines (i) “employee” as “any individual employed by an employer” and (ii) “employ” as “to suffer or permit to work.” However, the FLSA does not define “independent contractor.”

Administrative agencies and the courts have developed an array of factors to determine whether an individual is an independent contractor. The DOL intends the proposed regulations to focus the various interpretations into five factors establishing an economic reality test, rescinding any inconsistent, prior administrative rulings and interpretations. Ultimately, if “in economic reality”: (x) an individual is “economically dependent” on the employer, then the individual is classified as an “employee”; and (y) if an individual is “in business for himself or herself”, then such individual is an independent contractor.

Proposed § 795.105(d) divides the economic reality factors into “core factors” and “other factors”, with the two core factors carrying more weight than the three other factors.  The “core factors” under proposed § 795.105(d)(1) consider the individual’s: (i) “nature and degree of […] control over the work”; and (ii) “opportunity for profit or loss.” Under the core factors, if the individual (i)”exercises substantial control over key aspects of the performance of the work” and (ii) “has an opportunity to earn profits or incur losses based on his or her exercise of initiative (such as managerial skill or business acumen or judgment),” then these factors indicate a “substantial likelihood” that the individual is an independent contractor. Alternatively, if the potential employer exercises substantial control over the individual (such as setting the individual’s schedule and prohibiting work with competitors of the business) and the individual cannot “affect his or her earnings or is only able to do so by working more”, then these factors would likely indicate an employee classification.

The “other factors” under proposed § 795.105(d)(2) consider: (i) “the amount of skill required for the work”; (ii) “the degree of permanence of the working relationship between the individual and the potential employer”; and (iii) “whether the work is part of an integrated unit of production.” Under the “skills required” factor, if the individual depends on the potential employer for specialized training then this may indicate the individual is an employee, rather than an independent contractor. Under the “permanence” factor, if the length of the work relationship between the parties is “by design definite in duration or sporadic,” then this may indicate the individual is an independent contractor. However, the proposed regulations note that seasonal work does not automatically lead to an independent contractor classification. Under the “integrated unit” factor, an individual may be considered an employee if such individual’s work is “a component of a potential employer’s integrated production process for a good or service” and not “segregable” from it.  The DOL’s discussion of the proposed regulations notes that these factors are not as probative in determining whether an individual is an independent contractor, nor do they apply in every instance.

Furthermore, the proposed regulations direct that actual practice between the parties governs the analysis of the economic reality test over what may be possible in theory or stated by the contract. For instance, if the contract authorizes the potential employer “to supervise or discipline” the individual, yet in practice the potential employer never does so, then the actual practice would likely indicate an independent contractor relationship. The DOL anticipates the proposed regulations will “add much needed clarity and efficiency to the economic reality test” and invites comments on the proposed regulations.

The DOL will be accepting comments on the proposed regulations until October 26, 2020 at http://www.regulations.gov. If and when approved, employers should review their own policies and practices to determine the affect these new regulations would have on them. For further information or guidance on revising your policies, procedures, and contracts, please contact David Paseltiner or Jessica Baquet.

 

 

Sick Leave Law book and the stethoscope.

Earlier this year, New York State enacted a new  sick leave law, which becomes effective Wednesday, September 30. This law requires all New York State employers to allow employees to accrue sick leave. Although accrual of sick leave begins on the 30th, employees may not take the leave until January 1, 2021.

This law is separate and distinct from the New York State emergency paid sick leave law, which went into effect March 18, 2020 (discussed here). It remains unclear how these two laws will co-exist in 2021, although since the emergency sick leave law is a required benefit over and above any standard paid sick leave provided by an employer, it is possible that the emergency sick leave will be required in addition to the newly required sick leave.

Amount of Required Leave

The amount of mandated paid or unpaid sick leave available to employees is determined by the employer’s employee count and/or net income in the previous tax year, as follows:

 

Number of Employees Net Income Required Leave
1-4 $1 million or less 40 hours of unpaid sick leave each calendar year
1-4 More than $1 million 40 hours of paid sick leave each calendar year
5-99 Not relevant 40 hours of paid sick leave each calendar year
100 or more Not relevant 56 hours of paid sick leave each calendar year

For purposes of determining the number of employees, “calendar year” means the 12-month period from January first through December thirty-first. For all other purposes, “calendar year” shall either mean the 12-month period from January first through December thirty-first, or a regular and consecutive 12-month period, as determined by the employer.

Employers are allowed to provide sick leave, paid or unpaid, in excess of these requirements, and may adopt paid leave policies that provide additional benefits to employees. In addition, an employer may elect to provide its employees with the total amount of sick leave required to fulfill its obligations under the law at the beginning of the calendar year, provided, however that if an employer does so, it is not allowed to reduce or revoke any such sick leave based on the number of hours actually worked by an employee during the calendar year.

Employers that already meet the requirement of the new law under existing employee policies do not need to increase their sick leave allotments.

Accrual of Leave

Employees will accrue sick leave at a rate of not less than one hour for every 30 hours worked, beginning at the commencement of employment or September 30, 2020, whichever is later, subject to the use and accrual limitations described in this article.

Purpose of Leave

Starting January 1, 2021, upon the oral or written request of an employee, employers are required to provide accrued sick leave for the following purposes:

(i) for a mental or physical illness, injury, or health condition of such employee or such employee’s family member, regardless of whether such illness, injury, or health condition has been diagnosed or requires medical care at the time that such employee requests such leave;

(ii) for the diagnosis, care, or treatment of a mental or physical illness, injury or health condition of, or need for medical diagnosis of, or preventive care for, such employee or such employee’s family member; or

(iii) for an absence from work due to any of the following reasons when the employee or employee’s family member has been the victim of domestic violence pursuant to subdivision thirty-four of section two hundred ninety-two of the executive law, a family offense, sexual offense, stalking, or human trafficking:

(a) to obtain services from a domestic violence shelter, rape crisis center, or other services program;

(b) to participate in safety planning, temporarily or permanently relocate, or take other actions to increase the safety of the employee or employee’s family members;

(c) to meet with an attorney or other social services provider to obtain information and advice on, and prepare for or participate in any criminal or civil proceeding;

(d) to file a complaint or domestic incident report with law enforcement;

(e) to meet with a district attorney’s office;

(f)  to enroll children in a new school; or

(g) to take any other actions necessary to ensure the health or safety of the employee or the employee’s family member or to protect those who associate or work with the employee.

For the purposes of taking leave, the reasons outlined above in (a) through (g) must be related to the domestic violence, family offense, sexual offense, stalking, or human trafficking. A person who has committed such domestic violence, family offense, sexual offense, stalking, or human trafficking it not eligible for leave for situations in which the person committed such offense and was not a victim, notwithstanding any family relationship.

“Family member” means an employee’s child, spouse, domestic partner, parent, sibling, grandchild or grandparent; and the child or parent of an employee’s spouse or domestic partner. “Parent” means a biological, foster, step- or adoptive parent, or a legal guardian of an employee, or a person who stood in loco parentis when the employee was a minor child. “Child” means a biological, adopted or foster child, a legal ward, or a child of an employee standing in loco parentis.

Other Provisions

An employer may not require the disclosure of confidential information relating to a mental or physical illness, injury, or health condition of an employee or an employee’s family member, or information relating to absence from work due to domestic violence, a sexual offense, stalking, or human trafficking, as a condition of providing sick leave pursuant to the law.

An employer may set a reasonable minimum increment for the use of sick leave, provided it does not exceed four hours. Employees are required to receive compensation at their regular rate of pay, or the applicable minimum wage, whichever is greater, for the use of paid sick leave.

Employers are required to allow employees to carry over unused sick leave to the following calendar year, provided, however, that: (i) an employer with fewer than 100 employees may limit the use of sick leave to 40 hours per calendar year; and (ii) an employer with 100 or more employees may limit the use of sick leave to 56 hours per calendar year. The law does not require employers to pay an employee for unused sick leave upon such employee’s termination, resignation, retirement, or other separation from employment.

Upon returning to work following any sick leave taken pursuant to the law, an employee must be restored to his or her position of employment as held by such employee prior to taking such sick leave, with the same pay and other terms and conditions of employment.

Upon the oral or written request of an employee, an employer must provide a summary of the amounts of sick leave accrued and used by such employee in the current calendar year and/or any previous calendar year, such information to be provided within three business days of such request.

This law does not interfere with existing municipal sick leave laws (such as in New York City and Westchester County) and allows for cities to enact local laws or ordinances that conform to or exceed the law, if the city has a population of one million or more.

Next Steps

All employers should review their current sick leave policies to determine if any revisions are necessary to meet the minimum requirements of the new law (and, if an employer does not intend to pay for unused sick leave on termination, to confirm that their policies are clear on this issue), and make sure that their human resources personnel are aware of the law and properly tracking accruals commencing September 30.

For further information or guidance on revising your policies and procedures in accordance with this law, please contact David Paseltiner at dpaseltiner@jaspanllp.com or Jessica Baquet at jbaquet@jaspanllp.com.

Anti discrimination

As the legal and regulatory schemes arising from COVID-19 continue to shift and evolve, it is crucial that employers stay up to date on the latest in compliance. To that end, certain agencies offer primers and fact sheets to help guide the way.

Just this month, for instance, the Equal Employment Opportunity Commission (“EEOC”) updated its online primer on COVID-19 and the Americans with Disabilities Act (“ADA”), the Rehabilitation Act, and more. These updates, which concern disability-related inquiries, medical exams, the confidentiality of medical information, reasonable accommodations for people with disabilities, planning for furloughs and layoffs, and treatment of older workers, are summarized below:

Can I Test My Employees for COVID-19?

An employer may administer COVID-19 testing to employees before initially permitting them to enter the workplace and/or periodically thereafter. This is consistent with guidelines set forth by the Centers for Disease Control and Prevention (“CDC”), and the ADA’s “business necessity” standard, pursuant to which testing is appropriate if used to determine whether an employee’s present condition poses a direct threat to others in the workplace.

What Can and Can’t I Ask My Employee with Respect to COVID-19?

Employers may ask all employees who will be physically entering the workplace (1) if they have COVID-19 or symptoms associated with COVID-19, and (2) whether they have been tested for COVID-19. In fact, employers in New York State are required to ask such questions of employees and visitors pursuant to an executive order issued by Governor Andrew Cuomo. With respect to employees working remotely, such questions are generally not permitted.

Under the ADA, it is alright to ask such questions of only one employee, as opposed to all employees, provided the employer has a reasonable belief, based on objective evidence, that such employee might have COVID-19. Such evidence might include, for instance, a display of symptoms. In addition, when determining whom to ask, the employer may follow the recommendations of the CDC or other public health authorities, as the ADA would not require otherwise.

It is also okay to ask an employee why he or she did not report to work. This question has always been permissible under the ADA, and COVID-19 has not changed that. Questions about travel are also permissible under the ADA, as they are not disability-related. In other words, if the CDC or public health officials recommend or mandate a quarantine after travel to certain locations, an employer may ask whether an employee has traveled to such locations.

An employer cannot ask whether its employee has family members with COVID-19, as such questions are prohibited by the Genetic Information Nondiscrimination Act (GINA). The compliant, and ultimately more useful, question is whether said employee has had contact with anyone diagnosed with the disease, or with symptoms of the disease.

What Should Be Done if It Is Suspected that an Employee Has COVID-19?

The ADA requires that an employer keep all medical information about employees confidential, even information about COVID-19. Accordingly, if an employee is suspected to have COVID-19, that suspicion should be kept as confidential as possible. In other words, while a designated representative of the employer may be notified so as to ensure compliance with guidelines set forth by the CDC and public health officials, every effort should be made to limit the number of people who know the name of the employee.

For instance, it is not an ADA violation for an employer to interview a sick or potentially sick employee to ascertain a list of people with whom that employee has been in contact. However, when notifying those on the list, the name of the sick or potentially sick employee must not be revealed. Coworkers might be able to figure out who the employee is, but employers in that situation are still prohibited from confirming or revealing the employee’s identity.

If an employee is undergoing quarantine and working remotely, the fact that the employee is under quarantine is confidential, whereas the fact that the employee is working remotely is not. In other words, if an employee is absent or on leave, the employer cannot disclose the reason for the absence or leave, but may disclose that the individual is absent or on leave.

In the event that a manager is working remotely, such manager must safeguard any medical information received regarding COVID in accordance with the ADA requirement that medical information be stored separately from regular personnel files. If a manager cannot comply fully with such requirement, the information must be safeguarded to the greatest extent possible.

How Do I Deal with Requests for Reasonable Accommodations Under the ADA During the Pandemic?

The pandemic has disrupted normal work routines and, in some instances, has caused an increase in requests for reasonable accommodations under the ADA. In light of this increase, employers may be delayed in addressing these requests, but employers should do so as soon as possible, and are encouraged to use interim solutions to enable employees to keep working. This is true also for federal agencies, which are required to include timelines in their procedures governing how quickly they process requests for reasonable accommodations. The pandemic may constitute an “extenuating circumstance” that justifies exceeding that timeline.

To get ahead of a potential increase in requests for accommodations, employers may invite employees with disabilities to request accommodations in advance of a reopening.  If an advance request is received, the employer may begin the exchange of information known as the “interactive process,” by which an employer asks questions and/or requests documentation to determine whether an employee’s disability necessitates an accommodation.

As a practical matter, an employer may not be able to provide teleworking employees with the same ADA accommodations they would receive in the workplace. Where possible, an employer should provide interim accommodations to teleworking employees, provided such accommodations are necessary and do not pose an undue hardship, which means “significant difficulty or expense.”

The fact that employees with disabilities have been permitted to telework during the pandemic does not mean they are entitled to continue doing so as an ADA accommodation. If there is no disability-related limitation that requires teleworking, the employer does not have to provide telework as an accommodation. Moreover, the employer is entitled to understand whether there is such a disability-related limitation.

A similar standard applies to employees excused from one or more essential functions of their jobs during a COVID-related shutdown. Upon reopening, the employer is not obligated under the ADA to refrain from restoring all such essential duties. Requests for continued or new accommodations should be evaluated under the usual ADA rules.

For employers who previously refused to grant an accommodation because of concerns that an employee would not be able to perform essential functions remotely, pandemic-related telework may serve as a de facto trial period. If that employee wishes to continue teleworking, said trial period could inform whether the employer should reevaluate such request. The employer and employee should engage in a flexible, cooperative and interactive process if this issue does arise.

Do the Same Laws Against Discrimination Apply When I Am Planning Furloughs and Layoffs?

When planning for furloughs or layoffs, employers must keep in mind laws and regulations protecting against discrimination. Employers are prohibited from selecting a person for furlough or layoff selecting because of that individual’s race, color, religion, national origin, sex, age, disability, protected genetic information, or in retaliation for protected EEO activity. For instance, if an employer is allowing certain people to telework, an older, comparable worker should not be given fewer flexibilities or otherwise treated less favorably based on age.

This information represents only a small portion of the wealth of pandemic-related guidance offered on the EEOC’s website. Though frequently updated, much of such information it is based on a webinar held on March 27, 2020, which was transcribed and is still available at www.eeoc.gov/coronavirus. Additionally, regular updates will be made available through Jaspan’s COVID-19 Resource Center, where employers can turn for guidance in facing difficult workforce issues and compliance matters during the COVID-19 pandemic.

If you have any questions, please contact Rachel Morgenstern at rmorgenstern@jaspanllp.com or (516) 393-8291.

 

 

 

We previously blogged about a decision of the U.S. District Court for the Southern District of New York (SDNY) that invalidated portions of the U.S. Department of Labor’s (USDOL) final rule (Original Final Rule) relating to paid coronavirus leave under the Families First Coronavirus Response Act (FFCRA). To recap, that ruling: (1) invalidated USDOL’s rule that paid leave is only available if an employer has work for an employee to take leave from, because USDOL failed to provide a sufficient reason for imposing such a requirement; (2) struck down USDOL’s definition of “health care providers” who can be exempted from the FFCRA’s paid leave protections, because that definition was too broad; (3) eliminated USDOL’s mandate that an employee is only entitled to intermittent use of paid leave his or her employer agrees to allow it, because USDOL failed to provide an adequate reason for it; and (4) struck down USDOL’s requirement that an employee must submit documentation supporting his or her request to take leave before leave starts, because the FFCRA allows documentation to be provided at a later date in some situations.

Yesterday, USDOL issued a new rule (New Rule) which changes the Original Final Rule in some respects, and otherwise attempts to reinstate some of the previous requirements in ways that comport with SDNY’s decision. The New Rule, which is scheduled to take effect on September 16, 2020 (unless of course someone seeks and obtains a stay from a court), is summarized below.

The Work Availability Requirement 

The FFCRA provides for paid leave only where an employee is “unable to work (or telework) for a qualifying reason.” However, the Original Final Rule provided that an employer does not have to provide paid leave to an employee who cannot work (or work remotely) if the employer “does not have work” for the employee to do in the first instance (the Work Availability Requirement).

The Original Final Rule gave the following example: if a coffee shop closes temporarily or indefinitely due to a downturn in business related to COVID-19, a cashier of the business who is subject to a stay-at-home order may not take paid sick leave. That is because the lack of work is due to the downturn in business, not the cashier’s inability to leave home.

SDNY struck down the Work Availability Requirement, finding that it limits the availability of paid leave under the FFCRA in an “enormously consequential way” without a sufficient reason for such a “monumental policy decision.”

The New Rule reinstates the Work Availability Requirement but attempts to address SDNY’s concerns by explaining USDOL’s reasoning in more detail. It states that the employee’s qualifying reason for leave must be the “but for” cause of the employee’s inability to work. If an employee has a qualifying reason for leave, but also would not be able to work even in the absence of that reason because there is no work for him or her to do, the employee is not entitled to paid leave.

USDOL provides the following reasons for the Work Availability Requirement. First, USDOL states that this requirement is consistent with the FFCRA, because the law says that an employee is entitled to leave if he or she is unable to work “because” of a qualifying reason. If an employee is unable to work “because” the employer does not have work for him or her to do, then, according to USDOL, the requirements of the law are not met.

Second, USDOL states that the very concept of “leave” means that an employee would have been working if not for his or her qualifying need to be absent. In interpreting the phrase “leave” in other contexts, such as under the Family Medical Leave Act of 1993 (FMLA), USDOL has adopted a similar interpretation that “if an employee is not expected or required to work, he or she is not taking leave.”

Third, USDOL states that the purpose of the FFCRA is to discourage employees who are or may be infected with COVID-19 from coming into the workplace. That purpose would not be served by extending leave to employees who would not otherwise be going to work because there is no work for them to do.

Finally, USDOL reasons that extending leave to employees who do not have work would lead to illogical results. If employees do not have work to do, it is likely that they will be furloughed and will not receive pay from their employer. If a group of employees is furloughed, but one of them comes to have a qualifying reason for FFCRA leave, that employee would then be paid despite the furlough while other furloughed employees would remain unpaid.

This rationale notwithstanding, USDOL cautions that it would be illegal for an employer to manipulate the availability of work in order to avoid granting FFCRA leave to an employee. That sort of conduct would run afoul of laws that prohibit employers from retaliating against employees who request or take job-protected leave.

Health Care Provider Exemption

The FFCRA allows employers to exclude “health care providers” from eligibility for leave benefits. USDOL’s Original Final Rule defined the term “health care provider” in an extremely broad way. SDNY struck down that definition because of its overbreadth, noting that it hinges on the nature of the services the employer provides rather than the duties performed by the employee. For example, the court noted that, under the Original Final Rule, an English professor would be considered a health care provider if he or she worked for a University with a medical school.

In the New Rule, USDOL acknowledges that the purpose of the FFCRA’s permissive exemption of “health care providers” is “to prevent disruptions to the health care system’s capacity to respond to the COVID-19 public health emergency and other critical public health and safety needs that may result from health care providers and emergency responders being absent from work.” Therefore, the New Rule adopts the FMLA definition of “health care provider” and expands upon that definition by including any other employee “who is capable of providing health care services, meaning he or she is employed to provide diagnostic services, preventive services, treatment services, or other services that are integrated with and necessary to the provision of patient care and, if not provided, would adversely impact patient care.” The New Rule provides further parameters for determining which jobs are included, and which are excluded, from the latter portion of the “health care provider” definition.

Intermittent Leave

The FFCRA is silent as to an employee’s ability to take paid leave intermittently. The Original Final Rule attempted to fill this gap by providing that the intermittent use of leave is permissible, but only if the employer agrees to allow it and the employee is taking leave for a reason that involves “a minimal risk that the employee will spread COVID-19 to other employees.” For example, there is a minimal risk that an employee will spread COVID-19 where he or she takes leave to care for a child because school is closed or a childcare provider is unavailable. There is also a minimal risk of transmission where an employee takes leave for any qualifying reason, including one involving exposure to COVID-19, if the employee is working remotely.

SDNY upheld USDOL’s prohibition on the use of intermittent leave where an employee is at risk of spreading COVID-19 to other employees, i.e., where an employee reports to the workplace and seeks leave for any reason involving a potential exposure to COVID-19. However, the court held that, where intermittent leave is available, USDOL failed to provide a sufficient reason for prohibiting the use of intermittent leave if the employer does not agree to it.

The New Rule attempts to reinstate the requirement that intermittent leave can only be taken if an employer agrees to allow it, and to supplement USDOL’s explanation of the reasons for this requirement. Specifically, USDOL notes that, except in specific circumstances, employer approval is required for intermittent leave under the FMLA. According to USDOL, the reason for this requirement in the FMLA context — a recognition of the need to avoid “unduly disrupting the employer’s operations” — is equally applicable to leave under the FFCRA.

USDOL further points out that requiring employer agreement may foster discussions about an employee’s ability to telework, which could ultimately reduce or eliminate the employee’s need for FFCRA leave in the first place.

The New Rule carves out an important exception to the employer agreement requirement. USDOL does not consider an employee’s need for leave to care for a child who is learning remotely on a hybrid schedule to be “intermittent.” Instead, USDOL considers each period of remote learning to be a separate FFCRA qualifying event, regardless of whether the child is learning remotely on alternating days, on half days, or on alternating weeks. In this situation, the employee does not need employer permission to take FFCRA leave only on his or her child’s remote learning days. USDOL does caution, however, that if an employee is seeking to take leave for any period of time in which in-person learning is available to his or her child (i.e., the school is not closed to that child), such a request is considered one for intermittent leave and employer permission is required.

Documentation Requirements

The Original Final Rule required employees to submit certain documentation to their employers before taking leave under FFCRA. However, the law itself said something different. In the case of emergency family leave (i.e., leave to care for a child whose school or place of care is unavailable due to COVID-19), where the need for leave is foreseeable, the law states that the employee must provide the employer “with such notice of leave as is practicable.” In the case of emergency sick leave, on the other hand, the law states that “[a]fter the first workday (or portion thereof) an employee receives paid sick time under this Act, an employer may require the employee to follow reasonable notice procedures in order to continue receiving such paid sick time.”

Because of the conflict between the FFCRA and the Original Final Rule, SDNY held that the documentation requirement is invalid to the extent it requires documentation to be submitted before leave is taken.

Under the New Rule, documentation need not be given by the employee “prior to” taking emergency sick leave or family leave, but rather may be given “as soon as practicable.” USDOL notes that, in most cases, this will be when the employee provides notice to the employer. Additionally, the New Rule explains that, where the need for emergency family leave is foreseeable, notice of the need for leave generally must be provided before leave is taken. If the need for family leave was not foreseeable, the employee may begin to take leave without giving prior notice but must still give notice as soon as practicable.

Conclusion

USDOL has effectively reinstated the Work Availability Requirement and the requirement of employer permission for intermittent leave, with the carve-out described above regarding hybrid learning schedules. As to these matters, the purpose of the New Rule and its preamble is largely to beef up USDOL’s reasoning for these requirements, which SDNY previously found insufficient. There may be future legal challenges to USDOL’s stated reasons for these parts of the New Rule, and it remains to be seen whether they will withstand review by a court.

The New Rule also significantly alters USDOL’s previous definition of “health care providers” for whom employers can choose not to extend paid leave under the FFCRA. It further makes clear that employers can only require employees to submit documentation supporting their request for leave “as soon as practicable.” Whether this requires submission of documentation before or after the employee begins taking leave depends on the circumstances.

If you have any questions, please contact Jessica M. Baquet, the Chair of our Labor and Employment Practice Group, at (516) 393-8292 or jbaquet@jaspanllp.com.

Young mother on maternity leave trying to freelance by the desk with toddler child

Elementary and secondary school students throughout New York State have begun returning to the classroom—in some cases virtually—over the last several days. Whether or not students will attend school in person depends on a number of factors, such as the parameters of each school district’s reopening plan, the child’s grade level, whether or not the child has an individualized education plan and parental preference. As an outgrowth of this new educational landscape, employers must learn how to assess requests by parents for paid leave under the Families First Coronavirus Response Act (FFCRA) to care for children who are learning virtually.

As a refresher, the FFCRA provides for up to twelve weeks of paid leave for employees who cannot work or work remotely due to the need to care for a child whose school or place of care is closed because of COVID-19. Leave is only available if other suitable childcare is not available. And, as a result of a recent decision by a federal court in New York, employees are entitled to take FFCRA childcare leave on an intermittent basis.

The basic contours of the law leave open the question of how employers should respond to requests for paid leave when children are learning remotely some or all of the time, either because their school will not permit them to attend in person or because their parents opted into a virtual learning model. The answer can be found in guidance provided by the United States Department of Labor (USDOL) in the form of responses to frequently asked questions (FAQs) that were most recently updated two weeks ago.

For starters, in its response to FAQ 70, USDOL explained that a child’s school or place of care is considered “closed” if its physical location is closed, even if instruction continues to be provided remotely and/or there is a continued expectation that the child will complete assignments.

More recently, in its response to FAQ 98, USDOL addressed situations in which a child’s school is open, but the school has adopted a hybrid reopening plan that only permits students to attend in-person every other day. According to USDOL, school is effectively considered “closed” on days when an employee’s child is not permitted to attend in person. In that case, a parent may take intermittent childcare leave under the FFCRA on each day the child is engaged in distance learning, so long as the employee actually needs to care for his or her child and no other suitable care is available.

The rules are different when a school has given families the option to have their children attend in person, but parents choose instead to have their children learn remotely. According to USDOL’s response to FAQ 99, parents who opt to have their children participate in distance learning are not entitled to paid childcare leave under the FFCRA because school is not considered “closed” in these circumstances. USDOL points out, however, that a parent might still be entitled to leave if a child is not attending school because he or she was advised by a healthcare provider to self-isolate or self-quarantine (e.g., if school is open but the child may not attend in person because he or she was exposed to COVID-19). In contrast to paid childcare leave, this type of leave has a maximum duration of 80 hours for full-time employees.

USDOL has also provided guidance on situations in which a school has begun the year under a remote learning model but announced that it may reopen for in-person learning at a later date. According to the response to FAQ 100, parents may take paid childcare leave for the period in which the school is only providing remote learning. Whether parents can continue to take advantage of leave after school reopens depends on the circumstances, such as those discussed in USDOL’s responses to FAQs 98 and 99.

Some employers have reacted with skepticism to requests for paid childcare leave by employees who, during the Spring months, managed to work remotely while their children learned virtually from home. Do these employees actually need leave and how far can employers go in trying to find out? FAQ 91 addresses whether employers in this situation can ask employees why they now believe they are unable to work and/whether they have pursued alternative childcare arrangements.

USDOL’s response reminds us that, in contrast to other job-protected leaves, FFCRA leave is to be made more liberally available to employees based only on limited documentation in order to further the goal of slowing the spread of COVID-19. Specifically, USDOL states that employers in this situation may only require an employee to provide an oral or written statement of the qualifying reason that he or she is unable to work, the name of the child being cared for, the name or the school or child care provider that has become unavailable, and a statement that no other suitable person is available to care for the child. While USDOL notes that an employer “may” ask the employee to note any changed circumstances in his or her explanation of why the employee is unable to work, it also urges employers to “exercise caution in doing so.” USDOL further points out that, in previous months, employees may not have been able to effectively care for their children while teleworking or may now choose to take leave because a co-parent is no longer available to provide care.

USDOL’s response to FAQ 91 concludes by stating that employers may discipline an employee who falsely represents that he or she qualifies for paid childcare leave under the FFCRA. The reality, however, is that the restrictions on the information that employers can request from employees greatly hampers their ability to root out paid leave abuses.

Employers will likely find that USDOL’s new FAQs are very helpful in determining most employee requests for paid childcare leave under the FFCRA. For those requests that fall outside the scope of these FAQs, it is prudent to seek the advice of counsel. If you have any questions, please contact Jessica Baquet at (516) 393-8292 or jbaquet@jaspanllp.com.

As businesses and offices reopen during the continuing COVID-19 pandemic, employers must ensure they do not violate employment discrimination laws and regulations as they develop plans and procedures to abide by social distancing and safety guidelines required by federal, state and local law.

Recent technical assistance questions and answers from the U.S. Equal Employment Opportunity Commission (EEOC) state that equal employment opportunity laws do not interfere with or prevent employers from following the guidance put out by the Centers for Disease Control and Prevention (CDC) or state and local health departments. As of June 17, 2020, the CDC guidance defines workers at a high risk for severe illness from COVID-19 to be individuals over the age of 65 and those with underlying medical conditions. These conditions include, but are not limited to, chronic lung disease, moderate to severe asthma, hypertension, severe heart conditions, weakened immunity, severe obesity, diabetes, liver disease, and chronic kidney disease that requires dialysis.  The CDC recommends that employers protect those employees at a higher risk by encouraging them to telework or offering them other duties or hours to minimize their contact with others.

However, the EEOC also cautions that employers must not engage in discrimination in their implementation of social distancing requirements, such as age discrimination. The Age Discrimination in Employment Act (ADEA) protects applicants and employees, aged 40 or older, from age-based employment discrimination by private employers with 20 or more employees, state and local governments, employment agencies, labor organizations and the federal government. The EEOC notes that excluding an individual from the workplace based on his or her age being 65 or older violates the ADEA, despite the employer’s intent to protect said employee from potentially contracting COVID-19 and abiding by CDC recommendations.

Although employers cannot mandate any special procedures for employees based on their age, employers can offer a choice between alternative options for higher risk employees. The EEOC states that the ADEA does not prohibit employers from providing flexibility to employees age 65 or older, even if it results in employees “ages 40-64 being treated less favorably based on age in comparison.” Furthermore, an employer can require any employee experiencing symptoms of COVID-19 to leave the workplace and not return while experiencing those symptoms or until he or she has clearance from a doctor.

Some employees age 65 or older may have medical conditions, which would qualify them for protections under the Americans with Disabilities Act (ADA). The ADA applies to private employers with 15 or more employees, state and local governments, employment agencies, labor organizations and federal agencies under Section 501 of the Rehabilitation Act. Under the ADA, an employer cannot discriminate against an individual with (i) a disability or (ii) a relationship with a person who is disabled (such as a spouse with a disability).  The ADA definition of disability includes (i) a physical or mental condition that substantially limits a major life activity (such as walking, talking, seeing, hearing, or learning); (ii) a history of a disability (such as cancer that is in remission); or (iii) a belief that the individual has a physical or mental impairment that is not transitory and minor. An employee with a disability can request a reasonable accommodation from his or her employer. The employer must provide the accommodation so long as it does not cause undue hardship (i.e., significant business difficulty or expense) to the employer. Those employees caring for a loved one suffering from a serious health condition may have protections under the federal Family Medical Leave Act or state equivalent as well.

The EEOC has updated its Pandemic Preparedness in the Workplace guide to better address the current COVID-19 pandemic, which can be found here. Employers should keep these laws in mind while developing, implementing and modifying their plans and procedures for reopening during the COVID-19 pandemic. For further information or guidance on revising your policies and procedures in accordance with the above, please contact Jessica Baquet or David Paseltiner.

Coronavirus text outbreak with the world map and HUD 0002

In response to the novel coronavirus pandemic, Congress enacted the Families First Coronavirus Response Act (FFCRA). Among other things, this law provides employees impacted by COVID-19 with paid emergency sick leave and paid emergency family leave in certain circumstances. The portion of the FFCRA that relates to paid emergency sick leave is referred to as the Emergency Paid Sick Leave Act (EPSLA) and the portion that relates to paid emergency family leave is known as the Emergency Family and Medical Leave Expansion Act (EFMLEA).

The United States Department of Labor (USDOL) was charged with administering the law. In April 2020, USDOL enacted a final rule which set parameters about how the FFCRA would be implemented (Final Rule). In short order, the State of New York (NYS) brought a lawsuit against USDOL in which it claimed that the Final Rule was improper in several ways.

Just yesterday, the United States District Court for the Southern District of New York issued a ruling that largely agreed with NYS’s position and struck down critical parts of the Final Rule. Although the ruling is likely to be appealed, employers should familiarize themselves with the Court’s ruling, as it significantly affects employees’ entitlement to paid leave in certain situations.

This blog post will summarize the ruling’s most important takeaways, including that: (1) employers may not deny employees paid leave on the grounds that the employer does not have work for the employee to do; (2) the Final Rule’s definition of “health care provider” has been overturned, such that employers must exercise caution in claiming to exempt an employee from the FFCRA’s paid leave benefits because that employee may be a “health care provider”; (3) employers may not refuse to permit an employee to take intermittent leave in order to care for a child; and (4) employers cannot insist that employees submit documentation before taking leave, and must instead follow the provisions of the FFCRA relating to when an employee’s request for leave must be made.

EPSLA and EFMLEA Generally

By way of background, EFMLEA requires employers with less than 500 employees to provide twelve weeks of job-protected leave to any employee: (1) who has been on payroll for at least thirty calendar days; (2) is unable to work (or work remotely); (3) due to the need to care for a child under age 18 if school is closed or a childcare provider is unavailable; (4) as a result of an emergency declared by a federal, state or local government that is related to COVID-19.

The first ten days of EFMLEA leave are unpaid, although an employee may choose to use accrued paid time off (or paid leave under EPSLA, if available) during such time. During the remaining period of leave, an employee must be paid two-thirds of his or her regular rate of pay for the number of hours the employee would usually be scheduled to work, up to $200 per day and $10,000 for the entire period of leave.

EPSLA requires employers with less than 500 employees to provide paid sick leave to any employee who is unable to work (or work remotely) when the employee: (1) is subject to a federal, state or local quarantine or isolation order related to COVID-19; (2) has been advised by a health care provider to self-quarantine due to concerns relating to COVID-19; (3) has symptoms of COVID-19 and is seeking a diagnosis; (4) is caring for a person who is subject to a federal, state or local quarantine or isolation order related to COVID-19, or has been advised by a health care provider to self-quarantine due to concerns relating to COVID-19; (5) is caring for a son or daughter if the child’s school or place of care has been closed, or his or her child care provider is unavailable, due to COVID-19 precautions; or (6) is experiencing any other substantially similar health condition as specified by the Secretary of Health and Human Services. This leave is available to all employees regardless of the duration of their employment.

Full-time employees must be provided with 80 hours of paid sick leave. Part-time employees must be provided with an amount of paid sick leave that is equal to the average number of hours that the employee works in a two-week period.

The amount to be paid depends on the reason for the employee’s leave. In the case of reasons (1), (2) and (3) above, the employee is to be paid at the regular rate of pay, except that paid sick time may not exceed $511 per day, and $5,110 in total. In the case of reasons (4), (5) and (6) above, the employee is paid at two-thirds of the regular rate of pay, except that paid sick time may not exceed $200 per day, and $2,000 in total.

The Work Availability Requirement

Both EPSLA and EFMLEA provide for paid leave only where an employee is “unable to work (or telework) for a qualifying reason.” However, the Final Rule provides that an employer does not have to provide paid leave to an employee who cannot work (or work remotely) if the employer “does not have work” for the employee to do in the first instance.

What exactly does this mean? The Final Rule provides the following example: if a coffee shop closes temporarily or indefinitely due to a downturn in business related to COVID-19, a cashier of the business who is subject to a stay-at-home order may not take paid sick leave. That is because the lack of work is due to the downturn in business, not the cashier’s inability to leave home.

The Court held that the Final Rule’s work availability requirement is invalid because it limits the availability of paid leave under EPSLA and EFMLEA in an “enormously consequential way” without a sufficient reason for such a “monumental policy decision.” Thus, in the above example, the coffee shop employee would presumably be entitled to paid leave even though her employer does not have work for her to do.

Exemption for Health Care Providers

Both EPSLA and EFMLEA state that employers can choose to exclude “health care providers” from eligibility for leave benefits. The Final Rule defines the term “health care provider” very broadly so as to include:

anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, Employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions,

as well as

any individual employed by an entity that contracts with any of these institutions described above to provide services or to maintain the operation of the facility where that individual’s services support the operation of the facility, [and] anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments.

The Court struck down this definition of “health care provider,” reasoning that it is over broad because it hinges on the nature of the services the employer provides rather than the services provided by the employee. For example, the Court noted that, under the Final Rule, an English professor would be considered a health care provider if he or she works for a University with a medical school.

With this portion of the rule having been invalidated, who qualifies as a “health care provider” is unclear. For now, the definition of that term under the Family and Medical Leave Act of 1993 may be instructive.

Intermittent Leave

The Final Rule allows employees to take paid leave under EMFLEA or EPSLA intermittently, but only if the employer agrees to allow it and the employee is taking leave for a reason that involves “a minimal risk that the employee will spread COVID-19 to other employees.” In short, an employee is only eligible for intermittent leave where the employee is utilizing leave to care for a child because school is closed or a childcare provider is unavailable. In the case of all other EPSLA qualifying reasons, according to the Final Rule, the employee is at too great a risk of spreading COVID-19 to be permitted to return to work intermittently.

The Court upheld USDOL’s prohibition on the use of intermittent leave where an employee is at risk of spreading COVID-19 to other employees. However, the Court held that where intermittent leave is available (i.e., where an employee requires leave to care for a child), the Final Rule is unreasonable to the extent it allows employers to refuse to agree to provide intermittent leave.

Documentation Requirements

The Final Rule requires employees to submit certain documentation to their employers before taking leave under EFMLEA or EPSLA. However, the statutes themselves say something different. EFMLEA provides that, where the need for leave is foreseeable, the employee must provide the employer “with such notice of leave as is practicable.” EPSLA, on the other hand, states that “[a]fter the first workday (or portion thereof) an employee receives paid sick time under this Act, an employer may require the employee to follow reasonable notice procedures in order to continue receiving such paid sick time.”

Because of the conflict between the statutes and the Final Rule, the Court held that the documentation requirement is invalid to the extent it requires documentation to be submitted before leave is taken.

Conclusion

It is critical that all New York employers be aware of the ways that the Court’s decision will change how they evaluate employees’ requests for paid emergency sick or family leave. And, because the Court’s decision may be appealed and/or USDOL may go back to the drawing board and engage in additional rule-making, employers must be on the look out for additional developments.

If you have any questions, please contact Jessica M. Baquet, the Chair of our Labor and Employment Practice Group, at (516) 393-8292 or jbaquet@jaspanllp.com.

 

Warning of travel restriction in airport

As the process of reopening continues across New York state, businesses are challenged to maximize safety of employees returning to work. Among those challenges is ensuring that they and their employees are up to date on New York’s guidelines for quarantine following interstate travel.

Pursuant to Executive Order No. 205 (the “Order”), issued by Governor Cuomo and effective as of Thursday, June 25, 2020, individuals are required to self-quarantine for 14 days after traveling for 24 hours or longer within states that have significant rates of transmission of COVID-19. The Order required the Commissioner of the Department of Health to issue a Travel Advisory designating which states are subject to the travel restrictions. Those who fail to follow the voluntary self-quarantine guidelines set forth in the Travel Advisory could be issued a mandatory quarantine order. Moreover, those who violate such a mandatory quarantine order could be subject to fines of up to $10,000:

Any violation of a quarantine or isolation order issued to an individual pursuant to the Commissioner of the Department of Health’s travel advisory by a local department of health or state department of health may be enforced pursuant to article 21 of the public health law, and non-compliance may additionally be deemed a violation pursuant to section 12 of the public health law subject to a civil penalty of up to $10,000.

Just this week Governor Cuomo issued an update as to the advisory, which now covers 34 states, nearly twice as many as earlier this month, including Alabama, Alaska, Arizona, Arkansas, California, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentuky, Louisiana, Maryland, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, Nevada, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, Washington and Wisconsin. The determination as to which states are included is based on (1) a seven day rolling average, of positive tests in excess of 10%, or (2) the number of positive cases exceeding 10 per 100,000 residents. Travelers from these states, including returning New Yorkers, are now required to fill out a form documenting where they’re coming from, where they’re going and their local contact information before they leave the airport.

As COVID-19 infection rates in other parts of the country continue to rise, it is certainly advisable to maximize employee awareness of the Travel Advisory, the risks associated with travel to these states, and the potentially applicable state and local paid sick leave laws and ordinances. Employers may, consistent with best practices and applicable state and federal laws against discrimination, ask their employees to disclose past travel or future travel plans to assess whether their return to work could be a health risk to other employees or customers. In any event, it is certainly advisable to maximize employee awareness of the Travel Advisory, the risks associated with travel to these states, and the potentially applicable state and local paid sick leave laws and ordinances.

The Travel Advisory is just one of many factors New York employers must take into consideration as reopening continues. We remain committed to offering guidance in all areas including compliance, as new legislation and regulations unfold.

Page with FLSA fair labor standards act on a table.

            The Fair Labor Standards Act (“FLSA”) was enacted in 1938 to protect workers from substandard wages and oppressive working hours.  It has two principal features.  It requires employers to pay employees a federal minimum wage[1] and to pay overtime of one and a half times the employees’ regular rate of pay for hours worked in excess of forty hours a week.  Since the obligation is placed on the employer to comply with the wage and hour requirement, it is important to understand who is considered an employer under the Act.  FLSA defines an employer to include “any person acting directly or indirectly in the interest of an employer in relation to an employee.” But what if an employee is technically employed by one employer but provides services for another entity?  Which is responsible for complying with the FLSA’s wage and hour requirements?  The answer may be both.

Two or more entities may constitute “joint employers” for purposes of the FLSA.  Whether one entity is a joint employer with another depends of a number of factors and considerations.  A joint employment exists when the employment by one employer is not completely dissociated from the employment by the other.  The joint employment treats a worker’s employment by joint employers as one employment for purposes of determining whether the wage and hour requirements of the Act have been satisfied.  So for example, if an employee works for joint employers, the hours worked for each during the week are combined to determine if the employee is entitled to overtime. In addition, joint employers are responsible both individually and jointly for complying with the requirements of the Act.  Since joint employers are severally and jointly liable to the employee, if the employee is unable to collect what he is owed from one joint employer, for example due to insolvency, he may be able to collect what he is owed from the other.

Many courts consider a four part test in determining if an entity is a joint employer for purposes of the Act.  They include whether the alleged joint employer had the power to hire and fire the employee; supervised and controlled the employee’s work schedule or condition of employment; determined the rate and method of payment; and maintained employment records.  Other courts, including the Second Circuit, have a more expansive view, reasoning that Congress intended for the FLSA to have a broad application, noting that the relevant provision of the FLSA, defines “employ” as including “to suffer or permit to work” which is “‘the broadest definition [of ’employ’] that has ever been included in any one act.”  Other courts have supplemented the four factors by applying a multitude other factors when analyzing whether a joint employment arrangement exists as an economic reality.

The United States Department of Labor (DOL) recently proposed a new Rule that narrows what is meant by a joint employer under the FLSA.  The rule reins in the broad interpretation that some courts have applied and limits the factors that can be considered in determining joint employer status.

Under the DOL rule, if an employee works for an employer and another person simultaneously benefits from that work, the other person is the employee’s joint employer only if that person is acting directly or indirectly in the interest of the employer in relation to the employee.  To make that determination simpler, the DOL essentially adopted the four factor test with one significant modification – – only actions taken with respect to the employee’s terms and conditions of employment, rather than the theoretical ability to do so, are relevant in determining joint employer status.   The DOL’s four factors are whether the purported joint employer: (1) hires or fires the employee; (2) supervises and controls the employee’s work schedule or conditions of employment to a substantial degree; (3) determines the employee’s rate and method of payment; and (4) maintains the employee’s employment record.  Other factors may only be considered under very limited circumstances.

Several states, including New York, have sued the DOL challenging the Rule asserting that its promulgation violated the Administrative Procedures Act and alleging, among other things, that the Rule will result in lower wages and a decrease in compliance with worker protection laws, thereby harming workers as well as reducing the States’ tax revenue.  As of the date of this writing, the action is still pending.

[1]               State law may provide for a greater minimum wage.

How could you make such a mistake?

Employers and public agencies utilize contracts in many ways with a variety of parties. In addition to employment contracts and collective bargaining agreements, many employers also enter into contracts with third-party vendors to provide specialized services. Unfortunately, many existing contracts failed to contemplate pandemic events such as COVID-19, which has left many employers with uncertainty regarding payment and performance obligations during state-wide closures. The present situation provides an opportunity to review contracts and to consider incorporating certain protections into future agreements.

The most commonly discussed contract clause during the COVID-19 pandemic has been the force majeure clause. Typically, this clause relieves parties from their contractual obligations if an unforeseeable and uncontrollable event occurs. These events are sometimes referred to as “acts of God.” However, simply inserting a general force majeure clause into a contract will not be enough to protect an employer against a pandemic such as COVID-19. Rather, New York courts have held that a force majeure clause must include the specific event that is claimed to have prevented performance [Phibro Energy, Inc. v. Empresa de Polimeros de Sines Sarl, 720 F. Supp. 312, 318 (S.D.N.Y. 1989)]. In addition, New York courts have limited catchall provisions in force majeure clauses. In a decades-old decision, the Appellate Division, First Department applied the principle of ejusdem generis to catchall language in a force majeure clause, stating that “where certain things are enumerated, and such enumeration is followed or coupled with a general description, such general description is commonly understood to cover only things [of the same kind or nature] with the particular things mentioned” [Krulewitch v. National Importing & Trading Co., 195 A.D. 544, 546 (1st Dep’t 1921)]. Thus, a force majeure clause in New York must specifically list events such as epidemics, pandemics, serious diseases, and quarantines to adequately protect against a situation like COVID-19.

A well-drafted force majeure clause should have language to account for acts of government or measures of governmental authority. This will be particularly relevant where a pandemic event results in a shutdown At the state or local level, or the Governor or a Mayor issues an Executive Order that affects the terms of an agreement.

There are other useful unforeseen events that employers should consider incorporating into a force majeure clause. If an employer has concerns about a potential lack of communication, a force majeure clause can be written to require affected parties to provide notice to one another. Alternatively, an employer may wish to insert language requiring a party to mitigate the effect of a force majeure event to the greatest extent practicable, to limit the potential hardship of a future catastrophe. Employers should be aware that the mere existence of a qualifying event in a force majeure clause will not be enough to relieve the parties of their obligations. The United States Supreme Court has held that the event must not only be specifically listed, but must also be unforeseeable [United States v. Brooks-Callaway Co., 318 U.S. 120, 122-123 (1943)]. In other words, if an event is foreseeable and the parties can adequately prepare themselves in advance, a force majeure clause will not be triggered.

While force majeure clauses are one of the most important protective measures for employers to implement, other protections should also be considered. One of the lessons that COVID-19 has taught us is that there may be unanticipated costs related to the response effort of a pandemic. Additionally, governmental action and Executive Orders may contain language which would require employers to violate the terms of existing agreements. There are creative measures which employers can take to address these issues in future agreements. For instance, compliance clauses may provide that the terms of an agreement will be superseded by conflicting laws, including Executive Orders. Furthermore, contracts may include language that places the burden of paying for any necessary unanticipated equipment (i.e., protective masks or gloves) on the other party.

COVID-19 has been an unprecedented situation to navigate, but by anticipating potential issues and revising agreements accordingly, employers can rest assured they will be better prepared if another pandemic ever arises.