Reed Smith Client Alerts

On August 3, 2020, a New York federal court judge invalidated several key pieces of Department of Labor guidance concerning the Families First Coronavirus Response Act (FFCRA), a federal law that provides two forms of COVID-19-related paid time off to employees of businesses with fewer than 500 employees. Specifically, the Court ruled that four limitations on the use of FFCRA leave – all of which were promulgated by the U.S. Department of Labor (DOL) in an April 1 regulation – exceeded the agency’s rulemaking authority. The Court’s decision expands – potentially substantially – the number of U.S. workers who are eligible for FFCRA leave. Further, the Court’s decision may change several of the conditions surrounding such leave and force employers to reevaluate whether they fall within the statute’s coverage limits.
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In light of these changes, employers should take immediate action to assess:

  • Whether they remain a “covered employer” under FFCRA after accounting for employees for whom the employer has no work.
  • Whether they need to revisit prior leave denials based on lack of available work, “health care provider” status, or intermittent need.
  • Whether to issue new policies or guidance to employees regarding FFCRA rules and guidelines.

In light of the Court’s ruling, which applies at least to employers in New York but could be adopted by other courts, employers should consider working with counsel to develop contingency plans in the event other jurisdictions follow the lead of the today’s opinion.

The FFCRA and the DOL’s Final Rule

The FFCRA, which went into effect on April 1, 2020, provides two forms of paid leave – emergency paid sick leave (EPSL) and emergency family and medical leave (EFML) – to businesses with fewer than 500 employees in the U.S. 

Eligible employees can use EPSL if they (1) are subject to a federal, state, or local quarantine or isolation order related to COVID-19, (2) have been advised by a health care provider to self-quarantine due to concerns related to COVID-19, (3) are experiencing symptoms of COVID-19 and are seeking a medical diagnosis, (4) are caring for an individual subject to a quarantine or isolation order by the government or a health care provider, (5) are caring for a child whose school or place of care is closed, or whose childcare provider is unavailable, because of COVID-19, or (6) are experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor. Eligible employees can use EFML if they are unable to work because they must care for a dependent child due to COVID-19.

On April 1, 2020 – the same day the FFCRA took effect – the DOL promulgated a final administrative rule implementing the statute’s provisions (the Final Rule). The Final Rule, which is effective through December 31, 2020, provides rules and direction relevant to the administration of the FFCRA’s paid leave requirements. Certain provisions of the Final Rule, such as the “work-availability” requirement and definition of “health care provider,” placed limits on which employees could use FFCRA leave. For instance, under the “work-availability” requirement, employees are not entitled to take leave if their employers do not have work for them. Meanwhile, the DOL defined “health care provider” expansively to include not just doctors, but also anyone employed by a healthcare-related institution or an entity that contracts with such institution. Next, the Final Rule generally prohibits employees from taking intermittent leave unless their employer agrees to the intermittent leave. Lastly, the Final Rule requires that employees submit to their employer, prior to taking FFCRA leave, documentation supporting the reason for and duration of their leave.