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COVID-19

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Frequently Asked Questions

Do I have to terminate employees for them to be eligible for unemployment insurance benefits?

No. Employees who are furloughed or temporarily laid off can stay on your books while they collect unemployment without having to be onboarded again.

Is my business eligible for a loan under the CARES Act?

To be eligible for loan that is 100% federally guaranteed under the Paycheck Protection Program, the business must be …

  • A small business with fewer than 500 employees (The 500 employee threshold includes all employees: full-time, part-time and any other status.)
  • A small business that otherwise meets the SBA’s size standard
  • A 501(c)(3) with fewer than 500 employees
  • An individual who operates as a sole proprietor
  • An individual who operates as an independent contractor
  • An individual who is self-employed who regularly carries on any trade or business
  • A Tribal business concern that meets the SBA size standard
  • A 501(c)(19) Veterans Organization that meets the SBA size standard

In addition, some special rules may make the business eligible:

  • If the business is in the accommodation and food services sector (NAICS Code 72), the 500-employee rule is applied per physical location
  • If you are operating as a franchise or receive financial assistance from an approved Small Business Investment Company the normal affiliation rules do not apply.
For a lender to decide whether a business is eligible for a loan under the Payroll Protection Program, what factors and/or documentation will be taken into consideration?

The business must have been operating prior to February 15, 2020 and must have had employees for whom salaries and payroll taxes were paid or paid independent contractors. Additionally, the business will need to provide a good faith certification that:

  • The uncertainty of the economic conditions makes the loan request necessary to support ongoing operations
  • The borrower will use the loan proceeds to retain workers and maintain payroll or make mortgage, lease and utility payments
  • The borrower does not have a pending loan application duplicative of the purpose and amounts applied for under the CARES Act
  • From February 15, 2020 to December 31, 2020, the borrower has not received a loan duplicative of the purpose and amounts applied for under the CARES Act. [In some circumstances, emergency loans created between January 31, 2020 and the date the loan program becomes available may be folded into a new loan.)
Is an employee entitled to paid sick leave because of being quarantined?

An employee is eligible for paid sick leave under the Employee Paid Sick Leave Act portion of the FFCRA when the employee is unable to work, either at their workplace or remotely, due to a governmental quarantine or isolation order related to COVID-19. This would include an order to shelter in place, to stay home or that otherwise restricts an employee’s mobility. However, even if one of these orders has been issued, an employee is not eligible for paid sick leave if the employer has no available work. In other words, if the only reason the employee cannot work is because of a governmental order to quarantine or isolate, etc., because of COVID-19, then the employee is eligible for paid sick leave.

My employee is self-quarantined. Is he eligible for paid sick leave?

An employee is entitled to paid sick leave if the employee has been advised by a health care profession to self-quarantine because of concerns the employee has COVID-19, may have COVID-19 or is more vulnerable to COVID-19 because of underlying medical condition. The employee must actually be in the process of obtaining a medical diagnosis to be entitled for paid sick leave. [Yes, this means an employee who wants to stay home due to fear of contracting COVID-19 is not entitled to paid sick leave without seeking a medical diagnosis.]

My employee has requested paid leave under the FFCRA. What documents does the employee have to provide?

Employees should provide a signed statement including the following:

  • the employee’s name
  • the date(s) for which leave is requested
  • the COVID-19 qualifying reason for leave AND
  • a statement representing that the employee is unable to work or telework because of the COVID-19 qualifying reason.

Depending on the reason for the request, the employee may be requested to submit information and/or documentation such as the governmental agency that issued the isolation order or the name of the health care provider who advised the employee to self-quarantine.

For leave to care for a minor child whose school or child care is provider due to COVID-19, employees must provide:

  • the name and age of the child(ren) being cared for
  • the name of the school, place of care or child care provider that closed or became unavailable because of COVID-19, AND
  • a statement explaining that no other suitable person is available to care for the child(ren) during the period of requested leave.

Employers may also require employees to provide oral notice and sufficient information for the employer to determine whether the employee is entitled to leave under the FFCRA.

Note: For leave to provide care for children over the age of 14 during daylight hours, the employees should provide a statement that special circumstances existing that require the employee to provide care for the child(ren).

This documentation should also satisfy the IRS’s requirements to substantiate eligibility for the tax credits for qualified leave wages.

Can I require my employees to use vacation in the place of paid leave?

If an employee has leave available under a company paid time off policy, the employer may require the employee to use accrued leave to care for a child concurrently with expanded family and medical leave.

Can employees request intermittent leave leave under the FFCRA?

An employer may agree to allow an employee to use FFCRA intermittently, but it is not required. If agreed upon, before the leave is started, the employer and employee should agree on the increments of time in which the leave may be taken.

Note: If the employee can report to the workplace, intermittent FFCRA leave is prohibited, even with employer approval, for all qualifying reasons except for caring for a child whose school or child care provider is unavailable due to COVID-19.

How do I know if my business is required to provide paid leave under the FFCRA?

Private employers of fewer than 500 employees are required to provide paid leave under the FFCRA to qualifying employees. To count employees, employers are to include full-time and part-time employees, employees on leave, temporary employees who are jointly employed by the employer and another employer, and day laborers supplied by a temporary staffing agency. Do not count independent contractors or employees who have been laid off or furloughed.

Separate entities (whether within the same corporate umbrella or otherwise) must combine employees for purposes of the employee threshold when they qualify as either joint employers or integrated employers. The FFCRA uses the FLSA’s test for joint employment and the FMLA regulations’ test for the integrated employer analysis. If two entities meet either of these tests and their aggregate number of employees is 500 or more, then the FFCRA will not apply to either entity.

What types of businesses are exempt under the FFCRA as a health care provider or emergency responder?

Under the FFCRA, a health care provider is anyone who is capable of providing health care services necessary to combat the COVID-19 public health emergency. This not only includes medical professionals, but any worker who is needed to keep hospitals and similar health care facilities well supplied and operational. This would include, for example, employees involved in research, development, production of equipment, drugs, vaccines, and other items needed to combat the COVID-19 public health emergency. 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.

This includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities to provide services or to maintain the operation of the facility. This also includes anyone employed by an 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. This also includes any individual that is defined by a state’s highest official to be a health care provider necessary for the state’s response to COVID-19.

When does the small business exemption apply to exclude a small business from the provisions of the Emergency Paid Sick Leave Act and Emergency Family and Medical Leave Expansion Act?

A business with fewer than 50 employees may deny an otherwise eligible employee with paid leave under the FFCRA when:

  • such leave would cause the small business’s expenses and financial obligations to exceed available business revenue and cause the small business to cease operating at a minimal capacity; or
  • The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
  • There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.

If I am a small business with fewer than 50 employees, am I exempt from the requirements to provide paid sick leave or expanded family and medical leave?

A small busines is exempt from certain paid sick leave and expanded family and medical leave requirements if providing an employee such leave would jeopardize the viability of the business as a going concern. This means a small business is exempt from mandated paid sick leave or expanded family and medical leave requirements only if the

  • employer employs fewer than 50 employees;
  • leave is requested because the child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 relaed reasons; and
  • an authorized officer of the business has determined that at least one of the following conditions is satisfied:
  1. The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity; or
  2. The absence of the employee or employees requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
  3. There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.

Employers and employees are encouraged by the Department of Labor to reach the best solution for maintaining the business while ensuring employee safety.

If a small business is exempt from the provisions for paid sick leave and expanded family and medical leave, does any paid leave have to be paid?

Yes. An employer who is otherwise exempt from providing paid sick leave, or expanded family and medical leave, due to a school or place of care closures or child care unavailability due to COVID-19, must provide paid sick leave to an employee if the employee is eligible for paid leave due to their own COVID-19 related illness.

Does the law take into account the months children would be out of school for summer break?

Not currently.  Expanded family and medical leave is made available to employees when the employee is unable to work to care for a child (under 18 years of age) whose school or childcare provider is closed or unavailable for reasons related to COVID-19.  Routine school closings that are not a result of COVID-19 would not be covered under provisions of the FFCRA.

For employees working variable hours week to week, how are average hours calculated?

The regular rate of pay used to calculate paid leave is the average of the employee’s regular rate of pay over a period of up to six months prior to the date the employee takes leave.  If the employee has worked for less than six months, use the average of the employee’s regular rate of pay for each week the employee has been employed.

If an employee is isolated or quarantined while being tested for COVID-19, will the employee still qualify for paid leave if the employee tests negative?  Can we withhold payment until we have some form of documentation from the employee?

Yes.  The FFCRA specifically requires up to 80 hours of paid leave to an employee who is unable to work because the employee is experiencing COVID-19 symptoms and seeking a medical diagnosis.  The resulting diagnosis does not affect the employee’s eligibility.

While it is reasonable in this situation to request documentation from the employee that medical diagnosis has been sought for suspected COVID-19 symptoms, the DOL has requested that employers be more lax in the enforcement of their attendance policies during the declared pandemic.  This request would include requesting documentation from an overburdened healthcare provider.  Withholding payment could be seen as a violation of the FFCRA provision and therefore would not be recommended.

If an employee has already taken time off from work due to school closure, is the employee eligible to receive paid leave under the FFCRA?

The FFCRA has an effective date of April 1, 2020. It does not provide paid leave benefits retroactive to that date.

Do I have to continue an employee’s benefits while on leave under the FFCRA?

Yes. The FFCRA is just an extension of FMLA; therefore employers will have to continue coverage under the employer’s group health plan on the same terms as if the employee did not take leave.

Is the amount of paid sick leave based on leave for an employee’s own illness different from leave needed for the employee to care for someone else?

Yes. Paid Sick leave is calculated at the employee’s regular rate of pay for the number of hours the employee usually works, up to a maximum of:

  • $511 per day and $5,110 in the aggregate where the employee is subject to a quarantine order related to COVID-19, has been advised by a health care provider to self-quarantine, or is experiencing symptoms and seeking a medical diagnosis, and;
  • $200 per day and $2,000 in the aggregate where the employee is caring for another subject to a quarantine order, the individual has been advised by a health care provider to self-quarantine, or the individual is experiencing symptoms, or the employee is caring for a son or daughter due to school or loss of child care.

If the employee is off work because the employee is caring for an individual who is subject to a Federal, State or local quarantine or isolation order, is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID-19 precautions, or the employee is 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, then the employees rate of pay would be 2/3 the employee’s regular rate of pay, not 100%.

Workers Compensation and Maintaining a Safe Workplace

Will my property insurance policy cover contamination at my job site caused by COVID-19?

Standard property policies require the occurrence of physical loss or damage to covered property by an insured peril to trigger coverage. Contamination of property at an insured’s location may constitute physical loss or damage, yet policy exclusions for pathogenic organisms, viruses and disease- or illness-causing agents may restrict or exclude coverage. Many traditional property policies may exclude contamination altogether, specially those written for an insured who has no apparent exposure to contamination loss in the ordinary course of their business.

Limited available coverage for communicable or infectious disease may be offered on some property forms. This coverage is likely sublimited and narrow in its coverage scope. Covered costs may include cleanup, removal and disposal of contaminated property. Any business interruption extension is not likely to apply to locations that are not owned or operated by the insured.

If an employee contracts COVID-19 while at work, is the employer liable?

It depends. If the employee is a health care worker or first responder, the answer is likely yes (subject to variations in state law). For other categories of employees, a compensable workers’ compensation claim is possible, but the analysis would be very fact-specific.

It is important to note that the workers’ compensation system is a no-fault system, meaning that an employee claiming a work-related injury does not need to prove negligence on the part of the employer. Instead, the employee need only prove that the injury occurred at work and was proximately caused by their employment. Additionally, the virus is not an “injury” but is instead analyzed under state law to determine if it is an “occupational disease.” To be an occupational disease (again subject to state law variations), an employee must generally show two things:

  • the illness or disease must be “occupational,” meaning that it arose out of and was in the course of employment; and
  • the illness or disease must arise out of or be caused by conditions peculiar to the work and creates a risk of contracting the disease in a greater degree and in a different manner than in the public generally.

The general test in determining whether an injury “arises out of and in the course of employment” is whether the employee was involved in some activity where they were benefitting the employer and was exposed to the virus. Importantly, special consideration will be given to health care workers and first responders, as these employees will likely enjoy a presumption that any communicable disease was contracted as the result of employment. This would also include plant nurses and physicians who are exposed to the virus while at the worksite.

Workers compensation laws vary by state, so consult with your labor and employment attorney for any concerns specific to your business.