What Employers Need to Know During the Coronavirus Pandemic
Most Americans know that, as of March 19, 2020, there were more than 10,000 confirmed U.S. cases of the disease caused by the 2019 novel coronavirus (COVID-19). That number is likely to rise significantly in the next few days or weeks. Many employers find themselves uncertain as to what their rights and obligations with respect to their employees are under such extraordinary circumstances. This update provides general guidance on common questions from employers, as well as on the Families First Coronavirus Response Act (FFCRA), which was signed into law on March 18, 2020. However, each employer’s situation is unique, and the COVID-19 landscape is constantly changing. Should you have questions about your company’s specific needs, Trenam Law’s Employment Law Group is available to assist.
The following questions will be addressed in this update:
- Do I have to provide leave and/or pay for employees relating to COVID-19?
- What about healthy employees who refuse to come to work?
- What measures must I take to prevent the spread of COVID-19 in my workplace?
- What am I allowed to ask my employees regarding their health during the COVID-19 pandemic?
- I may need to temporarily suspend business operations during the pandemic. Do I need to pay my employees during the suspension?
- Does the FFCRA address Unemployment Benefits?
- What tax credits are available for employers?
- What if I’m self-employed?
1. Do I have to provide leave and/or pay for employees relating to COVID-19?
a. All employers
If you offer paid time off (PTO) or paid sick leave, you should allow employees affected by COVID-19 to utilize such leave in the same way they would if they were dealing with any other illness. Of course, you may not administer your leave programs in a manner that unlawfully discriminates against employees on the basis of disability, race, color, gender, pregnancy, religion, national origin, or any other protected class or protected activity.
In addition to the federal leave laws described below, you may be subject to state or local leave laws. Florida does not impose any requirements for private employers to provide leave, paid or otherwise. Other states and locales require employers to provide sick leave under some circumstances, however.
b. Employers with 500 or more employees
If you are a private employer with 500 or more employees, the FFCRA leave and pay provisions do not apply and nothing has changed. It is likely that COVID-19 would be considered a serious health condition under the Family Medical Leave Act (FMLA). Private-sector employers are covered by traditional FMLA provisions if they have 50 or more employees for at least 20 workweeks in the current or preceding calendar year. Almost all public agencies are covered by the FMLA. Employees of covered employers are eligible under traditional FMLA provisions if they (1) have worked for the employer for at least 12 months; (2) have worked at least 1,250 hours in those 12 months; and (3) work at a workplace that has at least 50 employees within 75 miles.
If your workplace is covered by the traditional FMLA provisions only (because you have 500 or more employees), eligible employees may be entitled to FMLA leave if they become ill with COVID-19 or must care for a covered family member who has contracted the virus. If PTO or other paid leave is available to the eligible employee, you may require or the employee may request that he/she use PTO or other applicable paid leave during the FMLA absence.
For more detailed guidance from the DOL’s Wage and Hour Division (WHD) regarding the traditional FMLA provisions and the COVID-19 pandemic, please visit: COVID-19 and the FMLA Q&A.
c. Employers with fewer than 500 employees
The FFCRA changes employers’ paid sick leave obligations and expands FMLA coverage for employers with fewer than 500 employees, including employers that were not previously covered by the FMLA, through December 31, 2020. For purposes of calculating the total number of employees, the FFCRA includes both part-time and full-time employees. Both the so-called “sick leave” and FMLA expansion sections of the FFCRA allow employers of healthcare providers and/or emergency responders to exclude such employees from their provisions, however. In addition, both sections allow the Department of Labor to adopt regulations exempting businesses with fewer than 50 employees if compliance would jeopardize the viability of the business as a going concern.
1) Paid sick leave
Affected employers are required to provide 80 hours of paid sick leave to full-time employees who are unable to work (remotely or otherwise) for reasons related to COVID-19. Part-time employees are entitled to paid sick leave equal to the number of hours that they worked over an average two-week period. These provisions apply to all employees, regardless of how long they have been employed, if they meet one of the following criteria:
- (1) The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
- (2) The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
- (3) The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
- (4) The employee is caring for an individual who is subject to an order as described in subparagraph (1) or has been advised as described in paragraph (2);
- (5) The employee 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;
- (6) 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.
This emergency sick leave must be compensated at the employee’s regular rate of pay or highest applicable minimum wage, whichever is greater, if the employee needs leave to care for him or herself under criteria 1, 2, or 3. Employers may cap this amount of paid benefits at $511 per day or an aggregate of $5,110 per employee. Employees who need to take leave to care for others, including children home from school under criteria 4 or 5 or for themselves under criterion 6, are entitled to two-thirds of their regular rate of pay or the highest applicable minimum wage, whichever is greater. Compensation for this leave is capped at $200 per day or an aggregate of $2000 per employee. An employer cannot require that an employee use other accrued and unused leave before taking this emergency leave, and an employer cannot amend or substitute the paid leave policy that it already had in place prior to the enactment of the FFCRA based on this provision. Further, employers are required to post notice of employees’ entitlement to this leave. A model disclosure is required to be provided by the United States Government within seven days of the law’s enactment.
2) FMLA expansion
The Emergency Family and Medical Leave Expansion section of the FFCRA allows an employee who has (a) worked for an employer for at least 30 calendar days and (b) is “unable to work (or telework) due to a need to care for the son or daughter under 18 years of age of such employee” whose child’s school or place of care is closed, or whose child care provider is unavailable, due to an emergency with respect to COVID-19 declared by a Federal, State or local authority, to take up to twelve weeks’ leave. The first ten days of such leave may be unpaid, with the remainder to be paid in an amount not less than two-thirds of the employee’s regular rate of pay, subject to a cap of $200 per day, or an aggregate amount of $10,000. Employees can choose to apply other paid leave to the first ten days of leave, but an employer cannot mandate that employees do so. Employees seeking to take such leave are required to provide the employer “with such notice of leave as is practicable.”
The FMLA traditionally requires that an employee returning from FMLA leave be restored to the same or equivalent position absent certain circumstances. It appears that this requirement applies to leave taken pursuant to the FMLA expansion section of the FFCRA, although employers with fewer than 25 employees would not be required to restore an employee if the employee’s position no longer exists for economic reasons or other changes in operating conditions caused by the COVID-19 public health emergency during the employee’s leave, the employer makes reasonable efforts to restore the employee to an equivalent position and, if those efforts fail, makes efforts to contact and reinstate the employee if an equivalent position becomes available within one year.
2. What about healthy employees who refuse to come to work?
A healthy employee who chooses to stay home simply to prevent the spread of COVID-19 or avoid contracting COVID-19 is probably not eligible for FMLA leave (except as provided under the FFCRA discussed above). Moreover, employees generally are not permitted to refuse to report to work unless they have a reasonable fear he/she will be in imminent danger. For example, a health worker might be in “imminent danger” if forced to work with COVID-19 patients without personal protective equipment. For employers in most industries, the risk of COVID-19 will probably not qualify as imminent danger. Thus, most employers are permitted to require their healthy employees to report to work, as long as the employee does not have a child or sick family member to care for (e.g., under FFCRA or traditional FMLA provisions).
If the healthy employee is able to perform job duties remotely, however, then you should consider allowing him/her to work from home. Social distancing is a critical containment measure, and allowing remote work is a good way to encourage social distancing. (Of course, if you have sick employees who are able and willing to work remotely and whose job duties permit it, you should consider allowing them to work from home as well.)
3. What measures must I take to prevent the spread of COVID-19 in my workplace?
Good hand hygiene, respiratory etiquette, and social distancing are critical to containing the spread of COVID-19 and keeping your employees safe. Most employers are in what the Occupational Safety and Health Administration (OSHA) considers low-risk industries (for the purposes of COVID-19 exposure). For these employers, the risk of employees contracting COVID-19 is no higher than the general public’s risk. These employers, and all employers regardless of their industry, should:
- Encourage sick employees to stay home.
- Immediately separate and send home employees showing COVID-19 symptoms.
- Encourage telecommuting when it is available.
- Increase the frequency of routine environmental cleaning, especially of frequently touched areas (doorknobs, light switches, elevator buttons, security keypads, etc.).
- Instruct employees to wash their hands with soap and water frequently, scrubbing for at least 20 seconds. Ensure that adequate supplies are available to employees.
- If soap and water are not available, instruct employees to frequently use hand sanitizer that is at least 60% alcohol. Ensure that sanitizer is available to employees.
- Instruct employees to cough or sneeze into a tissue, discard the tissue and immediately wash or sanitize their hands or, if no tissue is available, cough or sneeze into their upper sleeve or elbow.
Industries in which employees work in high-population-density environments (e.g., schools, high-volume retail) or have frequent and/or close contact with individuals whose COVID-19 status is unknown are considered medium-risk industries. Employers in these industries should consider whether and how to minimize face-to-face contact between employees and customers. They should also consider offering face masks to customers and employees who are or may be sick. Although paper face masks do not prevent a healthy person from becoming sick, they may help prevent a sick person from transmitting illness, which may help contain the illness until the sick person can leave the workplace.
OSHA warns that employers in the following industries have a high or very high risk of exposure as compared to the general public:
- Waste management
- Airline operations
- Border protection
- Work that requires travel to areas affected by the virus
Employers in these (and other) industries may be subject to industry-specific OSHA standards. They should carefully conduct hazard assessments of their workplaces to determine whether and how their employees will be exposed to COVID-19 and determine what measures can be taken to mitigate the risk of exposure.
All U.S. employers should monitor the Centers for Disease Control’s (CDC) website for the most up-to-date information on the spread and severity of the virus and best practices for containing its spread. For more detailed information about COVID-19 and generally applicable recommendations for containing its spread, please visit: CDC’s Interim Guidance for Businesses and Employers. For more information on the status of the pandemic, please visit the CDC’s Main COVID-19 Page. More local information for Florida employers may be found at Florida Health Department’s dedicated COVID-19 page: Florida Health COVID-19 Resources.
For more detailed information on OSHA’s risk classifications and how to meet applicable OSHA standards, please visit: OSHA’s COVID-19 Homepage and OSHA’s Guidance on Preparing Workplaces for COVID-19.
4. What am I allowed to ask my employees regarding their health during the COVID-19 pandemic?
Ordinarily, an employer cannot ask an employee specific questions about the employee’s medical issues except in very narrow circumstances. Such questions run the risk of being labeled impermissible medical examinations. Under pandemic conditions, however, an employer has more leeway because employees infected with COVID-19 are more likely to pose a “direct threat,” as that term is used within the Americans with Disabilities Act, to the health and safety of other workers.
Under pandemic conditions, employers may ask employees who call in sick, look sick, or who report feeling unwell at work whether they are experiencing COVID-19 symptoms (fever, chills, cough, sore throat and shortness of breath). Sick employees should be sent home.
Additionally, employers should request that employees notify them if the employee or a family or other household member tests positive for COVID-19. This information should be used to inform individuals who worked closely with the sick employee that they may have been exposed to the virus. You must not disclose any confidential medical information or any information that identifies the employee or his/her family or other household member, except where specifically required by law.
Finally, employers may ask employees returning from travel where they traveled. If the CDC recommends that individuals traveling to particular locations self-quarantine when returning home, employers may ask if their employees visited such places. Employers may require employees returning from such locations to provide fitness-for-duty certifications or other doctor’s notes before returning to work, even if the travel was for personal reasons. As of March 19, 2020, the CDC recommended self-quarantine for travelers returning from China, Iran, South Korea, the UK, Ireland, Malaysia, most of continental Europe, and any cruise ship.
For more detailed information about the Equal Employment Opportunity Commission’s guidance on employer obligations during the COVID-19 pandemic, please visit the EEOC’s COVID-19 and ADA Q&A and the EEOC’s Guidance on Pandemic Preparedness.
5. I may need to temporarily suspend business operations during the pandemic. Do I need to pay my employees during the suspension?
Non-exempt workers generally need not be paid for hours they do not work. Salaried, exempt workers generally need not be paid for weeks in which they perform no work. (If you close your offices mid-week, it may be more complicated. If your exempt employees work a partial week, and are ready, willing, and able to work the rest of the week, you would generally be required to pay them the full week’s salary for that week.)
Employees with accrued PTO may wish to use such PTO during the suspension. Employers’ obligations regarding PTO vary according to employer policy and state and local laws, rules, and regulations (e.g., city and county wage theft ordinances). To minimize their risk of a claim, employers should follow the terms of their PTO policies. If feasible, employers should consider allowing PTO use during the suspension, even if their policy does not require it, particularly if no other plan or policy exists that would provide or replace employees’ compensation during the suspension.
It is unclear whether the FFCRA alters the rules described above. For example, it might be argued that an employee who is on leave under the FFCRA is entitled to a continuation of payment even though the company has suspended operations. It is anticipated that in the coming days regulations may be implemented to bring clarity to this or other issues.
For more detailed guidance from the WHD regarding the Fair Labor Standards Act and COVID-19, please visit: COVID-19 and the FLSA Q&A.
6. Does the FFCRA address Unemployment Benefits?
The FFCRA provides for $1 billion of an emergency administrative grant to be distributed proportionally to states. Half of that amount will be distributed to states no more than 60 days after the enactment of the bill, so long as the state receiving the funds has complied with the requirements set out in the bill. These requirements include that the states require employers to provide notification of the availability of unemployment compensation to employees at the time of separation from employment; the states ensure that applications for unemployment compensation and assistance with the application process are accessible in at least two of the following ways: in-person, by phone, or online; and the states notify applicants when an application is received and is being processed, and in any case in which an application is unable to be processed, provides information about steps the applicant can take to ensure the successful processing of the application.
7. What tax credits are available for employers?
Under the FFCRA employers are eligible for a tax credit against the Old-Age, Survivors, and Disability Insurance portion of FICA (i.e. the 6.2% Social Security portion of payroll tax).
- Credit is available in an amount equal to 100% of qualified sick leave wages paid by the employer, up to a maximum of $511 per day for up to ten days (per employee).
- Qualified sick leave wages are the regular wages required to be paid in the event of the listed conditions described in more detail above under paragraphs 5 and 6 of Q1 “Do I have to provide leave for employees who are sick with COVID-19?”
- Additionally, credit is available in an amount equal to 100% of qualified family leave wages paid by the employer up to an aggregate of $10,000 in wages (per employee).
- Qualified family leave wages are the wages paid under the expanded FMLA (i.e. 2/3rds of regular pay capped at $200/day) described in more detail above under paragraph 7 of Q1 “Do I have to provide leave for employees who are sick with COVID-19?”
- Credit is also available for employer expenses associated with maintaining a group health plan. Expenses will be properly associated if they are allocated pro-rata over covered employees and pro-rata over coverage periods.
In the event the credit available exceeds the employer’s tax liability (against which it is creditable), it is refundable (i.e. employer will receive a dollar for dollar tax refund with respect to the excess). Wages eligible for the credit will not be double counted (i.e. not eligible for paid family and medical leave credit, and not deductible); however, the credit is optional.
8. What if I’m self-employed?
Under the FFRCA, qualified self-employed individuals are eligible for a tax credit against self-employment taxes. Qualified self-employed individuals are those who regularly carry on a trade or business and would be entitled to emergency sick or extended family leave if such individual had been an employee.
- Credit is available in an amount equal to the “qualified sick leave equivalent amount.” Qualified sick leave equivalent amount is an amount equal to the number of days during the year that the individual is unable to work, multiplied by either i) in the case of an individual who is a caregiver, the lesser of 67% of the individual’s average daily income or $200/day; or ii) in the case of individual’s illness, the lesser of 100% of the individual’s average daily income or $511/day.
- Credit is available in an amount equal to the “qualified family leave equivalent amount.” Qualified family leave equivalent amount is an amount equal to the number of days (up to 50 days) during the year that the individual is unable to work, multiplied by the lesser of 67% of the individual’s average daily income or $200/day.
In the event the credit available exceeds the individual’s tax liability (against which it is creditable), it is refundable (i.e. the individual will receive a dollar for dollar tax refund with respect to the excess). Individuals who also receive emergency sick leave wages or extended FMLA wages from an employer will not be eligible for a double benefit.
Trenam Law’s Employment Law Group is available to consult with you on these issues.
Employers should consider whether they have obligations to their employees in addition to those discussed above. For example, health insurance considerations will be critical to employees facing layoffs during the pandemic, and employers may have notice and other obligations under the federal Consolidated Omnibus Budget Reconciliation Act (COBRA) and Florida mini-COBRA. Employers will also have to navigate complex compensation issues as hours, schedules and staffing levels have to be adjusted for changing economic conditions.
We understand the challenges and difficult decisions that many businesses are facing during the COVID-19 pandemic. Trenam Law will continue to provide updates related to the COVID-19 pandemic and its ramifications for employers.
 Credit is against Federal Insurance Contributions Act (“FICA”) tax imposed under Internal Revenue Code (“IRC”) Section 3111(a). Credit is also available against the Tier 1 Tax (IRC Section 3221(a)) under the Railroad Retirement Tax Act.
 Only applies to wages paid between a date to be prescribed by Treasury secretary (between 3/18/2020 and 4/12/2020) through 12/31/2020.
 Note, these wages are also not considered wages or compensation for the purposes of IRC Sections 3111(a) and 3221(a) and equivalent amounts will be appropriated from the general fund (rather than withheld from the employee).
 Additional regulations to follow regarding other appropriate allocation methods.
 To be effected by adding the credited amount back to gross income of employer to offset wage deduction.
 Pursuant to 26 US Code, Subtitle A.
 For the same reasons an employee would be entitled to pay under the Emergency Paid Sick Leave Act as described in more detail in Q1, above.
 For the same reasons an employee would be entitled to emergency pay under the Family and Medical Leave Expansion Act pay as described in more detail in Q1, above.