As of April 1, employees are eligible for the paid sick leave and expanded family and medical leave available under the Families First Coronavirus Response Act (FFCRA).
On March 31st, the IRS published guidance (FAQs) on what employers must provide the IRS to support a claim for sick leave or family leave tax credits. The guidance also clarified that only one caretaker can take leave for a child whose school or childcare is closed, and if the child is 14 or older, the parent must provide an explanation of the special circumstances that require the employee to provide care to receive the tax credit (at this point it appears that you still must provide the paid FMLA leave under the FFCRA).
What Information Do Employers Need to Show Eligibility for the Sick Leave or Family Leave Credits?
An employer can show eligibility “for the sick leave or family leave credits if the employer receives a written request for such leave from the employee in which the employee provides:”
1. The employee’s name;
2. The date or dates for which leave is requested;
3. A statement of the COVID-19 related reason the employee is requesting leave and written support for such reason; and
4. A statement that the employee is unable to work, including by means of telework, for such reason.
If the Leave is Requested Based on an Order to Quarantine or Self-Quarantine Advice, then the Statement from the Employee Should Include:
1. the name of the governmental entity ordering quarantine or
2. the name of the health care professional advising self-quarantine, and,
3. if the person subject to quarantine or advised to self-quarantine is not the employee, that person’s name and relation to the employee.
If the Leave is Based on the Closing of a Child’s School or Childcare, Then the Statement Should Include:
1. the name and age of the child (or children) to be cared for,
2. the name of the school that has closed or place of care that is unavailable, and
3. a representation that no other person will be providing care for the child during the period for which the employee is receiving family medical leave and,
4. with respect to the employee’s inability to work or telework because of a need to provide care for a child older than fourteen during daylight hours, a statement that special circumstances exist requiring the employee to provide care.
“What Additional Records Should an Eligible Employer Maintain to Substantiate Eligibility for the Sick Leave or Family Leave Credit?”
An employer should maintain the following records to show that an employee legitimately took paid sick leave or emergency FMLA and to show that they are eligible for the tax credit:
1. Documentation to show how the employer determined the amount of qualified sick and family leave wages paid to employees that are eligible for the credit, including records of work, telework and qualified sick leave and qualified family leave.
3. Copies of any completed Forms 7200, Advance of Employer Credits Due To COVID-19, that the employer submitted to the IRS.
4. Copies of the completed Forms 941, Employer’s Quarterly Federal Tax Return, that the employer submitted to the IRS (or, for employers that use third party payers to meet their employment tax obligations, records of information provided to the third party payer regarding the employer’s entitlement to the credit claimed on Form 941).
How Long should an Eligible Employer Maintain These Records?
Employers “should keep all records of employment taxes for at least 4 years after the date the tax becomes due or is paid, whichever comes later. These should be available for IRS review.”
The information provided in this blog is for educational purposes only and is not legal advice. If you need legal advice, then you should speak with a lawyer about your specific issues. Every legal issue is unique. A lawyer can help you with your situation. Reading the blog, contacting me through the site, emailing me or commenting on a post does not create an attorney-client relationship between any reader and me.
The information provided is my own and does not reflect the opinion of my firm or anyone else.
It is a full-blown pandemic. Companies are actively trying to figure out the next steps that they will take in the current situation to keep their businesses operating and deal with employee issues.
There have been a ton of posts for various companies with what they can do. I have yet to see one that has some of the Texas specific issues that employers face. I’ve put together some resources and insights below for employers.
The Texas Workforce Commission (TWC) has put together some
answers to commonly asked questions here.
Beyond those resources, here are some common questions that
employers have had and some of the most important issues for employers to
consider.
Alternatives to
Layoffs
Before you consider laying off employees please consider
other options that you do have. It is a very tough situation right now for all
businesses and people, but there still are some ways to help your workers.
It is essentially a program where businesses
reduce employee hours for affected employees by at least 10% but no more than
40% for at least 10% of the employer’s workers in that particular unit. Workers
that experience a reduction in hours can then get partial unemployment to
supplement their hours.
The program allows a business to keep its
employees and supplement their wages while they continue to work.
You must apply for a shared work program online and can do so through this link.
Employers can also reduce employee pay (there may be special steps for exempt employees) or offer a voluntary early retirement or severance package for anyone that wants to take it.
Terminating Some
Employees
If you are not triggering the WARN Act but are terminating some employees and are looking for criteria to use to determine which employees to lay off, then you can find some tips on being consistent in disciplining and terminating employees here. To prevent an employment law claim you need to make sure that you document the reasons for termination. If it is related to the economic downturn and/or COVID-19, then you can put that on their termination notice.
When you are laying off some of your workers but not all of
them it is important to use criteria to determine who will and who will not be
laid off so that your policy is not discriminatory. You should use some
objective criteria like seniority, required skills, or other factors to
determine who to terminate.
Plant/Facility
Closings or Mass Layoffs
Employers with more than 100 employees are required to give
notice to their employees, the state, any union (if the company is unionized),
and the chief local government official when they shut down a facility or
layoff more than 50 workers for more than 6 months under certain conditions.
You can read more about conducting a mass layoff or plant closing and the
requirements under the WARN Act in my earlier article.
Small Business Loans for Businesses Affected by COVID-19
Many people are working from home at this time, but only 42% of workers have worked from home occasionally. The other workers need to be at work to do their jobs. Some of these workers like those in the restaurant industry may not be able to perform their normal work because the restaurant is shutdown. You have the option to shift them into doing food delivery or other work if it is available and they are willing to do it. Do not forget to train the employees and continue to see what else they need to do to be successful. Many of them will be performing duties that they had not been performing before. For example, you may need track and pay the delivery driver’s actual expenses or the IRS mileage reimbursement rate if their costs to deliver food will take them below the minimum wage.
Remote Workand COVID-19
Managing remote employees can be challenging. Here are a few
things to remember while you have employees doing remote work that did not
normally do so:
Be aware of and create a plan to deal with confidential information and cyber security issues. The employee’s spouses and children may accidently view information if the employee leaves their computer out. There may also be issues with the employee using their personal Wi-Fi to transmit sensitive materials and other issues.
Tracking time for hourly employees is essential to ensuring that you are properly paying your employees and not creating liability.
Workplace injuries that occur at home must be reported and companies will need to file a claim with their worker’s compensation carrier for injuries that the employees have.
Make sure voicemail and calls are being forwarded.
Ensure that the employee has access to company files that are stored on any shared server or on the cloud.
Put procedures in place to manage your team and ensure that work is completed.
I wrote a much more detailed post about what companies must consider for remote employees in light of COVID-19. You can read it here.
What Can You Ask an Employee that is Sickwith COVID-19?
During a pandemic, ADA-covered employers may ask such employees if they are experiencing symptoms of the pandemic virus. For COVID-19, these include symptoms such as fever, chills, cough, shortness of breath, or sore throat. Employers must maintain all information about employee illness as a confidential medical record in compliance with the ADA.
Can You Send a Sick Person HomeIf They Have COVID-19?
Yes, you can send a sick person home when they are
exhibiting the symptoms of COVID-19. You can also require that they stay home
while they are exhibiting the symptoms of the coronavirus.
Can an Employee Refuse to Come to Work Even Though They Are Not Sick?
Maybe. An employee cannot be forced to work in an unsafe
environment. If your business is not following the latest guidelines from OSHA
and the CDC, then it is possible that the person could file an OSHA retaliation
claim. There may also be ADA issues where an employee’s request for time off or
to work from home needs to be accommodated or at least considered. They may
also be entitled for leave to care for their child under the new federal rule
if their child is no longer in school. You may allow the employee to use their
PTO or go on an unpaid leave of absence.
If none of these situations apply, then you can let the
employee go if the employee is simply refusing to work. You do need to follow
your policy though and carefully consider the consequences of firing someone in
this situation. Obviously, some employees (e.g. healthcare workers) are
required to work with people that may have COVID-19 or be at a risk for
exposure. Employers are right to take action to ensure that these employees
work and to fire them if they refuse.
Can YouSend Someone Home that May Have Been Exposed to COVID-19?
Companies can require employees to remain home if they have been to areas where the illness has been present or when they believe that the employee has been exposed to the virus. Companies must careful not to engage in discrimination and to be consistent in how they engage in the policy. There has been issues with some companies discriminating against people of Asian descent.
It is likely better not to require the employee to get a
doctor’s note. Under the current circumstances it may be very difficult to
obtain a doctor’s note and may take valuable time away from the doctors. You may instead seek some documentation from a local clinic
or other source to certify that the person does not have COVID-19. You can also
use your best judgment to take an employee back to work after a certain period
of time when they no longer have the disease.
Caring for Children That Are Out of School Because of School Closures
Many states have laws that allow parents time off to care for children that are not in school. The new legislation that was passed at the federal level also has a provision that provides parents that need to care for their children 10 weeks of leave paid at 2/3rds of their regular pay if they are unable to work because they need to care for a child under 18 whose school or day care provider is closed because of COVID-19.
There are a number of items that businesses must maintain to obtain the tax credits for this leave. You can read about it here.
Families First Coronavirus Response Act
The government passed the Families First Coronavirus
Response Act, which requires companies with less than 500 employees (covered
employers) to do the following as explained by the DOL:
Two weeks (up to 80 hours) of expanded family and medical leave at the employee’s regular rate of pay where the employee is unable to work because the employee is quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis; or
Two weeks (up to 80 hours) of expanded family and medical leave at two-thirds the employee’s regular rate of pay because the employee is unable to work because of a bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor.
Moreover, as noted by the DOL, these covered employers must
also provide the following benefit for employees that have worked for them for
at least 30 days:
Up to an additional 10 weeks of expanded family and medical leave at two-thirds the employee’s regular rate of pay where an employee is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.
To pay for this the government has stated that covered
employers will be able to qualify for a dollar-for-dollar reimbursement through
tax credits.
The law goes into effect on April 1, 2020. The provisions above will be in effect through December 31, 2020.
There are a number of items that businesses must maintain to obtain the tax credits for this leave. You can read about it here.
What Should You Do If An Employee Has COVID-19?
Other than sending the employee home if they test positive
but have not had symptoms or otherwise were not home for some reason what
should companies do? Companies are not required to shut down if an employee
tests positive. The virus has been found to be able to live on plastic and
metal surfaces for 2-3 days, so it may be prudent to wait for that time to pass
before reopening the company. Another option is to thoroughly clean the work
area of the employee that has been found to be positive with the COVID-19
virus. You should also ask the employee to inform you of who they were in
contact with so that you can inform those employees that may have been contact
with an employee (do not mention the employee’s name) so that they can take
appropriate measures. Generally, you should not disclose the employee’s name as
the ADA and other laws prohibit disclosing medical information. As noted by Joseph J. Lazzarotti, ADA regulation
1630.14(d)(4)(i) provides a few exceptions to treating an employee’s medical
condition as a confidential medical record:
Supervisors and managers may be informed regarding necessary restrictions on the work or duties of the employee and necessary accommodations;
First aid and safety personnel may be informed, when appropriate, if the disability might require emergency treatment; and
Government officials investigating compliance with this part shall be provided relevant information on request.
These are narrow exceptions but may apply in your workplace. You need to carefully assess when they apply to your business if you intend to use them.
Employers May Also Benefit From Submitting a Mass Claim for Unemployment Benefits
Submitting a mass claim is a way to streamline the unemployment benefits process for your workers and to prevent businesses from receiving a ton of notices regarding unemployment claims. Companies can also submit severance and wage information to streamline the process for their employees. Normally, companies need to submit the claim at least 5 business days before the layoff occurs, but this has been waived in the current crisis. You can read more about Mass Claims on the Texas Workforce Commission site here and can file a claim here.
Companies with Labor
Unions
Companies cannot make unilateral changes to a mandatory subject of bargaining (such as changing workplace duties, increasing paid time off benefits, or bargaining about the effects of a layoff). You can review my article on negotiating a collective bargaining agreement to determine your obligations to negotiate. There may also be rules about laying employees off within your collective bargaining agreement that you will need to review to apply them to your business (e.g. bumping rights).
Companies should be aware that the CARES Act (the COVID-19 stimulus bill) has a provision that requires companies with 500 to 10,000 employees that take a loan through the act to remain neutral in any union organizing attempt during the course of the loan. The Act does not define neutral, but this will likely be interpreted as requiring the company to follow similar requirements when the company signs a neutrality agreement during any organizing campaign. It would prevent the company from holding meetings, passing out literature, and even correcting misstatements that the union makes. Any company that needs a loan should carefully weigh this factor before applying.
Conclusion
We can do this. This will be a difficult time, but there is a way through this crisis. Employers need to do everything that they can to keep their business operating and keep their employees safe.
The information provided in this blog is for educational purposes only and is not legal advice. If you need legal advice, then you should speak with a lawyer about your specific issues. Every legal issue is unique. A lawyer can help you with your situation. Reading the blog, contacting me through the site, emailing me or commenting on a post does not create an attorney-client relationship between any reader and me.
The information provided is my own and does not reflect the opinion of my firm or anyone else.
Brett Holubeck (of Houston, Texas) is the attorney responsible for this site.
