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Issue brief: Paid Sick Leave Regulations under COVID-19

Source: National Newspapers Association
 

The Department of Labor has released new regulations explaining how new paid sick leave requirements for small businesses will operate. The regulations include the first explanation for how businesses with fewer than 50 employees may exempt themselves from the requirement. While the rules provide more clarity for the exemption, some questions are not answered completely.  Employers should read the exemption with the purpose of the new COVID-19 sick leave purpose in mind, which is to keep employees from having to choose between their jobs and public health measures. However, the Department notes that a provision that forces a business to cease to remain a going concern would deprive employees of a job completely, which was not the intent of Congress.

Such a business may consider itself exempt if:

  • The paid sick leave would “cause the small employer’s expenses and financial obligations to exceed available business revenue and cause the small employer to cease operating at a minimal capacity;” OR
  • The employee’s absence would “pose a substantial risk to the financial health or operational capacity of the small employer because of (the employee’s) specialized skills, knowledge of the business or responsibilities);” OR
  • The employer cannot find “enough other workers who are able, willing and qualified and who will be available at the time and place needed, to perform the labor or services (of these employees) and their labor necessary to keep the business operating at a minimal capacity.

If a business is claiming an exemption because of a particular employee’s importance to the business enterprise, the exemption extends only to that employee and not the entire workforce. Before claiming the leave would “exceed available business revenue,” the employer should factor in the various financial relief provisions made available by Congress in the CARES Act, including borrowing from employer benefit tax deposits and other federal financial assistance.

The Department is not granting written waivers.  It advises businesses claiming the exemption to document their decisions and rationale for the decisions and maintain the documents in their own files.  In the case of a complaint for failure to follow the Family and Medical Leave Act compliance, the employer’s decision may be reviewed by the Wage and Hour Division of the US Department of Labor. Documents must be maintained for four years.

Employers are required to notify the employees of this new law.  Here is the poster that should be put up in the workplace and emailed or mailed to employees who will not see it there.

https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf

Congress provided for this small business exemption in the Families First Coronavirus Response Act, which imposes new rules under the Family and Medical Leave Act from April 1, 2020 to December 31, 2020.