EMPLOYERS: Are You Exempt from Paid Sick Leave for COVID?

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Among other things, the Families First Coronavirus Relief Act (FFCRA) provides paid leave to employees to care for a child and paid sick leave.  Though the FFCRA generally applies to employers with less than 500 employees, employers with less than 50 employees can be exempt if compliance with the FFCRA would jeopardize “the viability of the employer’s business as a going concern.” Upon enactment, Congress did not clarify the mechanism for claiming an exemption, but the Department of Labor (DOL) recently issued some guidance.

A small business (with fewer than 50 employees) may be exempt from certain paid sick leave and expanded family and medical leave requirements if: (a) leave is requested because the employee’s child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and (b) providing that employee such leave would jeopardize the viability of the employer’s business as a going concern.  As to (b), an authorized officer of the business must determine that at least one of the following three conditions is satisfied:

  1. the requested leave would result in the small business’s expenses and financial obligations to exceed available business revenues and cause the small business to cease operating at minimal capacity; or
  2. the absence of the employee or employees requesting leave would entail a substantial risk to the financial health or operational capabilities of the 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 leave, and those labor or services are needed for the small business to operate at minimal capacity.

The exemption applies only to leave requests under the FFCRA due to school closures and child care unavailability and does not exempt small businesses from providing sick leave for any of the other types of permissible requests under the FFCRA. 

The DOL does not explain how small businesses go about claiming the exemption and specifically advises employers not to send any materials to the DOL.  So what is an employer to do?  We recommend having an authorized officer of the employer sign a statement verifying that one or more of the three qualifying reasons apply and attach supporting materials if available.  The employer must maintain this record for at least four (4) years in case of a lawsuit, DOL audit or other challenge. Remember that this exemption only applies to employers with less than 50 employees and is otherwise inapplicable to employers with 51 to 499 employees.

Ellen M. Leibovitch

Board Certified Labor & Employment Lawyer

ASSOULINE & BERLOWE, P.A.

2300 Glades Road

East Tower – Suite 135

Boca Raton, Florida 33431

Main: 561-361-6566
Direct: 561-948-2479

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eml@assoulineberlowe.com

www.assoulineberlowe.com

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