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By Gary A. Matthews and Michael A FryeOf Jenkins Fenstermaker, PLLC on 10/19/2020
How Interpreting the FFCRA Has Changed

On August 3, 2020, a New York federal district court struck down several parts of the US Department of Labor (DOL) April 2020 rule (the April Rule) interpreting the FFCRA (Families First Coronavirus Response Act). The DOL has since issued a revised temporary rule to clarify the department’s interpretation of the paid leave provisions in the Act, but, significantly, it held fast to certain aspects of the prior final rule. How this affects employers across the country remains to be seen, so employers need to closely monitor any future challenges and changes to the DOL rule.

The Impact of New York’s Challenge to Rules Interpreting the FFCRA

In April 2020, the State of New York challenged the DOL final rule interpreting the FFCRA, alleging that certain aspects of the rule violated the Administrative Procedure Act (APA). In particular, New York asked the court to invalidate the following parts of the April Rule interpreting the paid leave act:

  • The requirement that employers provide COVID-based paid leave only if there is work available;

  • The definition of “health care provider” in the statute;

  • The interpretation of the FFCRA regarding intermittent leave;

  • The requirements regarding the time of documentation for eligibility for paid leave under the act

On August 3, 2020, the US District Court for Southern District of New York granted summary judgment to New York (the NY ruling), invalidating the DOL’s interpretive rule regarding the four matters described above. In response, the DOL responded by issuing a revised rule regarding FFCRA paid leave (Revised FFCRA Rule). The revised rule differs in some ways from the original, while in other regards it held fast to its original position, clarifying its reasoning for that stance.

What this means going forward is uncertain. New York did not request the federal district court’s ruling to apply nationwide, so arguably the order applies only in the Second District. Moreover, additional challenges could arise. West Virginia employers need up-to-date understanding of the FFCRA leave requirements and how this New York case could affect their handling of FFCRA leave.

Summarizing the FFCRA

The FFCRA is comprised of two acts, the Emergency Paid Sick Leave Act (EPSL) and the Extended Family and Medical Leave Act (EFLMA). The EPSL requires covered employers to provide paid leave to eligible employees for any of the following COVID-related reasons:

  1. The employee is subject to a qualifying quarantine or isolation notice

  2. The employee is subject to a health care provider’s self-quarantine recommendation

  3. The employee has sought medical care to diagnose COVID-related symptoms

  4. The employee is caring for someone who is subject to a qualifying quarantine order, isolation notice, or self-quarantine recommendation

  5. The employee is caring for a son or daughter whose school or childcare facility closed due to COVID-19

  6. The employee is suffering from a qualifying related, comparable condition

The EFLMA mandates that covered employers provide paid leave to care for a son or daughter who is a minor or is unable to provide self-care. The FFCRA authorizes reimbursement through tax credits, supported by adequate documentation, for covered employers who provide paid leave pursuant to the EPSL or the EFMLA.

Summarizing the April Rule Interpreting the FFCRA

In relevant part, the DOL’s April Rule provided that employers are obligated to provide employees paid leave under the FFCRA only if the following apply:

  • There is work available for the employee but only when there is work available

  • The employee does not fall under the definition of “health care provider” as defined by the Family and Medical Leave Act (FMLA),which was defined broadly to include anyone employed at a doctor’s office, medical facility of any kind, medical school, nursing or retirement facility, local health agency or department, medical testing facility, or pharmacy

  • The employer assents to an employee’s request for intermittent leave

  • The employee provides the employer documentation regarding the leave prior to beginning paid leave

The State of New York took issue with these four parts of the DOL rule interpreting the paid leave act. Specifically, New York alleged that the April Rule contradicted the express provisions of the FFCRA or that the DOL lacked the statutory authority to qualify an employee’s leave eligibility

The New York District Court’s Ruling and Its Potential Impact on Employers

The federal district court in New York agreed with the State’s challenges to the April Rule and invalidated the parts of the rule at issue:

  • The Work Availability Rule – In the NY Ruling, the court found that the DOL’s April Rule “lacked reasoned decision-making” and narrowed the potential scope of the FFCRA. However, under the reasoning in the NY ruling, employers that had temporarily ceased operations would be obligated to provide paid leave to employees who met any of the qualifying bases for paid sick leave under the EPSL or the EFMLA

  • The Definition of “Health Care Providers” – The FFCRA exempted employers of health care providers from the paid sick leave provisions with regard to those workers. The DOL’s April Rule defined “health care providers” to include employees of any medical, nursing, medical testing, or medical educational entity or pharmacy. The court invalidated this part of the April Rule, finding that the rule’s clarification of the definition of “health care provider” was overly broad because it focused on the employer instead of the employee. As a result, employees that had nothing to do with actual health care services would have been included in the DOL’s April Rule.  For example, a history department professor or others who did not provide patient care could be exempted FFCRA’s paid sick leave provisions if they were employed by a university that owned a hospital under the DOL’s April Rule

  • The Additional Restriction on Intermittent Leave – The FFCRA allows the paid leave to be taken in increments (as opposed to consecutive days). In the April Rule, the DOL clarified that intermittent leave was permissible only if agreed to by the employer. The April Rule also provided that intermittent leave is not authorized for leave taken for EPSL reasons three (an employee seeking diagnosis for COVID-related symptoms) or reason four (employee caring for someone subject to a quarantine or isolation order). The New York federal district court did not invalidate this part of the rule but questioned why the April Rule required employer consent without stating why

  • Advance Documentation Requirement – The FFCRA imposes no documentation requirement, but it allows employers to seek documentation from the employee requesting paid leave, ostensibly to support the employer’s application for tax credit reimbursement. The DOL’s April Rule required the employee to provide such documentation before taking FFCRA paid sick leave, including information on the duration of leave, the reason for the leave, and, in some cases, identification of the authority that issued the quarantine order. The court found that the DOL was not authorized to add requirements to paid leave under the FFCRA, namely, the requirement to provide documentation for the leave before the leave began. In all other respects, the court left this part of the April Rule intact

The DOL’s Revised Rules Interpreting the FFCRA

On September 11, 2020, the DOL issued revised regulations interpreting the FFCRA, which became effective on September 16. Clearly a response to the NY ruling, the Revised FFCRA Rule incorporates both attempts to correct inadequacies found in the NY Ruling but, in some areas, maintained the DOL’s prior position. Following is a summary of the Revised FFCRA Rule:

  • The Work Availability Rule – In the Revised FFCRA Rule, the DOL reaffirmed the work availability rule but provided additional explanation for its position. Construing the language of the FFCRA to require the qualifying reason for leave to be a but-for cause for leave. In other words, the employee could not qualify for leave for one of the FFCRA qualifying reasons if there was no work to do. The DOL supported its position by pointing out that the term “leave” implies that there is work to do from which the employee is requesting leave

  • The Definition of “Health Care Providers” – The DOL narrowed the definition of “health care providers” to focus on the employee instead of the employer. Specifically, the definition now includes those who meet the definition of “health care provider” under the FMLA (29 CFR 825.102 and 825.125) and those additional employees whose services are integral to patient care, such as diagnostic and preventive services

  • The Additional Restriction on Intermittent Leave – The DOL again reaffirmed its prior position that employer consent is necessary for intermittent paid leave under the FFCRA, pointing out that this position is consistent with long understood principles of the FMLA. However, the Revised FFCRA Rule clarifies that the employer-agreement requirement does not apply to employees whose children now attend school on an alternate day or other alternating schedule because of the pandemic

  • Advance Documentation Requirement – The Revised FFCRA Rule does not require advance documentation to support COVID-related paid employee leave. Instead, the rule now requires employees to provide documentation supporting their leave “as soon as practicable,” in the language of the FFCRA, after the first day of leave under the EPSL. In the case of EFMLA leave, the rule requires documentation as soon as practicable without qualification of when the leave started

After issuing the revised rule, the DOL also updated its FFCRA questions and answers page

Despite the DOL’s Revised Rules Interpreting the FFCRA, Questions Remain

Employers need to stay vigilant because the DOL’s revision of regulations interpreting the FFCRA may not be the end of the story. Given that the DOL held firm on two points in the revised rule interpreting the paid leave act, New York—or even another state or governmental unit—may still raise new challenges to the regulations interpreting the FFCRA. Moreover, the DOL Rules Interpreting FFCRA leave provisions do not address the question of retroactivity: 

  • Would federal courts in other circuits rule similarly if faced with challenges to the FFCRA rule?

  • Which rule do employers follow for employees who have taken leave before the April FFCRA Rule or after issuance of the new rule interpreting the paid leave act or whose leave began before the revised rule but ended after September 16?

  • How can employers know if future challenges result in further revisions to the DOL Rules interpreting FFCRA leave requirements?

West Virginia employer lawyers Gary Matthews and Michael Frye at Jenkins Fenstermaker, PLLC are closely monitoring the DOL rules interpreting the FFCRA requirements and challenges to the FFCRA rule or the legislation itself. Businesses seeking guidance on these or other employment-related matters should reach out for counsel and guidance. To be kept up to date, schedule a consultation today by calling (304) 523-2100 or by completing this online contact form.