Bulletin Board

Further Guidance Relating to the Families First Coronavirus Response Act

On March 28, 2020, the U.S. Department of Labor (“DOL”) offered further clarification of certain provisions of the Families First Coronavirus Response Act. The complete list can be found here: 

https://www.dol.gov/agencies/whd/pandemic/ffcra-questions 

Some of the significant clarifications for small to mid-sized businesses are as follows: 

Small Business Exceptions 

The DOL has clarified that small employers with fewer than 50 employees, including religious or nonprofit organizations, may claim an exemption from providing Emergency FMLA or Emergency Paid Sick Leave if their authorized officer determines one of the following applies: 

·     Providing the benefit would cause the business to incur expenses and financial obligations to exceed its revenues and cause the business to cease operating at a minimal capacity;  

·     The employee’s absence would entail a substantial risk to the business's financial health or operational capabilities because of specialized skills, knowledge of the business, or responsibilities the employee possesses; or  

·     There are insufficient workers who are able, willing, and qualified to perform the labor or services provided by the employee requesting childcare leave, and these labor or services are needed for the business to operate at a minimal capacity. 

The DOL indicates, however, that the school closures/childcare reasons for leave are the only reasons for which this exemption is available, and only if one of the above criteria is met.  

Business Size Requires Day-Of Calculation: 

The FMLA emergency leave provisions apply to private employers with 499 or fewer employees, but the law does not say what time period employers must use to make this calculation. The DOL clarified that employers should use the number of employees on the day the subject employee’s leave would start. 

Limits of FMLA Leave  

The DOL clarified that the Emergency FMLA provisions do not change the overall amount of FMLA leave employees can take during an applicable FMLA 12-month period. For example, if during an applicable FMLA 12-month period an employee takes 12 weeks of FMLA leave, Emergency FMLA leave is unavailable because the employee has exhausted 12 weeks of FMLA leave. 

Full Time vs. Part Time Employees 

The amount employees receive for emergency paid sick leave depends on whether they are "full" or "part" time. The DOL clarified that "full-time" employees for emergency paid sick leave purposes are those who normally are scheduled 40 or more hours per week. An employee who is not "full" time is "part" time, and that employee receives a number of emergency paid sick leave hours equivalent to the number of hours the employee works on average over a two-week period (using a six month average).  

Job Restoration After FMLA Leave 

The DOL clarified that employers can deny reinstatement to the same or equivalent position to an individual who qualifies as an FMLA "key" employee (salaried employee who is among the highest-paid 10% of all the employer's employees within 75 miles of the employee's worksite), or who works for an employer with 24 or fewer employees and takes school closure/childcare leave, and all four of the following hardship conditions exist: 

1. The position no longer exists due to economic or operating conditions that affect employment and are due to COVID-19-related reasons during the leave period;

2. Employer made reasonable efforts to restore the employee to the same or an equivalent position;

3. Employer makes reasonable efforts to contact the employee if an equivalent position becomes available; and

4. Employer continues to make reasonable efforts to contact the employee for one year, beginning on the date COVID-19 leave ends or the date 12 weeks after leave began (whichever is earlier). 

Emergency Leave Counts Toward Health Coverage Eligibility 

The DOL clarified that, for employees completing an eligibility period before they can receive employer-provided group health coverage, the time they take Emergency FMLA leave instead of actively working counts towards satisfying the eligibility period requirements. 

Definition of Health Care Provider & Emergency Responder for Employee Exception 

Employers of health care providers and emergency responders can elect to exclude the following employees, among others, from coverage: 

·     anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions, and any individual employed by an entity that contracts with any of the above institutions, employers, or entities. This also includes anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments.  

If you have questions or would like to discuss COVID-19 concerns, please contact Attorney Michael P. Doherty, Attorney Andrew M. Kepple, Attorney Gabriel W. Bell, or one of our other employment attorneys at 508-541-3000.

This article is for informational purposes only. It should not be considered legal advice. All those who read this article should seek the advice of a professional before taking action based upon any information provided herein.

© 2020 Doherty, Dugan, Cannon, Raymond & Weil, P.C.

DDCRW Law | (508) 541-3000 | ddcrwlaw.com

Paycheck Protection Program

Under the CARES Act

The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law on March 27, 2020. One important aspect of the CARES act is the Paycheck Protection Program (the “PPP”), a program which authorizes up to $349 billion in forgivable loans to businesses across the country. This program will be accepting applications from businesses beginning on April 3, 2020.  

Generally, the PPP will benefit smaller businesses with 500 or fewer employees. PPP loans to small businesses will be forgiven (and will not have to be repaid) under certain circumstances. As an initial matter, the loan money must be used only for certain allowable costs, including the following: 

·        covering payroll costs and benefits;

·        mortgage interest on obligations incurred before February 15, 2020;

·        rent costs pursuant to leases entered into prior to February 15, 2020;

·        utilities that began service to the business prior to February 15, 2020. 

Also, the amount of loan forgiveness will be reduced if a business cuts employees or reduces wages by more than 25%.  The PPP includes more details about forgiveness and a formula for determining potential loan forgiveness amounts.   

Businesses can apply to borrow up to 2.5 times the company’s average monthly payroll costs, up to a maximum of $10 million.  Loan payments can be deferred for six months and the interest rate for the loans will not exceed 4%. The loans will not require security or personal guarantees and can be repaid over a period of up to ten years.  

Information about the timeline and process for applying, the businesses that are eligible, and other information about PPP Loans can be found at the following link to the SBA’s website:  

https://www.sba.gov/funding-programs/loans/paycheck-protection-program-ppp 

A PDF version of the application can be found on the SBA’s website at the following link: 

https://www.sba.gov/document/sba-form--paycheck-protection-program-ppp-sample-application-form 

If you have questions or would like to discuss COVID-19 concerns, please contact Attorney Michael P. Doherty, Attorney Andrew M. Kepple, Attorney Gabriel W. Bell, or one of our other employment attorneys at 508-541-3000. 

This article is for informational purposes only. It should not be considered legal advice. All those who read this article should seek the advice of a professional before taking action based upon any information provided herein. 

© 2020 Doherty, Dugan, Cannon, Raymond & Weil, P.C.

DDCRW Law | (508) 541-3000 | ddcrwlaw.com