Last week I took a stab at making sense of the messy and unclear rules surrounding the substitution of employer-provided leave (which, for the sake of simplicity, I’ll refer to as (“PTO”) for paid sick leave (“EPSL”) and expanded Family and Medical Leave (“EFMLA”) under the Families First Coronavirus Response Act.
On April 21, the Department of Labor published its 5th set of FAQs discussing the FFCRA. Question 86 squarely addresses and clarifies the intersection between employer-provided paid leave and leave under the FFCRA.
1. An employer may not require that PTO run concurrently with—that is, cover the same hours as—EPSL. 2a. An employer may require that PTO run concurrently with the paid weeks of EFMLA. PTO that runs concurrently with EFMLA will enable the employee to receive 100 percent of his or her daily pay plus the EMFLA benefit (two-thirds of her or her regular rate of pay, capped at $200 per day and $10,000 in total). Note, however, that the FFCRA’s payroll tax credit only reimburses the employer for the paid leave provided under the Act, not for any concurrent PTO applied. Once an employee exhausts all available PTO, EFMLA is continued to be paid out of the statutory two-thirds rate. 2b. Alternatively, an employer and employee may agree to top off the two-thirds EFMLA pay to an amount equal to 100 percent of the employee’s regular pay. Again, the FFCRA’s payroll tax credit only reimburses the employer for the paid leave provided under the Act. 3. An employee may elect—but an employer may not require the employee—to take EPSL or PTO (but not both) during the first two weeks of unpaid EFMLA.
Some 768 million days of paid time went unused by American workers in 2018. That time amounted to about $65 billion in value.
While those statistics point to an American workforce that is overworked, it also presents an underlying problem many workers face: an organization’s time off policies that are poorly communicated, too complicated and overly cumbersome.
That could lead to employees shirking the system, which frustrates managers and angers payroll staff. Simplifying time off policies helps employers to more easily track their workforce’s vacation and sick time while allowing employees to take off the time they have earned.
Considering that some payroll systems are stuck in decades-old processes, an upgrade may sound easier said than done. But that’s not the case.
Even if a time off policy is locked in a paper-based 1980s time warp that’s as scary as Michael Jackson’s “Thriller,” employers can channel their “Old Town Road” and easily upgrade to a fresh, comprehensive 2020s system that promotes modern sensibilities through ease of use.
Here are four ways a tech upgrade canstrengthen your organization’s PTO policy:
Simply simplify.
With a simplified time-off system, employees are more likely to take the time off they have earned and deserve. That leads to happier employees, which in turn leads to higher productivity. An updated time off policy includes features allowing employees to submit time off requests from any device at any time, making it a convenience rather than a cumbersome process.
Communicate your time-off policy capabilities.
Employees can be intimidated to take time off for whatever reason. And if they don’t know that their employer has upgraded to an employee-friendly, mobile-enabled time-off system they are less likely to request earned PTO. It’s clear that a rested employee is more productive. Your enhanced time off system also should provide an easy and effective way to communicate anything from a newly opened shift to a company’s time off policies.
Paperwork is a relic of the past.
A time off system that relies on technology rather than file folders and cold steel cabinets is not only a nod to a more mobile workforce but to the younger demographics of today’s working population. A mobile-friendly time off policy makes it easy to manage PTO requests and sends the message that you’re encouraging employees — especially millennials and Generation Z — that they should use their time.
Build a more productive, trusting workforce.
By encouraging employees to take their time off, rather than obfuscating it through some dim, impermeable system, employers can enhance engagement, promote transparency and build trust. Such employee engagement tactics lead to a more positive work environment. Streamlining the PTO process makes it easier for employees to use their paid time off and leads to a more productive workforce.
An engaged, rested workforce leads to a more harmonious and productive workforce. A mobile-friendly leave management system also allows employees to better plan for their time-off needs, switch schedules and communicate with one another.Workforce.com’s intuitive leave management provides seamless operations and provides tie-ins to scheduling and payroll.
We all want to get back to work as safely and as quickly as possible.
One thing that would allow us to do this with confidence is widespread antibody testing, a quick blood test to reveal if one carries the COVID-19 antibodies from which an employer can presume exposure, immunity and a reasonable degree of safety for an employee to return to work.
This testing, however, raises two critical questions.
1. Can employers legally require it?
2. Should employers rely on it as an indicia of safety?
Can an employer legally require antibody testing?
The “can” question is easy to answer. According to the EEOC, because coronavirus is a “direct threat,” employers have carte blanche to test employees, including antibody testing as a return-to-work condition.
The Americans with Disabilities Act prohibits an employer from making disability-related inquiries or engaging in medical examinations unless they are job-related and consistent with business necessity, which includes when an employee will pose a direct threat due to a medical condition.
A “direct threat” is “a significant risk of substantial harm to the health or safety of the individual or others that cannot be eliminated or reduced by reasonable accommodation.” If an individual with a disability poses a direct threat despite reasonable accommodation, the nondiscrimination provisions of the ADA do not protect him or her, and disability-related inquiries and medical examinations are legal and permissible.
Per the EEOC, “As of March 2020, the COVID-19 pandemic meets the direct threat standard,” because “a significant risk of substantial harm would be posed by having someone with COVID-19, or symptoms of it, present in the workplace at the current time.”
Thus, because COVID-19 is a direct threat, employers absolutely can require antibody testing as a condition for an employee to return to work.
Should an employer rely on antibody testing as an indicia of safety?
The more difficult question is whether an employer “should” require it and rely on it.
More than 90 companies have jumped into the market since the F.D.A. eased its rules and allowed antibody tests to be sold without formal federal review or approval.
Some of those companies are start-ups; others have established records. In a federal guidance document on March 16, the F.D.A. required them to validate their results on their own and notify the agency that they had done so.…
Most of the tests offered are rapid tests that can be assessed in a doctor’s office — or, eventually, even at home — and provide simple yes-or-no results. Makers of the tests have aggressively marketed them to businesses and doctors, and thousands of Americans have already taken them, costing a patient roughly $60 to $115.
Rapid tests are by far the easiest to administer. But they are also the most unreliable — so much so that the World Health Organization recommends against their use.
These tests have a false-positive rate of 5 percent (or higher), a significant margin of error when you consider that in a community with a five percent infection rate you’d have as many false positive as actual positives.
Even labs that are marketing these antibody tests to employers are cautioning against their reliability.
This test hasn’t been reviewed by the FDA. Negative results don’t rule out SARS-CoV-2 infection, particularly in those who have been in contact with the virus. Follow-up testing with a molecular diagnostic lab should be considered to rule out infection in these individuals. Results from antibody testing shouldn’t be used as the sole basis to diagnose or exclude SARS-CoV-2 infection. Positive results may be due to past or present infection with non-SARS-CoV-2 coronavirus strains, such as coronavirus HKU1, NL63, OC43, or 229E.
In other words, these tests aren’t reliable because the FDA hasn’t reviewed them, and because of risk of a strand of coronavirus other than COVID-19 flagging a false-positive result.
What does all of this mean?
First, employers should not and cannot rely on currently available antibody tests as the magic bullet to get employees safely back to work. They are simply not sufficiently reliable.
Secondly, for the time being, employers will have to rely on measures other than testing to keep employees safe.
Third and finally, the government needs to ramp up the approval of reliable testing. Without readily available quick and reliable tests we are shooting in the dark by bringing employees back to work, and we will continue to spread infections no matter how many other steps businesses take to attempt safely to return employees to work.
The CDC recommends that employees who can work from home do so, and state stay-at-home orders are requiring telework whenever possible.
The larger questions, however, are whether COVID-19 will change our national outlook on the viability of telework, or when this crisis ends will businesses return to their pre-coronavirus telework hostility?
I hope it’s the former but I fear it’s the latter. And if it’s the latter, Tchankpa v. Ascena Retail Group, which the 6th Circuit Court decided in the midst of the growing coronavirus outbreak and just five days before the World Health Organization declared a viral pandemic, gives us some insight into the future issues.
Kassi Tchankpa, a database administrator for Ascena, seriously injured his shoulder while transporting laptops to work. The injury limited his ability to bathe himself, cook, wash dishes, open the refrigerator or drive normally. Yet, with a variety of accommodations from Ascena (such as arriving late or leaving early as needed to attend medical appointments and flexible scheduling), Tchankpa was able to work in the office for the first 10 months after his injury.
When he asked to work at his home three days per week as further accommodation (something he argued Ascena allowed other employees to do), the company balked. Tchankpa’s supervisor made clear that Tchankpa needed medical documentation to support his request for regular work from home.
Tchankpa’s doctor, however, never provided that documentation, and instead advised the company that Tchankpa could continue to work from the office as long as he took frequent breaks for his shoulder. Ascena thus denied the work-from-home accommodation request. As a result, Tchankpa quit and sued for disability discrimination.
The lack of documentation supporting Tchankpa’s telework accommodation request doomed his claim:
Employers are entitled to medical documentation confirming the employee’s disability and need for accommodation. And Ascena invoked that right in early 2013. Yet Ascena did not receive documents discussing Tchankpa’s medical restrictions until October 2013. Far from showing a necessary accommodation, Dr. Stacy’s report stated that Tchankpa could work eight hours per day, five days per week. Without medical documentation showing that Tchankpa’s disability required work from home, Ascena had no duty to grant Tchankpa’s request. After all, we presume on-site attendance is an essential job requirement.
Thus, an employee seeking telework as a reasonable accommodation must provide a requesting employer documentation as to the medical necessity of that accommodation. This is true of any reasonable accommodation. Unless the need for a reasonable accommodation is painfully obvious, an employer never has to take an employee’s word for it, and should always request medical documentation to support that need.
Which has nothing whatsoever to do with telework during this pandemic emergency. Everyone who can be teleworking should be teleworking, period, no questions asked.
The bigger question is what happens after we all return to our physical places of work. Currently, about half of employed adults are working from home. According to the Bureau of Labor Statistics, before coronavirus only 19.5 percent of the workforce performed some paid work at home. We should expect the numbers to meet somewhere in the middle after we are all allowed to safely return to work. Indeed, the Brookings Institute predicts that telecommuting will continue long after the pandemic ends.
While working from home hasn’t been perfect over the past month, it’s still been work. With email, remote access, cloud storage and Zoom, I’ve been able (more or less) to accomplish everything I’ve needed to. Still, I miss my co-workers and can’t envision doing this from-home thing on a permanent, full-time basis. But I can envision it a day or two a week.
So here are my questions on the heels of the Tchankpa court’s declaration that “on-site attendance is an essential job requirement.” Is it still? If employees are currently working productively from home, will an employer still be able to make a future claim that on-site attendance is essential to those employees’ jobs? Or will remote work finally take its rightful place alongside in-person work as accepted and acceptable?
While telecommuting has been the exception by a vast number, my hope is that the wall that has separated exception from rule will evaporate, as this pandemic has shown that we can productively work without being at work.
LAZ Parking has a corporate history straight out of a Netflix mini-series. And it’s shaped the company’s culture and values ever since.
In the summer of 1981, Alan Lazowski was an aspiring college student trying to earn a little cash before his senior year at the University of Connecticut. Instead of looking for a job, he borrowed money from his grandfather and started a parking valet service for a local restaurant in Hartford, Connecticut. By summer’s end, he and two of his friends were managing five parking locations and had 30 employees.
Nearly 40 years later, Lazowski and his co-founders, Jeffrey Karp and Michael Harth, have grown that summer business into the second largest parking company in the country. LAZ Parking now has more than 13,000 employees and $1.4 billion in annual managed revenues, and operates more than a million parking spaces.
The founders attribute their success story in large part to their long standing goal: “Create opportunities for employees and value for clients.”
Luis Henriques, general manager, LAZ Parking
That mission isn’t just a sign on the wall. Leaders across the company genuinely care about everyone on the team, from part-time valets to senior executives. They treat hourly workers like they will be with the company forever, said Luis Henriques, general manager for LAZ in Hartford. “Creating opportunities for employees is our secret sauce.”
Henriques knows from experience. He started at LAZ in 1989 as a teen-ager parking cars on weekends. His vice president recognized his dedication, and when Henriques completed his associate’s degree the company offered him a night management position overseeing 100 employees. Today he is responsible for 20 managers and more than 850 employees.
“I grew up in this company,” he said. “It is my family.”
LAZ leaders know that valet and parking attendant jobs aren’t glamorous, and that most employees see these jobs as a temporary measure to earn some quick cash. But the company is doing everything it can to encourage them to stick around, said Andi Campbell, senior vice president of people and culture.
Campbell was hired in 2012 as director of talent with the primary goal to “fill the talent pipeline.” Soon after she moved into the people and culture role because LAZ leaders recognized that finding and keeping talent is all about the company culture.
Everyone Deserves a Second Chance
The emphasis on creating opportunities for employees is seen everywhere at LAZ, beginning with recruiting.
“We are laser-focused on using data and KPIs to be sure we are getting people where we need them, and getting them into development,” Campbell said. “To grow as fast as we are growing, we have to find really good people, which isn’t always easy.”
The company hosts national job fairs in 20 cities twice a year and actively recruits everyone from college students to recent parolees.
“We are very big on second chances here,” said Henriques. He noted that while many companies won’t give previously incarcerated people an opportunity, LAZ believes these candidates can be great assets to the company. “They paid the price for what they did, and our experiences with them have all been positive.”
Once hired, employees are immersed in company culture from day one, so people know right away that the job can be more than just a temporary gig.
The LAZ onboarding process includes a variety of events, including Get Connected, a lunch and learn where employees meet with local, regional and national managers to talk about the company and opportunities beyond the front line.
“Our CEO always says that leaders are the ambassadors of the company,” Henriques said. “You have to take time every day to listen to your people. That’s what makes us different.”
Andi Campbell, SVP People & Culture, LAZ Parking
The company is also quick to celebrate its employees. Managers hand out Rave Cards that acknowledge employees who do excellent work, and the company throws elaborate end of the year parties for front line workers.
“Recognition is a big part of motivation,” Henriques said. “It’s how we say thank you to our staff.”
It Starts With Management
Campbell also makes sure that managers have the training and guidance to promote the company’s values in every employee interaction. This is key to the company’s engagement strategy.
“If you want to improve employee well-being, or safety, or engagement, it all comes down to how managers manage their people,” Campbell said. “Front-line workers don’t know the VPs, but they do know and trust their managers, so the key to change is at that mid-level.”
Whenever the company wants to address a corporate issue or encourage a certain behavior, it starts with manager training. Campbell has launched a series of learning programs over the years that align with corporate strategy, including how to meet the needs of front-line workers, how to prevent safety issues, and how to identify and promote high performers. Along with core workshops or live training events, she also provides frequent communications with management tips, access to coaching clinics, and a catalog of online training that managers can access any time. “When you teach people how to lead teams on the ground, that’s how you move the needle.”
One of the most successful efforts has been around teaching managers to be effective coaches, mentors and advocates for their people. Managers like Henriques are taught to always be on the lookout for passionate employees who might be LAZ management material.
When they identify these high performers, they can nominate them to attend LAZ University, an 10-week business management program that prepares aspiring hourly workers for management roles. Attending the training is considered an honor, and it draws attention to the company’s commitment to growth — both for employees selected for training, and those who see them move up the ranks, Henriques said.
Local and regional managers are also encouraged to suggest employees for management roles where positions open up. Henriques has promoted five people in the last nine years. “Their co-workers see that and recognize the opportunities are there.”
Hugs Not Handshakes
All of these values have been part of LAZ from the beginning, and are constantly reinforced by Lazowski himself. “He really cares about people,” said Tina Cyr, accounts payable director. Lazowski takes the time to learn everyone’s name, and is always available for a chat or a hug. “We are big huggers around here,” Cyr said.
Tina Cyr, accounts payable manager, LAZ Parking
Cyr was initially surprised by the warmth she felt after coming to LAZ from a much more corporate environment, but she quickly embraced it. “There is something really special about a genuine family culture,” she said. “It really feels like they put people before profits.”
While the company may have a touchy-feely approach to engagement, they also keep a close eye on results. Campbell tracks data on every program she initiates, and sets key performance indicators to measure success.
That helps her prove the impact of her programs, and to tie culture investments to bottom-line results. Most recently, efforts to improve safety and wellness have helped the company reduce its per employee per month healthcare claim costs, despite being in a rapid hiring phase.
“We see wellness as a huge opportunity for LAZ,” she said. It lowers costs, reduces absenteeism, and reinforces the company’s commitment to employee wellbeing.
The company has also seen engagement numbers steadily rise, and its turnover has dropped below 17 percent for salaried employees, and 70 percent for hourly workers.
“For the hospitality industry, those numbers are amazing,” Campbell said.
LAZ may have a unique culture and history, but Campbell believes that it can be replicated. The key is to make culture part of everyone’s responsibility, she said. Whether a company is trying to figure out how to improve retention, promote wellness, or drive bottom line results, when leaders factor employee needs into their business decisions, they make choices that allow a positive corporate culture to blossom.
“It sounds simple,” she said, “but that’s how we connect culture to everything we do.”
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We used to fill our time running our kids all over the place for various lessons, rehearsals, and gigs. Now, however, we have a lot of down-time, with nothing to do. So how am I filling my time when I’m not working? (Which, btw, I’ve been doing a lot of over the past month.)
1. Walking … a lot. We are walking a ton of miles. As in 4 to 6 miles per day. The rings on my Apple Watch are very happy. Partly because we have two high-energy dogs (one being an 11-month-old puppy) that can’t go to daycare to tire themselves out. And partly because what else are we going to do? Let me make a few observations from my miles of walking. First, thank you to most for maintaining social distance. People (more or less) have been really good about keeping six feet of separation. Secondly, people have been really nice to each other. Lots of, “How are yous” from total strangers (from a socially acceptable distance). Third, it appears that many people do not think kids can carry or catch COVID-19. Because I’ve seen lots of kids playing together in close groups (basketball, football, walking, etc.). Parents, I know this sucks for your kids. It’s going to suck more if they transmit this virus to each other. Please, let’s try to maintain social distance for a few more weeks, and we can all start to get back to normal socializing again (although it’s going to take me a while to feel comfortable shaking someone’s hand or getting in an elevator).
2. Cooking and baking. Because we always seem to be running around a lot, we are always grabbing food out. We must eat out four times a week. Without nowhere to go, I’ve been cooking every night. I’ve also been baking (a combination of comfort and nesting, I think). The cooking is starting to get old. I really do love to cook, but I also love the option of not cooking. When this is all over, I think I’ll be exercising that option a bunch. Also, if anyone wants the world’s greatest gluten-free chocolate chip cookie recipe, hit me up.
3. Grazing all day. One of the downsides of working from home (aside from the a-hole puppy who barks, and goes crazy, and generally likes to annoy us and his big sister) is the easy availability of food and constant snacking. Thankfully, no. 1 above makes up for these added comfort calories.
4. Virtual cocktail hours. Since we can’t connect with people in person, we’ve been connecting remotely via Zoom. We have weekly check-ins with family (real and our Fake ID band family). We’ve also connected with friends as far as the West Coast and as near as across the street. It’s been a great (albeit different) way to keep in touch and re-connect. And, cocktail hour.
5. Slowing way down. One of the unintended benefits of sheltering at home is that we have been forced to sloooooow down. No longer running to and from place to place, we have the time to sit and play a family game or watch a family movie (***** for “Almost Famous,” even though I forgot that Kate Hudson shows her boob; ***1/2 for “Onward,” not one of Pixar’s best, but still enjoyable and sweet.) It’s not like we weren’t connected as a family pre-coronavirus, but this has forced us to reconnect in a good way. And no one is sick of anyone else … yet.
Bloomberg Law asks whether employers are “responsible for paying workers for the time it takes to record their body temperatures before entering the workplace.”
To me, this question doesn’t require a legal analysis but a common-sense application of basic decency. If your employees are queuing before entering work because you are requiring them to pass a temperature check, pay them … period.
Since this is a legal blog, however, I might as well look beyond common sense and examine the laws impacted by this issue—the ADA and the FLSA.
The ADA typically prohibits employers from taking employees’ temperatures as an unlawful medical examination. Because the WHO has classified coronavirus as a pandemic, however, just about all medical exam issues under the ADA are temporarily moot. According to the EEOC, among other coronavirus prevention measures, employers may measure employees’ temperatures. This issue, at least for now, is pretty cut and dry.
The FLSA issue is a little more nuanced. In Integrity Staffing Solutions v. Busk, the Supreme Court held that the FLSA only requires employers to compensate employees for time spent performing “preliminary” (pre-shift) and “postliminary” (post-shift) activities that are “integral and indispensable” to an employee’s principal activities. What activities are “integral and indispensable?” Those that are (1) “necessary to the principal work performed” and (2) “done for the benefit of the employer.”
In Busk, for example, the Court held that post-shift security screenings were not “integral and indispensable” for an Amazon warehouse employee, because such screenings are not “an intrinsic element of retrieving products from warehouse shelves or packaging them for shipment,” and the employer “could have eliminated the screenings altogether without impairing the employees’ ability to complete their work.”
According to the Bloomberg Law article, employers could look to Busk to argue that pre-shift temperature checks, even if mandatory, are not “integral and indispensable” and therefore can be unpaid. (For what it’s worth, I think a just as good, or better, argument is that preliminary temperature checks to protect employees from a deadly virus are integral, indispensable, and compensable.)
Busk or no Busk, this isn’t a “what does the law allow” issue; this is a “what’s right is right” issue. If you’re requiring your employees to queue in a line to take their temperature before you’ll let them enter the workplace, pay them. Don’t be cheap and don’t count pennies.
Your employees are scared. They are risking their own personal health and safety, and that of everyone who lives in their homes, to keep your essential business up and running. They could just as easily stay home, limit their exposure, and collect unemployment.
What they need is your compassion, not your penny-pinching. Times are tough for everyone. I get it. But your business shouldn’t go belly up if you pay each employee for a few extra minutes of time each day, especially when the federal government is going to reimburse you through your Paycheck Protection Program loan. (You did apply for your loan, right?)
At the end of this pandemic, many businesses will no longer exist. If there’s such a thing as karma, one of the deciding factors in which ones survive will be how they treated their employees.
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Don’t forget that I’ll live on Zoom tomorrow, April 9, from 11:30 am – 12:30, open paid sick leave and eFMLA issues, and taking your coronavirus questions. And Norah has said she will drop in and share another song. You can access the Zoominar here: https://zoom.us/j/983559955
The past two weeks have seen a record 10 million new unemployment claims. This number does not even include many of the millions more who have had their hours or wages cut as businesses continue to struggle with the realities of operating in a world turned upside down by coronavirus. Sadly, we should expect this situation to get a lot worse before it starts to get better.
Thankfully for each worker unemployed or underemployed as a result of coronavirus, the CARES Act provides significant financial relief. It contains the following seven unemployment expansion and enhancement provisions.
1. Pandemic Unemployment Compensation (FPUC)— This program provides funding for an additional $600 per week in unemployment benefits through July 31, 2020, for any individual who becomes unemployed, partially unemployed, or unable or unavailable to work or telework because of any of the following coronavirus related reasons:
The individual has been diagnosed with coronavirus or is experiencing symptoms of coronavirus and seeking a medical diagnosis.
A member of the individual’s household has been diagnosed with coronavirus.
The individual is providing care for a family member or a member of the individual’s household who has been diagnosed with coronavirus.
A child or other person in the household for which the individual has primary caregiving responsibility is unable to attend school or another facility that is closed as a direct result of the coronavirus public health emergency and such school or facility care is required for the individual to work.
the individual is unable to reach the place of employment because of a quarantine imposed as a direct result of the coronavirus public health emergency.
The individual is unable to reach the place of employment because the individual has been advised by a health care provider to self-quarantine due to concerns related to coronavirus.
The individual was scheduled to commence employment and does not have a job or is unable to reach the job as a direct result of the coronavirus public health emergency.
The individual has become the breadwinner or major support for a household because the head of the household has died as a direct result of coronavirus.
The individual has to quit his or her job as a direct result of coronavirus (which one could interpret as covering employees who quit out of fear of contracting coronavirus).
The individual’s place of employment is closed as a direct result of the coronavirus public health emergency.
Additionally, this program contains a non-reduction rule, which prohibits states from changing how they compute regular unemployment benefits to reduce the average weekly benefit amounts or the number of weeks of benefits payable to impacted employees.
In Ohio, this means that a minimum wage employee with no dependents would see his weekly unemployment benefit increase from $171 to $771 (an annualized salary of $40,092), and an employee with three dependents maxed out on unemployment would see his weekly benefit increase from $647 to $1,247 (an annualized salary of $64,884).
Because of this substantial increase, I am worried that many employees will decide that they are better off (either financially or for health-related reasons) quitting their jobs and collecting unemployment, leaving essential employers with huge labor gaps to fill to maintain basis minimum operations. For this reason, essential employers should be communicating with their employees on a daily basis about all of the steps they are doing to ensure, as best as possible their employees’ health and safety.
2. Pandemic Unemployment Assistance (PUA)—This program provides unemployment compensation through December 31, 2020, for individuals who are self-employed, seeking part-time employment, or who otherwise would not qualify for regular unemployment benefits because of one of the above-listed coronavirus related reasons.
5. Emergency state staffing flexibility — States as provided flexibility through December 31, 2020, to modify their unemployment compensation laws and policies with respect to work-search requirements, waiting weeks, good cause standards, and employer experience rating. Ohio, for example, has eliminated its work-search requirement and waiting periods, and is not counting coronavirus related unemployment claims against an employer’s experience rating.
6. Pandemic Emergency Unemployment Compensation (PEUC) — This program provides up to 13 weeks of additional unemployment benefits through December 31, 2020, for individuals who have exhausted all rights to regular unemployment compensation under state or federal law or have no rights to regular unemployment compensation under any other state or federal law. The law requires individuals seeking PEUC benefits to be able to work, available for work, and actively seeking work. States, however, are required to offer flexibility in meeting the “actively seeking work” requirement for individuals unable to search for work because of coronavirus, including illness, quarantine, or movement restrictions.
One of the questions I have received the most since the passage of the Families First Coronavirus Response Act is how employers claim the tax credit available under the Act for paid leave provided to employees.
Late on March 31, the IRS published a detailed list of FAQs explaining all of the mechanics of this tax credit. I want to focus on the key employment law piece of these FAQ, how an employer should substantiate its eligibility for tax credits, i.e., the documentation you need to keep.
The IRS discusses this important issue in Questions 44–46. I’ll break it all down for you here.
What information should an “Eligible Employer” (a business with fewer than 500 employees) receive from an employee to substantiate eligibility for the sick leave or family leave tax credits?
The IRS says that an employee’s leave request must be inwriting and must include:
The employee’s name;
The date(s) for which leave is requested;
A statement of the coronavirus related reason the employee is requesting leave and written support for such reason; and
A statement that the employee is unable to work, including by telework, for such reason.
Additionally, for a leave request based on a quarantine order or self-quarantine advice (the employee’s or someone else’s for whom the employee is providing care), the employee’s statement should include the name of the governmental entity ordering quarantine or the name of the health care professional advising self-quarantine, and, if the person subject to quarantine or advised to self-quarantine is not the employee, that person’s name and relation to the employee.
For a leave request based on a school closing or child care provider unavailability, the statement from the employee should include:
The name and age of the child (or children) to be cared for;
The name of the school that has closed or place of care that is unavailable; and
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.
Also, note that there is a cut-off age at age 13 for care during daylight hours. An employee unable to work or telework during daylight hours because of a need to care for a child age 14 and older must also provide a statement that special circumstances exist requiring the employee to provide care.
Additionally, for all paid leave under the FFCRA for which an employer claims a tax credit, the employer must also provide:
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.
Documentation to show how the employer determined the amount of qualified health plan expenses that the employer allocated to wages.
Copies of any completed Forms 7200, Advance of Employer Credits Due To COVID-19, that the employer submitted to the IRS.
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).
Employers must keep these records for at least four years after the date the tax becomes due or is paid, whichever comes later, and should be available for IRS review.
I encourage all employers to have a conversation with their accountant and/or tax lawyer before filing your next quarterly payroll taxes to make sure you are claiming this exemption correctly.
One employer is an anomaly, two is a trend that must be stopped.
Last week, I nominated for the Worst Employer of 2020 an unnamed national restaurant chain that was reported to be stealing (the company called it “absorbing”) its employees’ CARES Act stimulus checks by reducing their scheduled hours in a pro-rata amount.
Now, another employer has been outed with similar plans.
According to KXAN, an unnamed national company advised its employees that it would be preemptively deducting funds from their paychecks based on the amount each employee anticipated receiving in their stimulus check.
The agreement would put workers under a “temporary compensation reduction that is in line with the assistance that it receives from the federal government related to the COVID-19 pandemic.” By signing the agreement, the company’s employees would have their paychecks between April 6 and April 20 cut by 100% of any money received under the stimulus bill.
The company would also take half of the $500 stipend allotted for dependents under the bill.
As a result of the few inquiries we have this week, I wanted to make the following points of clarification with regard to the Employee Emergency Compensation Program that was announced and specifically for those employees who have not already sacrificed with immediate pay reductions.
First, the plan will not go into effect until the earliest of April 6th and, there will be no pay reduction for the paycheck received on that date.
Second, it appears that Congress is very close to passing sweeping legislation to provide relief to companies like ours and to individuals. … If we can determine ways to minimize the amount of sacrifice that we have asked everyone to make, we will do so and amend the plan accordingly.
That last paragraph is his email is really important. The CARES Act contains key payroll and other relief to small and mid-size businesses, known as the Paycheck Protection Program. It allocates $350 billion to businesses with less than 500 employees through low interest (and, in some cases, fully forgivable) loans to help pay payroll, rent and utilities.
There are ways to keep your business operational and solvent without “absorbing” your employees’ stimulus checks. They need that money to live. Moreover, in the very same Act that makes those stimulus checks available, the government also makes available for businesses Paycheck Protection Program loans. Use those loans to help your business stay afloat during these trying and difficult times. Don’t absorb the money that’s meant specifically for your employees. It’s just plain wrong.
For more information on how your business can obtain funds through the Paycheck Protection Program, contact me and I’ll put you in touch with an attorney on our Coronavirus Response Team.
