Coronavirus Employment Law (Complete Guide 2020)
UPDATED: May 29, 2020
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- What are employee leave of absence rights and employer paid leave obligations?
- Can employers layoff employees as a result of COVID-19?
- How can employers safely hire employees during the COVID-19 outbreak?
- Can employers reduce working employee pay or hours as a result of COVID-19?
Businesses of all sizes are encountering new and challenging employment issues in the wake of COVID-19, the coronavirus disease 2019. There are important coronavirus employment laws that are specifically related to, or that are triggered by, the coronavirus and its impact on the American workforce, most notably the new Families First Coronavirus Response Act.
We will address frequently asked questions and provide coronavirus news about the impact of these employment laws on business operations in order to provide guidance to employers and employees about their rights and obligations during the coronavirus pandemic.
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Leave of Absence Rights and Obligations During Coronavirus
There are several employment leave of absence laws that come into play as a result of coronavirus, many that have existed for years and others that were specially passed to address the impact of COVID-19 on employers and their employees.
Paid Leave Under The Families First Coronavirus Response Act (FFCRA)
The leave law that is directly tied to COVID-19 is the Families First Coronavirus Response Act (FFCRA), sometimes referred to as the Coronavirus Employee Rights Act. The federal government recently passed the FFCRA, effective April 1, 2020 through December 31, 2020, to respond to economic devastation for families, workers, and businesses from the COVID-19 outbreak.
Under the FFCRA, Congress passed two employee paid leave-related bills:
- The Emergency Family and Medical Leave Expansion Act (EFMLEA), which expands the unpaid leave rights that currently exist under the Family and Medical Leave Act of 1993 (FMLA); and
- The Emergency Paid Sick Leave Act (EPSLA), which requires paid sick leave for employees who are unable to work due to the effects of COVID-19.
What does the Emergency Family and Medical Leave Expansion Act (EFMLEA) do?
The EFMLEA requires covered employers to permit up to 12 weeks of paid public health emergency leave through December 31, 2020 for eligible employees to care for their child(ren) during a COVID-19 public health emergency.
This is different from existing rights under the Family and Medical Leave Act of 1993 (FMLA), which, prior to the expansion act, only required covered employers to provide eligible employees with up to 12 weeks (or up to 26 weeks for eligible service members) of unpaid leave for qualified medical and family reasons during a 12-month period.
Details on employer obligations, employee eligibility and the amount and duration of paid leave under the EFMLEA are directly below in the section How is the EFMLEA different from the FMLA?
How is the EFMLEA different from the FMLA?
Paid Versus Unpaid Leave
Under the FMLA, covered employers are not obligated to provide paid leave unless required by their own policies. It does, however, require employers to maintain employee group health benefits during the leave.
Under the EFMLEA, covered employers must pay up to 12 weeks of expanded family and medical leave at two-thirds of an employee's regular wages for up to $200 daily and $10,000 total. Employers are not required to pay employees for the first 10 days of such public health emergency leave but employees may use accrued paid leave during such time.
Under the FMLA, a covered employer is any person engaged in commerce, or in any industry or activity affecting commerce, who employs 50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year.
Under the EFMLEA, employers of fewer than 500 workers are defined as covered employers; however, employers with fewer than 50 employees for each working day during each of at least 20 workweeks during the preceding year are not subject to civil liability for a violation of the act.
There are two important exceptions, notably, (1) employers of healthcare providers or emergency responders may exclude healthcare and emergency responder employees from the requirements of the act, and (2) employers with fewer than 50 employees if the requirements of this section would place the viability of that business at risk.
Under the FMLA, in order to benefit from the act, eligible employees must have worked for the company for 12 months or 52 weeks, must have worked at least 1,250 hours during the 12-month period immediately before the date when the leave is requested to commence, and must work in a worksite where 50 or more employees are employed by the company within 75 miles of that office or worksite.
Under the EFMLEA, eligible employees are those who cannot work because the school or childcare provider of that employee's child(ren) is closed as a result of a public health emergency.
With a finding of good cause, however, the Department of Labor may exclude certain healthcare providers and emergency responders from eligibility for public health emergency leave.
Reasons for Leave
Under the FMLA, eligible employees can take FMLA leave for the following reasons:
- The birth of a child and in order to care for that child
- The placement of a child for adoption or foster care and to care for a newly placed child
- To care for a spouse, child, or parent with a serious health condition
- A serious health condition that makes the employee unable to perform the functions of the position of such employee
- Any qualifying exigency arising out of the fact that the spouse, son, daughter, or parent of the employee is on covered active duty in the Armed Forces
- Military caregiver leave (also known as covered service member leave) to care for an injured or ill service member or veteran
Under the EFMLEA, as stated above, employees are eligible if they cannot work because the school or childcare provider of that employee's child is closed as a result of a public health emergency.
Under the FMLA, upon return from leave, an employee must be restored to his or her original job or to an equivalent job with equivalent pay, benefits, and other terms and conditions of employment. An employee's use of FMLA leave cannot be counted against the employee under a no-fault attendance policy, and may not affect employment decisions such as hiring, promotions, or discipline.
Under the EFMLEA, employers are generally required to restore an employee's former position following the use of public health emergency leave unless the employer (1) has fewer than 25 workers and (2) has made reasonable efforts to retain the employee's position but such position no longer exists due to economic conditions caused by such public health emergency.
What does the Emergency Paid Sick Leave Act (EPSLA) do?
The EPSLA requires employers to provide paid sick time to employees who are unable to work due to the effects of COVID-19.
Amount of Emergency Sick Leave Pay
Employers covered by EPSLA must pay: (1) the regular rate of pay up to $511 per day, and $5,110 in aggregate, for paid sick time used by an employee who experiences symptoms of COVID-19 or is required or advised to self-quarantine; or (2) $200 per day, and $2,000 in aggregate, for paid sick time used by an employee to care for the employee's child or other impacted person.
Paid sick time under this section may not carry over from one year to the next, but it may be used before other paid leave that may be available to an employee.
Employers with fewer than 500 employees and federal, state, and local public agencies are required to comply with the EPSLA. The Department of Labor may exempt employers with fewer than 50 employees if the requirements of the act would place the viability of that business at risk.
Full-time employees are entitled to 80 hours of paid sick time, which is available immediately for use if the employee:
- is subject to a governmental quarantine or isolation order,
- has been advised by a healthcare provider to self-quarantine,
- is caring for an individual who is subject to governmental or self-quarantine,
- is caring for the employee's child because the child's school or childcare provider is closed, or
- is experiencing a substantially similar circumstance related to COVID-19 as specified by the Department of Health and Human Services, in consultation with the Department of Labor.
Part-time employees are entitled to such paid sick time for the average number of hours the part-time employee works during an average two-week period.
With a finding of good cause, the Department of Labor may exclude certain healthcare providers and emergency responders from eligibility for emergency paid sick leave.
Reasons for Leave
As stated above, paid sick time under this act is available for employees who experience symptoms of COVID-19, are required or advised to self-quarantine, or have to care for a child or other impacted person.
Other Employer Obligations/Rights
The EPSLA sets forth the following other employer obligations/rights:
- Employers must provide conspicuous notice in the workplace of the emergency paid sick time requirements under the act.
- Employers are prohibited from taking adverse actions against employees who take leave under this division, or take actions to enforce the requirements of this act.
- Employers who violate the emergency paid sick time requirements are subject to fines and imprisonment pursuant to the Fair Labor Standards Act of 1938.
- This act does not affect employer rights or benefits under any other law, collective bargaining agreement, or existing employer policy.
- Employers are not required to pay employees for unused emergency paid sick time if an employee resigns, retires, or is terminated.
Military Leave Under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA)
The Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) secures important employment rights to active and reserve military personnel called to active duty. Under USERRA, returning service members have the right to reemployment provided they submit a timely return to work application.
USERRA also requires employers to provide eligible employees with up to five years of unpaid leave during their employment and to maintain the employee's seniority, healthcare, and pension benefits during this period.
What are employer obligations to uniformed service members who are called up to serve in response to the COVID-19 crisis?
Only the Federal National Guard service is covered by USERRA. That said, many states have enacted laws that provide similar protections as USERRA for military employees on active state duty, as well as laws protecting emergency relief workers, so employers should be cautious when addressing leave issues for both federal and state activated service members.
Layoff Rights and Obligations During Coronavirus
Unless employers are subject to collective bargaining agreements or other employment contracts restricting their rights to terminate employment, generally speaking employers are legally able to implement layoffs, also known as a reduction-in-force (RIF).
Nevertheless, employers must be careful that layoffs are in compliance with Title VII of the Civil Rights Act of 1964 and various other federal, state, and local employment laws. To that end, employers should consider the following issues when terminating members of their workforce during the current COVID-19 situation.
What is the difference between a layoff and a termination?
A layoff, or RIF for short, occurs when there is a legitimate business reason to eliminate a position or positions from the corporate structure.
A routine termination of employment is when the employer (or employee) decides to end the working relationship without cause or for cause, meaning the employee did something wrong, such as engaged in poor performance, a violation of company policy, or some other type of misconduct.
Employers should be careful about labeling a for cause termination as a layoff, even if the employee would be part of a layoff.
While employers are not legally obligated to recall laid off employees or show them preference in rehiring, if the employer subsequently refills the position with a replacement who is younger (age 40 or under), is not disabled, or is of a different race, ethnicity, religion, gender, etc., it the employer could be subjected to a claim that the position elimination was not legitimate in the first place and was pretext for unlawful discrimination.
Conversely, if an employer has legitimate grounds to terminate an employee for cause, and has adequate documentation to support that determination, then the employer has a strong legal basis not to rehire that employee in the future.
Is coronavirus a legitimate reason to lay off employees?
Clearly, the devastating economic impact of COVID-19 on businesses would constitute a legitimate business reason under the law.
That said, many businesses are trying to make compassionate decisions when it comes to reducing their workforce amidst the coronavirus crisis.
The sober reality, however, is that many employers are simply too small, fragile, or undercapitalized to stay in business at all, much less with a full workforce. For businesses that have no viable options other than significant layoffs, they should consider these measures first.
How should businesses decide who to lay off during the coronavirus?
Employers should be careful that reductions in force don't turn into employment discrimination claims. In order to do so, employers must use non-discriminatory criteria when determining which employees to lay off.
Employers Cannot Discriminate in Layoffs
When determining which employees will be laid off, employers must use non-discriminatory, objective, legitimate business criteria to make their selections. The layoff process should be in writing, setting forth the selection criteria, the decision made regarding a particular position or department, and the business need to support the decision to reduce the workforce.
The selection criteria should focus on the skills and abilities needed to maintain the business. Finally, the employer should identify which employees' performance, skill, and abilities are needed to sustain the business, and explain why.
Employers Must Conduct a Disparate Impact Analysis
Disparate impact is a legal theory of employment discrimination that focuses on the effect of a practice or policy. Disparate impact discrimination occurs when an employer's use of a facially neutral policy or practice (in this case, a reduction in force), impacts members of a protected class at a substantially higher rate than others and is not justified by business necessity and job-relatedness.
It is not necessary to prove intent to discriminate under the disparate impact theory of employment discrimination. Rather, it is used to analyze both objective and subjective selection standards.
As part of any RIF,employers must conduct a disparate impact analysis to ensure the layoff determinations do not disproportionately impact older employees, employees with disabilities or any other group protected by employment discrimination laws. Pursuant to recommendations of the Equal Employment Opportunity Commission (EEOC), if certain groups of employees are affected more than other groups, businesses should determine if they can adjust their layoff/RIF selection criteria to limit the impact on those groups, while still meeting the existing legitimate business needs.
Certain Employers Must Comply with Special Laws in Laying Off Older Workers
All private employers with 20 or more employees, as well as state and local government employers, employment agencies, and labor organizations must comply with the Age Discrimination in Employment Act of 1967 (ADEA).
The purpose of the ADEA is to prohibit employment discrimination against people who are 40 years of age or older.
The rule prohibits practices that, although facially neutral with regard to age, have the effect of harming older workers more than younger workers (i.e., disparate impact), unless the employer can show that the practice is based on a reasonable factor other than age (RFOA). This rule applies to layoffs.
In addition, employers must comply with the Older Workers Benefit Protection Act (OWBPA), which Congress passed in 1990 as an amendment to the ADEA. OWBPA establishes specific requirements for a knowing and voluntary release of ADEA claims to guarantee that an employee has every opportunity to make an informed choice whether or not to sign the waiver.
OWBPA lists seven factors that must be satisfied for a waiver of age discrimination claims to be considered knowing and voluntary, namely:
- A waiver must be written in a manner that can be clearly understood.
- A waiver must specifically refer to rights or claims arising under the ADEA.
- A waiver must advise the employee in writing to consult an attorney before accepting the agreement.
- A waiver must provide the employee with at least 21 days to consider the offer.
- A waiver must give an employee seven days to revoke his or her signature.
- A waiver must not include rights and claims that may arise after the date on which the waiver is executed.
- A waiver must be supported by consideration in addition to that to which the employee already is entitled.
Are employers required to offer severance packages to laid off employees?
Whenever possible, an employer instituting layoffs due to COVID-19 impacts should consider offering separation pay, also known as severance. Severance should always be offered through a written release agreement, which protects the employer with releases to all employment related claims. As set forth above, waivers of discrimination in employee separation agreements for older employees have particular requirements that must be met.
Are there special requirements for layoffs related to plant closings?
Companies covered by the federal Worker Adjustment and Retraining Notification (WARN) Act, or state equivalents, have an obligation to provide notice if they are forced to suspend operations due to COVID-19.
The federal WARN Act requires companies who employ 100 or more full-time employees to give a written 60-day notice of a plant closing or mass layoff in certain situations, even when they are forced to do so for economic reasons. Federal notice requirements can be triggered with layoffs of 50 employees, although state laws may require notice with a reduction in force of fewer than 50 employees.
The WARN Act provides a specific exception when layoffs or plant closings occur due to unforeseeable business circumstances or are the result of a natural disaster. In the case of the coronavirus epidemic, this exception could apply, but employers should seek reasoned legal advice before making any such determination.
In any event, employers must still provide as much notice as is practicable, and at that time shall give a brief statement of the basis for reducing the notification period, along with a statement explaining the failure to provide more extensive notice (i.e., the unpredictable duration and impact of coronavirus). The Act further specifies the specific information that must be contained in each notice.
Hiring Rights and Obligations During Coronavirus
Amid many mass layoffs, some businesses are actually hiring employees during the coronavirus outbreak. Here are some steps employers can take to safely hire new workers while also protecting existing workers.
Can employers screen new hires for coronavirus?
The EEOC has confirmed that employers can lawfully screen applicants for coronavirus symptoms but only after a conditional offer of employment is extended and only if the employer screens all new employees hired for the same job.
It is also permissible for employers to take an applicant's temperature as part of a post-offer pre-employment medical exam, but again, this can only occur after the conditional offer of employment.
Can employers withdraw an offer of employment for a new hire with coronavirus?
The EEOC also has taken the position that employers may withdraw employment offers to new hires with COVID-19 or symptoms associated with it when the employer needs the new hire to start immediately.
The EEOC's position is in line with the interim guidance for businesses and employers published by the Center for Disease Control and Prevention (CDC), which recommends that an individual who has COVID-19 or symptoms associated with it should not be in the workplace.
Pay/Wage and Hour Issues During Coronavirus
Whether an employer can alter an employee's wages in light of COVID-19 may be governed by the Fair Labor Standards Act (FLSA), which establishes minimum wage, overtime pay, and other employment standards affecting employees in the private sector as well as in federal, state, and local governments.
Alternatively, if the employee has an employment agreement, the extent to which pay or other work terms and conditions can be changed may be governed by contract. Employers should be aware of the following issues when considering a reduction in pay or other change affecting an employee's duties and compensation.
Must employers pay employees who don't work?
The wage and hour requirements of the FLSA come into play for hours worked in a given workweek. The FLSA does not require employers to pay non-exempt employees for hours they did not work.
As such, employees who are not working are typically not entitled to the wages pursuant to the FLSA, but they still may be entitled to pay when not working under the emergency and expanded paid leave rights under the FFCRA discussed above.
The case may be different for salaried and exempt employees. An employer must pay an exempt employee the full predetermined salary amount free and clear for any week in which the employee performs any work without regard to the number of days or hours worked.
However, there is no requirement that the predetermined salary be paid if the employee performs no work for an entire workweek.
Furthermore, non-exempt employees, i.e., hourly wage earners, who are paid on a fluctuating-workweek basis under the FLSA, generally must be paid their full fluctuating-workweek salaries for every workweek in which they perform any work.
As indicated above, an employer might have a contractual obligation to keep paying employees due to an employment agreement, a collective bargaining agreement, or some policy or practice that is enforceable as a contract or under a state wage law.
Can employers reduce the wages or hours of a non-exempt hourly employee?
The FLSA requires that all covered non-exempt employees receive at least the applicable federal minimum wage for all hours worked. The FLSA does not preclude an employer from lowering an employee's hourly rate as long as the rate paid is at least the minimum wage, nor does it preclude employers from reducing the number of hours an hourly employee is scheduled to work.
Can employers reduce the compensation of an exempt salaried employee?
An employer is not prohibited from reducing the predetermined salary of an exempt employee during a business or economic slowdown, as long as the reduction is bona fide and not for the purpose of evading the salary basis requirements of the FLSA.
However, a major caveat for employers wanting to reduce an exempt employee's salary due to coronavirus, or any other slowdown in business, is that reductions in the predetermined salary of an exempt employee could cause a loss of the exemption. In that case, the employee must then be paid at least the federal minimum wage and overtime pay required by the FLSA, as discussed above.
On the other hand, a predetermined regular salary reduction, not related to the quantity or quality of work performed, will not result in loss of the exemption, as long as the employee still receives on a salary basis at least $684 (or the current statutory amount) per week.
Also, physicians, lawyers, outside salespersons, or teachers in bona fide educational institutions are not subject to any salary requirements; therefore, reductions in the salary or pay of such employees will not result in loss of the exemption.
Reductions may not be made from the exempt employee's predetermined salary for absences caused by the employer or by the operating requirements of the business. In other words, if the employee is ready, willing, and able to work, deductions may not be made for the period of time when work is not available.
Can employers dock the amount of COVID-19 stimulus checks from wages?
In addition to being highly distasteful from a public relations standpoint, it is unlikely that federal or state laws would allow employers to reimburse themselves in the amount of any stimulus checks paid to American workers through the Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act.
First of all, under the FLSA, no deduction may be made from a non-exempt employee's wages which would reduce the employee's earnings below the required minimum wage or overtime compensation. Likewise, certain deductions from exempt employees could result in a loss of exempt status.
Furthermore, even though employers, in limited circumstances, can require that employees pay or reimburse them for certain items, like the cost of uniforms, in those cases, reimbursement is permissible only when the cost is tied to work-related items that are considered primarily for the benefit or convenience of the employer.
Moreover, some states, like Illinois, have laws that expressly prohibit employers from making deductions from employee pay except under very limited exceptions, such as when required by law (e.g., taxes), to the benefit of the employee (such as health insurance premiums, union dues etc.â), pursuant to a valid wage assignment or wage deduction order in effect, or made with the express written consent of the employee, given freely at the time the deduction is made.
Employment Law and Coronavirus Wrap Up
It is certainly no easy feat for employers to do what needs to be done to stay in business during the economic downturn precipitated by COVID-19 while also trying to do the best they can for their employees who, for some companies, are like family.
If both employers and employees stay calm and work together to try to find feasible solutions, there is a good chance that both sides will emerge stronger when the coronavirus crisis is finally over and the American workforce can get back to business as usual.
Employers with questions or concerns about employment laws triggered by COVID-19 should consult an employment lawyer before proceeding with actions that may adversely affect employees.