Pennsylvania’s and Congress’s Response to COVID-19: Business Update Part 2

Yesterday, we sent a Congressional update concerning President Trump’s enactment of the Families First Coronavirus Response Act and the provisions regarding FMLA extensions and Paid Leave. On Thursday, March 18, 2020, Governor Wolf ordered that “no person or entity shall operate a place of business in the Commonwealth that is not a life sustaining business.” We would also like to provide further information about how the Families First Coronavirus Response Act and other federal laws interacts with Governor Wolf´s order and similar details.

Governor’s Order and Life Sustaining Businesses

The new order went into effect on Thursday and enforcement actions against non-life sustaining businesses will begin on Monday, March 23, 2020 at 8:00 a.m. The major differences between this order and all previous proclamations by the state government is that compliance is mandatory, and non-compliance will be enforced. These are no longer voluntary, or strongly urged guidelines. Also note that businesses offering carry-out, delivery, and drive-through food and beverages may continue those operations, under the social distancing guidelines. All telecommuting remains exempt. To be clear, the order does not require that a business cease all operations if those operations can be accomplished remotely – I am sitting in my basement writing this!

A list of life sustaining and non-life sustaining businesses may be found here. The categories of businesses are sometimes vague or broad. Carefully review these categories to see whether your business clearly falls into one or spans several. Currently, GKH is advising that if a business’s activities fall into one of the life sustaining categories, the business may stay open to perform those functions. However, if a business is primarily in a non-life sustaining category, with only a few deemed life sustaining activities, it will want to contact counsel for a close review of those activities. Furthermore, the Department of Economic and Community Development is accepting applications for waiver from the new closure requirements. You can fill out the form on the department’s website (https://dced.pa.gov/); email the department (RA-dcexemption@pa.gov); or ask the administration for guidance (ra-dcedcs@pa.gov). Keep in mind that these resources will likely be overwhelmed in coming days and equally subject to the COVID-19 response guidelines.

Unless it is clear a business falls into the life sustaining category, decision makers should seek the advice of counsel before implementing any policies or operating at the business location.

Governor’s Order and FMLA Extension and Paid Leave

As discussed in the previous update, the Families First Coronavirus Response Act requires businesses to extend FMLA leave and paid leave to employees who must be absent from work or telework due to the COVID-19 emergency because of issues with the virus, to care for a person suffering from the virus, or because a child cannot go to school or access care. Here are some guidelines for how the FMLA extension and paid leave interact with the current FMLA rules:

  • Businesses with 50 or more employees are currently still subject to the original leave rules under the FMLA (i.e. 12 months of employment, 1,250 hours of service, 50 employees within 75 mile radius)

COVID-19 may be a qualifying reason under current FMLA provisions if the virus arises to a serious health condition that makes the employee unable to function due to his or her own illness from the virus or to care for a spouse, child, or parent with the virus.

  • The FMLA expansion becomes effective on April 2, 2020 and applies to businesses with less than 500 employees and to employees who have worked for the business for 30 days or more. The expansion ends on December 31, 2020. The FMLA expansion allows qualifying employees to seek leave when the employee must care for a child who cannot attend school or childcare services because of the COVID-19 emergency and the employee is not otherwise able to telework during this time. The first two weeks (10 days) of leave can be unpaid, unless an employee elects to apply other paid time off to this period (which may include the Paid Leave provisions below), but the following weeks are paid at two-thirds regular salary with applicable weekly and aggregate caps.

By April 2, these businesses must do the following:

  1. Businesses with 50-499 employees will need to comply with both the original FMLA leave rules as well as the expanded FMLA leave rules.
  2. Businesses with 49 employees or fewer will need to comply with the expansion only.
  3. Businesses with 500 employees or more will need to comply with the original leave rules only.
  • Paid Leave also begins on April 2, 2020 and applies to businesses with fewer than 500 employees and all of that business’s employees regardless of tenure, as follows:
  1. Employees subject to or experiencing COVID-19 related quarantines, symptoms and seeking a diagnosis, self-quarantine instructions from a doctor, or the employee is caring for someone under quarantine, self-quarantine, or an inability to attend school or childcare service, or any similar condition designated by the federal government.
  2. Full time employees receive 80 hours of paid leave, and part time employees receive paid leave for the normal hours worked in a two-week period.
  3. Employers with 1-49 employees will need to provide paid sick leave under the above circumstances, and the employee could also use this paid sick leave under the FMLA expansion to receive paid leave under the first 10 days of the FMLA expansion.
  4. Employers with 50-499 employees will need to provide paid sick leave under the above circumstances, and if such reasons meet the qualifying reasons under the original FMLA leave rules, the start of that leave can be paid sick leave, and if such reasons meet the qualifying reasons under the expansion of the FMLA rules, the start of that leave can be paid leave as well.
  5. In all cases, an employee may take the paid sick leave before taking any other leave available to him or her either through the original FMLA rules, the expanded FMLA rules, or other leave already offered by the employer. Thus, for example, a full-time employee sick with the COVID-19 or caring for child out of school due to COVID-19 could take 80 hours of paid sick leave, then take 10 days of unpaid leave, followed by 10 weeks of paid leave.
  6. Finally, keep in mind the telework provision and life sustaining business mandate by Governor Wolf. The FMLA expansion and paid leave are not required if the employee can work at the business or if the employee can telework while also experiencing a qualifying reason for leave. This would mean that non-life sustaining businesses must be able to offer telework to avoid the leave requirements if an employee is experiencing a qualifying reason for leave.

It is important to note that businesses that lay employees off between now and April 2 do not need to provide paid leave or FMLA expansion leave at this point but must comply with current FMLA rules and existing employer policies. Any FMLA leave taken under the expansion cannot be used to go beyond the 12 week period when combined with the original FMLA leave rules. Also, because the legislation is effective until the end of the year, if a business shuts down and then re-opens, it will be subject to the new laws. Equally important, if an employer has more than 100 employees it should consult counsel before laying off a large number of employees in order to ensure compliance with the WARN Act’s notice provisions.

On behalf of the GKH Team, be well.

Jeff


DISCLAIMER: The foregoing does not constitute legal advice and has been prepared for informational purposes only. Please contact us directly with questions about how this relates to your specific situation.

Prepared by GKH attorney Jeff Worley. Attorney Worley practices in the areas of employment law, business law and general litigation.

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