SFA Risk Mitigation Webinar Recap: Employment Law and How It Is Changing

During the SFA’s Business Continuity: Risk Mitigation Planning webinar series, industry experts assist SFA members with challenges related to the current unsettled business environment. In this installment, Alexandra M. Romero from the law firm Arent Fox LLP addresses key labor and employment considerations for SFA members.

The Families First Coronavirus Response Act, which went into effect April 1, allows for paid emergency family and medical leave, as well as emergency paid sick leave provisions for employees and employers. In addition, it includes loan programs and other small business relief programs. 

Emergency Family and Medical Leave

• This applies to workers that have been on the job at least 30 days at companies that employ 51 to 499 people.
• This entitles an employee to 12 weeks of leave if the employee poses a risk of transmitting coronavirus to other employees, to care for children under 18 whose school or day care closes due to coronavirus, or to care for a family member that has symptoms or has been exposed to coronavirus.
• The first 14 days of leave would be unpaid, but an employee can use any paid vacation, personal, medical, or sick leave they have previously accrued. Employees may also use Emergency Paid Sick Leave to cover the first 10 days of this leave.
• After the 14th day, employers would be required to provide paid leave at a rate equal to 66.67 percent of the employee’s normal pay.

Emergency Paid Sick Leave

• This requires employers with 499 employees or less to provide paid sick time to any employee that self-isolates due to a diagnosis with the coronavirus, obtains a medical examination or medical services related to coronavirus, complies with a recommendation from a health official or public official to enter quarantine, cares for family that has self-isolated, been diagnosed or is experiencing symptoms of coronavirus, or cares for a child whose school/child care has closed due to coronavirus.
• Full-time employees are entitled to 80 hours of paid leave.
• Part-time employees are eligible for an amount of leave equal to their normal scheduled hours during a two-week period.
• Employees should be paid at their normal wage for leave due to their own heath condition or at a rate equal to 66.67 percent for leave to provide care to a family member.

Requesting an Exemption

• Small businesses with fewer than 50 employees may be exempt from the Emergency Family and Medical Leave and Emergency Paid Sick Leave if “the imposition of such requirements would jeopardize the viability of the business as an ongoing concern.”

The Department of Labor has provided guidance around key FAQs on this act, including notice requirements, requesting documentation, calculating pay rates, and leave hour entitlements

CARES Act Small Business Relief

• The Paycheck Protection Program provision of the CARES Act provides short-term cash flow assistance to small businesses.The amount appropriated for the loans is $349 billion.
• Loans are made by lenders certified by the Small Business Administration and guaranteed by the federal government.
  • The loans can help cover costs such as payroll, benefits, insurance premiums, or rent.
  • The first eight weeks of the loan will be forgiven if companies use the funds for eligible reasons and prioritize keeping employees on the payroll.
• The Employee Retention Credit is a fully refundable tax credit for employers equal to 50 percent of qualified wages that they pay employees.
  • This only applies to wages paid after March 12, 2020 and before January 1, 2021.
  • The maximum amount is $10,000 per employee.
  • This not available to employers who are taking on loans from the Paycheck Protection Program.

Furloughs and Layoffs

• Check with your insurer to see if employees can keep their group health coverage while on furlough. You may need to add a provision if they are not currently covered and you would like to provide coverage.
• The CARES Act provides standard unemployment insurance coverage through the end of the year to employees who are unable to work or are unemployed due to COVID-19.
• Keep in mind that the Worker Adjustment and Retraining Notification Act requires employers to give employees a 60-day written notice before the date of a mass layoff or closing of a facility. Some states may also have their own statutes related to advanced notice of layoffs.
• All normal federal, state, and local anti-discrimination statutes are still in existence and being enforced.

State and Local Orders Regarding Essential and Non-Essential Businesses

• All food and beverage stores are considered essential businesses, as well as restaurants (though only for take-out and delivery).
• If your business isn’t deemed essential, you may be able to request an exemption. For example, in New York, businesses can go to the Empire State Development website and request an exception by stating why it's in the state’s best interest for the company to continue operating.

If you are an essential business or are still operating in some capacity:

• Limit the number of employees per shift to the extent you are able.
• Instruct employees to maintain good hand hygiene, and, to the extent possible, provide hand sanitizer and hand washing stations.
• There are some federal statutes that prohibit retaliating against employees who refuse to engage in highly hazardous work, so if an employee refuses to work, keep that in mind.

Click here to view the full recording.

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