Memorandum Re: Federal and New York State Employment Legislation and Protection in Response to COVID-19 Crisis

The COVID-19 pandemic has impacted nearly all ways of life, including businesses throughout New York State. The following addresses and summarizes recent Federal (FFCRA) and New York State legislation, which give additional protections and benefits to employees.

I. Federal Families First Coronavirus Response Act (FFCRA)

     a. FMLA:

• This law amends the FMLA to provide a new type of covered public health emergency leave for eligible employees of private employers with fewer than 500 employees and public entities. Small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or childcare unavailability if the leave requirements would jeopardize the viability of the business as a going concern.
• To be eligible, a covered employee must be employed by the employer for at least 30 calendar days.

  Starting the day the law goes into effect, April 1, 2020 through December 31, 2020, eligible employees will be able to take up to 12 weeks of FMLA leave because the employee is unable to work (or telework) due to a need for leave to care for their son or daughter under 18 years old if the child’s school or place of care has been closed or the child’s child care provider is unavailable, due to a public health emergency with respect to COVID-19 declared by a Federal, State, or local authority.

• The total available amount of time for all FMLA reasons combined would remain 12 weeks over a 12-month period.
• The first 10 days of public health emergency FMLA leave may be unpaid, but employees may elect to substitute accrued paid leave during this time, including paid sick leave pursuant to the Emergency Paid Sick Leave Act.
• Payment
  • Following the first 10 days of public health emergency FMLA leave, employers will be required to provide paid leave in an amount not less than two-thirds of an employee’s regular rate of pay for the remainder of the period of public health emergency FMLA leave period, up to 12 weeks (as needed). However, the two-thirds payment benefit is capped at $200 per day and $10,000 total.
    
    
• Taxes
  • Covered employers are entitled to a refundable tax credit equal to 100 percent of qualified family leave wages required to be paid by the Emergency Family and Medical Leave Expansion Act that are paid by an employer for each calendar quarter. The tax credit is allowed against the tax imposed by section 3111(a) (the employer portion of Social Security Taxes).

b. Federal Emergency Paid Sick Leave Act:

• Covered employers are required to provide full time employees with 2 weeks (80 hours) of paid sick leave when they are unable to work or telework (work from home) due to a need for leave because:
  • The employee is subject to a Federal, State or local quarantine or isolation order related to COVID-19;
  • The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
  • The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
  • The employee is caring for an individual who is subject to an order as described in (a) or has been advised as described in paragraph (b);
  • The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID-19 precautions; or
  • The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.
• Payment
  • When an employee is out related to his or her own condition (a-c above), pay is at the employee’s regular rate of pay, limited to $511 per day and $5,110 total.
  • When an employee is out related to the employee’s role as a caregiver (d-f above), pay is at 2/3 of the employee’s regular rate of pay, limited to $200 per day and $2,000 total.
• Taxes
  • Covered employers are entitled to a refundable tax credit equal to 100 percent of qualified paid sick leave wages required to be paid by the Emergency Paid Sick Leave Act that are paid by an employer for each calendar quarter. The tax credit is allowed against the tax imposed by section 3111(a) of the IRS Code (the employer portion of Social Security Taxes).

II. New York State Paid Sick Leave and Quarantine Leave related to COVID
A. Employers with 10 or fewer employees and  a net income less than $1 million last year must provide their employees with:

• Unpaid sick leave until the termination of any mandatory or precautionary order of quarantine or isolation and guaranteed job protection for the duration of the quarantine order.
• Compensation for the duration of their quarantine through existing Paid Family Leave (PFL) and Disability Benefits (DB) policy up to $2,884.62 per week.

B. Employers with 10 or fewer employees and a net income greater than $1 million last year must provide their employees with:

• At least 5 days of paid sick leave at the regular rate of pay and guaranteed job protection for the duration of the quarantine order.
• Compensation for the remainder of their quarantine through their existing PFL and DB policy up to $2,884.62 per week.

C. Employers with 11-99 employees must provide their employees with:

• At least 5 days of paid sick leave at the regular rate of pay and guaranteed job protection for the duration of the quarantine order.
• Compensation for the remainder of their quarantine through their existing PFL and DB policy up to $2,884.62 per week.

D. Employers with 100 or more employees must provide their employees with:

• Guaranteed job protection for the duration of the quarantine order.
• At least 14 days of paid sick leave at the regular rate of pay.

E. Public employers (no matter how many employees) must provide:

• At least 14 days of paid sick leave at the regular rate of pay.

F. The provisions of the quarantine legislation took effect immediately.
G. The New York State Department of Health has issued a guidance which defines quarantine and isolation as follows:

• Mandatory Isolation

H. Person has tested positive for COVID-19, whether or not displaying symptoms for COVID-19.
LHDs must immediately issue an order for Mandatory Quarantine or Isolation once notified, which shall be served on the person impacted.

• Mandatory Quarantine

I. Person has been in close contact (6 ft.) with someone who is positive but is not displaying symptoms for COVID-19.

• Person has traveled to China, Iran, Japan, South Korea or Italy and is displaying symptoms of COVID-19.
• Precautionary Quarantine – Person meets one or more of the following criteria: 

J. Has traveled to China, Iran, Japan, South Korea or Italy while COVID-19 was prevalent, but is not displaying symptoms.

• Proximate exposure to a positive person but has not had direct contact with a positive person and is not displaying symptoms.

K. Entities that may issue an “order” include the State of New York, New York State Department of Health, local Board of Health or any government entity authorized to issue such order. While there is guidance which provides that a person who has tested positive for COVID-19 must be served with an order for Mandatory Quarantine or Isolation, currently, there is no guidance on how an order may be obtained for a person who has not tested positive but is nonetheless subject to mandatory or precautionary quarantine based upon other criteria set forth above.

L. Employees are not eligible for paid sick leave due to a COVID-19 mandatory or precautionary quarantine or isolation order if: (1) they returned from traveling to a country for which the Centers for Disease Control and Prevention has issued a level two or level three travel health notice; (2) that travel was not taken part of the employee’s employment or at the direction of the employer; and (3) the employee was provided notice of the travel health notice and notice of the limitations contained in the new law prior to travel.

M. Also, an employee who is deemed asymptomatic or has not yet been diagnosed with any medical condition and is physically able to work while under a mandatory or precautionary order of quarantine or isolation whether through remote access or other similar means is not eligible for leave under this section.

N. If the federal government by law or regulation provides sick leave and/or employee benefits for employees related to COVID-19 then the provisions of this section, including, but not limited to, paid sick leave, paid family leave, and benefits due to disability, shall not be available to any employee otherwise to the provisions of this section; provided, however, that if the provisions of this section would have provided sick leave and/or employee benefits in excess of the benefits provided by the federal government by law or regulation, then such employee shall be able to claim such additional sick leave and/or employee benefits pursuant to the provisions of this section and the benefits available to such employee, if any, as provided by such federal law or regulation.

III. New York State WARN

A. According to the NYS Department of Labor, the WARN Act requirement to provide 90 days’ advanced notice has not been suspended because the WARN Act already recognizes that businesses cannot predict sudden and unexpected circumstances beyond an employer’s control, such as government-mandated closures, the loss of workforce due to school closings, or other specific circumstances due to the coronavirus pandemic.

B. If an unexpected event caused your business to close, please provide as much information as possible to the Department of Labor when you file your notice about the circumstances of your closure so we can determine if an exception to the WARN Act applies to your situation.

C. The New York State Worker Adjustment and Retraining Notification (WARN) Act requires businesses to give early warning of closing and layoffs. Businesses must give notice to:

• All affected employees
• Any employee representative(s)
• The New York State Department of Labor (DOL)
• The Local Workforce Investment Board (LWIB)

D. The WARN Act applies to private businesses with 50 or more full time workers in New York State. It covers:

• Closings affecting 25 or more workers
• Mass layoffs involving 25 or more full-time workers (if the 25 or more workers make up at least 33% of all the workers at the site)
• Mass layoffs involving 250 or more full-time workers
• Certain other relocations and covered reductions in work hours
• This means that covered businesses must provide all employees with notice 90 days prior to a:
  • Plant closing
  • Mass layoff
  • Relocation
  • Other covered reduction in work hours
    Businesses that do not provide notice may be required to:
    • Pay back wages and benefits to workers
    • Pay a civil penalty

If you have any questions about these recently enacted laws or any recent employment issues or concerns related to the COVID-19 crisis, please contact Brett R. Gallaway (bgallaway@mclaughlinstern.com) or Jacqueline C. Gerrald (jgerrald@mclaughlinstern.com).