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Top 5 Compliance Tips for the New FFCRA

By Jennifer Paul, Attorney in the Employment Law, Litigation and Condemnation & Unconstitutional Takings Practice Groups

Since the Families First Coronavirus Response Act (FFCRA) went into effect on April 1, 2020, there has been a push by government agencies to release regulations and guidance. The initial temporary rule was published on April 6, 2020, and corrections amending the initial rule were released on April 10, 2020. Everyone is working quickly to digest and implement the FFCRA in their workplaces. If you are an employer with fewer than 500 employees, then the FFCRA generally applies to you. 

For an overview of the FFCRA click HERE. For the Top 5 Compliance Tips on the FFCRA continue reading. . .

  1. Notice– All covered employers must post the FFCRA notice. The poster must be placed in a conspicuous place on the employer’s premises. If you have remote workers, consider providing the notice by email or posting it on your company’s website. Although there is currently no requirement to post the notice in different languages the DOL offers the notice in eight other languages besides English. The FFCRA poster is available to download HERE.
  2. Leave Request Documentation– Private sector employers that provide FFCRA benefits are eligible for payroll tax credit offsets covering the cost for providing FFCRA leave. However, Employers must have the correct information documented about the employee and their use of FFCRA leave. Use a form that is compliant with both the FFCRA and IRS guidelines that capture the following at a minimum: The employee’s name; the date(s) of leave; a statement regarding the COVID-19 related reason for the leave, including in some cases supporting documentation; and a statement that the employee is unable to work remotely. We prepared a compliant form that you can download for use HERE.
  3. Interplay with Paycheck Protection Program– Many small businesses are taking advantage of the Paycheck Protection Program (PPP) under the Coronavirus Aid, Relief, and Economic Security Act (CARES). For more information about the PPP click HERE. It is important to understand the interplay between PPP loans and the tax credits available under the FFCRA. Wages, employer health plan expenses and Medicare taxes paid by eligible employers and required by the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family and Medical Leave Expansion Act (EFMLEA) (which are both components of the FFCRA), are generally covered by the payroll tax credits under the FFCRA when properly documented. While receipt of these FFCRA tax credits does not affect an employer’s eligibility for a PPP loan, loan proceeds under the PPP may not be used for wages and related expenses required by the FFCRA.
  4. Coverage Requirements During Periods of Lack of Work or Furloughs– Many employers have been required to shut-down, furlough employees, lay-off employees or reduce working hours because of lack of work. The FFCRA does not apply to employees who are furloughed, laid off or have reduced hours because of lack of work. This is true even if the business closure itself was due to a federal, state or local directive related to COVID-19. Only the specific COVID-19 qualifying reasons under the EFMLEA and the EPSLA will trigger employee coverage. To review employee coverage click HERE.
  5. Small Business Exemptions and OFLA- Employers with fewer than 50 employees may qualify for an exemption from the requirement to provide paid leave under the EFMLEA and the ESPLA due to school closings or child care unavailability if the leave requirements would jeopardize the viability of the business as a going concern. This is the only qualifying reason for leave that is subject to the small business exemption. No other COVID-19 related reasons for leave under the ESPLA qualify for the small business exemption. If an employer chooses to apply this exemption they must properly document the basis for the exemption upon each request for leave, including one of the following reasons:“(1) such leave would cause the small employer’s expenses and financial obligations to exceed available business revenue and cause the small employer to cease operating at a minimal capacity; (2) the absence of the employee or employees requesting such leave would pose a substantial risk to the financial health or operational capacity of the small employer because of their specialized skills, knowledge of the business, or responsibilities; or (3) the small employer cannot find enough other workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services the employee or employees requesting leave provide, and these labor or services are needed for the small employer to operate at a minimal capacity.” 29 CFR 826. However, even if an employer has established the small business exemption under the FFCRA if an Oregon employer has 25 or more employees, the employer will still be subject to Oregon’s emergency expansion of sick child leave under the Oregon Family Leave Act (OFLA). Such leave includes 12-weeks unpaid leave under the OFLA, related to absences to care for an employee’s child whose school or place of care has been closed in conjunction with a statewide public health emergency (such as COVID-19). Keep in mind, while OFLA is unpaid, Oregon’s sick leave law requires up to 40 hours of paid leave when caring for a child due to the closure of a school for those employers with 10 or more employees (6 or more employees for Portland employers).    

FFCRA compliance is complicated. If you have questions about the FFCRA or other compliance issues related to COVID-19 please contact us.

 

Jennifer Paul is a partner in the Employment Law, Litigation and Condemnation & Unconstitutional Takings practice groups. Jennifer is also a member of the Agri-Business and Construction industry teams. The information in this article is not intended to provide legal advice. For professional consultation, please contact Jennifer at jpaul@sglaw.com at Saalfeld Griggs PC.  503.399.1070. © 2020 Saalfeld Griggs PC