Federal District Court Invalidates Portions of the Final DOL Rules Implementing the Paid Leave Provisions of the Family First Coronavirus Response Act (FFCRA)
By Dannae Delano, Barry Salkin and Roberta Casper Watson
The federal District Court for the Southern District of New York invalidated parts of the DOL’s final rules implementing the paid leave provisions of the FFCRA in State of New York v. Department of Labor last week. Parts of the rules held invalid include:
- The exclusion from the leave benefits of all employees for whom the employer does not have work available;
- the definition of “health care provider” for purposes of excluding health care providers from the leave benefits;
- the requirement that an employee seek employer consent for intermittent leave in certain circumstances; and
- the requirement that documentation be provided before taking leave.
The remainder of the DOL final regulations, including the outright ban on intermittent leave for certain qualifying reasons and most of the documentation requirements, continue in effect.
Public employers and employers with fewer than 500 employees that are evaluating employee requests for paid leave for qualifying events related to the coronavirus pandemic should do so knowing that parts of the regulations have been held invalid by one court, in a way that could expand the rights of certain employees. The inherent risks in emergency legislation and fast-tracking implementation rules for such legislation have been exposed. Nor do we know the full impact of the case, because it is unclear whether the regulation is invalidated everywhere, or just within the Southern District of New York. Additionally, it is possible the decision could have retroactive application.
Paid sick leave under the FFCRA has been available since March and will be available through the end of the year, but the guidance implementing the leave has been partially invalidated. Employers are now forced to navigate providing their employees with this statutory leave from a new perspective, especially with regard to excluding from eligibility health care providers and employees for whom there is no work available.
Background. The FFCRA has two parts, the Emergency Paid Leave Act, which grants employees (excluding health care providers) who are unable to work (or telework) two weeks (80 hours) paid leave for six different COVID-19 qualifying events, and the expanded FMLA provision, which provides paid leave for an additional 10 weeks for employees who are unable to work (or telework) due to having to care for a child because the child’s school closed or the day care provider is unavailable for a COVID-19 related reason. Qualifying employers are entitled to a corresponding tax credit for paid leave under the FFCRA so the leave is subsidized by the federal government, but an employer must front the cost. The six qualifying events are:
- An employee is subject to a quarantine or isolation order related to COVID-19.
- An employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
- An employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis.
- An employee is caring for an individual who is subject to a quarantine or isolation order related to COVID-19, or the employee is caring for an individual who has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
- An employee is caring for a child because the school or place of care of the child is closed, or the child care provider of such child is unavailable, due to COVID-19 precautions.
- An employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.
Work Availability. The DOL rules implementing the leave provided that employers could deny leave for employees for whom they did not have work available. The DOL rules so provided for some of the COVID-19 qualifying events, including: (1) caring for a son or daughter whose school had closed; (2) caring for an individual subject to a federal, state or local quarantine order; or (3) if the employee was subject to an isolation order. For employees in these groups, if an employer did not have work available, the employee was not entitled to leave under the FFCRA. The basis of the work availability requirement for these events was that the employee would have been unable to work even without the qualifying event due to there being no work available for them. The court held this portion of the final regulation to be invalid under longstanding principles of administrative law due to its arbitrary application to only some of the qualifying events entitling an employee to leave, as well as to the DOL’s “patently deficient” explanation of the reason for the work availability requirement. This is important for employers who do not have work available for employees who are requesting paid leave under the Act, because the regulations’ requirement is or may be invalid as to those employees.
Exclusion of Health Care Providers. The FFCRA is clear that health care providers are excluded from the paid leave benefits provided for employees by the Act. “Health Care Provider” is defined broadly in the rules. According to the court, the definition in the regulations could include even English professors, librarians or cafeteria managers at universities with medical schools. The court found the DOL’s definition of “health care provider” to be overbroad in comparison to the statute – employer focused instead of employee role focused – and invalidated the definition in its entirety. Employers of health care providers, few of whom would have applied the rule as broadly as the DOL conceded would be permissible under its definition, should be wary of excluding employees who do not actually provide medical services when evaluating FFCRA leave requests.
Consent for Intermittent Leave. The DOL regulations allow employers to permit employees to take their leave as needed and not all in one continuous 12-week period in two situations: where an employee is caring for a child when either the child’s school or place of care is closed, or if the childcare provider for the employee’s child is unavailable due to COVID-19. The court held that limiting intermittent leave to only certain categories of employees affected by COVID-19 was permissible under the statute, but requiring employer consent for such leave was unreasonable and therefore invalid. This is important because, if the court decision is upheld and applied nationally, employers will have to allow intermittent leave under such circumstances on a qualifying employee’s request.
Documentation. The DOL rules also require that, prior to taking leave, employees provide their employer with documentation of the need for leave, the duration of the leave, and any isolation or quarantine order that is the basis of the leave. The court held that the requirement that such documentation be provided prior to taking the leave was invalid because it is contrary to the notice procedures set out in the FFCRA. The FFCRA provides that, after the first day an employee receives emergency paid sick leave, an employer can require an employee to follow reasonable notice procedures to continue receiving leave, and for expanded FMLA leave an employee should provide notice as soon as practicable when the necessity for the leave is foreseeable. The court held that prior notice is contrary to both these provisions of the Act and held the requirement to be invalid.
This court opinion is likely not the final word on these issues. The DOL may appeal the decision to the Second Circuit and also request a stay, which may or may not be granted. Consequently, employers – particularly those outside the Southern District - should evaluate leave requests under the statute with the knowledge that these provisions of the DOL rules have been invalidated by a single court, and should be aware there may be additional changes regarding how leave must be implemented, whether by court decision, new DOL action, or even Congressional action.