Attorney Update: Employer Obligations and Employee Rights Families First COVID-19 Response Act

[Republication of an email notice from 3/23/3030]

Dear Clients, Associates, and Friends,

I would like to update you on the status of Employer Obligations and Employee Rights concerning the Coronavirus outbreak. There have been some very recent changes in response to this public health emergency, so please ensure you are in compliance.

First, to remind you that on Thursday, March 19, 2020, the California Governor issued an Order to Shelter in Place.

The Governor’s Order is available here:

https://covid19.ca.gov/img/N-33-20.pdf

Sixteen (16) Critical Infrastructure Sectors were identified under federal rules as exceptions to the Shelter in Place Order.

Those exceptions are available here:

https://www.cisa.gov/identifying-critical-infrastructure-during-covid-19

That brings us to today.

Employee’s Right to Unemployment Insurance: Due to lack of work, because of dangerous conditions related to the Coronavirus, or due to federal, state or local quarantine, employees may be put on a “furlough,” or temporary layoff from work by their employers. Under California’s Unemployment Insurance rules, a furloughed employee is entitled to unemployment benefits for the period of time they will not be paid. So, if you send your employees home without pay, they should be entitled to collect Unemployment Insurance.  You do not need to actually terminate your employees for them to be eligible for Unemployment Insurance benefits.

By Executive Order, the Governor has waived the EDD one-week unpaid waiting period, so eligible employees can collect UI benefits for the first week they are out of work. If eligible, the EDD processes and issues payments within a few weeks of receiving a claim. Presently, I do not know if EDD will be handling these Coronavirus furloughs any differently from any other layoff.  I have heard vague rumblings about the EDD enacting some different rule or processing for furloughed workers due to the Coronavirus, but that may not be reliable information.

Rights of Employees on Furlough:

Please note, generally, any salaried employee that works at any time during the work week is entitled to be paid for the full week, and hourly employees are entitled to be paid only for hours worked, all in accordance with existing wage and hour law.

Here is the link for the EDD (Unemployment Insurance) re: Coronavirus:

https://www.edd.ca.gov/about_edd/coronavirus-2019.htm

While under normal conditions furloughing employees would probably affect your Unemployment Insurance rating, I cannot guess what will happen here. It is entirely possible the Governor or state legislature will step in and prohibit the insurers from changing employer’s ratings based on those claims arising from Coronavirus furloughs.

Leave Issues:

In California, employees are already entitled to 24 hours of sick leave. This requirement was already in effect for the last several years.

Additionally, if employees actually become ill, under the newly enacted federal Emergency Paid Sick Leave Act (part of the recently signed federal Families First Coronavirus Response Act), employees may be entitled to paid sick leave in certain situations related to the Coronavirus disease.

 When Does this Take Effect:  The Emergency Paid Sick Leave Act takes effect April 2, 2020 and expires on December 31, 2020.

 What is this New Leave Policy:  This requires employers to provide an additional 80 hours of emergency paid sick leave to full time employees who are unable to work or telecommute for reasons related to the Coronavirus outbreak. Part-time employees must be provided emergency paid sick leave for the average number of hours they would work over a two-week period. Employers will receive a tax credit against payroll social security taxes for emergency paid sick leave payments made. Emergency paid sick leave will not carry over into 2021.  There is no requirement that any unused emergency paid sick leave must be paid out upon separation of employment.

 What About Existing Sick Leave Laws or Employer Policies:  This new federal emergency paid sick leave is in addition to other paid leaves available under union contracts, existing employer policies, and other federal, state, or local laws. Employers may not require employees to use other available leaves, such as PTO or paid sick leave required by state law or city ordinance, before using emergency paid sick leave.

 Who Does it Apply too:

  • Employers:  It applies to all employers with less than 500 employees.
  • Employees:  Starting April 2, 2020, employees are allowed to immediately use emergency paid sick leave, regardless of tenure. It is available to employees who are unable to work or telecommute for any of the following reasons. For now, in California, most employees will probably fall under reason #1, though this situation is fluid and is likely to change:
  1. The employee is subject to a federal, state, or local quarantine or isolation order related to the Coronavirus outbreak. (Pay is at the greater of the employee’s regular rate or applicable minimum wage, but capped at $511 per day and $5,110 in the aggregate.)
  2. The employee has been advised by a health care provider to self-quarantine because of Coronavirus concerns. (Pay is at the greater of the employee’s regular rate or applicable minimum wage, but capped at $511 per day and $5,110 in the aggregate.)
  3. The employee chooses to obtain a medical diagnosis because the employee is experiencing symptoms of Coronavirus. (Pay is at the greater of the employee’s regular rate or applicable minimum wage, but capped at $511 per day and $5,110 in the aggregate.)
  4. The employee is caring for or assisting an individual who is subject to an order or recommendation as described in 1 or 2 above. (Pay is at two-thirds of the greater of the employee’s regular rate or applicable minimum wage, but capped at $200 per day and $2,000 in the aggregate.)
  5. The employee is caring for the employee’s child because of school or daycare closure, or because the child care provider is unavailable, due to Coronavirus. (Pay is at two-thirds of the greater of the employee’s regular rate or applicable minimum wage, but capped at $200 per day and $2,000 in the aggregate.)
  6. The employee is experiencing any other substantially similar condition specified by Human Health Services. (Pay is at two-thirds of the greater of the employee’s regular rate or applicable minimum wage, but capped at $200 per day and $2,000 in the aggregate.)

Employers will have to carefully track leaves under these statutes as this situation is fluid and it is likely many employees in the state will change categories under which they take leave, so there are likely to be issues.

I hope this helps guide you. As always, if you have questions, feel free to contact me.

Stay safe and healthy.

Regards,
Richard B. Rudolph