Business Counselor April 3, 2020

Employee Eligibility for Paid Sick Leave Under DOL’s New Temporary Rules

On April 1, 2020, the Department of Labor issued temporary rules addressing implementation of the Families First Coronavirus Response Act (FFCRA). The rules, effective from April 1, 2020 through December 31, 2020, address several aspects of the FFCRA-created paid federal leaves, including documenting the need for qualifying leaves, interaction between the two paid leaves—the Emergency Paid Sick Leave Act (EPSLA) and the Expanded Family Medical Leave Act—created by the FFCRA, and the potential exemption of small employers (under 50 employees) from certain paid leaves. The DOL’s rules can be found at the following link:

The EPSLA describes the circumstances under which a covered employer must provide paid sick leave to an eligible employee. The first of those circumstances, and one that has created the greatest amount of confusion and uncertainty, is when “an employee is unable to work because he or she is subject to a federal, state, or local COVID-19 quarantine or isolation order.” The question often asked by clients is whether executive orders, such as the shelter in place/safer at home order issued by Governor Whitmer on March 23, 2020, fall into such a category. At the outset, the statute relates specifically to quarantine or isolation orders that prevent the employee from working. That is a critical point. While the terms “quarantine” and “isolation” have been defined by the Center for Disease Control as very restrictive orders, the April 1, 2020 DOL rules define a “quarantine or isolation order” more expansively:

For purposes of the EPSLA, a quarantine or isolation order includes quarantine, isolation, containment, shelter-in-place, or stay-at-home orders issued by any Federal, State, or local government authority that cause the Employee to be unable to work even though his or her Employer has work that the Employee could perform but for the order. This also includes when a Federal, State, or local government authority has advised categories of citizens (e.g., of certain age ranges or of certain medical conditions) to shelter in place, stay at home, isolate, or quarantine, causing those categories of Employees to be unable to work even though their Employers have work for them.

This definition seems to encompass Executive Order 2020-21; however, the DOL made clear in its discussion of the rules that not all employees who are not working due to Executive Order 2020-21 are eligible for paid sick leave. The question is not only whether an employee must stay at home because of a quarantine or isolation order. Rather, “the question is whether the employee would be able to work or telework “but for” being required to comply with a quarantine or isolation order.” Employees are only eligible for paid sick leave under qualifying reason number 1 if their employer has work for them to do, and the employee cannot perform that work because of a qualifying order. If an employer does not have work for an employee to perform – even if the lack of work is due to Executive Order 2020-21 – the employee is not entitled to paid sick leave under qualifying reason number 1.

To illustrate the point, the DOL used the following example:

For example, if a coffee shop closes temporarily or indefinitely due to a downturn in business related to COVID-19, it would no longer have any work for its employees. A cashier previously employed at the coffee shop who is subject to a stay-at-home order would not be able to work even if he were not required to stay at home. As such, he may not take paid sick leave because his inability to work is not due to his need to comply with the stay-at-home order, but rather due to the closure of his place of employment.

In order to understand how the statute and DOL guidance applies, one must first understand that the DOL’s guidance was intended to address the myriad of different Stay at Home orders that are currently in place throughout the country. In general, qualifying reason number 1 applies where an executive order prevents an employee, or group of employees, from going to their place of employment, and does not generally apply when the business must close or reduce workforce because of the order. This is a highly fact-specific determination and must be carefully analyzed based upon the factors at issue in your case. We are happy to help with questions.

If you have any questions about the scenario above or the new DOL rule, Nikole Canute ( 632-8049), Nate Wolf ( 632-8046), and Scott Dwyer ( 632-8033) are available to assist.