Federal Court Vacates Portions of the DOL’s Final Rule Under the Families First Coronavirus Response Act

By Geoffrey A. Lindley and Taylor Flake-Lawson

Earlier this year, Congress passed, and the President signed into law the Families First Coronavirus Response Act (FFCRA) in an effort to provide relief to workers and promote public health during the ongoing COVID-19 pandemic by providing federally mandated paid leave subsidized through payroll tax credits to employers. The FFCRA, which took effect April 1, 2020, contains two key provisions: (1) the Emergency Paid Sick Leave Act (EPSLA) and (2) the Emergency Family and Medical Leave Expansion Act (EFMLEA). Both provisions apply to private employers who have fewer than 500 employees and to public employers. 

Emergency Paid Sick Leave Act (EPSLA)

The EPSLA provides paid sick leave to all employees who are unable to work in the traditional sense or work remotely because of a need for leave under the following circumstances:

1. the employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
2. the employee has been advised by a health care provider to self-quarantine because of concerns related to COVID-19;
3. the employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis;
4. the employee is caring for an individual subject to a government issued quarantine or isolation order related to COVID-19 or has been advised by a health care provider to self-quarantine because of concerns related to COVID–19;
5. the employee is caring for a child of such employee whose school or place of care is closed or whose child care provider is unavailable because of COVID-19 precautions; or
6. 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.

A full-time employee is eligible for up to 80 hours of paid sick leave, and a part-time employee is eligible for paid sick leave for the number of hours that the employee works on average over a two-week period. For leave related to reasons (1), (2), and (3) above, an employee is paid sick leave at the employee’s regular rate of pay up to a cap of $511/day with a maximum total payment of $5,110. For leave related to reasons (4), (5), and (6), an employee is paid sick leave at 2/3 of an employee’s pay up to a cap of $200/day with a maximum total payment of $2,000.

Emergency Family and Medical Leave Expansion Act (EFMLEA)

Under the EFMLEA, employees who have been employed by the employer for at least 30 calendar days and who are unable to work in the traditional sense or remotely because they have a child whose school is closed or childcare provider is unavailable because of COVID-19 are eligible for up to ten (10) weeks of paid leave at 2/3 of the employee’s regular pay capped at $200/day with a maximum total payment of $2,000. As the EFMLEA is an amendment to the Family and Medical Leave Act (FMLA), the leave required counts toward the employee’s twelve (12) weeks of traditional FMLA leave.

The Dispute

On April 1, 2020, the United States Department of Labor (DOL) issued its Final Rule implementing the FFCRA. On April 14, 2020, the State of New York filed suit against the DOL under the Administrative Procedure Act in federal district court, State of New York v. United States Department of Labor (Case No. 20-CV-3020), alleging that the DOL exceeded its authority in portions of its Final rule, thereby unduly restricting paid leave under the FFCRA. More specifically, the State of New York challenged the following four features of the DOL Final Rule:

1. the work availability requirement;
2. the definition of health care provider;
3. the intermittent leave provisions; and
4. the documentation requirements.

The Court’s Decision

Work-Availability Requirement

Under the FFCRA, employees are eligible for paid sick leave because they meet one of the six COVID-19 related criteria. The DOL’s Final Rule dictates that paid sick leave under the Act only applies when the employee has work available to do but cannot not do it because of a COVID-19 related reason. In other words, if the employer closes because of the pandemic, then there is no work for the employee to do, and the employee does not need FFCRA leave. However, the DOL’s Final Rule only applied this work-availability requirement to EPSLA reasons (1), (4), and (5). The DOL seemed to recognize this inconsistency and argued that the Court should interpret the DOL’s Final Rule as applying the work-availability requirement to all six reasons. The court refused to do so and ultimately struck down this work-availability requirement. In vacating this portion of the Final Rule, the court further reasoned that though the DOL’s position was not necessarily inconsistent with the FFCRA, the DOL failed to demonstrate that the work-availability requirement was the result of “reasoned decision-making.”

Definition of Health Care Provider

The FFCRA allows employers to exclude a “health care provider” from receiving leave benefits.  The text of the FFCRA defines a “health care provider” as “(A) a doctor of medicine or osteopathy who is authorized to practice medicine or surgery (as appropriate) by the State in which the doctor practices; or (B) any other person determined by the Secretary to be capable of providing health care services.” 29 U.S.C. § 2611(6). However, the DOL’s Final Rule provided a much more expanded definition and included:

“anyone employed at any doctor’s office, hospital care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, Employer, or entity…” or any individual who is employed by an entity that contracts with any of the institutions that were previously described.

The court noted that the DOL even conceded that its definition of “health care provider” would include “an English professor, librarian, or cafeteria manager at a university with a medical school[.]”

In vacating the DOL’s definition of “health care provider”, the court noted that the DOL’s definition was employer based. It failed to consider the employee’s particular job responsibilities. As a result, it included employees who had only a distant connection to actually providing health care. In contrast, the court held that the statute required the DOL to base its definition of “health care provider” on whether a particular employee is capable of providing health care services. Further, such an employee’s role must be “essential to maintaining a functioning health care system during the pandemic.”

Intermittent Leave Provisions

New York also took issue with the DOL’s rule limiting an employee’s ability to take FFCRA leave intermittently, arguing that the rule would require employees to take leave in a single block of time. The DOL pointed out that while “an employee taking leave for an intermittent-leave-restricted reason must take his or her leave consecutively until his or her need for leave abates . . . once the need for leave abates, the employee retains any remaining paid leave, and may resume leave if and when another qualifying condition arises.”

The court upheld the DOL’s rule in this regard because it only restricts intermittent leave to EPSLA reasons (1) through (4) and (6), which relate “to the public-health risk of an employee who may be infected with COVID-19 returning to work before the risk of contagion dissipates.” In other words, the DOL’s rule was consistent with the FFCRA’s statutory intent of providing relief to workers while promoting the public health. However, the court took issue with the Final Rule’s blanket requirement that an employee obtain approval from the employer in order to take intermittent leave. Because the DOL Final Rule does not provide justification for why such a requirement should exist in a situation where the leave is to care for a child whose school or place of care is closed, the court vacated that portion of the Final Rule.

Documentation Requirements

The DOL’s Final Rule requires that employees submit documentation justifying their need for FFCRA leave to their employer. The court noted that the substantive aspects of the documentation required are consistent with the statute. However, the court stated that the DOL’s regulations require that the employee submit such documentation prior to taking leave. However, the FFCRA provides that the timing of such justification for leave is “as is practicable” for EFMLEA leave and “[a]fter the first workday . . . an employee receives paid sick time” for EPSLA leave. Therefore, the court vacated the temporal aspect of the documentation requirement.

Employer Considerations

It is likely that the DOL will seek to remedy the technical issues found by the court with regard to the work-availability requirement and the intermittent leave provisions. In the meantime, in response to this decision, employers should consider the following:

• adopting documentation requirements consistent with the court’s ruling, meaning that an employer not require documentation before leave is granted;
• allowing employees to take intermittent leave to care for their children whose school or place of care is closed or whose childcare provider is unavailable because of COVID-19 precautions; and
• employers in the health care industry should evaluate their employment positions and consider providing leave, if they are not already doing so, to qualified employees who fall outside of the court’s interpretation of the FFCRA’s definition of health care provider.