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Earlier this week, a federal court in New York kicked to the curb four key provisions of the U.S. Department of Labor’s regulations implementing the paid leave provisions of the Families First Coronavirus Response Act, requiring employers covered by the Act to quickly decide how it will address these scenarios in the future.

As you will recall, the DOL issued final FFCRA regulations on leave on April 1, 2020 as a sweet little April fool’s present for us. Days later, the State of New York sued the DOL, claiming that the agency  unlawfully denied leave to otherwise eligible employees and by exceeding their statutory authority in drafting the final regulations.

After sifting through the parties’ arguments, the Court invalidated four FFCRA regulations:

  • The DOL’s requirement that FFCRA leave is available only where the employee had work available to be performed;
  • The broad healthcare provider exemption, which allowed a health care employer to decide which of its employees would be eligible for FFCRA leave;
  • The requirement that employees obtain consent from the employer for intermittent leave for certain reasons; and
  • The timing of documentation supporting the need for FFCRA leave.

You can access the Court’s opinion here (pdf).

Court Finds Work-Availability Requirement to be Faulty

One of the key preconditions for taking FFCRA leave (both paid sick leave – EPSL, and paid FMLA leave – FMLA+) is that the employer actually have work available for the employee to perform.  If the employee is not scheduled to work — whether it’s due to a furlough, business closure or otherwise — there is no work schedule from which to take leave.

Having a work schedule is the prerequisite for taking FMLA leave.  Consider, for instance, the FMLA regulations, which make clear that periods of time when an employee would not otherwise be expected to work should not count against an employee’s FMLA leave entitlement:

If for some reason the employer’s business activity has temporarily ceased and employees generally are not expected to report for work for one or more weeks (e.g., a school closing two weeks for the Christmas/New Year holiday or the summer vacation or an employer closing the plant for retooling or repairs), the days the employer’s activities have ceased do not count against the employee’s FMLA leave entitlement.  29 C.F.R. § 825.200(h)

Therefore, it seems eminently reasonable that the DOL requires that an employee actually be working as a precondition in taking FFCRA leave. Common sense, yes?

This federal court apparently didn’t think so.

Using a somewhat unusual “snow day” analogy, the Court noted that an ongoing period of parental leave would continue, despite that there might be a one-day, weather-related closure.  But as my Littler colleagues and fellow FMLA nerds Alexis Knapp and Emilie Hammerstein point out in our analysis on the Court’s decision, surely there is a difference between whether an ongoing, statutory leave of another sort would continue despite a brief, weather-related interruption, and an employer’s obligation to provide new, paid, federal leave benefits to an employee when there is an absence of work available at all.

Nevertheless, the Court determined that DOL could not require that employees actually be working in order to take FFCRA leave.  How ’bout them apples?  The Court’s decision to strike these work availability requirements opens the door for claims of leave by employees who are furloughed or temporarily laid off or whose employers have had to temporarily cease operations under state or local orders, or due to economic circumstances during the pandemic.  [This ruling also likely blows up DOL FAQs 23-28, all of which deal with the employee’s inability to take FFCRA leave when there is a business closure or reduction in hours.]

This. Is. A. Big. Deal. 

Employer Consent Not Required for Certain Intermittent Leave Reasons

Congress did not address intermittent leave at all in the FFCRA. As such, DOL was responsible for filling in the gaps through its regulatory authority.

In its final rule, the DOL significantly limited intermittent leave for both EPSL and FMLA+. In an effort to limit the risk that an employee might spread COVID-19 to other employees, DOL limited the use of intermittent leave for those who are working onsite to two main conditions:

1) that the employee and employer agree to the use of intermittent leave; and

2) such use is limited to the employee’s need to care for a child whose school or place of care is closed, or where child care is unavailable.

In doing so, DOL slammed the door on the use of intermittent leave for any of the other five reasons under EPSL for employees working onsite.  Its reasoning was practical: where an employee is absent due to COVID-19 symptoms or diagnosis or is taking care of an individual in a similar predicament, it is not acceptable for the employee to take intermittent leave due to the “unacceptably high risk” that the employee might spread COVID-19 to other employees.  In these situations, DOL made clear that the employee must continue to take continuous paid sick leave each day until the employee either exhausts paid leave or no longer has a reason for leave from work.

In the case of telework, the DOL issued rules supporting intermittent leave for employees who are taking EPSL or FMLA+, but again, only if the employer and employee can agree.  DOL contemplated that the employee and employer will “agree on an arrangements” for intermittent leave “that balance the needs of each teleworking employee with the needs of the employer’s business.”

In reviewing the DOL’s rationale, the Court first agreed that intermittent leave should be limited to situations where there is no risk that the employee might spread the virus to others.  However, the Court found that the DOL had “utterly fail[ed] to explain why employer consent is required for the remaining qualifying conditions,” which do not implicate the same public-health considerations. In other words, the DOL offered no reasonable explanation for its requirement that an employer’s consent is needed for intermittent leave due to school or childcare closure.

Given the DOL’s lack of rationale for the blanket requirement of employer consent, the Court invalidated this portion of the final rule where the employee needs to care for a child whose school or place of care is closed or where child care is unavailable.

Employers Cannot Require Documentation Before Leave

The final rule obligated employees to submit documentation to their employer prior to taking FFCRA leave that indicates the reason for and duration of the leave, and where relevant, the authority for the isolation or quarantine order qualifying them for leave.  The State of New York took issue with this rule, arguing that documentation is not required before an employee takes FFCRA leave.

Notably, under EPSL, an employer may require the employee to follow reasonable notice procedures in order to continue receiving such paid sick time after the first workday an employee receives paid sick time under this Act.  Additionally, FMLA+ requires that the employee provide the employer with notice of leave as is practicable under the circumstances.

In light of these specific requirements, the Court determined that a blanket requirement that an employee furnish documentation before taking leave renders statutory provisions unworkable. To the extent that the final rule imposes a more stringent condition for leave, the Court found it inconsistent with the FFCRA’s notice provisions.

While striking down any requirement that documentation be provided as a precondition to leave, the court left intact the final rule’s overall documentation requirement to support the need for leave.

The Court Strikes the Definition of Health Care Provider

In the final rules, the DOL allowed an employer to exclude from FFCRA leave any health care providers and pretty much anyone associated with a health care provider.  The regulation defines health care provider broadly for this purpose as: anyone employed at any doctor’s office, hospital, health 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 (my emphasis added).

The DOL didn’t stop there. The regulation’s definition also includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions.  This definition includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities institutions to provide services or to maintain the operation of the facility.

Notably, as the Court pointed out, the DOL rule finds that an “English professor, librarian, or cafeteria manager at a university with a medical school” all are considered “health care providers” under the FFCRA regulations, and their employers could deny these individuals FFCRA leave, even though they would be surprised to learn that they even fell into this esteemed category of individuals.

Despite the DOL’s argument that maintaining a broad definition of “health care provider” is necessary to “maintaining a functioning healthcare system during the pandemic,” the court minced no words in invalidating the rule:

the Final Rule’s definition is vastly overbroad . . . in that it includes employees whose roles bear no nexus whatsoever to the provision of healthcare services, except the identity of their employers, and who are not even arguably necessary or relevant to the healthcare system’s vitality.

Ouch. Back to the drawing board on this one.

Insights for Employers 

Ok, now what?  Couple of thoughts:

  1. Does this decision apply just to New York employers or is it nationwide in scope?  Really good question. The New York Attorney General, Letitia James, seems to think so based on this press release her office issued after the decision was handed down. Here are my quick thoughts: 1) the State of New York asked the judge to issue an injunction to halt these regulations from being enforced; 2) New York suggested no limitation; and 3) the Court’s ruling offered no limitation on the scope of its ruling. Also, for what it’s worth, these kinds of decisions tend to result in a nationwide scope [think FLSA regulations back in late 2016]. Bottom line: an employer who thinks this decision applies just to New York employers does so at great peril.
  2. Will the DOL appeal? No clue, they’ll have a couple weeks to decide. But it seems to me that the DOL really has to advance these issues to the appellate court.
  3. Will the DOL issue new regulations? You’ve got to think so, right? This decision just crashed a semi-trailer through some key FFCRA regulatory provisions that employers have been relying on since April 1, and the DOL would be wise to give some thought to (at a minimum) the manner in which employers should address availability of work and the definition of health care provider.
  4. Do Employers Have to Provide Retroactive Leave dating back to April 1? Another good question. Clearly, employers have a very good argument that we had a right to rely on the DOL’s FFCRA regulatory provisions before the Court’s decision yesterday, and therefore, this ruling would not be applied retroactively. In the unlikely event this ruling applies retroactively, let’s face it: we’re all together in a world of hurt.

These are tough questions, and you need help deciding whether you will change your approach on these leave issues. You know I am not often one to punt on giving practical advice in my blog articles, but you really need to call to your employment attorney to begin strategizing.

Do it this week.

Jeff Nowak is a Partner at the law firm of Littler Mendelson and has been named as one of Illinois’ top “40 Attorneys Under 40” to watch in 2012.  Jeff is widely recognized as one of the nation’s foremost FMLA and ADA experts, regularly counseling clients on compliance with FMLA and ADA regulations, conducting FMLA/ADA audits and training, and successfully litigating FMLA and ADA lawsuits.  Jeff is the author of the highly regarded FMLA Insights blog, which has been selected for four consecutive years by the ABA Journal as one of the top 100 legal blogs (2011-2017) and was also voted the No. 2 Labor and Employment blog by LexisNexis.

The above article first appeared in FMLA Insights and is reprinted with Jeff’s permission.

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