Cynthia Bremer & Michael EckardApril 21, 2020

Presented by:

COVID-19 Employer Update:Understanding Potential Workplace Impacts (Part 2)

Presenters

Cynthia BremerShareholder

Minneapolis Office

612-336-6868

Michael EckardShareholder

Charleston, SC Office

843-853-1300

Agenda

1. Overview of Legislative Initiatives for EmployersA. FFCRA: Paid Sick LeaveB. FFCRA: Paid FMLA LeaveC. Unemployment

2. North Dakota Updates3. Looking Ahead: Preparing for the Return to Work

But before we get started, what happened since we presented just last week?• ND Smart Restart Plan: 8 steps to reopen ND• U.S. Senate/House to vote on more funds to Paycheck Protection Program• CDC updated guidance(s) regarding many COVID-19 topics

• E.g., symptoms could include fever, cough, shortness of breath/difficulty breathing, chills, shaking w/chills, muscle pain, headache, sore throat, loss of taste/ smell

• EEOC updated guidance on COVID-19:• Reasonable accommodation process• Pandemic-related harassment• Return to work – protective gear; infection control practice• https://www.eeoc.gov/eeoc/newsroom/wysk/wysk_ada_rehabilitaion_act_coronavi

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FAMILIES FIRST CORONAVIRUS RESPONSE ACT

An Economic Stimulus Package – Families First Coronavirus Response Act (FFCRA)

Expanded FMLA Created New Paid Sick Leave

Benefit Mandates and

Tax Credits“EFMLEA” “EPSL”

FFCRA – Two Benefits to Employers

Incentivized states to loosen unemployment compensation, and not have benefits affect tax rating

Created tax credits for employers who provide EFMLEA and EPSL

FFCRA• Effective April 1, 2020 (according to DOL) – December 31, 2020

NOTE – THERE IS ALSO A SUNRISE – ANY LEAVE GIVEN PRIOR TO APRIL 1 FOR THE REASONS WE ARE ABOUT TO DISCUSS GETS NO CREDIT UNDER THE NEW REQUIREMENTS.

• Applies to schools, governmental employers of any size, and private employers with less than 500 employees• How do you count? For either EFMLEA

or EPSL• Start with the W-2 employer

• Add to that # any temporary employees, leased employees, or other “shared” employees

• Consider whether an “Integrated Employer”

FFCRA: Who is Covered?

• May opt out of providing childcare related benefits if Company officer determines:1. Providing EPSL or EFMLEA “would result in the small business’s expenses

and financial obligations exceeding available business revenues and case the small business to cease operating at a minimal capacity;”

2. The absence of the employees requesting benefits “would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities;” OR

3. There are not enough workers able, willing, and qualified to perform the services provided by the employees requesting EPSL or EFMLEA, and such services are needed for the business to “operate at a minimal capacity”

What About Employers With <50 Employees?

EMERGENCY FAMILY AND MEDICAL LEAVE EXPANSION ACT

Expanded FMLA (EFMLEA) Key Points

• It is just another form of FMLA (so 12 weeks; same FMLA year as usual)• Normal FMLA rules apply (e.g., benefit protection, etc.)• If leave is granted, and you are already an FMLA covered employer, any leave taken will count against

the normal 12-week period for other types of FMLA• Other than pulling out of the same 12-week bank, this law is different enough that it should not alter

how you normally go about processing FMLA leaves for traditional reasons, and you should not try to modify your forms – just build new ones for this

• It provides leave for ONLY ONE type of COVID-19 situation• If the employee has a minor child• The child’s school or daycare closes because of COVID-19 concerns or if the child’s normal, paid care

provider is unavailable because of COVID-19• As a result, the employee cannot work or telework because they need to care for the child (and if ee

says they cannot telework, must take their word for it)

• Changed the definition of employer (SOLELY FOR EFMLEA)• Private employers <500• Schools• Public agencies (governmental employees)

The OLD definition of employer still applies for all other forms of FMLA• Employers with 50 or more employees in 20 or more workweeks this year or

last

• Changed the definition of eligible employee (SOLELY FOR EFMLEA)• Any employee who has been on payroll for more than 30 calendar days

(whether working or not)• If not eligible when requested, but they become eligible because they are still

on payroll, then they get it when they hit 30 days

EFMLEA “Employer” and “Employee”

EFMLEA Pay

• Unpaid for first two weeks • But could be paid by EPSL or employer’s other paid leaves

(at employee’s option)

• Provides for pay to employees for weeks 3-12 • At two-thirds regular rate of pay (over past 6 months)

(subject to applicable minimum wage)• Regular rate of pay is same definition as FLSA (includes all non-

discretionary bonuses)• Capped at $200 per day

• Employer cannot require employees to supplement with other paid leaves, and employee cannot demand. Must be by agreement.

Other EFMLEA Key Points:

• Intermittent leave by agreement• Entitlement ends if termination or facility closure• Employers can/should require medical documentation to support tax

credits• Employer may exclude coverage for healthcare providers and

emergency responders• DOL urges judicious use of this exception• For more information on what is considered a “healthcare provider” or

“emergency responder,” see DOL FAQs:https://www.dol.gov/agencies/whd/pandemic/ffcra-questions#56

EMERGENCY PAID SICK LEAVE ACT

Employee Eligibility• All employees are eligible for EPSL

• Length of employment does not matter• Unlike EFMLEA provisions, there is no calendar

days, hours of service, or geographic proximity requirements

• No waiting period• All covered employers have the same

obligation• Larger employers (>500) may offer EPSL but

no tax benefits

When Can EPSL Be Used?

• State or local quarantine or isolation order related to COVID-19 (includes stay-at-home orders)

• Self-quarantine at healthcare provider’s advice related to COVID-19• Experiencing COVID-19 symptoms and seeking a medical diagnosis• Caring for an “individual” (undefined) subject to a

quarantine/isolation order or self-quarantine related to COVID-19• Caring for a son or daughter whose school or place of care has been

closed, or whose child care provider is unavailable, due to COVID-19

Available Hours• Full-time employees get 80 hours• Part-time employees get the number of hours they work, on average,

over a 2-week period• For example, if part-time employees average 24 hours a week, they get 48

hours

• Hours for part-time employees with variable schedules – available EPSL hours should be calculated according to:

• Their average daily hours scheduled in the six (6) months prior to use of EPSL, or

• If they did not work for six months prior, a “reasonable expectation” of average daily hours scheduled upon hire

EPSL Pay• Unlike EFMLEA, all EPSL is paid• Pay is calculated at the higher of:

• Regular rate, federal minimum wage, or local minimum wage• Inclusive of commissions, tips, or piece rates

• EPSL capped at $511/day ($5,110 total)• Employees absent for “Care for Others,”

“School/Childcare Closure,” and “Similar Conditions” get 2/3 of regular rate, capped at $200/day ($2,000 total)

• No carryover to subsequent years• No payout at termination, retirement

Preexisting Policies and Other Paid Leave

• The FFCRA’s EPSL provisions “impose[] a new leave requirement on employers that is effective beginning on April 1, 2020.”

• Employers may not require use of other paid leave before use of EPSL.

• Employers may allow, but not require, employees to use EPSL concurrent with EFMLEA

• Employers may require other company paid leave benefits to be used concurrently with E-FMLEA

TAX CREDITS

Tax Credits for Wages• Employers with fewer than 500 employees

are eligible for:• Tax credits on amounts paid to employees who

go out on qualified EPSL or EFMLEA• Costs to maintain health insurance coverage for

employees during period of leave for EPSL or EFMLEA

• For IRS Guidance on Claiming Credits:https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs

Documentation to Support Credits• A written request from the employee

• Employee name and dates of leave• COVID-19 Reason and written support

• For illness: Name of the sick person and name of the healthcare provider or authority ordering quarantine or isolation

• For childcare: Name of the child and the school or provider that is closed/unavailable; representation that nobody else will be caring for the child

• Statement that the employee cannot work or telework due to the COVID-19 reason

Additional Documentation to Support Credits• How employer determined the amount of wages paid to employees

eligible for the credit, including records of work, telework, and qualified sick leave and qualified family leave

• How employer determined the amount of qualified health plan expenses that the employer allocated to wages

• Copies of Forms 7200, Advance of Employer Credits Due To COVID-19, that employer submitted to the IRS

• Copies of Forms 941, Employer’s Quarterly Federal Tax Return, that employer submitted to the IRS (or records of information provided to third-party payer regarding employer’s entitlement to the credit claimed on Form 941)

UNEMPLOYMENT

Unemployment Insurance• State UI benefits are max $618 per week

• CARES Act adds an additional $600 per week for 4 months or until July 31st

• State UI available for up to 26 weeks• CARES Act extends for a total of up to 39 weeks

• Employer’s account will not be charged due to COVID-19• No first week waiting time• Partial UI allowed (60% WBA setoff)• Employer may pay employee’s health benefits• Business owner(s) may be eligible• Job Service ND technical issues delayed $600 federal stimulus checks

See Job Service FAQs: https://www.jobsnd.com/sites/www/files/documents/COVID19/uicovidfaq04082020.pdf

OTHER NORTH DAKOTA UPDATES

Available Guidance and Resources• North Dakota Court Government Resources:

• https://www.ndresponse.gov/covid-19-resources

• North Dakota Court System:• Supreme Court virtual arguments (among the majority in the U.S.)https://www.ndcourts.gov/news/federal-courts/related-courts/nd-us-district-court/u-s-district-court-updates-coronavirus-emergency-order• Federal Court suspending in-person appearances through May 31 and

extends other deadlines and requirementshttps://www.ndd.uscourts.gov/announce/4-20%20COVID-19%20Order.pdf

LOOKING AHEAD:PREPARING FOR THE RETURN TO WORK

Whitehouse.gov Guidance

Employee Temperature Screening

• No CDC or North Dakota guidance…..yet.

Likely Best Practices• Employee Communication• Determine Screening Area• Who will be the screeners?• Determine Training and PPE• Determine Recordkeeping• Determine Employee Outcomes

Employee Screening Resources• OSHA (Hazard Assessments and PPE):

https://www.osha.gov/SLTC/covid-19/index.html• CDC (Critical Infrastructure Workers):

https://www.cdc.gov/coronavirus/2019-ncov/community/critical-workers/implementing-safety-practices.html

• CDC (Homeless Shelter Screening Protocol): https://www.cdc.gov/coronavirus/2019-ncov/community/homeless-shelters/screening-clients-respiratory-infection-symptoms.html

• Ogletree Deakins Return to Work Guide and sample screening protocol

https://ogletree.com/solutions/coronavirus-covid-19-resource-center/

Thank you!