Documentation of the employee’s need to take FFCRA leave is required for employers to claim a tax credit.
Employees who have been furloughed, or whose worksites have been closed, are not entitled to paid leave, but may seek unemployment benefits.
Employers may not require—but employees may elect—to use existing accrued paid leave for qualifying reasons, either instead of or to supplement partially paid FFCRA leave.

As noted in Pillsbury’s March 25 Client Alert, the U.S. Department of Labor (DOL) has now published materials to aid employers in ensuring compliance with the FFCRA, including fact sheets, questions and answers, and the required workplace poster. On March 26, the DOL expanded the Questions and Answers section to clarify important issues facing employers under the FFCRA.

Documentation and Certification
The Questions and Answers clarify that employers must require employees to provide appropriate documentation in support of the reason for their leave in order for the employer to claim a payroll tax credit for FFCRA leave payments. Unlike other forms of FMLA certification, no signed third-party certification is required for FFCRA paid leave. Appropriate documentation should include: the employee’s name, qualifying reason for requesting leave, a statement that the employee is unable to work, including telework, for that reason, and the date(s) for which leave is requested. Documentation of the reason for the leave will also be necessary, such as the source of any quarantine or isolation order, the name of the health care provider who has advised the employee to self-quarantine, or notice of a school closure or lack of child care. Adequate documentation may include a copy of the Federal, State or local COVID-19 quarantine or isolation order; written documentation from a health care provider advising the employee to self-quarantine; or an email, website announcement, or other published notice of closure or unavailability from an employee’s child’s school or child care provider.

Employers should retain this documentation. Employers who grant paid FFCRA without obtaining or keeping such documentation may not be eligible for a payroll tax credit. Employers would also be prudent to establish separate leave codes for FFCRA-covered hours to assist in tracking the time.

The Questions and Answers also clarify that existing certification requirements under the FMLA remain in effect if an employee is taking unpaid leave for one of the existing qualifying reasons under the FMLA. For example, if an employee on FFCRA leave develops a medical condition that rises to the level of a serious health condition, the employee must continue to provide medical certifications under the FMLA if required by their employer, and the employee’s leave would then fall under existing unpaid FMLA leave entitlements, rather than the FFCRA.

Intermittent Leave
The Questions and Answers clarify that employers are not required to provide intermittent leave under the FFCRA to employees teleworking or working onsite. Employees may take emergency paid sick leave or expanded family and medical leave intermittently while teleworking or working onsite only if their employers allow it. Employees may take intermittent FFCRA leave in any increment, provided that such schedule is agreed upon by the employer and employee. While employees who are teleworking may take any FFCRA leave intermittently with employer approval, employees who are working at their usual worksite (as opposed to teleworking) may take intermittent emergency paid sick leave with employer approval only if the qualifying reason relates to the need to care for a child due to school or childcare closures. Employees taking emergency paid sick leave for other COVID-19 reasons must take paid leave in full-day increments.

Employees who work their normal number of hours, but outside of normally scheduled hours (e.g., late at night) are not considered to be taking any leave.

The DOL encourages employers and employees to collaborate to achieve flexibility and meet mutual needs.

Workplace Closures and Furloughed Employees
If an employee’s worksite has been closed or an employee has been furloughed (before or after April 1), the employee is not entitled to paid FFCRA leave, but the employee may still be eligible for unemployment insurance benefits. This applies even if an employee requested leave prior to the closure.

If an employer closes an employee’s worksite while the employee is on emergency paid sick leave or expanded family and medical leave, the employee must be paid for any emergency paid sick leave or expanded family and medical leave used before the employer closed. As of the date of the worksite closure, however, the employee is no longer entitled to paid FFCRA leave, but may be eligible for unemployment insurance benefits.

The Questions and Answers clarify that employees may not receive paid leave and unemployment benefits at the same time.

Interaction Between FFCRA Paid Leave and Existing Paid Leave
The Questions and Answers also clarify that only leave taken on or after April 1, 2020, will qualify for FFCRA leave payments. Any paid leave employers have provided prior to April 1, 2020, will not reduce an employee’s FFCRA entitlement, nor will employers be able to claim a tax credit under the FFCRA for such payments.

As of April 1, employers may permit but may not require employees to choose between using their existing accrued leave and FFCRA paid sick leave or expanded family and medical leave. Employers may also permit but may not require employees to supplement any partially paid sick leave or expanded family and medical leave under the FFCRA with existing accrued paid leave in order to receive their full compensation. If an employee prefers not to use existing accrued paid leave, employers cannot require the employee to do so.

If employers pay their employees in excess of FFCRA requirements, employers may still receive a payroll tax credit for the amounts paid within the FFCRA statutory limits. Employers will not receive a tax credit for amounts paid above the FFCRA’s statutory limits.

Pillsbury’s experienced crisis management professionals are closely monitoring the global threat of COVID-19, drawing on the firm's capabilities in supply chain management, insurance law, cybersecurity, employment law, corporate law and other areas to provide critical guidance to clients in an urgent and quickly evolving situation. For more thought leadership on this rapidly developing topic, please visit our COVID-19 (Coronavirus) Resource Center.

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