Coronavirus E-blast - DOL Clarifies Small Business Exemption for New Paid Sick Leave Requirements
Effective April 1, 2020, the new paid sick leave requirements under the Families First Coronavirus Response Act ("Family First Act") require employers with fewer than 500 employees to provide emergency paid sick leave. Although formal regulations have not been released, the Department of Labor ("DOL") has provided some limited information about which small businesses with fewer than 50 employees will be exempt from these new paid sick leave requirements under the Families First Act.
According to the DOL's additional guidance just released on the DOL's website, a small business is exempt from the new paid sick leave requirements under the Families First Act if: (a) the employer has fewer than 50 employees; (b) an employee requests leave because the child's school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and (c) an authorized officer of the business has determined that at least one of the following three conditions is satisfied:
The provision of paid sick leave or expanded family and medical leave would result in the small business's expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
The absence of the employee or employees requesting paid sick leave or expanded family and medical leave 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
There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.
The additional guidance also notes that that small businesses electing this small business exemption, which only exempts providing paid sick leave due to school or place of care closures or child care provider unavailability for COVID-19 related reasons, should carefully document the reasons that they meet the criteria for this exemption.
We expect the DOL to issue formal regulations any day now, which should provide additional clarity to the small business exemption under the Families First Act. Indeed, a footnote within the DOL's guidance directs employers to Department regulations expected during April. We will send out new e-blasts as soon as regulations become available. We will be here for you throughout this pandemic. Stay safe.
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