Labor & Employment Law Daily OIG dings Wage and Hour Division over FFCRA administration and enforcement
Thursday, August 13, 2020

OIG dings Wage and Hour Division over FFCRA administration and enforcement

By Pamela Wolf, J.D.

Among other things, the temporary regulation defined “health care providers” too broadly.

A new report released by the Labor Department’s Office of the Inspector General finds that, while the Wage and Hour Division acted quickly after Congress passed the Families First Coronavirus Response Act (FFCRA) by issuing guidance, training staff, and conducting oversight, the division nonetheless continues to face challenges as it implements and enforces FFCRA requirements.

Enforcement activities hit. One of the challenges identified by the OIG is conducting enforcement activities while maximizing telework and maintaining social distancing. While the WHD’s efforts should help control the spread of COVID-19, the resulting reduced or eliminated onsite investigations is impacting the division’s oversight of the FFCRA, as well as its existing programs, most notably those related to the FLSA, according to the report.

Temporary rule’s eligibility definition. Another major challenge is ensuring appropriate eligibility for FFCRA’s emergency paid leave benefits. Here the report notes that the DOL issued a temporary rule “with a broader definition for health care providers than the definition established by the Family and Medical Leave Act of 1993.” That definition, according to the OIG, expands the types of occupations potentially exempt from FFCRA benefits.

The temporary rule also includes an estimate of 9 million health care providers potentially impacted by the exemptions. This estimate, however, which was provided to the public and other stakeholders, could be understated because it does not include all of the occupations in the DOL’s expanded definition for health care provider.

S.D.N.Y action. As the report details in a footnote, the broad definition of health care provider set forth in the DOL’s temporary rule prompted the New York Attorney General to file a lawsuit in the Southern District of New York against the federal agency. On August 3, 2020, the court issued its decision holding that the definition was overly broad.

Operating plan. The OIG also found that the WHD did develop a COVID-19-specific addendum for its operating plan. However, it focuses on past efforts and does not sufficiently address the agency’s planned future actions, including how it intends to use the additional $2.5 million it received in CARES Act funding to fulfill its obligations under the FFCRA.

Recommendations. The OIG made the following recommendation for the Wage and Hour Division Administrator:

1. Develop a plan to monitor the effectiveness of the agency’s oversight of the FFCRA and the FLSA programs so that the agency can identify if or when operational adjustments are necessary to most effectively utilize resources.
2. Maintain a backlog of delayed on-site investigations and develop a plan to manage the backlog once normal operations resume.
3. Determine the impact of the decision issued by the U.S. District Court for the Southern District of New York to the agency and its mission; and take appropriate action to address its impact.
4. Update its COVID-19 operating plan addendum regarding the agency’s oversight of the FFCRA to include:
a. Specific performance goals;
b. Agency plans to use the $2.5 million received from the CARES Act;
c. Enforcement and outreach plans for the FFCRA once COVID-19 restrictions are lifted; and
d. Enforcement plans for the FFCRA after it expires December 31, 2020.

According to the report, the WHD agreed with the OIG’s recommendations.

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