By Tulay Turan, J.D.
New Q&As from the DOL discuss sick leave, pay rate changes due to COVID-19.
The Department of Labor (DOL) has added more questions and answers (Q&As) regarding the implementation of the Families First Coronavirus Response Act (FFCRA). As of April 22, 2020, there are 88 Q&As listed by both category and number.
Computing number of hours. Question #80 addresses how to compute the number of hours of paid sick leave for an employee who has irregular hours. The DOL indicates that generally, under the FFCRA, an employer is required to provide an employee with paid sick leave equal to the number of hours that employee is scheduled to work, on average, over a two-week period, up to a maximum of 80 hours.
If an employee works an irregular schedule such that it is not possible to determine what hours he or she would normally work over a two-week period, an employer must estimate the number of hours. The estimate must be based on the average number of hours an employee was scheduled to work per calendar day (not workday) over the six-month period ending on the first day of paid sick leave. This average must include all scheduled hours, including both hours actually worked and hours for which the employee took leave.
Regarding how to compute the number of hours an employer must pay an employee who has irregular hours for each day of expanded family and medical leave taken, the DOL provides that generally, under the FFCRA, an employer is required to pay an employee for each day of expanded family and medical leave taken based on the number of hours the employee was normally scheduled to work that day. If an employee works an irregular schedule such that it is not possible to determine the number of hours he or she would normally work on that day, and the employee has been employed for at least six months, an employer must determine the employee’s average workday hours, including any leave hours. The average must be based on the number of hours an employee was scheduled to work per workday (not calendar day) divided by the number of workdays over the six-month period ending on the first day of an employee’s paid expanded family and medical leave. This average must include all scheduled hours, including both hours actually worked and hours for which the employee took leave.
Average regular rate. Employers are required to pay and employee based on his or her average regular rate for each hour of paid sick leave or expanded family and medical leave taken. The average regular rate must be computed over all full workweeks during the six-month period ending on the first day that paid sick leave or expanded family and medical leave is taken.
If during the past six months, an employer paid an employee exclusively through a fixed hourly wage or a salary equivalent, the average regular rate would simply equal the hourly wage or the hourly-equivalent of their salary. But if an employee were paid through a different compensation arrangement (such as piece rate) or received other types of payments (such as commissions or tips), his or her regular rate may fluctuate week to week, and an employer may compute the average regular rate using these steps:
- compute the employee’s non-excludable remuneration for each full workweek during the six-month period. Notably, commissions and piece-rate pay counts towards this amount. Tips, however, count only to the extent that an employer applies them towards minimum wage obligations (i.e., the employer takes a tip credit). Overtime premiums do not count towards an employee’s regular rate. Please note that, unlike when computing average hours, an employer should not count payments an employee received for taking leave as part of the regular rate, then
- compute the number of hours the employee actually worked for each full workweek during the six-month period, and
- divide the sum of all non-excludable remuneration received over the six-month period by the sum of all countable hours worked in that same time period. The result is the average regular rate.
Regarding how to compute the average regular rate of an employee who is paid a fixed salary each workweek, the DOL indicates in Question 83 that if an employer pays an employee exclusively through a fixed salary that is understood to be compensation for a specific number of hours of work in each workweek, the employee’s average regular rate would simply be the hourly equivalent of that salary.
However, if the fixed salary is understood to compensate the employee regardless of the number of hours of work in each workweek, then the regular rate may vary alongside the number of hours worked for each workweek. In this case, an employer would have to add up the salary it paid an employee over all full workweeks in the past six months and divide that sum by the total number of hours worked in those workweeks. If an employer lack records for the number of hours an employee worked, the employer should use a reasonable estimate.
Use of existing leave. The Q&As also address under what circumstances an employer may require an employee to use his or her existing leave under a company policy. Paid sick leave under the Emergency Paid Sick Leave Act is in addition to any form of paid or unpaid leave provided by an employer, law, or an applicable collective bargaining agreement. An employer may not require employer-provided paid leave to run concurrently with—that is, cover the same hours as—paid sick leave under the Emergency Paid Sick Leave Act.
In contrast, an employer may require that any paid leave available to an employee under the employer’s policies to allow an employee to care for his or her child or children because their school or place of care is closed (or child care provider is unavailable) due to a COVID-19 related reason run concurrently with paid expanded family and medical leave under the Emergency Family and Medical Leave Expansion Act. In this situation, the employer must pay the employee’s full pay during the leave until the employee has exhausted available paid leave under the employer’s plan—including vacation and/or personal leave (typically not sick or medical leave). However, the employer may only obtain tax credits for wages paid at 2/3 of the employee’s regular rate of pay, up to the daily and aggregate limits in the Emergency Family and Medical Leave Expansion Act ($200 per day or $10,000 in total). If the employee exhausts available paid leave under the employer’s plan, but has more paid expanded and medical family leave available, the employee will receive any remaining paid expanded and medical family in the amounts and subject to the daily and aggregate limits in the Emergency Family and Medical Leave Expansion Act. Additionally, provided both an employer and employee agree, and subject to federal or state law, paid leave provided by an employer may supplement 2/3 pay under the Emergency Family and Medical Leave Expansion Act so that the employee may receive the full amount of the employee’s normal compensation.
Finally, an employee may elect—but may not be required by the employer—to take paid sick leave under the Emergency Paid Sick Leave Act or paid leave under the employer’s plan for the first two weeks of unpaid expanded family and medical leave, but not both. If, however, an employee has used some or all paid sick leave under the Emergency Paid Sick Leave Act, any remaining portion of that employee’s first two weeks of expanded family and medical leave may be unpaid. During this period of unpaid leave under the Emergency Family and Medical Leave Expansion Act, the employee may choose—but the employer may not require the employee—to use paid leave under the employer’s policies that would be available to the employee to take in order to care for the employee’s child or children because their school or place of care is closed or the child care provider is unavailable due to a COVID-19 related reason concurrently with the unpaid leave.
Stay-at-home and shelter-in-place orders. For purposes of the FFCRA, a federal, state, or local quarantine or isolation order includes shelter-in-place or stay-at-home orders, issued by any Federal, State, or local government authority. However, in order for such an order to qualify an employee for leave, being subject to the order must be the reason the employee is unable to perform work (or telework) that an employer has for an employee. An employee may not take paid leave due to such an order if his or her employer does not have work for him or her to perform as a result of the order or for other reasons.
For example, if an employee is prohibited from leaving a containment zone and his or her employer remains open outside the containment zone and has work the employee cannot perform because the employee cannot leave the containment zone, the employee may take paid leave under the FFCRA.
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