Pension & Benefits News NY AG lawsuit challenges lawfulness of FFCRA regulations
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Wednesday, April 29, 2020

NY AG lawsuit challenges lawfulness of FFCRA regulations

By Pension and Benefits Editorial Staff

New York Attorney General Letitia James has filed a lawsuit against the U.S. Department of Labor, challenging its rule that, as the AG sees it, unlawfully narrows workers’ rights under the Families First Coronavirus Response Act (FFCRA) to paid sick leave and emergency family leave during the pandemic. At the same time, the AG also filed a motion for summary judgment asking the federal court in the Southern District of New York to block the regulations and to restore the FFCRA to its intended effect.

On April 6, the DOL issued a temporary rule implementing the FFCRA, "denying vital financial support and exposing millions of American workers and their communities to further transmission of infectious disease in the middle of a once-in-a-century pandemic," according to the complaint. The temporary rule is effective from April 2, 2020, through December 31, 2020, but became operational on April 1.

Paid sick and emergency leave provisions. The FFCRA, enacted on March 18, includes key provisions requiring job-protected paid sick leave and emergency family leave for employees unable to work due to COVID-19. Up to 61 million employees are potentially eligible for paid sick leave or emergency family leave under the FFCRA, the AG noted.

Congress enacted the paid sick leave and emergency family leave provisions in the FFCRA both to stem the rate of coronavirus transmission—by encouraging sick workers to stay home but still be paid—and to protect the economic well-being of workers who must stay at home to care for their children during this period of unprecedented national disruption, the AG explained. The FFCRA’s paid leave provisions assist in the implementation of the directives laid out by the CDC calling for residents to take the necessary steps to lessen the spread of COVID-19, and protect themselves, their families, and their communities from devastating harm, according to the AG.

FFCRA violated. Asserting Administrative Procedure Act claims, the AG contends that the regulatory action exceeds the DOL’s authority under the FFCRA. Among other things, the complaint alleges that the temporary rule violates the FFCRA by:

  • Unlawfully denying paid sick leave and emergency family leave to otherwise eligible employees if the employer determines—for any reason—that the employer does not have work for the employee; and
  • Enabling the denial of the FFCRA’s paid sick leave and emergency family leave benefits to large classes of otherwise eligible workers by including them in an unlawfully broad definition of "health care provider."

Both alleged violations are discussed more fully below.

Work availability. The AG contends that the regulations impose a new "work availability" requirement, permitting employers to deny workers emergency family leave or paid sick leave with no statutory basis.

Emergency family leave. The FFCRA requires up to 12 weeks of emergency family leave, 10 weeks of which are paid, for employees who are unable to work or telework because they have to care for a child due to the coronavirus.

"The Final Rule adds a non-statutory constraint to an employee’s entitlement to emergency family leave, limiting employee eligibility to those circumstances where the employer determines in the employer’s sole discretion that the employer has work for the employee," according to the complaint.

Paid sick time. The FFCRA also requires an employer to provide paid sick time where an employee is unable to work or telework if the employee meets one of six qualifying conditions. As to three of these qualifying conditions—the employee is subject to a governmental quarantine or isolation order; is caring for an individual subject to a governmental or medical quarantine order; or is caring for a son or daughter whose school or place of care has been closed—the regulations add a non-statutory constraint to an employee’s paid sick leave entitlement, the AG alleges.

Under the regulations, employee eligibility is limited to those circumstances in which the employer determines in its sole discretion that it has work for the employee. "Nothing in the text of the FFCRA limits an employee’s entitlement to paid sick leave to those circumstances when the employer has work for the employee to perform on each day," the complaint states.

Health care providers. "Congress directed that ‘health care provider’ have the same meaning in the FFCRA as that term has in the FMLA," according to the complaint. However, despite this express direction, the regulations do not universally adopt the same definition of "health care provider" codified and employed under the FMLA.

The AG alleges that the temporary rule’s "definition of ‘health care provider" for employee exclusion purposes expands that term far beyond both its plain meaning and the FMLA definition, to include, for example:

  • a teaching assistant or librarian at a university;
  • employees who manage the dining hall or information technology services at a medical school;
  • the cashier at a hospital gift shop; and
  • anyone employed by any contractor to any entity listed in the regulations, including all employees of a payroll processing firm or vending-machine re-supplier.

This definition of "health care provider" exposes millions of American workers to exclusion from emergency family leave and paid sick leave as authorized by the FFCRA. The DOL has acknowledged that the regulations are likely underinclusive because it "may not . . . include employees who provide services to the health care industry," the AG contends, citing 85 Fed. Reg. at 19,343.

Intermittent leave. The complaint also challenges the lawfulness of the intermittent leave provisions under the regulations, which limit intermittent leave to certain of the qualifying leave conditions, and only if the employer affirmatively agrees to allow it, as the AG notes. Unless the employer agrees, all paid leave must be taken in "one continuous period" under the regulations.

"In regulating intermittent leave with the employer’s consent, the Final Rule differentiates between employees who are reporting to their normal worksite and those who are teleworking," according to the complaint.

Reporting to worksite. As to those reporting to a worksite, intermittent leave is permitted only for employees who are taking emergency family leave or who are taking paid sick leave to care for a child whose school is closed. These employees can only take intermittent leave provided their employer approves. "For employees reporting to a worksite and taking paid sick leave as allowed by any of the other qualifying conditions, intermittent leave is categorically prohibited," the complaint states.

Teleworking. Employees who are teleworking must take emergency family leave or paid sick leave in "one continuous period" under the regulations, unless the employer agrees to permit intermittent leave.

"Nothing in the FFCRA authorizes the Department to grant employers the ability to deny paid leave to an employee who is otherwise entitled solely because the employer prefers that the leave be taken in one continuous period," the AG contends.

Conflicts with statute and congressional intent. According to the complaint, "The Final Rule conflicts with the plain language and purpose of the statute Congress enacted by, among other things, (1) codifying broad, unauthorized exclusions from employee eligibility that risk swallowing Congress’s intended protections; and (2) creating from whole cloth new restrictions and burdens on employees that appear nowhere in the text Congress enacted. The Final Rule thus undermines Congress’s public health and economic security goals."

The AG contends that unless the challenged provisions are vacated, the regulations will have "devastating consequences for New York and its residents." Further, with about 95 percent of Americans now under some form of "stay at home" order due to the COVID-19 pandemic, the regulations’ impacts will be felt by families all across the country.

SOURCE: https://ag.ny.gov/sites/default/files/ny_v_us_dol_motion_for_summary_judgment.pdf

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