By: Daniel L. Herrington and Khayyam M. Eddings
Earlier this month, the United States District Court for the Southern District of New York struck down the Department of Labor’s (DOL) definition of “health care provider” as promulgated in the regulations implementing the Families First Coronavirus Response Act (FFCRA). See State of New York v. United States Department of Labor. In this case, the State of New York sued the DOL claiming that several provisions of the regulations implementing the FFCRA violated the Administrative Procedures Act.
By way of background, the FFCRA contains two related acts; the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family and Medical Leave Expansion Act (EFMLEA). The EFMLEA is an amendment to the FMLA. The EFMLEA allows employees who are unable to work because they must care for a dependent child due to COVID-19 to be paid for up to 12 weeks at 2/3 pay. See FFCRA §§ 3102 (a)(2); 3102 (b). Similarly, the Emergency Paid Sick Leave Act (EPSLA) requires covered employers to provided sick leave to employees for one of six qualifying COVID-19 related reasons.
The legislation provides that an employer of “an employee who is a health care provider or emergency responder may elect to exclude such employee” from the benefits provided by the EFMLEA and EPSLA. See FFCRA § 3105. The FFCRA does not define “health care provider.” The FMLA, however, defines “health care provider” narrowly, as “a doctor of medicine or osteopathy who is authorized to practice medicine or surgery,” or “any other person determined by the Secretary to be capable of providing health care services.” See 29 U.S.C § 2611 (6)(B).
On April 1, 2020, the DOL promulgated its Final Rule implementing the FFCRA. Instead of defining “health care provider” in terms of employees, the DOL defined “health care provider” in terms of employers. The DOL defined “health care provider” as essentially any employee who works for an employer who is a health care provider, such as a doctor’s office, hospital, clinic, etc. To wit:
anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, Employer, or entity. This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions,
as well as
any individual employed by an entity that contracts with any of these institutions described above to provide services or to maintain the operation of the facility where that individual’s services support the operation of the facility, [and] anyone employed by any entity that provides medical services, produces medical products, or is otherwise involved in the making of COVID-19 related medical equipment, tests, drugs, vaccines, diagnostic vehicles, or treatments.
See Final Rule at 19,351 (29 CFR § 826.30)
The District Court described the DOL’s definition as “expansive” and “vastly overbroad” when considered in light of the statute’s definition.
The import of this decision for any employer such as a clinic, hospital, homecare provider, etc., is that you risk being sued under the FFCRA if you deny leave to employees who are incapable of personally providing health care services.
It remains to be seen how the DOL will respond to this ruling. The DOL could appeal to the United States Court of Appeals for the Second Circuit. Alternatively, the Secretary could go back to the drawing board and define “health care provider” in the context of employees, rather than employers. The latter fits within the Secretary’s authority to exempt “any other person determined by the Secretary to be capable of providing healthcare services.” See 29 U.S.C. § 2611 (6). Employers familiar with the FMLA process will understand that “health care provider,” in that context, is fairly narrow. That does not mean the DOL is constrained to that narrow definition for purposes of a health care provider exemption under the FFCRA, however. Therefore, it is reasonably likely that the DOL will promulgate a regulation listing those employees who are capable of providing healthcare services.
In the meantime, employers should limit the FFCRA exemption to employees who could be determined by the Secretary capable of providing healthcare services. These employees would include doctors, nurses, and others who are providing direct patient care versus those supporting the functioning of the healthcare system such as billing, medical records clerks, and the like.
Employees May be Eligible for FFCRA Leave Even if Company is Shut Down or Employee is on Furlough
The above was not the only provision of the regulations struck down by the Court. New York’s first challenge to the DOL’s regulations was to the so-called “work availability” requirement. The EPSLA grants paid leave to employees who are “unable to work (or telework) due to the need for leave because of any of the six COVID-19 related reasons.” The Final Rule implementing these provisions excludes from these benefits employees for whom employers “do not have work.” See Final Rule at §§ 826.20 (a)(2), (6), (9), (b)(1)). Because an employee is not typically entitled to leave if they are not working, this seems to be a commonsense proposition. For example, an employee on the night shift is not entitled to continue FMLA leave if the plant lays off all employees on the night shift. Along those lines, the DOL argued that the terms “due to” and “because” compel the conclusion that an employee for whom the employer “does not have work” is not entitled to leave, irrespective of any of the qualifying reasons. Accordingly, the DOL argued that the terms “due to” and “because” imply a but-for causal relationship.
The DOL further argued that an absence from work due to a lack of work is not “leave.” The court agreed that “due to” and “because” traditionally imply but-for causation, but not in all cases. For example, according to the Court, “in ordinary usage, a teacher on paid parental leave may still be considered on ‘leave’ even if school is called off for a snow day.” The district court’s example is not akin to the dire situation employers have faced throughout this pandemic — that the business is completely shut down for weeks, if not months, due to COVID.
In the end, the district court overturned the regulation on the basis that its “monumental policy decision” was not fully explained. Thus, the DOL could easily save this requirement by better explaining its reasoning in an amended final rule.
Employees May Take FFCRA Leave Intermittently
The Final Rule allows employees to take FFCRA leave intermittently only if the employer and employee agree. New York challenged the regulation as exceeding the DOL’s authority. The District Court held “insofar as it requires employer consent for intermittent leave, then, the rule is entirely unreasoned and fails analysis.”
Employees Not Required to Provide Medical Documentation Prior to Leave
Finally, the district court ruled that the FFCRA regulation requiring employees to submit documentation prior to taking the leave was contrary to the statute. While the Act itself requires an employee to provide notice when leave is foreseeable, the regulation’s documentation requirement appeared to impose a different and more stringent precondition to leave. Employers should remain flexible and conditionally grant leave dependent on subsequently receiving the information needed to a) determine whether leave qualifies under the FFCRA, and b) support taking the payroll tax credit to pay for the leave.
What Does This Mean for Arkansas Employers?
This district court’s decision is not binding precedent in Arkansas. It is, however, a warning to employers of the risk of being sued for violation of the FFCRA even though you are in compliance with the regulations as drafted. You are advised to consult counsel and keep an eye on the progress of this case. In the meantime, employers should rethink a blanket exemption from the FFCRA, bans on intermittent leave and requiring documentation before leave begins.
Daniel L. Herrington is a partner in the Labor and Employment Relations Practice Group focused on representing employers in all areas of labor and employment law, including ADA, FMLA, Wage and Hour, Title VII, OSHA and NLRA. He proactively works with his management clients to help ensure their employment decisions can withstand legal scrutiny.
Khayyam M. Eddings is a partner in the Labor and Employment Litigation Practice Group where he counsels employers in all aspects of the labor and employment laws including compliance with Title VII of the Civil Rights Act of 1964, Family Medical Leave Act, Americans with Disabilities Act, Fair Labor Standards Act, National Labor Relations Act and the Occupational Safety and Health Act.
Disclaimer: The information included here is provided for general informational purposes only and should not be a substitute for legal advice nor is it intended to be a substitute for legal counsel. For more information or if you have further questions, please contact one of our Attorneys.