Navigating the pandemic; Are there ways to avoid getting sued?
QUESTION: I own a rental company, and I’m trying to understand how to navigate this pandemic, make sure I comply with the law and deal properly with my employees so I don’t wind up getting sued. I keep reading all of these articles published by so-called “experts,” but incredibly, I can’t seem to find any clear answers. Can you please try to simplify some of this? I don’t think I can take reading another rambling, circular diatribe and, no offense, but I have no desire to go to law school.
Answer: Trust me when I tell you that I “know your pain.” I actually did publish a brief explanation of some of the more pressing issues on the American Rental Association (ARA) Coronavirus Discussion Group page on Facebook in late July, the research for which took many hours of sifting through the torrent of expert opinions you mentioned. I am including a summary of that article below in hopes that it reaches and perhaps helps more ARA members.
Note that the regulations, and their respective interpretations, have changed so much and so rapidly over the past several months that by the time this article is published, some of the following may have changed. For example, just recently, a federal court in New York struck down four of the rules pertaining to the leave requirements of the Families First Coronavirus Relief Act (FFCRA) and it is not yet clear whether the ruling applies nationwide or only in New York.
Consequently, the information included in this article is intended to serve solely as a framework for understanding and not as a final statement of the applicable law — which obviously enough, does not yet exist. I, therefore, strongly encourage readers to try to stay abreast of new releases and to remain in close contact with their employment counsel at least through the end of the year.
With that as a windup, here is my most recent attempt to summarize some of the most important issues and answers relating to employee relationships in the coronavirus (COVID-19) era.
With so much information being released by countless specialists, I’m not surprised to see that the same seemingly simple questions don’t seem to be getting answered or answered clearly enough to be useful for ARA members.
So, let me try to break it down into four simple questions with four direct — to the extent possible — answers:
Do you have to pay employees’ wages during their quarantine period? Yes, for up to two weeks in most cases. Technically, you do not have to pay employees for time they don’t work, and you can require them to use paid time off (PTO), sick leave and vacation time for absences. But, under FFCRA, which among other things, changed the PTO rules at least through Dec. 31, 2020, you now must make available enhanced paid sick leave of up to two weeks at 100 percent of the employee’s pay rate and paid child-care leave, up to additional 10 weeks of paid expanded family and medical leave at two-thirds of the employee’s pay rate for childcare in certain cases, though businesses with fewer than 50 employees may qualify for an exemption from the requirement to provide leave due to school closings or child care unavailability if the leave requirements would jeopardize the viability of the business.
The U.S. Department of Labor has published a poster which attempts to summarize and explain the requirements and benefits at https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf.
You also will want to be sure to check state and local wage-and-hour laws, as they tend to vary substantially and may impact your obligations. Most states have an Employment Commission, State Department of Labor, Office of Workforce Development or similarly named entity that can provide answers to these types of questions for employers. The U.S. Department of Labor publishes a list of, and contact information for, each such state office online at dol.gov/agencies/whd/state/contacts.
Will you be reimbursed if you compensate employees during self-quarantine periods? Yes, you can be reimbursed, but not directly in most cases. Under the FFCRA, employers are entitled to take payroll tax credits for mandatory amounts paid to employees for sick leave and qualifying family and medical leave wages, and for allocable costs to maintain health care coverage for employees on leave, if such costs are incurred between April 1, 2020, and Dec. 31, 2020. Each quarter, employers are entitled to a refundable tax credit equal to the amount of qualified leave wages paid to eligible employees, plus qualified health plan expenses and the employer’s share of the Medicare tax on those wages.
Separately, under the Coronavirus Aid, Relief and Economic Security (CARES) Act, employers are entitled to a refundable credit against the employer component of employment tax — Social Security and Railroad Retirement — of up to 50 percent of qualified wages, including qualified health plan expenses, incurred after March 12, 2020, and before Jan. 1, 2021. This credit is in addition to the tax credit available under the FFCRA, but may not be claimed on the same wages. While the tax credit under the FFCRA relates to wages and related health care costs for employees on mandatory paid leave due to COVID-19, the tax credit under the CARES Act only relates to wages and related health care costs paid to employees when the employer has fully or partially suspended operations, or has had a significant decline in gross receipts due to the pandemic. The maximum amount of qualified wages taken into account with respect to each employee for all calendar quarters is $10,000. Thus, the maximum credit for an eligible employer for qualified wages paid to any employee is $5,000.
Can you restrict your employees’ travel? Generally, no, but you can control your work environment. An employer has little ability to restrict an employee’s personal travel within the United States. Of course, an employer is free to urge employees to use common sense when traveling to certain higher risk areas. An employer should stay up to date on the advice from the Centers for Disease Control and Prevention (CDC) regarding travel in order to determine what steps employees should take if they elect to engage in voluntary domestic travel.
An employer can require an employee who has traveled from or through a Level 2 or 3 country — as designated by the CDC or the World Health Organization (WHO) — to refrain from coming to work for an appropriate period of time, which usually is 14 days. Note that some states affirmatively restrict or prohibit an employer from limiting employees’ personal travel. Check your state’s employment division before adopting any particular policy.
Should you have customers and/ or employees sign COVID-19 waivers? This is a great idea with respect to customers — every brick-and-mortar store operator throughout the world should now be doing this as a means of protecting themselves from illness-related lawsuits filed by customers claiming they became infected by entering your facility, handling your equipment and/or dealing with your employees and/or contractors. In a few cases, such waivers may prove to be unenforceable, but there is virtually no potential harm associated with requiring customers to sign them.
Separately, with respect to employees, I think such waivers are much more likely to be deemed legally unenforceable and, at worst, the practice may create legal exposure for employers based on the perceived lack of fairness — essentially, judges and/or juries may take a dim view of implicit threats by employers to fire employees who refuse to sign away their rights with respect to illness-related claims.
So, although some employers have gone ahead and obtained such waivers from their employees, in light of the above, business owners may want to consider a variation on the waiver theme that at least appears to be a bit fairer to their employees. For example, these employers might offer voluntary employee testing paid for by the employer — remember, employers are not covered by the Health Insurance Portability and Accountability Act (HIPAA), so the test results won’t be subject to the same confidentiality requirements.
Also, if an employee accepts it and agrees to be tested, get his/her written agreement to voluntarily quarantine if the results are positive. If an employee declines it and refuses to be tested, then have him/her sign a waiver of liability based on the fact that he/she was given a reasonable cost-free option for enhancing his/her own safety as well as the safety of the overall work environment, but declined to exercise that option.
This is not a perfectly symmetrical analysis, but an employer-paid test would at least establish whether or not the employee already had contracted COVID-19 for liability/safety purposes. That should be compelling to a judge and/or jury on a fairness level in most cases.
Again, bear in mind that the regulations appear subject to modification and reinterpretation almost daily. Worse, a wave of COVID-19-related lawsuits is just starting to make its way into courthouses throughout the country. That makes it imperative for business owners to do whatever they can immediately in order to protect themselves, including getting waivers signed by their customers, and where doing so is legally supportable, by their employees as well. I work with a number of capable employment law attorneys, so don’t hesitate to reach out if we can help. Stay safe.