SDNY Decision Strikes Down Portions of DOL’s FFCRA Regulations
On August 3, Judge Paul Oetken of the Southern District of New York issued a decision invalidating various portions of the Department of Labor’s rules implementing the federal Families First Coronavirus Response Act (FFCRA).
The FFCRA is the federal law that provides emergency relief and support to employees who need to take leave from work for COVID-19 related reasons during the pandemic. The two key provisions of the law are the Emergency Family and Medical Leave Expansion Act (EFMLEA) and the Emergency Paid Sick Leave Act (EPSLA). Both apply only to employers with fewer than 500 employees. The EFMLEA amends the federal Family and Medical Leave Act to provide a new type of covered public health emergency leave for eligible employees who take leave, for up to 12 weeks, to care for their child if the child’s school or place of care has been closed, or the child’s child care provider is unavailable, due to a public health emergency with respect to COVID-19 declared by Federal, State, or local authorities. The EPSLA provides up to two weeks of paid sick leave to eligible employees for any of the following reasons: (1) if they are subject to a quarantine or isolation order; (2) if they have been advised by a health care provider to self-quarantine; (3) if they are experiencing COVID-19 symptoms and are seeking a medical diagnosis; (4) if they are caring for an individual who is subject to a quarantine order or who has been advised to self-quarantine; (5) if they are caring for their child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19; or (6) if they are experiencing any other substantially similar condition.
Under both the EFMLEA and EPSLA, employees who are able to work from home are ineligible for paid leave. The DOL’s Final Rule implementing the FFCRA, issued in April 2020, also excluded from coverage employees whose employers did not have work available for them. As the Court explained, the Final Rule, “excludes from these benefits employees whose employers ‘do not have work’ for them.” In other words, under the Final Rule, employees who were on a leave of absence, or furlough, for example, due to a lack of work were not eligible for paid leave under the FFCRA.
The State of New York challenged the DOL’s interpretation on the grounds that the work-availability requirement contravened the FFCRA’s text and purpose. The Court’s decision first noted that under the DOL’s Final Rule the work-availability requirement applied only to employees who took leave under the EFMLEA, or the EPSLA for reasons 1, 4, or 5 listed above. The court ultimately struck down the work-availability requirement because it was not based on a permissible construction of the FFCRA. First, the Rule’s differential treatment of the six EPSLA qualifying reasons was unreasoned and contrary to the FFCRA’s language. Second, the DOL’s proffered reasoning – that the work-availability requirement was justified because the employee would not be able to work even if they did not have a qualifying reason to take leave – was circular and insufficient. In essence, the Court held that the work-availability requirement was not well-reasoned, and therefore struck down the requirement as an impermissible construction of the FFCRA.
Health Care Provider Definition
Under the FFCRA, employers may elect to exclude “health care providers” from the statutory leave entitlements. The Court considered whether the DOL’s definition of “health care provider”, as articulated in the Final Rule, exceeded the DOL’s statutory authority.
Initially, the Court noted that the FMLA, which provides the relevant definition for the FFCRA provisions at issue, defines “health care provider” as: “(A) a doctor of medicine or osteopathy who is authorized to practice medicine or surgery (as appropriate) by the State in which the doctor practices; or (B) any other person determined by the Secretary to be capable of providing health care services.” The Rule’s definition invoked the authority provided by section B above, and included not only anyone employed at a doctor’s office, hospital, health care center, and other enumerated health care facilities, but also:
any individual employed by an entity that contracts with any of these institutions to provide services or maintain the operation of the facility where the 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.
The court struck down this “expansive” definition, finding the FFCRA required a “minimally role-specific determination.” According to the court, the Secretary of Labor was required to determine whether an employee was capable of furnishing healthcare services. In contrast, the DOL’s definition was based on the nature of the employer, rather than the employee’s role or duties. The court reasoned that even if the DOL’s definition was consistent with the FFCRA’s purpose to exempt from the statute employees who are essential to a functioning healthcare system, the definition was still overbroad. As such, the court struck down the DOL’s “health care provider” definition.
The DOL’s Final Rule limited the circumstances under which employees could take FFCRA leave intermittently. The Rule permitted intermittent leave only if the employee and employer agreed, and, even then, only for certain qualifying reasons. Specifically, intermittent leave could only be taken if the employee took leave to care for a child whose school or place of care was closed, or whose child care was unavailable.
Here, the court agreed with the DOL’s interpretation limiting intermittent leave only to child care purposes, finding it to be in line with the DOL’s public-health justification for the restrictions: employees taking leave for the other reasons may be infected with COVID-19 by virtue of their need for leave, and present public health risks if they return to work before the risk of contagion subsides. As such, the court found that because intermittent leave is not addressed in the statutory text of the FFCRA, the DOL’s Final Rule as it relates to limiting intermittent leave to child care purposes was entitled to deference because it was reasonable.
However, the Court found that the Final Rule’s requirement that the employer consent to intermittent leave was unreasoned. The Court determined that while the DOL’s public health reasoning justified limiting intermittent leave to child care purposes, it did not justify requiring employers’ consent for intermittent leave. Because the DOL provided no other justification for the employer consent requirement, this portion of the Rule was unreasoned.
The court, therefore, upheld restrictions on intermittent leave in cases where an employee is (or has the potential to be) exposed to the virus, but struck down the requirement that the employer consent to providing intermittent leave in the case of child care leave. Therefore, intermittent leave may only be taken if an employee’s qualifying need is to care for a child whose school or place of care is closed or unavailable, and employees do not need employer consent to take such intermittent leave.
The Final Rule also required employees submit certain documentation to their employer prior to taking FFCRA leave. Despite the DOL’s various arguments, including that the documentation requirements were not onerous, the court struck down the documentation requirements as unlawful preconditions to leave. The court upheld the substance of the documentation requirement, including that employees are required to provide their employer with documentation indicating “their reason for leave, the duration of the requested leave, and, when relevant, the authority for the isolation or quarantine order qualifying them for leave” but not the requirement that such documentation be provided to the employer in advance of taking the leave.
Of course, we will continue to monitor these developments, including any further rules and guidance issued by the DOL regarding the FFCRA.