Employment Implications of COVID-19

As COVID-19 spreads across the United States, it is having a profound impact on employment relationships. With the situation changing daily, employers are making decisions that may impact the health of their employees, their ability to continue to service customers and clients, and the very future of their businesses. Each of these decisions must be made with consideration of the broad legal principles that continue to apply even in these extraordinary circumstances.

What are employers’ obligations? Should we shut down our office?

Under the Occupational Safety and Health Act, employers have an obligation to provide a safe working environment for employees. How that broad principle applies will vary from situation to situation, but it does not mean that all employers are required to shift to a remote working environment, at least in the absence of a specific reason to do so, such as local governmental order or localized outbreak in a particular office or building. 

All employers should implement reasonable precautions to limit the risk of transmission in the workplace, which may include:

• Banning nonessential business travel and instead encouraging virtual meetings and interactions
• Requiring employees who have traveled to high-risk countries (including China, Iran South Korea and most of Europe, including Italy) to self-quarantine for a minimum of 14 days
• Requiring employees who have symptoms consistent with COVID-19 or the flu to stay home
• Requiring employees to self-quarantine when a member of their household contracts COVID-19 or is required by governmental authorities to self-quarantine
• Requiring employees to disclose travel to restricted areas or exposure to COVID-19 so that appropriate precautions, including self-quarantine, can be taken
• Accommodating concerns of individuals at higher risk, such as those with a history of respiratory illness
• Instituting regular deep cleaning of offices and facilities
• Considering permitting or requiring employees to work remotely

One of our employees has a confirmed case of COVID-19. Do we have to tell our other employees? Are we permitted to?

Employers should alert co-workers of their possible exposure but generally should not share the identity of an individual who has contracted COVID-19. The employer also should consider requiring other employees who had close contact with the affected individual to self-quarantine for 14 days.

Can employees refuse to come to work because of fear of infection?

Employees are legally permitted to refuse to come to work if they believe they are in imminent danger, a high standard that may not be met for most U.S. work locations at this point. That said, employers should consider whether and how to accommodate such employees, including by permitting them to use available paid leave or placing them on unpaid leave.

Can we prohibit personal travel by employees?

No, employers generally cannot restrict employees’ right to engage in legal activities. Of course, if they travel to a restricted area, they may be subject to quarantine.

When an employee is out due to COVID-19 issues, how is that time treated?

An employee who contracts COVID-19 may be eligible for paid sick leave, short-term disability leave and leave under the Family and Medical Leave Act (FMLA). An employee who is caring for a family member who contracts COVID-19 may be eligible for state paid family leave and leave under the FMLA. 

Employees who are self-quarantining because of potential risk may not be eligible for any of the types of leave referenced above. Employers should consider whether such time off will be treated as paid time off PTO, vacation or other leave. Among the considerations are whether employees will be required to use available paid leave before moving to unpaid status and whether employers will grant additional paid leave to affected employees.

How will the new federal Emergency Paid Sick Leave Act of 2020 affect employers?

On March 14, 2020, the House of Representatives passed the Emergency Paid Sick Leave Act of 2020 as part of the Families First Coronavirus Response Act. Assuming it becomes law, the act will require covered employers to provide paid sick leave to individuals who miss work because they have symptoms of COVID-19, are under self-quarantine, are providing care to an individual who has contracted COVID-19 or is self-quarantining, or are caregivers to children whose schools or other care programs have been closed or whose other caregivers are unavailable as a result of the pandemic.

Individuals will not be eligible for benefits in any period during which they receive pay from their employer or unemployment insurance. Benefits are capped at a total of 80 hours per employee and are paid at the employee’s regular rate of pay for a two-week period, except that employees who take leave to care for family members are entitled to receive two-thirds of their regular pay. Paid sick leave under the act is in addition to other paid sick leave under preexisting employer policies, and employers may not require (but may permit) employees to use other available paid leave prior to using leave provided under the act. Employers may be able to take advantage of a tax credit to offset all or part of the expense of paid sick leave provided under the act.

Critically, the act does not apply to employers that have 500 or more employees. In addition, the statute gives the Department of Labor the authority to issue regulations that would exempt small businesses with fewer than 50 employees if the imposition of the paid leave requirements would jeopardize the viability of the business as a going concern.

Finally, Families First Coronavirus Response Act would expand the FMLA to cover COVID-19-related absences and provide for paid FMLA leave for specified COVID-19-related absences (after the first 14 days of absence) in an amount of not less than two-thirds of the employee’s regular rate of pay.  The Act also broadens the FMLA in several respects for absences related to COVID-19.

We have decided to shut down our offices. Do we have to pay employees who cannot work remotely?

Generally, no. Nonexempt employees are entitled to be paid only for time actually worked. Exempt employees are entitled be fully compensated for any week in which they work, even if there is a shutdown for a portion of the week.

Nonetheless, many employers are electing to continue to pay employees, at least for some period of time, whose work cannot be performed remotely.

The impact on our business is so great we need to conduct a furlough or layoffs. Are there any limitations on doing so?

Employers are required to satisfy the notice requirements of the Worker Adjustment and Retraining Notification Act and similar state laws. These laws generally do not require notice for a temporary furlough where there is a reasonable expectation that the affected employees will be recalled. If there is no such reasonable expectation and the employer instead implements a layoff, the employer will be required to provide written notice, but the notice period likely will be shortened (perhaps to the point of immediate termination) because the layoff is caused by unforeseeable business circumstances.