FAQs about paid sick leave

Note: this information comes from the NYC Hospitality Alliance’s Hospitality Employer Update. However, much of the information also applies to other types of businesses. Click HERE for the full document.

Additionally Cozen O Connor has put together this checklist for employers who have employees with COVID-19 (either confirmed or unconfirmed). Check it out HERE.

We have temporarily laid off employees with the intent to reinstate them. Are they eligible for federal or New York sick leave and/or paid FMLA? Such individuals are not eligible for paid federal sick leave or paid FMLA. However, such individuals may be eligible for paid sick leave under New York law. As long as there is an employment relationship, under New York law, the individual may be eligible for Emergency Paid Sick Leave, should the individual satisfy the criteria necessary to be entitled to such leave.

I am in NYC and still open and doing deliveries. What happens if all of my employees call on April 1 and say they do not feel comfortable and/or are sick and they want their two-weeks of paid leave? If I hire employees to replace them for two weeks, do those employees also get the two weeks? If you are open on April 1, any individual who is employed on April 1 (or hired thereafter) may take New York or Federal Emergency Paid Sick Leave, provided the employee meets the criteria to be eligible for such leave. Under Hospitality and Labor & Employment Alert | April 2020 New York law, the employee would have to be subject to a quarantine or selfmonitoring order issued by a public health official (the current shelter-in-place order is not sufficient). Under federal law, the employee must be diagnosed with COVID-19, experiencing symptoms of COVID-19 and awaiting medical diagnosis, ordered to self-monitor or quarantine by a governmental official or health care provider, or needs to care for someone who meets the aforementioned criteria or needs to care for a child whose school or care center has been closed due to COVID-19. Simply being “afraid” or “not comfortable” is insufficient to satisfy the criteria necessary to trigger any of these emergency leave requirements. 

Do you have to pay out federal or NYS sick pay if your restaurant closed on March 20? You do not need to pay out federal sick pay if you closed on March 20. If you closed on March 20 and terminated the employees, you would not need to pay New York State paid sick leave. If you closed on March 20 and did not terminate the employees, then you may have to pay New York State paid sick leave should the individual become subject to a mandatory quarantine or selfmonitoring order issued by a public health official (the current shelter-in-place order is insufficient to trigger the leave requirement).

What if we have laid off or furloughed employees on 3/15? Are we still responsible for paying the 80 hours of federal sick leave to our employees? No. There is no requirement to pay 80 hours of sick leave under federal law to employees who were laid off or furloughed prior to April 1. 

If an employee requests paid sick leave can I request proof from DOL, NYS or health provider? If an employee is requesting sick leave under federal or state law, then you can require them to produce documentation necessary to support their need for the leave. Depending on the need for the leave, the documentation could be a note from a health care provider, a copy of the quarantine order, or some other relevant documentation. 

What are the legal differences between furlough, lay-off and temporarily lay off? Legally, the term “furlough,” “lay-off,” and “temporary layoff” have no meaning. Unless there is a “mass layoff” under an applicable WARN Act, we generally prefer not to use the term “layoff” because it confuses most business owners. An employee is either terminated (there is a severance of the employment relationship, whether voluntary or involuntary) or there is a furlough (the employee is informed that there is no work available and the employee will not be scheduled to work for a specific or indefinite period). Thus, a furlough is akin to an involuntary, unpaid leave of absence, but the employment relationship between the employer and the employee still exists. 

When paying tipped food service workers subject to the NYS tip credit, what is the correct rate of pay for paid sick leave, $10, $15 or other? The correct pay rate to pay a tipped food service worker sick leave is the regular minimum wage, which in New York City is currently $15.00 per hour.

Are furloughed employees able to collect unemployment benefits? Yes, they should be able to collect unemployment benefits if they meet all other eligibility requirements. 

How is a furloughed employee able to collect unemployment benefits while still getting sick leave? The State determines eligibility and employees not working and not receiving pay will likely qualify for unemployment benefits. Legally, employees who are getting paid sick leave benefits cannot collect unemployment benefits. 

What is the correct way to notify employees on being laid-off versus termination? The correct way to notify employees about either a termination or a lay off is in writing, and, in certain circumstances, the writing may have to conform to federal or state requirements under applicable Worker Adjustment and Retraining Notification Acts (“WARN”). The writing would state, among other things, that the employment relationship has been severed (in the case of a termination) or that the employee is temporarily laid off or furloughed (in the event of a lay off) due to the COVID-19 pandemic. 

While on this leave, how do they pay for insurance premiums? Can we cancel it during this time due to non-payment? Employees are entitled to group health coverage during their paid sick leave on the same terms as if they continued to work. If the group plan requires that the employee pay a portion of the premiums, if the employee is on leave he or she must continue to pay a portion of the premiums in order to maintain their health insurance benefits. Employee can continue to make such payments by writing a check to the employer to continue their health insurance benefits. If the employee does not make such payments, the employee risks losing coverage. However, employer should consult with legal counsel before terminating the health insurance of any employee. 

When an employer furloughs team members, does the employer need to pay unused Paid Time Off? It depends on what is contained in your PTO policy, past practice and the state you are in. In New York, unless your policy provides otherwise you do not have to pay out PTO at termination. Per the Division of Labor Standards Enforcement opinion letter mention earlier, a furlough of ten or more days triggers “final pay” requirements, including accrued but unused PTO payout. 

So, all New York State non-essential businesses who were mandated to close, do not qualify for the New York State sick leave? No; the test is whether the employees have been terminated or laid off. Simply closing the business does not relieve an employer of paid sick leave obligations. 

I’m a New York City restaurateur who furloughed its hourly employees. Could I now terminate them to avoid the sick leave obligations? No. If you are terminating employees simply to avoid paid sick leave mandates, such terminations would be deemed retaliatory under applicable law and therefore impermissible. 

Does the emergency sick leave or new paid sick leave back date to a certain day, or is it for all employees that are currently scheduled and/or receiving a paycheck on 4/1? The federal emergency paid sick leave law applies to any employees scheduled to work on or after April 1. The New York paid sick leave law applies to all employees as of March 18. 

Do employees have to put in the emergency paid sick leave request to be paid, or should the company payout automatically under qualifying events? The employer should pay the employee for the leave once the employee submits appropriate documentation supporting the need for the leave under federal or state law. 

Are employers responsible for communicating to employees they might be eligible for emergency leave? Do employees need to reach out and request it? Yes, the FFCRA requires the employer to provide employees information about their rights to federal paid sick leave and expanded FMLA leave. The notice can be sent electronically. 

Do current, furloughed, or laid-off employees have to receive notice of the new federal sick leave laws? As long as such individuals are still employees and the employer has not terminated the employment relationship, such individuals should receive notice of the new federal sick leave laws.

Why are employers over 500 exempt? The belief is that most employers with over 500 employee have policies that already provide paid sick leave for events covered by the FFCRA. In addition, Congress did not want “large employers” to be eligible for tax credits that are being provided to employers that are required to provide paid sick leave under the FFCRA. 

Is there any relief package or unemployment options for our independent contractors? We have so many DJs and promoters that are just out of work but have been paid as 1099’s Answer: The new CARES Act allows, under certain circumstances, some independent contractors to collect unemployment insurance benefits. However, it is likely that DJs and promoters who apply for such benefits will list their venue as their employer. In such an event, it is very likely that a business that has so many 1099’s will get audited by the New York Department of Labor to determine whether they were appropriately categorized as contractors. 

Is there any change in procedure regarding COBRA for laid off employees? For this question, assume the employee has is laid off and was paying a portion of the premium when they were employed with us. When an employee (or other qualified beneficiary) elects to continue his/her coverage through COBRA, he/she becomes responsible for 100% of the premium, plus any administrative charge (not to exceed 2% of the premium) that may apply. The employer may subsidize the premium but is not required to do so. 

Currently we are paying for full health insurance premium for all affected employees. If we want to cut off our payments on a certain date (for example end of May), does this have to coincide with a termination? Not necessarily. Individuals could still be employed and lose their health insurance benefits, triggering COBRA. Conversely, an employee could have their employment terminated, but the employer has agreed to cover their COBRA premiums or has agreed with the insurance provider to keep the individual on the health care plan. 

Question: Is the WARN notice requirement triggered for plant closings that last less than 6 months (i.e., not necessarily an “employment loss”)? If there is a temporary or permanent plant closing in which more than 25 employees suffer a job loss and which is expected to last more than 30 days, New York WARN will usually be triggered. If there is a mass layoff or reduction in hours in which the plant remain open but simply operates with fewer workers, then the mass layoff and/or reduction in hours must be expected to last for more than 6 months in order for WARN to be triggered. (The New York WARN Act requires that organizations comply with the regulation if more than 25% of their employees are laid off, and at least 25 full-time employees, or more than 250 employees, during a 30 day periods. New York WARN Act regulations require that you provide 90 days notice)