Several Significant DOL Regulations Interpreting the FFCRA are Held Invalid by NY Court

Within the last few days, there has been a major development as to the DOL regulations interpreting the FFCRA. Its overall implications remain unclear, as I note at the end here. However, you should be aware of it. A federal district court in New York has ruled that several of the Department of Labor’s regulations interpreting the FFCRA are invalid and have vacated those regulations.

This is a very significant development and could have far-reaching impacts, although how and whether this will apply outside of that specific district is unclear. The following is a summary of the DOL’s regulations that have been vacated. The first is the DOL’s interpretation that FFCRA leave is only available if an employer actually has work available to be performed.

In other words, according to the regulations, the FFCRA leave is not available to an employee if the employee has been furloughed, the business has closed, or work is otherwise unavailable. This means that employees who were laid off, furloughed, or whose employers temporarily ceased operations under state or local orders or due to economic circumstances due to COVID actually were entitled to that leave.

The second major change pertains to the definition of a healthcare provider. The FFCRA allows an employer to exclude from coverage of any healthcare providers. That term was not defined.

The regulations then defined healthcare providers as:

Anyone employed at any doctor’s office, hospital, healthcare center, clinic, post-secondary educational institution offering healthcare 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 similar to such institutions. Along with “any individual employed by an entity that contracts with any of the above institutions, employers, or entities institutions to provide services or to maintain the operation of the facility. 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, drugs, vaccines, diagnostic vehicles, or treatments.

Under this definition, the court noted that the DOL concedes that an English professor, librarian, or cafeteria manager at a university with a medical school would all be considered “healthcare providers” under the Rule who could be denied FFCRA leave despite the fact this result was arguably not intended by the exclusion. The DOL defended the definition by arguing that it was broad to exempt those employees “essential to maintaining a functioning healthcare system during the pandemic.

The court said that this definition was “vastly overbroad.” It includes employees whose “roles bear no nexus whatsoever to the provision of healthcare services, except the identity of their employers, and who are not even arguably necessary or relevant to the healthcare system’s vitality.” The third change regards the requirement that to use FFCRA leave on an intermittent basis, an employee has to obtain consent from the employer.

The reason given by the DOL for such limitation was to try to prevent an employee from spreading COVID to other employees in the workplace. Therefore, the intermittent leave was limited only to an arrangement that was agreed to between the employer and employee, and that was limited to the employee’s need to care for a child under the FFCRA (i.e. intermittent was not available for the paid sick leave provisions). Again, the court disagreed.

Specifically, while the court agreed that intermittent leave should be limited to ensure an employee does not expose others in the workplace, it did not agree that intermittent leave should require employer consent when taken for reasons related to childcare. Therefore, the court vacated the regulation to the extent it requires employer consent in situations where the employee requests the leave to care for a child whose school or place of care is closed or where child care is unavailable.

The fourth change regards the timing of documentation supporting the need for FFCRA leave. The regulations say the employee must produce documentation before taking FFCRA leave showing the reason, duration of the leave, the authority for the isolation, or quarantine order qualifying them for leave. The court held that requiring that documentation before even taking the leave was not consistent with the FFCRA.

The real question now is what does this means for Maine employers. The decision itself does not limit its scope to just New York. However, the DOL now can appeal the decision. It is not yet final. One possibility is that the DOL issues new regulations consistent with the opinion.

If it does, those apply to all covered employers. Changes will need to be made. If the DOL does not take any action, the issue as to the scope of the decision remains unclear. We will have to work through the best strategy for response.