Fine, Boggs & Perkins LLP has received thousands of calls and emails over the last two weeks related to the COVID-19 pandemic and how dealers should handle various situations caused by the impact of the pandemic related State and local Health Orders and the new Families First Coronavirus Response Act (“FFCRA”). This webpage is intended to address several of the most common questions and practical answers and advice on how dealers should handle these situations as of today. We recommend that you review available resources intermittently, as both medical and regulatory information is changing regularly.
If you have general questions about coronavirus-related issued, visit our Dealership Coronavirus Resources webpage.
Question: One of our employees reported that he/she has developed symptoms associated with COVID-19 (e.g., fever, non-productive cough, etc.) or has been in close contact with someone who has such symptoms. What should I do with the employee and my other employees?
The reporting employee, if still working, should be sent home immediately. The employer should immediately identify those employees that have had close or direct contact (within six feet of the employee or the employee’s work area and/or belongings) with the reporting employee for the last fourteen (14) days. Ask the reporting employee to give you a list of persons if you are able to do so. You should not tell anyone that the reporting employee has COVID-19 symptoms as everyone is entitled to privacy under California law. However, as it may be necessary to protect other employees, you might need to disclose the person’s name and ask who has had close contact with that person in the last fourteen (14) days (i.e., a need to know basis) without giving any details as to the person’s health condition or his/her symptoms. You should also find out when the last time was that each person had such contact (potential exposure).
All persons who had closed contact with the reporting employee should be sent home immediately and should be told to seek medical attention by phone, email or video immediately with their doctor. You should also conduct a more throughout cleaning of all work areas of the reporting employees and the work area of those that were in contact with the reporting employee. You should also communicate with customers and vendors that came in close contact with the infected/reporting employee. Any employee who is tested twice 24 hours apart and is negative may return to work. If not tested twice with negative results, those employees that were sent home should not be allowed to return to work for a minimum of fourteen days (14) after the last close contact with the reporting employee even if they develop no symptoms at all.
Every employee who experiences any symptoms akin to COVID-19, should self-isolate and not come back to work until the later of: (1) a minimum of seven days (7) days after the first symptoms appeared, or (2) at least 72 hours (3 days) after the last sign of fever (without the use of fever-reducing medication), provided that other symptoms have improved (for example, when cough or shortness of breath have improved).
Question: I have some employees that are older and/or some that have serious health conditions, and as a result are more at risk of catching COVID-19. Can I send the employee home?
No. An employer may not treat older employees or employees with health conditions differently without medical evidence that there is an immediate risk of death or serious injury to the employee or others by having them at work. That is a difficult standard to meet and so very risk without competent legal advice. You can, however, offer all employees that are more at risk the choice whether to request and to take a personal leave of absence while the risk exists if they voluntarily choose to do so. If you offer this voluntary personal leave of absence, you should obtain a written request for the leave in writing signed by the employee.
Question: If an employee is afraid of catching COVID-19 should they be allowed to have time off work?
The answer may be YES, particularly if the employee is older and/or has a disability, such as diabetes, chronic heart disease, lung disease, etc. that makes them more at risk for the effects of COVID-19, they you should treat the situation as you would for any other disability in terms of having an interactive discussion and making reasonable accommodations. You can, however, offer all employees that are more at risk the choice whether to request and to take a personal leave of absence while the risk exists if they voluntarily choose to do so. If you offer this voluntary personal leave of absence, you should obtain a written request for the leave in writing signed by the employee.
Question: Should I furlough or lay off employees? What is the difference legally?
There is a lot of misinformation about the term furlough vs. layoff. Legally, there really is little or no difference in California. However, the two terms have different emotional impacts on workers due to long-standing common perceptions in the two terms. The term furlough is commonly used when an employee has been asked not to come to work for a limited period of time and generally is not considered by the employee as though they are terminated from employment. A layoff, on the other hand, carries with it more uncertainty and the term is usually used to indicate an uncertain or perhaps permanent period of not working and is considered by employees to be a termination from employment. However, in California those terms really don’t have any legal significance where the layoff is longer than the current pay period. That is because the California Labor Commissioner does not recognize the difference in the two terms if a furloughed or laid-off employee remains off work into the new pay period.
If that happens, the Labor Commissioner considers the employee terminated for the purposes of paying out earned wages and accrued vacation. The Labor Commissioner opined that that if an employer reduces an employee’s scheduled work hours to zero — and does not reschedule that employee within the same pay period or the employee is not expected to return to work within the same pay period — the employer has effectively laid off the employee, which triggers the final pay requirements under Labor Code section 201. Also failure to pay those wages timely (including vacation) can lead to significant penalties of up to 30 days of wages.
If an employer with 75 or more employees lays off more than 50 employees, the California WARN requirements apply. While Governor Newsom waived the 60-day notice period recently as a result of the pandemic, a modified notice must still be sent to the employee, the government agencies and any union that may represent your employees. A free informational guide and sample WARN letters are available at https://www.employerlawyers.com/legal-updates/. Just enter your information and the COVID-19 information and sample forms will be emailed to you. You will automatically receive updates if you sign up as well. If you are a HR Hotlink subscriber, you may access the forms from the Home page. Likewise, health care benefits and COBRA apply in the same manner whether you call it a furlough and/or a lay off. Finally, whether called a lay off or a furlough, unemployment benefits apply as well in the same manner.
Question: I had and have employees that are not supposed to be working because of the State and/or local Health Orders or who have been laid off because business is slow and no customers are coming in. Will any of them be entitled to take advantage of the new FFCRA Paid Sick Leave or Paid Expanded Family Leave?
The answer—at least for now—is No. The Department of Labor issued guidance on the implementation of the FFCRA yesterday that clears ups certain questions. First, only those employees that are employed as of April 1, 2020 are eligible. Second, only those employees that have been asked to work (i.e., employer has work available for them) as of the time of the leave are eligible. So, if an employee is at home and not working on or after April 1 as a result of the State or local Health Orders requiring that the employee not work at the dealership, they are NOT entitled to the Paid Sick Leave and/or Paid Expanded Family Leave because the employer does not have work available for them. If the employee is at home and is working (i.e., the employer does have work from home available) they would be entitled the Paid Sick Leave and/or Paid Expanded Family Leave if they otherwise meet the requirements for the Reason for the leave. Any employee not employed as of April 1, 2020, will not be eligible for the new Paid Sick Leave and/or Paid Expanded Family Leave.
An employee will be entitled to paid sick leave if the employee is unable to work or telework due to a qualifying reason related to COVID-19. The employee must provide to the employer documentation in support of the reasons for the paid sick leave. These documents may include a copy of the Federal, State or local quarantine or isolation order related to COVID-19 or written documentation by a health care provider advising the employee to self-quarantine due to concerns related to COVID-19.
The reality of this new guidance is that the Paid Sick Leave and Expanded Paid Family and Medical Leave is not intended to cover situations where work is not available to the employee and but for the reason for the leave would be working because the employer has work available to the employee. However, the new CARES stimulus package just passed on March 27, 2020, and its enhanced unemployment and other benefits, will be the real vehicle for compensating employees that are unable to work because they are subject to a State or local Health Order or subject to a furlough or layoff due to deterioration of business (i.e., downsizing by furlough or layoff).
Question: I have employees that have written pay plans that provide for a guaranteed salary, a minimum draw or target earnings or some other guaranteed minimum payment. Do I need to do anything if I am having them work reduced hours if I do not want to be locked into the guarantee amount?
Yes. If you want to pay an employee less than the guaranteed minimum earnings stated in his/her pay plan, you must make changes to the pay plan. Salary-exempt managers are entitled to the full salary for any workweek in which they work any hours at all unless the manager requests time off for personal reasons in full-day increments. If you don’t have the manager work all the normal days, you must pay the salaried manager the entire salary for any workweek the manager works (even taking a few calls or responding to emails from home triggers that obligation). If you want to pay a salary-exempt manager less money for reduced hours where the manager works some hours each workweek, must reduce the salary in writing. That reduction must be given in a prior advance prospective written notice of the reduction. In general, an employer may reduce an exempt worker’s salary, as long as the salary does not fall below the minimum salary requirement for exempt workers. The minimum salary requirement for 2020 for white-collar workers is $54,080 for employers ($4507 per month). If any other classification of employee has a minimum draw, a minimum target earnings or any other form of minimum earnings guarantee, an addendum to the pay plan should also be issued. A sample addendum to reduce minimum guaranteed earnings is available at https://www.employerlawyers.com/legal-updates/ or through HR Hotlink.
Question: How do I notify employees of their rights and do I need to do any paperwork to give employees paid sick leave or paid expanded family leave?
You must post the new DOL Employee Rights Poster and/or provide the Poster to employees as indicated in the instructions. A copy of the poster is available at https://www.employerlawyers.com/legal-updates/ or through HR Hotlink. Employees must fill out a written Request certifying certain information regarding the request for leave. A sample form is available at the same web links above. If one of your employees takes paid sick leave under the Emergency Paid Sick Leave Act, you must require your employee to provide you with appropriate documentation in support of the reason for the leave, including: the employee’s name, qualifying reason for requesting leave, statement that the employee is unable to work, including telework, for that reason, and the date(s) for which leave is requested. Documentation of the reason for the leave will also be necessary, such as the source of any quarantine or isolation order, or the name of the health care provider who has advised you to self-quarantine. For example, this documentation may include a copy of the Federal, State or local quarantine or isolation order related to COVID-19 applicable to the employee or written documentation by a health care provider advising the employee to self-quarantine due to concerns related to COVID-19.
You are also required to obtain certain documentation from your employee in support of any request for Expanded Family and Medical Leave taken to care for a child whose school or place of care is closed, or child care provider is unavailable, due to COVID-19-related reasons. For example, this requirement may be satisfied with a notice of closure or unavailability from a child’s school, place of care, or child care provider, including a notice that may have been posted on a government, school, or day care website, published in a newspaper, or emailed to the parent from an employee or official of the school, place of care, or child care provider.
Keep in mind that the documentation requirements are not designed as a hurdle for the employees to overcome to qualify for the leave. Rather they are designed to ensure that employers can validate their entitlement to the accompanying tax credits, as the FFCRA specifically notes that credits are only available for paid leaves required under the statute, not for paid leaves offered by employers in excess of the statutory standards.