As we approach the effective date of the recently passed, Families First Coronavirus Act (FFCRA), on April 1, 2020, the Department of Labor has provided some guidance and potential relief to immediate enforcement. Understanding the impact the Act may have on already struggling employers, the DOL has issued a Field Assistance Bulletin that “indicates that the agency will not take any enforcement actions against FFCRA-covered employers between March 18 and April 17, 2020, as long as these employers make reasonable, good faith efforts to comply with the law.” This “temporary non-enforcement period”, does not extend the effective date of the FFCRA. It provides employers, without the immediate means for compliance, an opportunity to gather themselves and prepare for enforcement. There are specific criteria for utilization of the temporary non-enforcement period.
Employers are expected to:
- Become familiar with their obligations under the FFCRA and with the DOL’s guidance regarding its enforcement of these provisions. Best practices would include, documenting meetings dedicated toward compliance, contacting outside experts for consult for compliance such as Insurance Broker, Legal Counsel and or Financial Advisor, designation of staff dedicated to the review and implementation of the Act, and a documented action plan.
- Monitor the IRS’ Coronavirus Tax Relief website. Employers should familiarize themselves with the anticipated tax relief provisions of the Act. They should consider and document possible recovery and its place in the employer’s compliance plan. Employers should, again, consult and document all efforts toward compliance including review with outside expert legal and financial consultants.
- Monitor the CDC, WHO and state and local public health department websites for information on the status of the Coronavirus. This is an opportunity to demonstrate and document the employer’s efforts to stay abreast of the changing landscape, legal requirements, and employers updated plan for address.
- Consider measures that can help prevent the spread of illness, such as allowing employees flexible work options, like working from home. This requirement enhances the responsibility of the employer to not only establish a plan to accommodate paid sick leave and absence from work, but also to augment its efforts to prevent and or contain exposure.
The Department of Labor does not intend to enforce penalties for lack of immediate compliance with the FFCRA during this temporary non-enforcement period. However, the Department does reserve the right to enforce where employers fail to put forth a good faith effort or are found to deliberately violate the Act. Enforcement may be immediate if the employer:
- Violates the law willfully;
- Fails to provide a written commitment to future compliance with the law; or
- Fails to remedy the violation upon notification by DOL.
The Field Assistance Bulletin indicates that employers that are unable to immediately comply may avoid penalty by demonstrating all of the following:
- The employer remedies any violations;
- The violations were not “willful”; and
- The DOL receives a written commitment from the employer to comply with the FFCRA in the future.
These requirements, by their very nature, demonstrate the standard of “good faith”. This is not an opportunity to simply fail to comply. This is an effort by the Department of Labor to work with and provide some relief to employers that may have difficulty with immediate compliance with the FFCRA. To establish a plan for compliance and/or defense to immediate non-compliance, employers must work with designated staff internally as well as with external experts.
We strongly encourage employers, particularly small employers, to consider and document their consideration of additional options including Small Business Loan alternatives afforded by the FFCRA and Stimulus Package. As you are aware, many states are offering small business loans and grants, and the recently passed federal legislation known as the CARES Act offers several different loans and grants including the opportunity to have all or portions of the loan debt forgiven. Our Banking Group attorneys are available to answer your questions and assist you with the application process.
As always, if you are experiencing difficulty with anticipated compliance or have any questions about how this may impact your business, please do not hesitate to contact our Employment Law Group at 1-888-488-2638.