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The U.S. Department of Labor (“DOL”) has issued the first round of guidance regarding the recently enacted Families First Coronavirus Response Act (“FFCRA”).

This guidance includes: Fact Sheet for Employers; Fact Sheet for Employees; and Questions and Answers.  Although much of the DOL’s guidance echoes what we already knew (or guessed) about the FFCRA, the DOL did address some issues that employers have been grappling with since its enactment last week.

Below is a summary of the pertinent highlights:

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On the evening of Monday, March 16, the House amended the Families First Coronavirus Response Act (“FFCRA”) (HR 6201) by amending the bill with what are being called “technical corrections.”

The previous bill, passed by the House on March 14, contained two main centerpieces: (1) new paid Family and Medical Leave to deal with the

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JOIN US: Tuesday, March 17, 2020 at 12:30 PM EST

Employers are in uncharted territory with the COVID-19 pandemic, which has created complicated employment issues that continue to evolve by the hour. Join Kelley Drye’s Labor and Employment co-chairs Barbara Hoey and Mark Konkel and senior associate Diana Hamar as they share practical advice for…

As federal, state and local governments continue to develop their responses to the COVID-19 outbreak, employers may find themselves in uncharted territory as to how to deal with emerging employee issues.

There are three overriding rules that all employers should remember:

  1. Think safety first. Keeping those employees who are infected or at risk of infection at home to ensure that the rest of the workforce is safe should be the number one priority.
  2. Think about how you can keep your business going.  Make sure your work-from-home policies and technology are up to date, and remind employees how to use them.
  3. Avoid stereotypes. Do not allow employees to assume that people of certain ethnicities are at a higher risk than others. If you become aware of any discrimination or harassment—stop it immediately.

Below are some general answers to questions our clients have been asking.  However, please be aware that this is a very fact-specific and complex topic; COVID-19 related employment issues are evolving by the hour. Employers are cautioned to stay abreast of federal, state, and local government advisories, and to consult legal counsel before making employment decisions or changing policy.

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With the arrival of 2019 novel coronavirus (“COVID-19”) to the United States, employers should begin thinking about strategies to mitigate business interruptions, ensure employee safety, and avoid unnecessary litigation.

Know Your Resources

Employers should continue to monitor reliable guidance provided by the U.S. Centers for Disease Control and Prevention (“CDC”) and local public health agencies. Understanding how COVID-19 is transmitted and what steps can be taken to protect diagnosed or exposed employees is essential to dispelling employee fears. Employers can educate employees on prevention and symptoms and should be prepared to answer employee concerns regarding workplace safety. The following are guides which may be helpful to employers:

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Several jurisdictions have recently adopted laws requiring individuals to purchase health coverage or pay a state tax penalty. Employers employing residents in a covered jurisdiction now need to facilitate compliance by reporting health coverage information to local governmental authorities. The following is a brief summary of the new health coverage reporting requirements.

State Individual Mandates

Under the Affordable Care Act’s (the “ACA”) individual mandate, beginning in 2014, individuals were required to either purchase minimum essential coverage (“MEC”) or pay a federal tax penalty for failing to maintain such coverage. MEC generally includes employer-sponsored group health plan coverage. The Tax Cuts and Jobs Act of 2017 effectively eliminated the individual mandate by reducing the penalty to zero starting in 2019. In response, however, California, the District of Columbia, New Jersey, Rhode Island and Vermont (“Adopting Jurisdictions”) have each adopted their own versions of the ACA’s individual mandate.

Note that Massachusetts had already adopted an individual mandate requirement in 2006, well before the ACA became law. This Advisory does not address coverage reporting requirements under Massachusetts law.

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The Departments of Labor, Health and Human Services and Treasury recently issued joint final regulations expanding the availability of health reimbursement arrangements (“HRAs”) by introducing two new types of HRAs – Individual Coverage HRAs and Excepted Benefit HRAs. The following is a brief overview of the requirements employers must satisfy in order to offer HRA coverage to their employees, and employees’ dependents, under one of these new arrangements.

Background

HRAs constitute group health plans that are subject to various Affordable Care Act (“ACA”) rules. The ACA rules include prohibitions on capping or requiring cost-sharing for certain benefits (the “Market Reforms”).

Under prior guidance, in order to comply with or avoid the Market Reforms, HRAs generally had to be integrated with other qualifying group health plan coverage or limit the scope of reimbursable expenses to benefits excepted from compliance (e.g., limited scope dental or vision coverage). The new regulations make it easier for employers to offer HRA coverage by providing two new options that do not require integration with a group health plan or limiting the scope of reimbursable expenses.

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Last week, the Chicago City Council passed the Chicago Fair Workweek Ordinance (“the Ordinance”), which requires employers to give workers early notice of their schedules or face penalties if they change shifts without sufficient notice.  For employers, this may present an administrative challenge, but employers should be prepared to address this national trend.  New York City, Philadelphia, Seattle, San Francisco, Oregon, and the District of Columbia have already enacted laws to protect worker schedules and limit employer discretion in adjusting employee schedules. Mayor Lightfoot is expected to formally sign the bill and it will subsequently be effective July 1, 2020. The highlights follow:

Who’s Covered?

  • The Ordinance requires employers in any “Covered Industry,” which includes building services, healthcare, hotels, manufacturing, retail, or warehouse services with more than 100 employees globally (250 in the case of non-profits) with at least 50 covered employees, to provide certain protection around the scheduling of an employee’s shifts.
  • For restaurants, the law is applicable for businesses with 30 locations globally and at least 250 employees.
  • The Ordinance applies to all employees, within Covered Industries, who make less than $26 per hour or receive an annual salary of under $50,000.

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On July 17, 2019, the Treasury Department and the IRS issued Notice 2019-45 to expand the types of preventive care services and benefits that can be provided to individuals under high deductible health plans (“HDHPs”) before reaching a minimum deductible and without preventing such individuals’ participation in health savings accounts (“HSA”). The additional preventive care services and benefits relate to medical care that helps maintain the health of individuals with chronic conditions.

As background – to be eligible for an HSA, an individual must be covered by a HDHP.  Generally, a HDHP cannot provide benefits for any year until the minimum applicable deductible for that year is satisfied.  However, there is a statutory safe harbor that permits HDHPs to provide “preventive care” without a minimum deductible.  New Notice 2019-45 sets forth a list of 14 medical services and benefits for the treatment of specified chronic conditions (including diabetes, hypertension, and heart disease, among others) that, effective July 17, 2019, can be provided by a HDHP under the preventive-care safe harbor without a minimum deductible.

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