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New York Federal Court Strikes Down Key Provisions of FFRCA Final Rule

In response to a lawsuit by the State of New York, a New York federal district court judge struck down aspects of a U.S. Department of Labor (“DOL”) final rule (the “Rule”) providing guidance on interpretations of the Families First […]


In response to a lawsuit by the State of New York, a New York federal district court judge struck down aspects of a U.S. Department of Labor (“DOL”) final rule (the “Rule”) providing guidance on interpretations of the Families First Coronavirus Response Act (FFCRA). The court’s ruling, which was made on August 3, 2020, strikes down the Rule’s “work availability” requirement, the “health care provider” definition, portions of the employer consent requirement for intermittent leave, and the advance documentation requirements for taking FFCRA leave.

It is unclear whether this decision applies only to New York or on a nationwide basis. An appeal of the decision to the U.S. Court of Appeals for the Second Circuit is expected.

Background

The FFCRA, which was enacted on March 18, 2020, requires employers with fewer than 500 employees to provide paid leave due to certain circumstances related to COVID-19 through two separate provisions: the Emergency Paid Sick Leave Act (“EPSLA”) and the Emergency Family and Medical Leave Expansion Act (“EFMLA”).

The EPSLA applies to virtually all private employers with fewer than 500 employees and to virtually all public agencies employing one or more employees. Under section 5102(a) of the EPSLA, employers shall provide employees with paid sick time if they are unable to work (or telework) due to a need for leave because:

  1. The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
  2. The employee has been advised by a health care provider to self-quarantine due to concerns relating to COVID-19;
  3. The employee has COVID-19 symptoms and is seeking a medical diagnosis;
  4. The employee is caring for an individual subject to quarantine or isolation or advised to self-quarantine as described in paragraphs (1) or (2) above;
  5. The employee is caring for his/her child if the school or place of care has been closed or the child care provider is unavailable due to COVID-19 precautions; and
  6. The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services.

Pursuant to the EFMLEA, which is a temporary amendment to the Family and Medical Leave Act (FMLA), eligible employees (those employed for 30 calendar days or longer) receive up to 12 workweeks of leave to care for their child whose school or place of care has been closed, or whose childcare provider is unavailable, due to COVID-19 precautions.

On April 1, 2020, the DOL issued the Rule implementing and interpreting the FFCRA. On April 14, New York filed a complaint for declaratory and injunctive relief against the DOL and the Secretary of Labor in the U.S. District Court for the Southern District of New York, and moved for summary judgment.

Work Availability Requirement Under the FFCRA

The Rule clarified that employees are not entitled to paid leave under the FFCRA if their employers “do not have work” for them to do. This “work availability” requirement was significant because, as the district court explained, COVID-19 has caused the temporary shutdown or slowdown of many businesses nationwide, resulting in a decrease in work available to employees.

In its complaint, New York asserted that “[t]he Final Rule imposes a new ‘work availability’ requirement that permits employers to deny their workers emergency family leave or paid sick leave, with no statutory basis.” The DOL argued that the Rule is consistent with the statute because employees are not “unable to work (or telework)” (due to one of six reasons listed above) if their employer has no work available for them to perform.

The Court disagreed, concluding that the work availability requirement exceeded the DOL’s authority because it applied only to three of six qualifying reasons for EPSLA leave, which the court found inconsistent with the language of the FFCRA. The court also found the DOL’s “barebones explanation” for the work availability requirement to be “patently deficient,” particularly in light of its “enormously consequential” impact of narrowing the scope of the FFCRA.

Definition of “Health Care Provider”

The FFCRA permits employers to exclude a “health care provider or emergency responder” from paid leave benefits. New York argued that the Rule’s definition of a “health care provider” exceeds the DOL’s authority under the FFCRA. The DOL defined “health care providers” as employees of a broad group of employers, including, in part, anyone employed at “any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care 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 institutions, Employer, or entity.”

The court determined that the FFCRA “unambiguously forecloses” the DOL’s definition. The court found the definition to be “vastly overbroad” because it included individuals whose roles bore “no nexus whatsoever” to the provision of healthcare services and “who were not even arguably necessary or relevant to the healthcare system’s vitality.”

Intermittent Leave Provisions

The Rule permits employees to take leave intermittently (i) upon agreement between the employer and employee and (ii) only for a subset of qualifying conditions. New York took issue with both aspects of the Rule. The court upheld the DOL’s limitation of leave to qualifying reasons that are not logically correlated with a higher risk of viral infection. However, the court determined that the DOL “utterly fails to explain why employer consent is required for the remaining qualifying conditions.” Therefore, the district court vacated the requirement for employer consent.

Documentation Requirements

New York also challenged the Rule’s requirement that employees submit to their employer, prior to taking FFCRA leave, documentation explaining their reason for leave, the duration of leave, and, to the extent relevant, the authority for the isolation or quarantine order qualifying them for leave.

The district court noted that the FFCRA contains notice requirements but no documentation requirement for taking leave. It concluded that the requirement that employees furnish documentation in advance of leave imposed different and more onerous standards inconsistent with the FFCRA’s unambiguous notice provisions. The district court stated: “The documentation requirements, to the extent they are a precondition to leave, cannot stand.”

Conclusion

As noted above, it is unclear whether this decision applies only to New York or has nationwide impact. We will continue to monitor and keep you informed as to further developments, which could include an appeal of the decision or new guidance being issued by DOL. If you have any questions about this case, or FFCRA issues more broadly, please contact your Fraser Trebilcock attorney.


We have created a response team to the rapidly changing COVID-19 situation and the law and guidance that follows, so we will continue to post any new developments. You can view our COVID-19 Response Page and additional resources by following the link here. In the meantime, if you have any questions, please contact your Fraser Trebilcock attorney.


Elizabeth H. Latchana, Attorney Fraser TrebilcockElizabeth H. Latchana specializes in employee health and welfare benefits. Recognized for her outstanding legal work, in both 2019 and 2015, Beth was selected as “Lawyer of the Year” in Lansing for Employee Benefits (ERISA) Law by Best Lawyers, and in 2017 as one of the Top 30 “Women in the Law” by Michigan Lawyers Weekly. Contact her for more information on this reminder or other matters at 517.377.0826 or elatchana@fraserlawfirm.com.