On March 20, 2020, New Jersey Governor Phil Murphy signed legislation (“Law”) prohibiting employers from taking any adverse employment action against employees who take, or request, time off due to an infectious disease that could affect others at work based on a written recommendation of a New Jersey licensed medical professional.  The Law, which we summarized in a previous article, became effective upon enactment.

On April 1, the New Jersey Department of Labor and Workforce Development (“NJDOL”) adopted temporary emergency new rules implementing the Law and concurrently proposed the same rules for permanent adoption. The regulations, which became effective upon their emergency adoption, are codified at N.J.S.A. 12:70 (the “Regulations”).

The Regulations define several of the terms used in the Law, including, of most significance, “protected leave,” which is defined as:

leave from work taken by an employee during the Public Health Emergency and State of Emergency declared by the Governor in Executive Order No. 103 (2020) concerning the COVID-19 pandemic, based on the written or electronically transmitted recommendation of a medical professional licensed in New Jersey that the employee take that time off for a specified period of time because the employee has, or is likely to have, an infectious disease that may infect others at the employee’s workplace.

More substantively, the Regulations reiterate that an employee returning from protected leave must be reinstated to the position the employee held immediately prior to the commencement of the protected leave, with no reduction in seniority, status, employment benefits, pay, or other terms and conditions of employment.  The Regulations, however, also provide that if the position has been filled, the employer must reinstate the employee returning from protected leave to an equivalent position of like seniority, status, employment benefits, pay, and other terms and conditions of employment.

Finally, the Regulations address those instances in which an employment action may not be retaliatory under the Law, even though the employee took protected leave. Specifically, reinstatement is not required and failure to reinstate will not be considered retaliatory if: (i) the employer conducts a reduction in force that would have affected the employee had that person been at work; or (ii) the employee would have been impacted by the good faith operation of a bona fide layoff and recall system, including a system under a collective bargaining agreement that would not entitle the employee to reinstatement to the former or an equivalent position.

The remainder of the regulations primarily address remedies under the Law and the Regulations, in particular, reinstatement of the aggrieved employee to the same or an equivalent position and potential fines of $2,500 for each violation.

The U.S. Department of Labor has again updated its compliance assistance for the Families First Coronavirus Response Act (“FFCRA”), in the form of “Questions and Answers.”  This post summarizes the most recent Questions and Answers.  Previous summaries can be found here and here.

Some of the newest answers include the following:

  • Question 60: Clarifies that shelter-in-place and stay-at-home orders can qualify as federal, state, or local quarantine or isolation orders for purposes of leave under FFCRA.
  • Question 61: Clarifies that an individual is eligible for paid sick leave due to the need to self-quarantine, if a health care provider directs or advises the worker to stay home or otherwise quarantine, and quarantine prevents the individual from working (or teleworking).
  • Question 62: States that an individual generally is not eligible for paid sick leave, even if exhibiting symptoms of COVID-19 and self-quarantining, without seeking a medical diagnosis or the help of a health care provider.
  • Questions 63-65: States that an employee may take paid sick leave to care for someone subject to a quarantine or isolation order, or who has been advised by a medical professional to self-quarantine, only if that person genuinely needs the employee’s care. An employee may take leave only to care for an immediate family member, someone that resides with the employee, or someone with whom the employee has a relationship that creates an expectation of care.
  • Question 68: Confirms that a “child care provider” includes not only paid child care providers, such as nannies, au pairs, and babysitters, but also unpaid individuals who provide care on a regular basis, such as grandparents, aunts, uncles, or neighbors.
  • Question 70: Confirms that a child’s school or place of care is considered “closed” if it is physically closed, even if the school provides online or other form of “distance learning.”
  • Questions 71-72: State that while an employee may take paid sick leave to care for someone else’s child under certain circumstances, an employee may not take expanded FMLA leave to care for someone else’s child.
  • Question 75: Provides four steps to calculate the daily amount you must pay a seasonal employee with an irregular schedule who takes paid sick leave or expanded FMLA leave:
    1. Calculate how many hours of leave the seasonal employee is entitled to take each day by determining the average number of hours each day that he or she was scheduled to work over the period of employment, up to the last six months.
    2. Calculate the seasonal employee’s regular hourly rate of pay by adding up all wages paid over the period of employment, up to the last six months, and then dividing that sum by the number of hours actually worked over the same period.
    3. Multiply the daily hours of leave (step #1) by the regular hourly rate of pay (step #2) to compute the base daily paid leave amount.
    4. Determine the actual daily paid leave amount, which depends on whether the leave taken is paid sick leave or expanded FMLA leave, and the reason for the leave.
  • Question 76: States that an employee may not receive paid sick leave or expanded FMLA leave while receiving workers’ compensation or temporary disability benefits, unless the employee has returned to light duty and a qualifying reason prevents the employee from working.
  • Question 77: States that if an employee is on a voluntary, employer-approved leave of absence, the employee may end the leave of absence and begin taking paid sick leave or expanded FMLA leave if a qualifying reason prevents the employee from working (or teleworking).  But an employee on a mandatory leave of absence may not take paid sick leave or expanded FMLA leave.
  • Questions 78-79: Confirms that the DOL will not bring enforcement actions for violations of the FFCRA occurring within the first 30 days of enactment (e, March 18 through April 17, 2020), provided that the employer has made a reasonable, good faith effort at compliance.  This limited period of non-enforcement, however, does not excuse employers from failing to comply with the FFCRA during this time.

The COVID-19 pandemic has altered the international workplace and international employee-employer relations in profound ways.  As employees now work from home in significant numbers around the globe, multinational companies have suddenly been confronted with managing issues they may not have previously prioritized. Matters such as outfitting employees’ homes with the necessary technology to stay connected with clients and coworkers, and ensuring that employees receive sufficient ergonomics support and training to maintain a safe and healthy home office space, now are part of the “new normal” to sustain both employers and employees’ efficiencies and morale.  These issues are especially challenging for multinational companies that might wish to implement uniform global policies and practices, but that may be prevented from doing so by the varying protocols and guidance of the different countries in which they operate.

In addition to taking steps to maintain business continuity as citizens worldwide are being asked or ordered to “shelter in place,” many companies are exploring measures to avoid layoffs and mitigate economic insecurity during this crisis.  Options may include, for example, requiring employees to use accrued, unused paid leave; salary reductions; deferring salary increases, bonuses, and/or equity awards; and furloughs.  In many countries, however, actions such as these cannot be undertaken without employee consent and consultation with employee representatives or works councils; further, they may bring with them risks of constructive or wrongful dismissal with the associated damages.  And, as a last resort, many employers may find it necessary to consider permanent layoffs, which are highly regulated outside the United States, and which often require notice and/or severance, consultation with employees and works councils, and government notifications and/or social plans.

Like domestic businesses, multinational employers may consider several different approaches to address the economic impact of the COVID-19 epidemic. Global companies, however, also must consider the different ways that each option would have to be implemented in the various countries in which they do business.   Multinational employers, for example, are more likely to need to review and analyze any collective bargaining agreements that may be in effect – and which may apply by industry or position – and to follow mandatory procedures with respect to affected workers.

Although country-specific statutory and regulatory requirements will preclude a uniform, one-size-fits-all multinational solution, several important global themes have emerged during this crisis.  For example, in response to the COVID-19 pandemic, many countries are implementing legislation (e.g., Brazil, the Netherlands, and the United Kingdom) to socialize the idea that employers may seek to reduce employees’ pay in exchange for greater job security.  Such legislation has been widely publicized, and employees in other countries are unlikely to be surprised that their employers are considering similar measures outside the established statutory scheme.

As we enter a “new normal,” it will behoove multinational employers to lay the ground work for employee “buy-in” before implementing changes that their businesses need to weather the COVID-19 storm.  Effective communications with employees and works councils will be paramount to help ensure that (i) the proposed measure is implemented successfully, (ii) the risk of subsequent legal action is reduced, and (iii) employee morale issues are minimized.  Straightforward and honest communications with employees can ease employee relations concerns. Employees inevitably will learn who will and will not be impacted by a company’s actions; however, open communications in advance can be a valuable tool in successful implementation of painful, but necessary measures.  And, of course, to the extent the employment actions being undertaken can be truthfully presented as temporary as opposed to final, the more likely employees will be willing to accept such changes, especially in the current COVID-19 business environment.  These communications must come from the top ranks of the organization in order to legitimize the effort to save as many jobs as possible.

The global coronavirus pandemic ignores international borders and has created a worldwide health and financial crisis.  The business response to the financial consequences wrought by COVID-19, however, will be constrained, and must be informed, by the workplace laws and practices that govern in different countries around the world.

As featured in #WorkforceWednesday:  Last week, Congress passed and President Trump signed the CARES Act, a $2+ trillion stimulus law, which is the largest stimulus in U.S. history. Attorney Paul DeCamp discusses how this law could benefit certain employers during this unprecedented time in the following video interview.

Video: YouTubeVimeoMP4Instagram.

The U.S. Department of Labor (“DOL”) continues to update its compliance assistance for the Families First Coronavirus Response Act (“FFCRA”), in the form of “Questions and Answers.”  The DOL posted a temporary rule issuing regulations pursuant to the FFCRA on April 1, 2020; while we are digesting the temporary rule and preparing a forthcoming advisory, we wanted to highlight some of the important insights of the updated FAQs. The DOL published its initial guidance on March 24, 2020, summarized in a previous post, covering the FFCRA’s paid sick and paid family leave requirements as well as the mandatory notice to employees.

Some of the newest answers to FAQs include the following:

  • Questions 20 and 21: Address the fact that employees may take sick time and expanded FMLA intermittently, but only if the employer agrees, in the following circumstances:
    1. If the employee is teleworking, any type of FFCRA leave could be taken intermittently, and in any increments the parties agree to.
    2. If the employee is physically at the workplace, an employee may take intermittent leave if the employee needs to care for their child whose school or place of care is closed, or child care provider is unavailable (in either case specifically because of COVID-19 related reasons). Such leave can only be taken in full-day increments.
  • Questions 23-27: Address the fact that, if an employee has been terminated, is on furlough, or the employer has closed its worksite (and as a result, the employee has no work), regardless of whether this change occurred before or after April 1, the employee is not eligible for paid or unpaid leave under the FFCRA.
  • Question 28: States that if an employee’s work schedule is reduced by the employer, the employee cannot take FFCRA leave to bridge the gap between the employee’s reduced hours and the hours the employee used to work. However, if a qualifying reason makes the employee unable to work their full schedule, they are entitled to leave based on their prior full schedule.
  • Question 29: Confirms that employees cannot collect paid benefits through FFCRA and through unemployment insurance at the same time.
  • Question 30: States that employees who have elected group health coverage are entitled to retain that health coverage throughout any period of FFCRA leave.
  • Questions 31-33: Provide that only upon agreement between the employer and the employee may an employee run paid time off under the employer’s existing policies and FFCRA leave concurrently, so that the employee can receive full pay while on FFCRA leave.
  • Question 40: Explains that, for purposes of determining FFCRA paid family leave eligibility, the interpretation of the term “son or daughter” is consistent with current FMLA regulations, and includes the employee’s own child, which includes a biological, adopted, or foster child, stepchild, legal ward, or a child for whom the employee stands in loco parentis, as well as an adult son or daughter who (1) has a mental or physical disability, and (2) is incapable of self-care because of that disability.
  • Question 43: Confirms that although leave under the FFCRA is job-protected, it does not shield employees from “employment actions, such as layoffs, that would have affected you regardless of whether you took leave.”
  • Questions 44-45: Clarify that the 12 weeks of expanded FMLA leave under the FFCRA are cumulative with any other FMLA leave the employee may have already taken. In other words, if an employee has already taken 8 weeks of FMLA leave in the one-year period their employer uses to define eligibility under the FMLA, the employee will only be eligible to take 4 more weeks of expanded FMLA leave under the FFCRA. Further, the amount of FMLA leave previously taken will not affect whether the employee is entitled to take sick leave under the FFCRA.

In addition to the above FAQs applicable to all employers, the DOL also answered some questions that are particularly relevant to health care entities:

  • Question 56: Explains that, for purposes of determining who may be excluded from FFCRA coverage, the term “health care provider” broadly includes 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 institution, employer, or entity. The definition of “health care provider” for this purpose also includes any individual employed by an entity that contracts with any of the above institutions, employers, or entities 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, tests, drugs, vaccines, diagnostic vehicles, or treatments; and any individual that the highest official of a state or territory, including the District of Columbia, determines is a health care provider necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.
  • Question 57: Explains that, for purposes of determining who may be excluded from FFCRA coverage, the term “emergency responder” is an employee who is necessary for the provision of transport, care, health care, comfort, and nutrition of such patients, or whose services are otherwise needed to limit the spread of COVID-19, including military or national guard, law enforcement officers, correctional institution personnel, fire fighters, emergency medical services personnel, physicians, nurses, public health personnel, emergency medical technicians, paramedics, emergency management personnel, 911 operators, public works personnel, and persons with skills or training in operating specialized equipment or other skills needed to provide aid in a declared emergency. “Emergency responders” also include individuals who work for such facilities employing these individuals and whose work is necessary to maintain the operation of the facility, as well as any individual that the highest official of a state or territory, including the District of Columbia, determines is an emergency responder necessary for that state’s or territory’s or the District of Columbia’s response to COVID-19.

Finally, the DOL issued guidance on the application of the small business exemption provided for by the FFCRA:

  • Question 58: States that an employer with fewer than 50 employees can claim the small business exemption provided for by the FFCRA if an authorized officer of the business has concluded that:
    1. The provision of paid sick leave or expanded family and medical leave would result in the small business’s expenses and financial obligations exceeding available business revenues and cause the small business to cease operating at a minimal capacity;
    2. The absence of the employee(s) requesting paid sick leave or expanded family and medical leave would entail a substantial risk to the financial health or operational capabilities of the small business because of their specialized skills, knowledge of the business, or responsibilities; or
    3. There are not sufficient workers who are able, willing, and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee(s) requesting paid sick leave or expanded family and medical leave, and these labor or services are needed for the small business to operate at a minimal capacity.

On March 31, 2020, the U.S. Department of the Treasury (“Treasury”) issued preliminary guidance regarding implementation of the Paycheck Protection Program (“PPP”), which is the $349 billion program contained in the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) that provides forgivable loans to eligible small U.S. businesses to help them weather the coronavirus (“COVID-19”) crisis.  The guidance consists of three advisory documents: (i) an overview of the program; (ii) information for lenders about the PPP; and (iii) information for potential borrowers.  Additionally, the Treasury released a copy of the PPP application form.

While this initial guidance generally restates what is already contained in the CARES Act (as we reported here), the just-released documents provide the following clarifications and new information:

  1. The terms of all PPP loans will be the same for every borrower. The loans will have a term of two years with an interest rate of 0.5 percent, and payments will be deferred for six months, although interest will continue to accrue over this period. The interest rate is significantly lower than the 4 percent cap mandated in the Act.
  2. Banks may start processing applications on Friday, April 3, 2020 for eligible small businesses and sole proprietorships (i.e., employers with 500 or fewer employees, with exceptions for some larger businesses). Eligible independent contractors and self-employed individuals can apply for loans beginning April 10, 2020.
  3. While eligible entities have until June 30, 2020 to submit their PPP loan application and all required documentation to an approved lender, the guidance encourages early application as the program has a funding cap.
  4. With respect to the amount of the loan that may be forgiven, it is “anticipated” that, “due to the likely high subscription” to the loan program, not more than 25 percent of the forgiven amount may be used for non-payroll costs.
  5. Additional guidance may be issued with regard to the waiver of the Small Business Administration’s (“SBA”) affiliation standards (which the CARES Act waived for small businesses (i) in the hotel and food services industries, pursuant to NAICS code 72; (ii) that are franchises in the SBA’s Franchise Directory; or (3) that receive financial assistance from small business investment companies licensed by the SBA).
  6. The guidance provided for lenders concerns a variety of matters, including fees and underwriting.

It is expected that additional, formal regulations and/or more substantive guidance will be forthcoming.

Sometimes a crisis can be an opportunity to embrace new technologies and changes that were already on the horizon – albeit at a much more expedited pace.  As employees are required to work remotely and practice social distancing due to the COVID-19 pandemic, the federal government and several state governments (including New York and New Jersey) are moving (New York more quickly than New Jersey) to enable remote online notarization and keep businesses operating.

A Potential Federal Solution

On March 18, 2020, Senator Kevin Kramer, R-N.D. and Mark Warner, D-Va, introduced legislation that would allow immediate nationwide use of remote online notarization in response to the Covid-19 outbreak.  Senate Bill 3533, the Securing and Enabling Commerce Using Remote and Electronic Notarization Act of 2020 (the “SECURE Act”) was introduced as bipartisan legislation to authorize and establish minimum standards for electronic and remote notarizations that occur in or affect interstate commerce.  If the SECURE Act becomes law, it will authorize every notary in the US to perform remote on-line notarizations using audio-visual communications and tamper-evident technology in electronic notifications and provide fraud prevention through use of multifactor authentication.

Currently, only twenty-three states allow notaries to conduct remote notarizations: Arizona, Florida, Idaho, Indiana, Iowa, Kentucky, Maryland, Michigan, Minnesota, Montana, Nebraska, Nevada, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington and Wisconsin.

Until the Covid-19 outbreak forced non-essential businesses to close and employees to work from home, neither New York nor New Jersey permitted remote on-line notarization of documents.

New York Moves Swiftly To Allow Remote Notarizations Through April 18, 2020

New York Governor Andrew Cuomo issued an executive order allowing notarizations using audio-video technology in place of physical appearance under certain conditions. This option allows New York Notaries and signers to practice the necessary “social distancing” required to reduce risk of contracting COVID-19. The order is in effect through April 18, 2020.

To use audiovisual technology to communicate during the notarization, the Notary and signer must comply with the following requirements:

  • The person seeking the Notary’s services, if not personally known to the Notary, must present valid photo ID to the Notary during the video conference. The signer may not present ID prior to or after the notarization.
  • The video conference must allow for direct interaction between the person and the Notary (e.g. no pre-recorded videos of the person signing).
  • The person must affirmatively represent that he or she is physically located in the State of New York.
  • The person must transmit by fax or electronic means a legible copy of the signed document directly to the Notary on the same date it was signed.
  • The Notary may notarize the transmitted copy of the document and transmit the same back to the person.
  • The Notary may repeat the notarization of the original signed document as of the date of execution provided the Notary receives such original signed document together with the electronically notarized copy within thirty days after the date of execution.

New Jersey Is On The Right Track, But Moving Too Slowly

On March 19, 2020, the New Jersey Legislature passed bill A-3864 https://www.njleg.state.nj.us/2020/Bills/A4000/3864_I1.HTM which awaits signature by Governor Murphy and will allow remote notarization.  However, once signed by the Governor, the bill does not take effect for 90 days.  In addition, the New Jersey law does not apply to wills or family law matters (divorce, adoption, etc.).

Until Bill 3864 is signed by Governor Murphy and becomes effective, notaries in New Jersey have been instructed to perform “window-separated signings”.  This means that the Notary and signor must be able to communicate with each other by sight and sound through the window and by normal means.  Cell phones, FaceTime, Skype, Zoom or any other electronic communication tools may not be used for a “window-separated signing.”  The Notary must follow all federal, state and local guidelines for social distancing, health protection and sanitization when meeting with signers and handling documents, IDs or other materials. As Covid-19 continues to tear through New Jersey and the United States as a whole, “window-separated signings” is not a practical solution and provides little comfort to notaries and signers alike.

While the US as a whole has been moving towards remote notarization for years, state by state, this crisis could be the impetus for a national resolution.

On March 30, 2020, New Jersey Governor Phil Murphy and Superintendent of the State Police Colonel Patrick Callahan (who also acts as the State Director of Emergency Management) issued Administrative Order 2020-6  providing additional guidance regarding how certain businesses may operate under Gov. Murphy’s Executive Order 107 (which we wrote about here).  The Administrative Order clarifies and directs that:

  • Individual appointments to view real estate with realtors by individuals or families shall be considered essential retail business, but that open houses are still considered impermissible gatherings;
  • Car dealers may continue to conduct online sales or remote sales that are consistent with current law. In the event of such a sale, the car may be delivered to the purchaser or the purchaser can pick up the car either curbside or in the dealership’s service lane;
  • In accordance with the guidance released by the federal Department of Homeland Security, effective Tuesday, March 31, at 8:00 a.m., firearms retailers are permitted to operate – by appointment only and during limited hours – to conduct business that legally must be done in person. The NICS background check system will be up and running to process firearms purchases; and
  • Golf courses are considered recreational and entertainment businesses that must close to the public and to members associated with private golf clubs.

In announcing the Administrative Order, Col. Callahan and Gov. Murphy stressed the need to be flexible in order to keep New Jersey’s economy running, but made clear that the safety of residents is the top priority.  “While we’ve made adjustments to businesses that are permitted to operate, my stay-at-home order remains firmly in effect,” said Governor Murphy. “Unless you absolutely need to get out, or unless your job is critical to our response, I have ordered all New Jerseyans to just stay home.”

In a matter of weeks, COVID-19 has changed the workplace.  Travel restrictions, shelter-in-place orders, and mandatory closures have meant that it is far from business as usual for nearly all employers.  The unprecedented events of the last few weeks have forced many employers, facing major business disruptions or closures, to make tough decisions about hiring, layoffs, furloughs, and compensation.

Some of these employment decisions may implicate written employment contracts and collective bargaining agreements that contain “force majeure” clauses that excuse performance if certain events should occur.  Black’s Law Dictionary defines “force majeure” as “an event or effect that can be neither anticipated nor controlled.”  The frequency of force majeure clauses varies by industry.  In healthcare employment agreements, force majeure clauses are more common because disaster planning is particularly prevalent in the healthcare industry.  Other industries may follow suit in the wake of this pandemic.

The question many employers are now asking is whether COVID-19 allows them to invoke the force majeure clauses in their employment contracts to excuse their inability to perform their contractual obligations.  And the answer is: It depends.

As with most things in the legal world, the devil is in the details.  Initially, employers should closely examine the language and scope of the contract because not all force majeure clauses are created equal.  Some contracts may specifically delineate “pandemics,” “epidemics,” or “outbreaks of disease” as force majeure events.  Other contracts, however, may contain more general force majeure clauses that refer to “Acts of God” or “events which are outside of the parties’ control.”  No doubt, many parties will end up litigating whether COVID-19 qualifies as a force majeure event under these more general clauses.

But even if an employment contract clearly contemplates an epidemic or a pandemic such as COVID-19, as a force majeure event, there are still other issues that employers need to examine:

  • Consider whether the employment contract (or applicable state law) imposes an obligation on the party invoking the force majeure event to timely notify the other party of its inability to perform under the contract. For example, collective bargaining agreements may include notice provisions that require employers to provide the union with timely notice of the employer’s inability to perform under the contract as a condition of being able to rely on the clause.
  • Evaluate whether the force majeure provision excuses the employer’s nonperformance completely, or only during the pendency of the force majeure event. For instance, if an employer has made an employment offer to a prospective employee but the business has stopped operating due to a statewide shelter-in-place or quarantine order, the employer should consider whether the force majeure provision allows the employer to withdraw the offer entirely or simply delays the prospective employee’s start date until the business can resume operations.
  • When seeking to rely upon a force majeure clause, an employer may still be under a duty to mitigate the impact that COVID-19 has on its ability to perform under the employment contract. In fact, the contract may even delineate what mitigation steps the employer should take.  For example, many employers have attempted to mitigate the effects of shelter-in-place orders by allowing employees to work from home.

Even where no express force majeure clause exists to excuse nonperformance, the common law doctrines of impossibility, impracticability, and frustration of purpose may fill that void.  Further discussions of these doctrines can be found here and here.

Employers should also consider how they can incorporate the lessons learned from COVID-19 into their future employment contracts.  Force majeure clauses are sometimes thrown in as a matter of boilerplate, but no drafter should include such a clause without fully considering the potential consequences.  See e.g., Commonwealth Edison Co. v. Allied-General Nuclear Serv., 731 F. Supp. 850, 855 (N.D.Ill. 1990) (Posner, J.) (“If, however, the parties include a force majeure clause in the contract, the clause supersedes the doctrine [of impossibility].”)  Employers should consider clarifying any vague or ambiguous force majeure clauses and ensure that pandemics, epidemics, and other outbreaks of disease are specifically carved out as force majeure events.  General force majeure clauses that do not specifically include pandemics in their definitions may not provide protection during a future pandemic if courts find that such events have now become foreseeable.  Equally important, employers should think about what contractual remedies are available to the parties if a force majeure event should occur.  For example, employers should consider whether to include liquidated damages remedies in the event that a force majeure event requires termination of the contract.  Employers should also review the “choice of law” provisions in their employment contracts and determine how widely or narrowly the courts in the chosen jurisdiction have interpreted force majeure clauses.

Perhaps one of the most important takeaways from COVID-19 is to value contingency planning and have business continuity plans in place.  Indeed, preparing for business disruptions in this way may obviate the need for some employers to invoke force majeure clauses at all.

Should you have any questions or need further guidance on this or any COVID-19 issue, please contact Peter Steinmeyer, Amy Bharj, or your Epstein Becker Green attorney.

New York State has issued guidance in the form of Frequently Asked Questions (“FAQs”) regarding the State’s new COVID-19 Leave Law (the “Law”). As we have reported, the Law requires New York employers to provide certain employees who are under a COVID-19-related quarantine or isolation order with either paid or unpaid sick leave, depending on the employer’s size and net income. The FAQs provide answers to more than 30 questions regarding the Law’s mandates on benefits, eligibility, the application process, disputes, and the complaint process.

For example, the FAQs clarify that the leave periods under the Law refer to calendar days, not business days, but when granting paid leave, employers are required to pay the amount of money that the employee would have otherwise received during the five- or 14- day period. The FAQs also clarify that the Law applies to part-time employees, and that employers must provide such employees paid leave at the rate they would have otherwise been paid “had the employer’s operations continued in its normal due course.” If necessary, employers should look at a representative time period to determine the employee’s average daily pay rate. Notably, the FAQs clarify that the Law applies retroactively, that is, to employees who were quarantined prior to the Law’s effective date (March 18), but remain under a quarantine order

With respect to eligibility, the FAQs state that only employees who are under a mandatory or precautionary quarantine order, and are not able to work from home through remote access or other means, are eligible for leave under the Law.  The FAQs also make clear that employees whose employer temporarily shuts down because of COVID-19 are not covered by the Law (but may be eligible for unemployment insurance, which they can apply for at the NYS Department of Labor website).

Regarding school closures, if the child’s school or care center is closed due to a mandatory or precautionary order of quarantine or isolation issued by the State, department of health, local board of health, or government entity, an employee may be eligible to apply for NY Paid Family Leave benefits (but will not be eligible for paid leave directly from an employer).  The Law, however, does not provide eligibility for PFL benefits for school closures unrelated to a quarantine (e.g. for preventative social distancing), and the FAQs do not directly address whether the Governor’s order closing schools constitutes a “quarantine” order under the Law (and by its express terms, the Governor’s directive does not reference or seem to constitute such a quarantine order. While school closures are covered as eligible for leave under the federal FFCRA, absent a quarantine order, such closures do not entitle employees to paid leave from their employer under NY law.

The FAQs also address the Law’s interaction with other forms of paid leave to which an employee may be entitled. Specifically, the FAQs state that employers may not require employees to use their existing sick leave accruals or other accruals, such as paid time off, before taking COVID-19 leave under the Law. Further, employees may be eligible to take leave under the expanded Paid Family Leave provisions, and may also be entitled to disability leave if they are quarantined due to COVID-19, but only after exhausting the Law’s paid sick leave benefits (if they are eligible for such benefits).

Additionally, the FAQs provide detailed guidance on the types of forms and supporting documentation employees must provide when applying for leave benefits under the Law.

Finally, while the FAQs themselves do not address how employer’s size should be calculated for the purpose of determining how much leave employees are entitled to, an operator at the NY Paid Family Leave Hotline advised us that the employer’s size should be determined by counting an employer’s total number of employees, not just the employees working in New York.