Garret Murai | California Construction Law Blog
Unemployment claims hit a historic high this past week as 3.3 million Americans filed for unemployment benefits. To give you some context, this is not only the highest number of unemployment claims ever filed, it is five times higher than the previous record of 695,000 unemployment claims in 1982.
Restaurants, hotels, airlines and other businesses have begun to layoff or furlough workers. According to a survey conducted by the Associated General Contractors of America this past week, 39% of respondents reported that project owners have halted or cancelled construction projects due to deteriorating economic conditions, 45% reported project delays or disruptions, and 23% reported supply chain disruptions.
While the construction industry likely won’t be impacted nearly to the same degree as the retail sector has, some involved in the construction industry may nevertheless be faced with the prospect of having to lay off or furlough workers as “shelter in place” orders are extended. If you’re faced with that situation here are a few things to remember:
Paid Sick Leave
Under California law, nearly all employers are required to provide paid sick leave to employees who work for 30 or more days in a given year. Paid sick leave can be used by an employee for illnesses, including COVID-19, the diagnosis, care, or treatment of existing health conditions, and preventative care for the employee or employee’s family member. The important thing to remember here is that use of paid sick leave is an employee’s choice. While an employer, concerned that an employee may have contracted COVID-19, may require that an employee not come to the office, the employer cannot force such an employee to use his or her paid sick leave. For more information, the California Labor Commissioner has created a webpage specific to COVID 19.
Paid Time Off
Paid time off, or PTO, typically bundles various types of leave including sick leave, vacation and personal leave. Although employees can utilize PTO as they wish, employers have generally had the ability to require that employees use PTO within the contractual terms of the employer’s PTO policy. In the case of the coronavirus epidemic, some employers required that their employees “use” their PTO while business has slowed or while the business has been shuttered due to the “shelter in place” orders.
This changed, however, after Congress passed the Families First Coronavirus Response Act which takes effect on April 1, 2020.
The Families First Coronavirus Response Act
The Families First Coronavirus Response Act was passed by Congress on March 18, 2020, takes effect on April 1, 2020, and will continue in effect through December 31, 2020. The Act, which applies to all private employers with fewer than 500 employees, includes two main components: (1) paid sick leave; and (3) partially-paid family medical leave.
As to paid sick leave, the Act requires that employers provide employees, irrespective of how long employed, up to two weeks of paid sick leave at the employee’s regular rate of pay, up to $511 per day and $5,110 in the aggregate, if:
- The employee is subject to federal, state, or local quarantine or isolation order related to COVID-19;
- The employee has been advised by a health care provider to self-quarantine due to COVID-19;
- The employee is experiencing systems of COVID-19 and is seeking a medical diagnosis.
The Act also entitles employees up to two weeks of paid sick leave at two-thirds of the employee’s regular rate of pay, up to $200 per day and $2,000 in the aggregate, if:
- The employee is caring for an individual who is subject to quarantine or isolation order related to COVID-19 or who has been advised by a health care provider to self-quarantine due to COVID-19;
- The employee is caring for a son or daughter whose school or place of care, including childcare, is unavailable due to COVID-19;
- The employee is experiencing any other condition “substantially similar” to those described above as specified by the Secretary of Health and Human Services.
As to family medical leave, the Act requires that employers provide employees, who have been employed at least 30 days, up to 10 weeks of partially paid family medical leave.
For more information the Department of Labor has created website of FAQ concerning the Families First Coronavirus Response Act.
Be careful out there.